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Understand Alberta for What It Is

understand alberta

Understand Alberta for what it is. A too easy target for foreign special interests and domestic critics. And Canada’s economic engine.

Greetings from Alberta, home of the much vilified oil sands energy landscape. Our oil sands produce 0.15% of the planet’s greenhouse gas emissions. Yes, you read that number right: one sixth of one percent. Even if you believe climate science in its entirety, you must realize that the oil sands effect on global warming is basically none.

In little more than a day, China emits more GHG than Alberta’s oil sands does in a year. What about locking them in? Alberta gets spanked. China gets encouraged. Strange world.

Canada creates most of its wealth through net exports of mineral fuels from our western provinces, mainly Alberta. No other sector comes close, by nearly an order of magnitude. Blockading pipelines kneecaps Canada and does nothing on the climate front. In fact, it makes thing worse.

Adding pipelines and exporting more oil and gas to China and India could dramatically reduce use of coal to produce energy in Asia. We would also reduce imported oil flowing into Quebec and Atlantic Canada from Saudi Arabia and of course, United States. Eastern Canada is the United States’ second largest export market for fossil fuels, slightly behind Mexico. No surprise American special interests want to lock in Alberta energy production.

“Without economically competitive access to global markets and global prices, the policy-induced recession that has devastated Alberta for the past five years will become permanent.” You can read more in Moment of Truth: How to Think About Alberta’s Future.

Understand Alberta Roller Coaster

Since the OPEC wars in 1973, Albertans have lived on an economic roller coaster of boom and bust. Our provincial governments have done a lousy job of managing these cycles. Diversification remains an unfulfilled dream but not really the problem.

You will find most things are great in Alberta except government fiscal policy which has never come to grips with the reality of commodity cycles.

With the latest downturn, our province now qualifies to receive federal equalization payments for the first time since 1965. Add in COVID-19 and our fiscal deficit is almost beyond belief.

And yet we remain Canada’s struggling wealth creation engine. Go figure.

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