I've been bouncing this essay back and forth a bit. I don't know how coherent it really is: I'm still trying to figure out exactly where I am going with it. Anyway, here it is.
Maclean's magazine from 2012-10-01 has three articles, one following the other that, when taken together, tell an interesting story.
The first article, Plugging for Pipelines, discusses the economic arguments for selling Canada's tar sands oil to China. It claims out that while Deng Xiaoping was responsible for terrible human rights crimes he also led changes to the political and economic structure of China that brought hundreds of millions of people out of poverty (discuss!). Those people and those who were already wealthy enough now want cars and the other industrial benefits of their incomes. More cars (and other things) means they need more oil. Since Canada has some oil that unfortunately costs a lot more to produce than traditional methods Canada needs a better market (i.e. one with greater demand) to sell the oil for higher prices than what it can be sold for now. At the moment Canada is pretty much limited to the oil market in North America and that's not the most advantageous from a seller's point of view. Selling to China specifically and the rest of Asia in general would probably be far more lucrative. Unfortunately, it's difficult to get the oil to those markets because of the location of the source, deep inside the continent and far away from them across the Pacific Ocean. What to do?
"... in Edmonton, the topic of discussion has been the basic economic rationale for the pipeline. Put in its simplest form: China needs oil, and Canada’s got it. In truth, however, that pretext could be stood on its head. Canada needs alternative markets for its oil, and China is the obvious one. Right now, the oil sands are more or less forced to take a U.S. Midwest price for their product. With the sudden reflation of U.S. oil reserves, Alberta has been getting an increasingly raw deal."
Canada is involved in some reasonably significant political turmoil at the moment and much of it is centred on the idea that we need to do more to cash in on our collective resources. More investment in resource extraction and development is being encouraged to point of significant rewrites of environmental protection regulations. The policy at the federal government level certainly seems to be one of getting in while the getting is good. To that end Alberta and the federal government, under control of the Conservative Party of Canada led by Stephen Harper, are eager to build a pipeline to get the oil through the mountains of British Columbia to the coast where it can be loaded onto ships for delivery elsewhere.
The current government of British Columbia (BC) is deeply conflicted (apparently) about carbon fuels. It longs for the quick budgetary fix of oil and gas revenue but also wants to appease a significant fraction of the people who are opposed (wisely in my opinion) to further expansion of those resources. The BC government several years ago pinned several future budgetary years (such as the current one) on revenues from gas fields in the north east of the province. Since gas prices have plummeted due to the increased availability of natural gas in North America (fracking!) the accounting problems in government here have grown significantly. There is a multi-billion dollar shortfall in the budget this year.
Many people in BC believe (I think mostly rightly) that there is significant risk of pollution from possible future leaks and accidents from a pipeline crossing the province. There also seems to be very little economic benefit (comparatively) for BC. It's a peculiarity of Canada's political structure that individual provinces have control of resources located in their political boundaries. In this case the oil resource is located in Alberta. In spite of constitutional control the provinces have over their own resources the Federal Government has in the past taken some control for itself, at least to some degree, in order to impose (what it felt was) more equitable sharing of benefits (e.g. The National Energy Program, http://en.wikipedia.org/wiki/National_Energy_Program).
At the moment, the federal government, seems to be particularly pro resource extraction and contra concern for future generations, unless such concern is couched in an economic argument that is exclusive of known and unknown future harm from greenhouse gases. This is a problem and seems quite short sighted. We have to put up with a couple more years of the Conservatives in control and then we get another chance to change things again.
The second article in Maclean’s, following immediately after the first in the magazine, High Yield Stalks, is about the significant increase in real estate values of farmland across Canada. Historically farmland has been less expensive than other real estate simply because it couldn't be used for other purposes and farming hasn't made much money (compared to other types of land development). Sometimes such land couldn't be used for non-farming uses because of protection under law. For example, BC has an Agricultural Land Commission that pools agricultural land in an effort, as I understand it, to prevent that land from being used for other purposes. The goal is to maintain a pool of agriculturally useful land at a fixed level over time. This seems sensible to me but I’m no expert on the details. I'm not sure what other provinces do but I suspect that there are similar plans elsewhere in Canada.
"Much of the enthusiasm for farmland has been driven by farmers enticed to expand their operations by low interest rates and record-high prices for corn, barley and wheat, thanks to the worst drought in a half-century that’s swept the U.S."
This article, and specifically the quote, was interesting mostly because of the mention of the word drought with no discussion of the possible causes. There is some evidence that the recent drought across the central USA and reaching into parts of Canada (southern Manitoba, southwestern BC) is related to climate change. Climate change is being driven by global emissions of greenhouse gases predominantly emitted by burning fossil fuels. Canada is a big emitter of these gases on a per capita basis but not so big as a portion of global emissions. The current federal government and some provincial governments seem quite content to encourage selling oil, gas (and even coal) in spite of what is now very certain evidence of the harm. One excuse often given for the lack of concern is that Canada contributes so much less than others such as China that it won't make much difference in the long term so we should cash in while we can. This is a depressingly selfish, short-sighted attitude.
So, it seems that farmland is now seen as a sort of speculative investment against a future where crops and farming in general will be more valuable. If that's the case there is a specific warning from scientists that such investors should consider. We don't know yet with much certainty what the effects of climate change will be in different specific regions. What if, as seems likely, rainfall patterns like the recent drought become the norm in the wheat and corn growing areas of North America? Land that once provided reliable crops might now become unreliable. Speculators do seem to zero in on segments of the economy where uncertainty is providing a potential windfall (or loss). It's that risk, after all, that drives them.
The third story in this compare and contrast exercise is, Road Blocks Ahead (all of the articles are linked below). Here we shown some figures that suggest that China is not as mad for cars as we thought and that car sales are in fact down in China. Down in this case means that growth in car sales, at 32% year over year two years ago, is only 5.2% this year. Note that car sales are still increasing just not as quickly as before.
"The worrisome figures come at a time of general turmoil in the world’s second-largest economy. This month, China’s economic growth has been its weakest since the global financial crisis began in 2007—unsettling news for automakers who are banking on growth in China’s auto sector amid weak demand in the United States and Europe."
Maybe this is simply attributable to the overall global economic malaise of the last few years but the article mentions another reason: "Guangzhou became the fourth city in China (after Beijing, Shanghai and Guiyang) to limit auto sales in an attempt to halve the number of cars on the road in an effort to fight congestion and pollution problems."
So, urban governments world wide, in recognition of the problems that more and more cars cause in cities, are enacting laws to restrict the use of cars. It’s not necessarily being done to reduce emissions of greenhouse gases but it is happening. In many places where city governments are doing these kinds of things the governments with larger scope are doing much less. This is true for emissions (my local government has an anti-idling by-law specifically to reduce local pollution and greenhouse gas emissions) and things like sea-level change where we see local governments introducing changes to zoning and construction rules in anticipation of higher sea-levels. I suppose these things are happing at this level because it’s exactly at the interface of people’s daily lives and the environment around them that local government exists.
In any case companies are still making lots of money selling cars in China. And more cars in sold China (sales are decreasing more quickly in North America and Europe) means more demand for gasoline. That's going to drive up prices around the world and those who long for the quick fix of cash from oil are going to remain convinced that their best hope comes from ever more capital invested in oil extraction and delivery. Putting more and more capital as a fraction of Gross Domestic Product into the kind of resource extraction we see in the tar sands is a losing game regardless of the price we may get for the oil. That extra capital would (probably or surely?) benefit us more by being invested in other less harmful things or just in alternative carbon free energy systems.
As I read these three stories (links are below) one after the other I saw a common thread and I wondered if the editors of Maclean's arranged them this way on purpose. I think that they probably didn’t but they seem to be smart folks so, maybe. The link that each article has to climate change and greenhouse gases should serve to remind us that, ever increasingly, the activities that we humans are collectively involved in lead back to our sources of energy and to climate change. It frustrates me that our political leaders are so afraid of their core constituencies or merely so ignorant or selfish that they refuse to take climate change seriously. It's already a big problem that is only getting bigger. Reducing the harm now and for all of our collective descendants is going to require new ways of thinking about our shared economic processes and well-being. Major economic upheaval is likely either way. If we continue to ignore the cause of the problems we see happening we'll just have to pay to accommodate them in our economies in the future. If we start to act now to change away from carbon energy sources we'll pay the price of the adjustment now. In the latter case though we'll reduce future harm and so reduce that cost to our descendants. If the many studies that I’ve seen on this subject are right we’ll also reduce the costs we pay now and in the short-term.
I don’t have an amazing, pithy summarization of this essay. Just think about the connections between the technology you use everyday and the consequences of its use and help make the world a better place for everyone now and in the future. What we do really does have consequences that resonate through time. We are collectively changing the entire world and we need to collectively figure out a way to make that change happen for the better instead of worse.
Links:
http://www2.macleans.ca/2012/09/25/plugging-for-pipelines/
http://www2.macleans.ca/2012/09/25/high-yield-stalks/
http://www2.macleans.ca/2012/09/24/road-blocks-ahead/