Hear, hear!
Evidence of meeting #78 for Natural Resources in the 41st Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was norway.
A recording is available from Parliament.
Evidence of meeting #78 for Natural Resources in the 41st Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was norway.
A recording is available from Parliament.
4:45 p.m.
Some hon. members
Hear, hear!
4:45 p.m.
Conservative
The Chair Conservative Leon Benoit
We now continue the five-minute with Mr. Anderson, Monsieur Gravelle, and then Mr. Calkins.
Go ahead, please, Mr. Anderson, for up to five minutes.
April 30th, 2013 / 4:45 p.m.
Conservative
David Anderson Conservative Cypress Hills—Grasslands, SK
Thank you, Mr. Chair.
Those of us from Saskatchewan are a little bit more sensitive, perhaps, to the rhetoric about socialist democratic governments. We have already experienced that, and I think the only thing—or not the only thing, but one of the main things—that really helped us in Saskatchewan was when the Alberta government decided to play with their royalty regime. That was really what kicked off, in my area anyway, the development of the oil and gas industry, and we're still benefiting from that.
Government interference can certain affect the market, and for those of us in Saskatchewan, it's been a very positive thing with the Alberta government over the last few years.
Mr. Mintz, I want to ask you, and Mr. Willis, as well, does every kernel of grain need to be made into bread in order for the producers to be able to make some money and do a good job?
4:45 p.m.
Director and Palmer Chair in Public Policy, School of Public Policy, University of Calgary, As an Individual
No. In fact, that's really the lessons of economics. It's Economics 101 trade theory, which goes back to my comment about comparative advantage, that you can do some things really well, more cheaply than anybody else. You sell on the international market, you import goods and services that way, but if you try to do things where you're trying to go up the value chain altogether, you can actually end up losing money.
In fact, it's not all about jobs. When you measure value-added, you're talking both about returns on labour and on capital. If you have negative returns on capital, you may not be going up the value-added chain at all; you may be going down, in that sense.
We've had a lot of disasters in public policy in the past number of years that we should not forget about, whether it was building cucumber plants in Newfoundland, a car company in Nova Scotia…. I can go through a host of diversification projects in Alberta that ended up flubbing, costing the government billions of dollars in revenue ultimately and being a major loss to taxpayers.
The other thing is that you're taking resources that are being used for more productive uses and you're putting them into things with less productive uses. That actually has a very negative impact on the economy. What happens is that, sure, you may move up the value chain for a particular product, but if you're getting fewer profits, less output associated with it, or less production or less productivity associated with it, because you're drawing it away from other things that are producing better, then you actually have a negative effect on or loss to the economy.
That's the lesson of economics. That's why this whole focus that we've got to move up the value-added chain all the time has been dismissed over the years by just about every credible organization, including the World Bank and the IMF and many others.
4:45 p.m.
Conservative
David Anderson Conservative Cypress Hills—Grasslands, SK
The only ones who seem to be able to handle the ongoing negative return on capital are governments with access to taxpayers' money.
But, Mr. Willis, I'm interested in your response to that question as well.
4:45 p.m.
Director, Natural Resources and Environmental Policy, Canadian Chamber of Commerce
To be completely honest, I think Gil might have a more interesting response than I do.
The chamber certainly believes that there are options that would be in Canada's best interest, both in terms of market diversification and product diversification, whether that's moving some up the value chain or simply moving it across provincial borders and getting to tidewater. Again, I think our biggest problem is that we tend to think very regionally and provincially.
4:45 p.m.
Conservative
David Anderson Conservative Cypress Hills—Grasslands, SK
My question for you, then, is a little bit different.
On the development of pipelines, do you see that as an either/or prospect, that if we develop, then we lose jobs? Or do you see that it's possible for jobs to be developed on both sides of the border, as we develop pipelines and move more product to foreign markets?
I'll ask Dr. Mintz to respond to that as well.
Is it a case where, if we develop our pipelines, we lose jobs because somebody else is gaining jobs?
4:50 p.m.
Director, Natural Resources and Environmental Policy, Canadian Chamber of Commerce
I certainly don't think so, no.
4:50 p.m.
Conservative
David Anderson Conservative Cypress Hills—Grasslands, SK
We've heard that from our colleagues across the way, and others as well.
4:50 p.m.
Director, Natural Resources and Environmental Policy, Canadian Chamber of Commerce
In the interest of brevity, no, I don't think so.
4:50 p.m.
Conservative
David Anderson Conservative Cypress Hills—Grasslands, SK
Okay.
Dr. Mintz, would you like to comment?
4:50 p.m.
Director and Palmer Chair in Public Policy, School of Public Policy, University of Calgary, As an Individual
No, it goes back to proper utilization of resources and back to Economics 101. This is why the markets end up doing a pretty good job in sorting these decisions out, as you end up putting the resources into the most productive uses. If we're going to build pipelines, obviously, the more energy we produce, and to me this is not.... If we had a world without regulations, if we didn't have the United States having to give a foreign permit, Keystone XL would have been built already or certainly would be on its way and creating a lot more income in Canada.
Are there things we may try to do in order to move up the value chain? Yes, you could try to do it, but you have to remember that there's a cost to doing that, an opportunity cost of using resources to do that, which could actually have negative consequence for the economy overall.
4:50 p.m.
President, Alberta Federation of Labour
Do you only ask questions that jibe with your ideological point of view?
4:50 p.m.
Conservative
The Chair Conservative Leon Benoit
Excuse me.
We go to Mr. Gravelle, for up to five minutes.
Go ahead, please.
4:50 p.m.
NDP
Claude Gravelle NDP Nickel Belt, ON
Welcome to the real world.
I have a quick question for Mr. Mintz. You answered Mr. Anderson's question with a simple no, so I'd like you to answer my question with a simple yes or no.
If we were to use Canadian grain and make Canadian bread, would we create Canadian jobs? Yes or no?
4:50 p.m.
Director and Palmer Chair in Public Policy, School of Public Policy, University of Calgary, As an Individual
I don't know.
I'm not sure what you're saying.
No. I mean, the answer is—
4:50 p.m.
Director and Palmer Chair in Public Policy, School of Public Policy, University of Calgary, As an Individual
No, I mean it's kind of a.... I'm not going to say it's a silly point, but anyway...
4:50 p.m.
NDP
Claude Gravelle NDP Nickel Belt, ON
It's okay, I only have five minutes. Never mind. I wanted a yes or no answer.
Mr. McGowan, you referred to a lot of numbers and also to freedom of information documents.
Can you give me a bit of information on the freedom of information documents? Where were they from, and who got them?
4:50 p.m.
President, Alberta Federation of Labour
The documents in question were produced by something called the hydrocarbon upgrading task force, a task force established by the Alberta provincial government to look at the viability of moving up the value ladder. Their own experts basically came to the conclusion that it made all sorts of sense, and those documents were suppressed and not released.
4:50 p.m.
NDP