Gas attack

Aaron over at Grandinite writes,

So the Liberals are going on an Anti-American tirade in order to get more support from Ontarians, eh? Under the guise of sticking it to the big, bad bald eagle to the south, the Liberals could slap an export tax on natural gas, the fountain from which Alberta gets its surpluses.
grandinite

He suggests that this might get ugly. And he’s right, it might. However, I suspect that there is a good deal of support for sticking it to the Americans in light of their ongoing failure to honour the terms of NAFTA on softwood lumber. Add that to the remarkable level of knee jerk anti-Americanism in much of Canada and the Liberals are on to something.

Note to the butterheads at the CPC: rather than attacking such a proposal broaden it to include all energy exports to the US with hydro electric included in the mix. 5% starting, say, November 1 and rising 2% per month until the illegally collected duties on Canadian softwood lumber are returned and a settlement reached…and, yo, Tories it might not be a bad idea to say that the revenues from this export tax will go to reducing the debt. It would be rather fun to have American SUV drivers an electricity users bringing Canada’s debt down.

The point for the Tories is to make this a Canadian rather than an Albertan issue. And, if they are really clever - as if - they will manage to avoid sounding anti-American. Instead they should sound pro-Canadian and pro-Canadian business and jobs.

Written by jay on August 28th, 2005 with 3 comments.
Read more articles on Canada US Relations and Canadian Politics.

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3 comments

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Get your own gravatar by visiting gravatar.com dcardno
#1. August 29th, 2005, at 8:44 AM.

Jay - I agree; if the export tariff is narrowly applied to Nat Gas only it is an incredible problem for the Liberals. First of all, Alberta, while blessed with lots of gas, also makes money from crude (and refined products) - about a third of total non-renewable resourse revenues. It is BC (where the Libs still hope to pick up a seat or two) and Saskatchewan that have almost 100% gas-based hydrocarbon sectors. Applying the tariff to all energy forms would both share the pain across the country, and hurt the yankees more.

Another possible destination for the funds would be to refund the illegal softwood tariffs to the companies that have paid them, and keep them in place until the full amount has been collected.

Get your own gravatar by visiting gravatar.com Aaron
#2. August 30th, 2005, at 12:19 AM.

Jay: your point about natural gas demand not responding to a tax increase is corret, but this is the reason _why_ the Federales might do it. Not in spite of, but because of.

Get your own gravatar by visiting gravatar.com jay
#3. August 30th, 2005, at 4:20 AM.

In essence Canada has exactly one trump card with the US. The trick is to play it with maximum effect. By levying an energy export levy we bring most of the country into the fray and aim at the one place it will really hurt.

Done right the threat should be enough.

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