Tuesday, May 22, 2012

Herald Column: Mulcair Should Stay Home

My latest Calgary Herald column looks at NDP leader Thomas Mulcair's recent comments about "Dutch disease" and how that relates to his planned visit to Alberta:
After having established Western Canada as the villain in his calculated political narrative, NDP Leader Thomas Mulcair plans on visiting Alberta, the centre of his axis of evil.
Mulcair arrives here next week for a two-day visit which may or may not include a trip to the oilsands.
In fairness, his views on the "petrodollar" or "Dutch disease" or even his "polluter pay" policy should not be predicated on having to witness oilsands development first hand - just as one need not visit Ontario to reject Mulcair's views about what ails that province's manufacturing sector.
Frankly, it's difficult to see what purpose this trip will serve. There's little ambiguity when it comes to Mulcair's views on oilsands development, so he's not coming to learn anything.
I'm sure it will be easy to dig up some Albertans for Mulcair to meet who share his views on oilsands development. That will reinforce what he already believes, and he can then claim to have "gone to Alberta and spoken to Albertans."
In that sense, it would appear the only purpose to this trip is political damage control. While Mulcair clearly sees political benefit in pitting Ontario against the West, he has perhaps realized the pitfalls of being so brazen about it.
For all his talk about the Harper government being his intended target, it lacks credibility and believability when he is targeting western premiers, calling them Harper's "messengers."
And whatever points Mulcair might have to make about the federal government's commitment to environmental sustainability and stewardship, he has deliberately made the issue about much more than that.
By invoking Dutch disease - the term used to describe a high currency resulting from energy development and the resulting harm then inflicted on exporters - Mulcair is tapping into the economic angst in Ontario and offering them a scapegoat: the West.
Of course, manufacturing is but one sector of Ontario's large and diverse economy, so it's curious that national economic policy debates must revolve around it.
While Mulcair may be trying to position himself as a defender of Ontario's economic interests, it's difficult to see how any "cure" to Dutch disease would be beneficial to Ontario, let alone the rest of the country.
Presumably, it would mean severely limiting economic development in the energy sector and then hope for a depreciated Canadian dollar, or specifically manipulating the currency to achieve such an outcome.
Either way, our economy would not benefit.
As several economists have pointed out in this debate, resource development and a higher Canadian dollar are net positives for the Canadian economy.
Economist Stephen Gordon has noted the resource boom of the 21st century and the accompanying rise in the Canadian dollar have meant job growth and real wage growth.
The Canadian Energy Research Institute has concluded that after Alberta, Ontario stands to benefit the most from oilsands development.
Although manufacturing in Canada has long been in decline, recent development in the resource sector has given it a boost. Last week, for example, Statistics Canada reported a strong rise in manufacturing sales for March, led by the petroleum and coal industries.
If Mulcair has a soft spot for manufacturing jobs, then perhaps he should put forth a plan to boost that sector rather than knocking down other sectors. Mind you, one might hope the NDP's economic concerns are broader than just one specific sector.
Further, if Mulcair truly wishes to pursue an agenda of increased environmental accountability and responsibility, then he should perhaps decouple that from his ill-informed economic views.
Although, it's hard to take the NDP seriously when they talk of making the "polluter pay," given their strong opposition to higher gasoline prices and support for subsidized home heating costs.
But whichever policy course Mulcair pursues, he should save his Alberta trip for a time when he's genuinely curious about what's going on here - not when he's trying to put out political fires.

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