Liberals give in to interests of corporate world
Justin Trudeau’s election as Prime Minister of Canada can largely be chalked up to his campaign promise of massive infrastructure spending — an offer to voters that a Liberal government would do and spend more than other parties to build new public infrastructure.
Of course, Trudeau’s spin was always based on misleading representations of the other parties’ plans, and particularly a false attempt to equate deficits with public investment. But his theme promoting the value of large-scale public infrastructure — to be built even if it meant some red ink in the short term — was seen as signalling a government willing to make ambitious decisions in the public interest, and played a crucial role in the Liberals’ election.
Sadly, it didn’t take long for any prospect of visionary federal investment to fall by the wayside.
From Day 1, the Liberals’ proposed pace of increase in infrastructure spending proved unworkable. Instead of meeting his promise to double the amount poured into infrastructure over the first two years of his term, Trudeau merely continued the pace set by the displaced Conservatives.
More recently, the Liberals’ policy on infrastructure has taken an even more alarming turn — from failing to seek out opportunities to advance the public interest, to actively promoting corporate opportunities.
Instead of improving the federal government’s capacity to seek out and invest in projects to serve public ends under public ownership, the Liberals have set up an infrastructure bank to fund and promote schemes for investor profit.
And this week’s federal takeover of the Trans Mountain pipeline is the largest step yet in using the public treasury for private gain.
On that front, it’s worth noting that Kinder Morgan positioned itself to flee at a profit if the predictable problems with a Trans Mountain expansion ever materialized. Its financing model always placed substantial risk on oil producers and governments, maximizing the pressure that could be brought to transfer any downside risk.
Unfortunately, Trudeau either failed to recognize that plan, or didn’t see a problem using our money to bring it to fruition. Hence the federal government’s willingness to pour $4.5 billion into purchasing an existing pipeline recently valued at barely a tenth of that amount, and then to commit to the future cost of pursuing any expansion — all resulting entirely from its panicked reaction to an artificial deadline imposed by a shrewd corporate operator.
What’s worse, even if one overlooks how Trudeau allowed Kinder Morgan to play his government like a fiddle, the broader implications of a publicly funded pipeline expansion also involve a disturbing willingness to use public money solely for the purpose of inflating private profits.
The fossil fuel sector as a whole — including the Alberta oilsands — has seen royalty rates plunge in recent years. And with the U.S. pushing its own production of oil products to unprecedented levels, there’s little prospect that royalty revenues will ever return to the inflated levels that once insulated a few provinces from any perceived responsibility to manage their economies with an eye to the future.
The ultimate effect of the Trans Mountain bailout is thus a massive immediate windfall for Kinder Morgan, which at best might result in oil producers seeing their profits soar as well while providing minimal return to the public.
Even leaving aside the catastrophic environmental ramifications of pipeline expansion, the Liberals’ willingness to pour tens of billions of dollars of public money into that result surely signals their complete capture by corporate interests. And voters who recognized the value of a promise of public investment to serve the common good will need to look elsewhere.
...The Liberals’ proposed pace of increase in infrastructure spending proved unworkable.