Wednesday Night #1601

Thanks to an introduction from Alexandra Greenhill, the evening was enlivened by the arrival of the very engaging Joyce Murray, Liberal M.P. for Vancouver Quadra and soon-to-be candidate for the leadership of the Liberal Party of Canada

video clips of the evening

The Scribe’s Preamble

The uncertainty leading up to the re-election of U.S. President Barack Obama, who must again face a hostile House of Representatives, the recent rise of the NDP  in Québec at the expense of the Liberal party, the phoenix-like rise of the Conservative party in Canada out of the ashes of the Reform party, the rise of local leaders precipitating popular demonstrations, the resurrection of  the Parti Québécois in Québec and the astounding if not surprising revelations of corruption among local politicians leading up to Mayor Tremblay’s resignation, constitute a powerful message of the need for change of the alleged motivation of some politicians from entitlement to contribution.
The results of the most recent federal election both in terms of the election of a majority Conservative government and the decimation of the Liberal party has surprised and shocked. During the last few months of his life, Jack Layton displayed a courage and fortitude that surpassed all political considerations;  the Liberal candidate for Prime Minister, while a brilliant asset to the party, unfortunately, could not match the charisma of his NDP counterpart.
The gradual population shift westward is likely also a factor in the supremacy of the Conservative Party to the detriment of the Liberals.

Tree-planter extraordinaire,  Joyce Murray co-founded with her husband an international reforestation company, Brinkman & Associates that has now planted over a billion trees in Canada and Central America. Joyce is the Wangari Maathai of Canada and has personally planted some 500,000! She  is currently exploring the possibilities of a run for the Liberal leadership. As the bio on her website notes: Joyce is a fierce advocate for the key issues of environment and climate change; building a stronger, greener economy with emphasis on job creation and support for small businesses; human rights and women’s rights; education with a focus on financial support for college and university students; health and home care; and preventative health. Thus, a great interest in most, if not all, of Wednesday Night’s public policy issues. Joyce emphasizes her background in business including logistics and people management, restoration of forests, forest and ecosystem management; their company was also at the forefront of bringing about the changes in policy that now require harvesters to replace the mixed forests and steward them until the trees are tall  enough to thrive.

In response to a question regarding the possibility of overcoming the devastation caused to the forests of B.C. by the Japanese beetle, Joyce was clear that those pine forests are gone and this is because our winters are no longer cold enough – a casualty of the climate change caused by greenhouse gas emissions. She spoke eloquently of the costs of doing nothing about the emissions, citing the example of Japan that collects $400 million p/a in tariffs on metallurgical coal exports from Canada because we do not put a carbon price on the materials. Yes, she advocates a carbon tax pointing to British Columbia where such a tax has not killed the economy.

Some believe that we need only contrast China’s voracious consumption of coal-generated energy and the total absence of any environmental protection in Russia with the small amount of emissions emanating from our small population to question whether any actions or stronger regulation by the Canadian government would have little if any influence on the world’s polluters. True, however, we are also reminded that until recently, Canada exercised considerable influence in major international organizations such as the OECD and was admired as a model of good government, governance and global good citizen. This could again be true if our government were courageous in leading the way on important issues, notably the environment.

The Liberal Party has to find the unique value that it provides to Canadians … we’ve lost our path and it’s not a simple solution … Our Party has ceased to be seen as a party that offers a unique value to the people it wants to serve.  …
A party that used to have 308 boutiques that provided wonderful value and now, Walmart has moved in to the neighborhood. We have not come to grips with the fact that we have competitors on both sides of us and our competitors are offering things that Canadians think have value; we cannot continue to think that because we had something of value in the past, the people will return.

Renewal will require hard work, rolling up the sleeves and being prepared to overcome the traditional views and practices. The Party needs someone who comes from outside the culture and cults of personality and power, concentration of power and past achievements that have prevailed for too long.  Some Wednesday Nighters believe that uniting the Left may be a necessary option – not a merger of NDP and Liberals – but a coalition, or perhaps strategic voting in ridings where the Conservative candidate has won by a narrow margin thanks to the split of Liberal and NDP voters. They argue that the Liberals and NDP are closer philosophically than the PCs and Reform, so it is not such a huge leap. Joyce would dispute that contention given that both NDP and Conservatives are tied to special interests that form their respective bases; the Liberals, in her view, are the pragmatic, problem-solving party, capable of tackling large issues and producing good public policy, precisely because they are not tied to a specific ideology.

For  an MP from British Columbia, the current issue of  The Canada-China Foreign Investment Promotion and Protection Agreement (FIPA)  is of particular concern. The negotiation of this Treaty behind closed doors, without a clear and transparent framework, or public debate (as was the case with NAFTA)  is worrisome. While Free Trade is in principle a good thing and there could well be benefits to Canada, notably  in terms of environmental businesses, there are also the dangers of the lack of a level playing field, length of the agreement (31 years), and of liabilities for Canada should the conditions under which the agreement is signed be changed subsequently, e.g. if the rollbacks of environmental assessments by the Conservatives were reversed in the future, China could  deem the action to be detrimental to its investments in Canada and sue the Government of Canada for changing the rules. This is not a wild-eyed conspiracy theory. [As Elizabeth May has since pointed out, US-incorporated Lone Pine Resources announced its intentions of suing the Government of Canada under the North American Free-Trade Agreement’s infamous Chapter 11. Over what? Quebec’s decision to impose a moratorium on all oil and gas exploration activities in the Gulf of Saint Lawrence.]

[Editor’s Note: Professor Gus Van Harten of Osgoode Law School has addressed the concerns surrounding FIPA  in a number of articles. See Taking apart Tories’ Party Line on China-Canada Treaty]

Having described some of the superhuman efforts of her company’s early days, and the daunting situation she faced as Minister of Environment of BC, responsible for some 14% of BC’s landmass (BC Parks), wildlife, endangered species, water quality, etc. while facing a 23% budget cut,  Joyce clearly showed that she  has the focus, energy, organizational, people and policy skills at the nexus of environment and business, required of a national political leader. Whether or not she is successful in her quest for the leadership, she will  add an important voice and dimension to the Leadership debate and to the  Liberal Party; the country is indeed fortunate to have someone of her qualities in public office.

Pierre Arbour made his first appearance at Wednesday Night since the launch of his book Extraordinary Encounters/Rencontres extraordinaires a personal memoir that begins with the story of his grandparents’ business misadventures caused by Mussolini, and goes forward and backward, recounting the visit of Benjamin Franklin to Montreal, relating that to the rise of Napoleon, anecdotes about memorable people Pierre has encountered … a fascinating read. The publication surprised all his friends as he had not mentioned that he was writing until voilà, it was in print.

Mark Roper introduced Gregory (Greg) Vit, Associate Professor (Clinical) of Strategy & Organization, who teaches Strategy, Managing Innovation and International Business to McGill undergraduates, MBA’s, Masters of Management students and executives. Professor Vit is also the director of the Dobson Centre for Entrepreneurial Studies and the founder of the Dobson Cup Start-Up competition.

Prologue

One term more – delightful pro-Obama parody of Les Miz.
It is obvious that the dissection of the results of the U.S. elections are at the top of our list even if we are subjected to a hanging chad situation (see Mail-in ballots: the hanging chads of 2012?). As we write, the outcome is still too close to call, which doesn’t seem to stop many pundits. Still, there are a number of noteworthy articles and analyses some of which we have gathered on our U.S. elections 2012 Obama versus Romney page and a couple of arcane bits of information on the elections trivia post. We also should call your attention to Tom Friedman’s The Morning After the Morning After and, of course, our friends David Jones and David Kilgour have posted their predictions on David vs. David
Finally, for any of you who still have not made up your minds try watching Why I’m voting for Mitt Romney

China and corruption
However, while we have been mesmerized by the election campaign and Hurricane Sandy’s devastation of New York and New Jersey, as mentioned last week, we cannot neglect the equally important political developments in China where the changing of the guard will take place at the CPC (Communist Party of China) gathering which kicks off on November 8 as – given the time difference – we will still be awaiting the U.S. results. No bated breath over the outcome in this case, but much turmoil over corruption. Even Xinhua states that the most pressing issue for the Chinese public is the uninhibited and widespread abuse of power and corruption among government officials and businessmen . And the western press has been paying attention; please check out some of the entries on our page on China: government & governance especially the delightfully titled Brother Wristwatch and Grandpa Wen: Chinese Kleptocracy which has set off a stimulating exchange between several Wednesday Nighters on the differences between developmental and degenerative corruption. We do not intend to make light of the situation, there are likely to be serious ramifications well beyond the borders of China while that country is pressing its challenge to the U.S. in the Asia Pacific region.

Canada, China, energy and foreign investment
Once the tumult and the shouting has died down, we hope that Canadians will focus on the issues of Canada-China relations (FIPA) and their compatibility with the thorny issue of a National Energy Strategy. While we have all been worrying about the latest polls in the U.S., the Harper government continues to forge madly ahead in all directions* with nary a moment of consultation. The Tyee has followed the FIPA debate assiduously in consultation with Gus Van Harten, associate professor at Osgoode Law School and a critic of the agreement. Meantime, even Albertans are worried about the Nexen deal. Please see below an excerpt of a long message from a canny Alberta-based observer which reminds us that CNOOC and Petronas are not the only foreign ownership questions.
*In the PM’s case, off to India on what seems to be a rather ill-timed visit complete with his very own armoured vehicles

Related to the above is the news that The Montreal Branch of the CIC is organizing an event on December 4 with the author of the CIC’s recently released report “The 9 Habits of Highly Effective Resource Economies“. Madelaine Drohan is the Canada correspondent for The Economist and contributes regularly to its sister company, the Economist Intelligence Unit. For the last 35 years, she has covered business and politics in Canada, Europe, Africa and Asia. She has written in the past for The Financial Times (UK), appeared as a commentator on BBC Radio (UK), ABC Radio (Australia) and CBC Radio, and worked in Canada for The Globe and Mail, The Financial Post, Maclean’s, and The Canadian Press. Will keep you informed and encourage you to bring a Conservative friend.

UPDATE LE MAIRE TREMBLAY QUITTE LA MAIRIE
Less important in the global state of affairs, but with more impact on our daily lives and pockets, are the Charbonneau Commission’s daily revelations of rampant corruption in Montreal, which led Mayor Tremblay to take a few days off ‘for reflection’ as the saying goes. We read that he will be back in his office on Tuesday, no doubt in time for more shoes to drop – would those be cement shoes?

And what of Québec? Let’s wait until next week to tackle that issue, although we should call your attention to Beryl Wajsman’s crusade “United Against Discrimination” – some news on http://www.facebook.com/MontrealMet

We do not discriminate against any Wednesday Nighters – and hope very much that you will join us for a celebration accompanied by the strains of the Triumphal March of Aida, (see Note) or for an empathetic licking of wounds.

Note
I would be careful about invoking Aida. The Triumphal March is great, (better productions have elephants marching across the stage) but that is not the end of the opera. The end is rather sad.
I would, instead, recommend Beethoven’s Fidelio, where at the end the prisoners are released from the dungeon and sing “Freedom! Freedom!” on their knees. Tony

 
A view from Edmonton on CNOOC/Nexen and related matters
At three minutes before midnight on Friday October 19th, the Harper government issued a press release saying it would not approve the proposed $5.2BN takeover of Calgary-based Progress Energy by Malaysia’s state-owned Petronas. This was collateral damage from the much bigger & far more uncomfortable question Mr. Harper’s Conservatives c.s. are facing as to what to do about the proposed $15.2BN purchase by CNOOC
Limited of all the outstanding common & preferred shares of Calgary-based Nexen Inc. (but not its $4.3BN debt). Harper has been touting the idea, especially in China, that Canada is open for business foreign investment-wise, has been courting Beijing decision makers as never before (regardless of the idea of a “principled” Canadian foreign policy on human rights his Foreign Minister has been flogging), & knows that Beijing has the deep pockets, the long-term perspective & the demand for oil (at world market-, rather than Mickey Mouse-, prices) critical to the development of the Alberta oilsands in a way that could potentially optimize their benefits for Alberta, & Canada as a whole. But the Nexen transaction has captured the public’s imagination; for it has been alerted to the fact CNOOC is controlled by the Government of China (a minority of its shares are listed on the Hongkong Stock Exchange & in New York with the clever ticker symbol CEO), and polls now show that even in Alberta a majority of Canadians view the presence of the Government of China in the oil patch as 100% owner-operator as inappropriate, especially since no one in his/her wildest dreams could imagine a situation in which Beijing would ever permit such a coup if the shoe were on the other foot.
But in many ways Canada’s `baying at the moon’ opposition politicians, & the hoi polloi whom they are inspiring, are `barking up the wrong tree’ & seeking to `close the barn door after the horse has bolted’.
For Nexen may be Calgary-based but operates mostly outside Canada, first & foremost the North Sea (although it also owns 7.23% of Syncrude – which, added to Sinopec’s 9.03%, would give Beijing a 16.26% total interest in that venture – thereby making it its third-largest shareholder – and also owns 65% of, & operates, the 72,000 bbld Long Lake `in situ’ – i.e. underground as opposed to open pit – oil sands project 25 miles Southeast of Fort McMurray – of which CNOOC already owns the other 35%, which it acquired last year for $2.1BN out of the bankruptcy of OPTI Canada (which it may well have looked upon at as a prelude to the Nexen acquisition). Long Lake has had a rather troubled past (&, as a result, numerous ownership re-arrangements), which may well have been one of the reasons it appealed to CNOOC (& not to anyone else).
Then this week there was an announcement by TransCanada Corp., that so far has raised no public eyebrows, that it had entered into a 50-50 JV with Phoenix Energy Holdings Ltd. to build a large capacity 500 km. pipeline to carry 900,000 bbld of bitumen & 330,000 bbld of diluent from a new area Northwest of Fort McMurray where Phoenix wholly owns the Mackay & Dover oilsands properties (which it acquired in two stages, for a tot al $2.58BN, last year & early this year from Athabasca Oil Sands Corp.) to the `industrial heartland’ near Edmonton (which makes one wonder what they know, or think they know, that no
one else does, since it hardly seems reasonable to pump such amounts of oil to Edmonton when there may not be the facilities in place to take it from Edmonton elsewhere & when, even if the Keystone pipeline were to go through, it would only be able to take about half that amount of throughput (although it likely is no coincidence that this pipeline’s target completion date coincides with that of the Kinder Morgan pipeline expansion (to Burnaby, B.C.). For Phoenix is wholly-owned by Petro China Co. Ltd (PTR – NYSE) which is in turn controlled by Government of China-owned CNPC (China National Petroleum Corp.). And there are already several other Beijing-owned or controlled companies with their tentacles deep into the Alberta oil patch (as do the governments of Norway & Abu Dhabi).
In the end, the Prime Minister may well approve both take-overs & justify doing so by claiming that the turning down of the Petronas bid had resulted in such improvements in the two companies’ offers as to have significantly hiked the “net benefit” to Canada.