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Norway's Oil Riches. Canada's Poverty. Guess Why?

Norway’s vs. Canada's Oil Riches. A Painful Comparison.

by Robin Mathews, May 2015

Finally, and one might say suddenly, Norway’s experience, and Canada’s, with Oil Revenue Savings are under a bright light of comparison.  It’s a painful comparison … for Canada.  Especially since (a) Canada has far greater fossil fuel production and reserves than Norway, and (b) Canada began operating a non-renewable resources fund well before the Norwegians.

Today Norway has a trillion dollars in its reserve fund and no deficit, combined with excellent universal social insurance.  Alberta is in painful deficit with a meagre resource fund, and the federal government (pretending to balance its annualized budget) is in deep and growing indebtedness.

The subject is being discussed widely in Canada now.  In 2012 Mitchell Anderson visited Norway and wrote (for TYEE) probably the best report on what Norway’s Oil Fund has done for the lives of all Norwegians in comparison with Canada.  The benefits Norwegians have (which Canadians don’t) are stunning.

One of the latest and apparently fullest analyses of the whole Norway/Canadian Experience is by Canadian Greg Poelzer for the Macdonald-Laurier Institute in Ottawa. The Institute is described by Wikipedia as a Right-leaning think tank.  That is a nice way (a very Canadian way) of saying what other, franker Canadians would say means a neo-liberal, neo-fascist Institute.  That Greg Poelzer would agree to be published by the Macdonald-Laurier Institute says all that needs to be said about him, here.

His eleven page article on Norway’s “Energy-Based Economics” is – the Economics profession would say - “objective”.  The word “objective” in Canada’s academic world means “expert” reporting that never tells historical truth, that pretends Canada is not an economic colony, and offers information as if failures – like the massive failure of Canada to have done what Norway has done – are the result of slips in thought, accidents in policy making, sheer chance, - the roll of the dice … so to speak.

Nothing could be farther from the truth.

The Canadian (mis)management of its colossal fossil fuel wealth has been a complete and simple story of an Economic Colony at work – adminstered by colonial servants – who devote the major part of resource wealth to the imperial corporations which scatter a few crumbs from the Imperial Table on to the floor where the colonials crouch and feed.

What I will write in the following paragraphs is Canadian history that has never been recognized, or recorded by Canadian historians, biographers, or economists.  Their task is to go around major facts about Canada – especially those which show it as an economic colony.  They, then, report “objectively”.

Greg Poelzer is a shining example of the breed … in the respect that policy and policy failures need historical explanation … which he completely ignores.

In 1947 the Great Gusher, Leduc Oil Well No. 1 burst into history, leading Canada to become a major exporter of oil.  From 1943 until 1968 the premier of Alberta was Ernest Manning, a fundamentalist Christian with strong ties to wealthy U.S. Reactionary fundamentalists.

Manning never considered creating a major Canadian presence in the oil industry.  His primary loyalty was to U.S. financial/oil interests.  Manning could not be called a “progressive”. 

He, for instance, resisted having a francophone Roman Catholic as head of the Eastern development of Social Credit ideas.  He is said to have worked to end anti-Semitism in the Socred Party.  In the early 1960s, however, teaching at the University of Alberta in Edmonton, I had a fierce, fundamentalist Socred youth in my class who, wonderfully, challenged ideas and made his position clear. 

At the time, three or four of my academic friends were studying anti-Semitism and couldn’t find in any bookshop in Edmonton the famous Protocols of the Elders of Zion. I asked my fundamentalist student if he knew the book.  Indeed he did – and he sold me four copies to share with my friends.  Upon graduation he moved into the legislature to work for a Socred MLA.

Ernest Manning sat atop the growing development of oil resources in Alberta from 1947 to 1968 and he did nothing (a) to create a significant Canadian presence in the Alberta Oilpatch or (2) to begin anything like the Norway Oil Fund. 

In the 1960s it was claimed that U.S. oil corporations paid lower royalties to the Alberta government for oil extraction than they paid the Texas government to extract oil in Texas. That is not surprising.  In colonial history it is not at all unusual that the imperial power pays less for resources and labour in the colony than it does in the home country. The lack of Canadian presence was not an accident. It was the result of policy.

James H. Gray, vitally active and interesting Prairie writer and editor, worked for the Winnipeg Free Press from 1935 to 1947 – and then he branched out.  From 1955 to 1958 he ran The Western Oil Examiner, an Oilpatch magazine, out of Calgary.  Watching Canadian entrepreneurs squeezed out, pushed to the sidelines, thrown scraps of the action, Gray began demanding in the Examiner that independent Canadian producers should be given support by government, fairness in their own province and country. Ernest Manning did nothing.  But Gray’s magazine was destroyed by the U.S. interests in Alberta who withdrew all advertising and pressured what Canadian advertisers there were also to pull advertising in order to destroy James H. Gray.  The Western Oil Examiner folded without the dropping of a tear by the Ernest Manning government – the magazine being destroyed by the collaboration of U.S. corporations wanting no Canadian firms sharing Oilpatch wealth in Alberta.

In 1965, at a luncheon meeting held by The Knights of the Round Table in Calgary, I was assured by four or five young Canadians working in U.S. Oil Firms that if they so much as mentioned publicly the need for Canadian ownership – or mentioned nationalization in the exploitation of the Oilpatch, they would be on the street the next morning looking for work.

At about the same time a former UBC student friend (a ‘soft geologist’), working for a major U.S. oil company in Calgary, took into its lounge a copy of a literary and political quarterly journal I worked with in Edmonton.  My friend told me that within two hours he was called into the vice-president’s office and told if he wanted to continue working in that place, he would not bring into the lounge Canadian publications of the kind represented by Edge, a perfectly respectable Alberta journal.

When Peter Lougheed took power in Alberta from 1971 to 1985, he served U.S. oil interests.  His Alberta Heritage Fund was a delusionary fabric that quickly fell to pieces. The Oilpatch propagandists have built a false E. Peter Lougheed who did nothing more, in fact, than Ernest Manning did for Albertans and other Canadians.

As with Manning, historians and economists avoid Lougheed’s real history.  In no biography of Lougheed have I been able to find a major fact recorded.  When Lougheed left office as Alberta premier in 1985, he went to Ottawa to act as a lobbyist for U.S. Oil interests.  That fact, strangely, is absent from all his biographies I have seen.  Also evacuated from history is that the NEP, the Trudeau Liberal’s National Energy Program, was supported by 80% of Canadians polled – AND among them were 80% of Albertans who approved of the NEP.  Now we are hammered daily with the lie that ALL ALBERTA rose up in rejection of the NEP.  A lie.

The creation of Petro Canada in 1975 to assure a major Canadian presence in the Oil Industry was resisted by Joe Clark, Conservative Party leader.  And during the prime ministership of Brian Mulroney the sell-off of Petro Canada began.  What role the U.S. oil interests had is still not clear since that kind of history isn’t written in Canada.  But it is public knowledge that Brian Mulroney has never disclosed the sources of financial support for his campaign to become Conservative Party leader.

The National Energy Program (1980-1985), viciously misrepresented now, and scurrilously attacked in its time was “designed to promote oil self-sufficiency for Canada, maintain the oil supply, particularly for the industrial base in eastern Canada, promote Canadian ownership of the energy industry [as Norway achieved], promote lower prices, promote exploration for oil in Canada, promote alternative energy sources, and increase government revenues from oil sales through a variety of taxes and agreements “[as Norway succeeded in doing]. (Wikipedia]

Norway’s Oil Fund is not a brilliant and accidental creation of an eccentric group of administrators who “lucked” upon a saving system and a major standard-of-living guarantor.  It is the product of an independent people seeking to use resource wealth to guarantee the safety and security of the whole population.  An independent people.

In an economic colony like Canada, no real independence exists and any breakthroughs on behalf of the whole population begin to be undermined as soon as made. [Universal Health Care??] What operates in a country like Canada is the embarrassing service of Canadian “leaders” to foreign power and foreign greed … employing, at the same time, smoke-and-mirror propaganda and lies to lull the population into acceptance of colonial inferiority, colonial passivity, and sell-out of their rights and their wealth.

The tragedies of Petro Canada, the NEP, and the E. Peter Lougheed Heritage Fund are absolutely predictable in an economic colony.  Until Canada’s colonial status is erased, Canadians will be at continuous war among themselves to better the condition of all Canadians, expending huge amounts of effort that are undermined by a combination of the “imperial masters” and the cooperating “colonial administrators” (called Canadian governments).

                                 – Robin Mathews, Vancouver §


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