The (Right) News Rundown
- We go once again to the Trans Mountain Pipeline Expansion project, with no construction beginning yet but lots of political decisions to talk about on the matter. Is there anything else going on in BC other than the pipeline issue? Well, Premier John Horgan is "considering" a private member's bill put forward by Green Leader Andrew Weaver to lower the voting age in BC to 16. There's also been more talk about the upcoming November electoral referendum and just how easy it will be (50%+1) to change the electoral system.
- But yet, the big news this week is the ongoing pipeline issue. If you haven't heard much about it, Kinder Morgan proposed a pipeline expansion from the refineries in Edmonton through BC to the port in Burnaby. The pipeline already exists, they just want to twin the line so more product can be moved. Local Burnaby residents are against the pipeline, and so is the NDP provincial government, who are trying to stall it any way they can. It's caused a trade war of sorts to erupt, with Alberta making threats and following through by stopping BC wine imports. It's even led to the Alberta NDP's Economic Development Minister Deron Bilous to refer to the BC government as "being a bunch of shitheads." It's such a contentious issue in Alberta that a motion in the legislature passed unanimously 70-0 that MLAs support the Trans Mountain pipeline expansion and growth in general. Premier Notley will also refuse to raise the carbon tax unless Trans Mountain moves forward.
- Alberta's next step is probably shutting off gas to BC completely. Looking at it objectively, if Horgan wishes to limit the flow of bitumen flowing through BC to Burnaby, Alberta will want to do the flip side and limit the flow of refined gas to BC in return. Opposition leader Jason Kenney has been threatening it for months. And now, the province’s ruling NDP just made it a key plank of their latest speech from the throne. So what would actually happen if Alberta did restrict flow of the oil through the pipeline?
- According to Natural Resource Canada, roughly 50 to 60 percent of Vancouver’s petroleum originates in an Edmonton refinery. Meanwhile, even Vancouver’s locally refined fuels have some Alberta lineage. Metro Vancouver’s only refinery, a Parkland Fuel Corp.-owned facility in Burnaby, is supplied primarily with Alberta petroleum from the Trans Mountain pipeline. That pipeline also sends 54 per cent of its annual shipments to refineries in Washington State, which then ship gas and diesel to Metro Vancouver on fuel barges. It’s commonly said that between 80 and 90 per cent of all the fuel consumed in the Lower Mainland spent at least part of its life inside the Trans Mountain pipeline. So it's quite clear that we need the pipeline.
- Vancouver already pays the highest pre-tax gas price in the country, at roughly 90c/litre. With taxes that translates to about 150c/litre. Mostly this is because it's tough to get gas into the city, with only has the Trans Mountain pipeline, a mid-sized refinery and the occasional fuel barge trundling in from Washington State. This diminished competition in the Lower Mainland makes the region particularly vulnerable to devastating price shocks if a critical supplier suddenly disappears. For example, the Parkland Fuels refinery in Burnaby supplies up to 25 per cent of B.C.’s gasoline and diesel. On occasions when the refinery is temporarily shut down for scheduled maintenance, gas prices in Vancouver can spike by as much as 20 cents.
- The other alternative to a pipeline would normally be by railcars. However, Canadian railways are already so overstretched that farmers are complaining of the worst grain backlog in years, and grain shippers are now calling on the federal government to issue orders compelling railway companies to step up their agricultural shipments. Last week, CN was even forced to apologize “for not meeting the expectations of our grain customers, nor our own high standards.” All in all, it’s a bad time to assume that railroads could bail B.C. out of a sudden and unprecedented fuel shortage. And again, if Alberta is imposing an oil embargo, it would presumably remember to stop the oil trains as well. Also, trains tend to crash at a higher rate than pipelines leak.
- If Alberta imports run dry, B.C. will be forced to source its gas almost exclusively from Washington State. This is easier said than done. Currently, “less than 10% of the gasoline consumed in B.C. is imported via ship or barge from the U.S. Pacific Northwest,” according to the National Energy Board. There are very few places to offload oil into the province by sea. One of the biggest, Westridge Marine Terminal, is ironically owned by Kinder Morgan. It's the export terminal for the Trans Mountain pipeline, however, it wouldn’t be easy to retool the place for export. For one thing, a lot of the terminal’s storage tanks are located high on Burnaby Mountain, allowing them to gravity-feed product into waiting tankers. But in a scenario where the terminal is converted for imports, Kinder Morgan would need to rig up an entirely new pump system to get product up the mountain. There are also port facilities at the Parkland Fuels refinery, but a spokesperson told the National Post “we cannot operate the refinery at full capacity without the Trans Mountain pipeline.”
- The other problem with sourcing more from Washington State is that their refineries are running at 94% capacity, and would not be able to sustain adding more production on. Worse, with no U.S. pipelines over the Rocky Mountains, Washington is cut off from the rest of the American oil market. Texas refineries could quickly stem a gas shortage in Chicago via pipeline. But for anything west of Idaho, it takes them a minimum of 10 days to send a tanker. Patrick DeHaan, a U.S. analyst with GasBuddy.com, estimated that it could take up to two weeks for Washington refiners to nail down a stable supply for B.C.. And, of course, there are still Vancouver’s rail and port bottlenecks to worry about. The absolute worst case scenario is that Washington State is forced to supply Vancouver primarily with tanker trucks.
- Washington State's governor Jay Inslee says he is "allied" with the BC government's obstinance on the pipeline issue. "We are hopeful that the premier's efforts to allow the voices of his citizens to be listened to will be successful, because it is very much in common with our citizens," Inslee said, adding that residents in his state recently rejected proposals for both coal and oil ports. Obviously Inslee would be happy if Trans Mountain stalls, because that results in reduced competition and increased reliance on his state's products.
- So with all this said, it's crystal clear for British Columbians. Alberta needs to get its product to market, but we also need that product. And it's ridiculous to think that holding up this pipeline will have any economic advantage for BC. Cancelling pipelines is not economically advantageous. A 2014 report by the Canadian Energy Research Institute noted the Energy East project would have contributed $7.6 billion in tax revenues, including $3.5 billion in federal revenues – money that could have been used to help pay for government services or pay down debt. CTF Alberta Director Colin Craig puts it bluntly: “The rest of the world is laughing at us. Canada has the third largest oil reserves in the world and yet we’re spending billions each year on importing oil. Then, when someone tries to build a pipeline to reduce reliance on foreign oil, the federal government puts up a roadblock. It’s crazy.”
- With inflation and changes to the route Edmonton’s West Valley Line LRT will jump by $440m from $1.8b to $2.24b.
- These design changes include grade separations at 178th Street near West Edmonton Mall and as well at 149th Street where the track will stay at grade while adding a car underpass.
- Mayor Don Iveson feels that based on the provincial money given to Calgary should be reciprocated and the difference in funding could come from the province.
- Councillor Andrew Knack feels that spending $160m on the 149th Street underpass is not worth saving drivers 99 seconds on average of wait time.
- Councillor Knack said, “I think there’s a better use of that money when we’re worried about traffic flow.”
- Knack also suggested looking at tools such as artificially intelligent traffic tools and making Stony Plain Road west of 149th Street a one way road allowing light timings to change easing traffic constraints.
- In total these grade separations will cost in total $240m.
- Meanwhile Ward 11 councillor Mike Nickel feels that Edmonton may regret building the west leg of the LRT in the future.
- If the city were to build a BRT (Bus Rapid Transit) option instead it would cost roughly 75% of the LRT plan coming in at $1.68b.
- This Friday he said, "I'm looking at LRT right now to the west end, other projects along that line and asking the question, are we overbuilding our infrastructure? I'm very concerned. In the west end, we're dropping $2.24 billion on a LRT system that might be redundant in 20 years. Now is the time to start asking these questions, as we set this new line… I think there is a value-for-tax question that needs to be asked. What is mass transit going to look like in 15 years, in 20 years?”
- Last summer on The Right Side we talked about a traffic congestion report regarding Edmonton’s new LRT lines.
- This report said that in 2019, 18 of 38 intersections would be congested during rush hour.
- It gets a lot worse 25 years years from now — it was forecast that in 2044 7 intersections could have wait queues of greater than 500m meaning that about 600 vehicles would be queued up.
- Mayor Don Iveson’s words at the time were, "You can make modifications and you can widen roads up to a point but you need something transformational, a strategic shift... that's why we're building the LRT. We're introducing tradeoffs for sure, but it makes sure that hundreds of thousands of people ... travel by train."
- The West Valley Line goes to public hearing on March 21 with a decision to be made later this year regarding its construction.
- It will be interesting to see if traffic wait times and the ulterior motives that may be present on city council appear regarding appetite or reluctance to build at grade separations.
- There's been some dire economic news this past week from many outlets. The Bank for International Settlements, an international financial institution that promotes economic stability put out a warning that Canada is among the economies most at risk of a banking crisis. The BIS flagged Canada as a risk in its quarterly report due to a higher rate of households’ maxed-out credit cards and high debt levels in the wider economy.
- There's also been news that investment in Canada has been plummeting, and the Canadian dollar itself is predicted to drop to its lowest level since the turn of the millenium. With the federal government adding another 18.6B deficit to the upcoming fiscal year, they are likely looking for some good news about the economy. Well, let's look no further than a seemingly glowing report from Statistics Canada, which boasts that around 15,000 new jobs were created in the month of February. Sounds good, right? Well, unfortunately that's a result of 39,000 full time jobs being lost and replaced with 54,000 part time jobs.
- Stats Can's report leads with the 15,000 jobs created and notes unemployment going down by 0.1% nationally, but its report does not mention the 39,000 full time job losses, those can only be found by going into the report's data and table. It's noted that most of the gains are due to a 50,000 increase in public sector jobs.
- So while we have created jobs technically, it's at the expense of stability and good paying jobs with benefits for workers. And as we've said on this show before, when you replace full time jobs with part time jobs, not only is that not good for the economy, it's not good for middle and working class workers as well.
- What's worse is a usually nonpartisan government department glosses over negative results and only publishing positive ones in their report over the past month.
- Interestingly, Trudeau's best takeaway from his wacky India trip was that he secured business deals that would apparently add around 6000 jobs. However, Stats Can regards the 15000 jobs gained this month as "little change". I guess Trudeau's new jobs would be considered a rounding error.
The Firing Line
- The headline is “Jagmeet Singh attended 2016 seminar with Sikh youth leader who advocated political violence”
- The Sikh youth leader in question called political violence a “legitimate form of resistance”
- The extremist in questions were denouncing India and were calling for an independent state known as Khalistan.
- Singh is no stranger to walking this grey line regarding political violence.
- Back in 2015 when Singh was an Ontario NDP MPP he appeared at a rally in San Francisco that featured a large poster of Jarnail Singh Bhindranwale. Bhindranwale was the leader of an armed extremist group that occupied the Golden Temple in India. (Note on the word occupied. This lead to the assassination of Gandhi.)
- And soon after Singh was elected NDP leader, questions arose about his speed at outright condemning the Air India attack that killed 329, 268 of which were Canadian.
- Fast forward to 2016, Singh spoke at another pro-sovereignty seminar in London, Ontario.
- The 2016 video shows Singh sharing the stage with NSYF (National Sikh Youth Federation) co-founder Shamsher Singh and Sikh homeland advocate, Harwinder Singh Mander. This wouldn’t be an issue on its own but… the youth leader spoke about the “superiority of [their] culture, [their] language and [their] ideal[s]” and ultimately ended by saying that his cause “endorses violence as a legitimate form of resistance and survival”
- Some may think that it’s just the Conservative Party who is condemning Singh for this. It’s not. Liberal MP John McKay told The Globe and Mail that Jagmeet Singh owes Canadians an explanation, specifically, “Did he actually know what he was, in effect, implicitly endorsing?”
- The director of media relations for Conservative Leader Andrew Scheer said, “It’s inappropriate for any Canadian politicians regardless of their political party to take part in events that promote, glorify or validate violent extremism”
- While many may turn a blind eye to this because it is Canada, we must not.
- FLQ Crisis.
- Turning a blind eye to “resistance” violence.
- This is important because as we saw in Alberta, the third party formed government. The third party opposition Liberals formed the federal government in 2015. And the third party opposition Greens hold the balance of power in British Columbia. The third party is very important.
- If this were the Conservative party in question, you can bet the media would be all over this, even if violence were not endorsed and it were something much much simpler, such as speaking at a pro-life or pro-gun rally.
- At this time, Singh did not comment on the 2016 seminar in London, Ontario.
- After the story broke, when asked about the San Francisco rally he said he was there as “an advocate of human rights” and "I condemn all acts of terrorism in every part of the world, regardless of who the perpetrators are or who the victims are. Terrorism can never be seen as a way to advance the cause of any one group. It only leads to suffering, pain and death."
- If he does not “condone terrorism or acts of violence” he should not have been at an event co-chaired by someone who condoned violence.
- What’s more, at the 2015 rally Jagmeet Singh referred to India as “our country.” He said, “We are talking about it because, in our country where we live, that country intentionally tried to wipe us out, that in that country it was a planned process to attack the Golden Temple.”
- For someone who is leader of the third party and whose chance of becoming Prime Minister is not zero, he doesn’t speak like a Canadian.
- Canadians should take notice on this issue pertaining to Jagmeet Singh.
- Credit to the governing Liberals and opposition Conservatives for asking the questions but the media largely ignored this story this week as it did not fit within the week’s talking points.
Word of the Week
Talking points - something that lends support to an argument; also : a subject of discussion
How to Find Us
Episode Title: Political Armageddon
Teaser: Alberta could shut off oil to BC resulting in a market shock, Edmonton’s LRT project cost jumps by 440M, StatsCan reports 15k more jobs while ignoring 39k full time job losses, and Jagmeet Singh walks a fine line on political violence.
Recorded Date: March 17, 2018
Release Date: March 18, 2018
Edit Notes: None
Podcast Summary Notes