take back our oil

[bush_cheney2004]

complete and utter submission to plutocracy! completely spineless! disgusting...

the oil comapnies love guys like you. they don't own the oil! even the oil companies know that!

Then why did you take their money?...to get the oil that they don't own?

[August1991]

want cheap gas? all candians have to do is... take it back! its our, isn't it?

lets follow the lead of venezuela where gas is $.12 a gallon! and venezuela recently told big oil to get lost!

And while we're at it, we'll make you work for 50 cents an hour.

What gives you the right to force someone to sell something at a lower price than they can receive elsewhere?

Anyway, at 12 cents a gallon, people would buy it and cart it across the border in jerrycans and sell it to the Americans anyway. All that you would accomplish is making a few Easterners rich at the expense of Albertans - aside from the spillage in gasoline and the odd explosion that would be bound to happen.

Only a (South American) dictator could think of an idea so dumb...

Edited April 22, 2008 by August1991

[Wilber]

complete and utter submission to plutocracy! completely spineless! disgusting...

the oil comapnies love guys like you. they don't own the oil! even the oil companies know that!

No they don't own the oil, the provinces own the oil so you can't dictate to them what they will do with it by a national referendum. So far they have decided that letting private interests make the investment and take the risk while they just take a royalty on what they remove is the way to go.

[planetx]

Then why did you take their money?...to get the oil that they don't own?

wtf?

any actual intellectual debate out there? i'm guessing that everybody is on board then besides the usual idiots?

[Wilber]

wtf?

any actual intellectual debate out there? i'm guessing that everybody is on board then besides the usual idiots?

You mean like the "silent majority"?

[planetx]

No they don't own the oil, the provinces own the oil so you can't dictate to them what they will do with it by a national referendum. So far they have decided that letting private interests make the investment and take the risk while they just take a royalty on what they remove is the way to go.

risk? risk?! what frickin risk?!

they've made all their money back plus billions... thats obvious. they now have a huge cartel where there is a complete lack of 'free market' at the pumps.

kiss them goodbye and with good riddance!

[guyser]

... then besides the usual idiots?

I ..um...dont think you should pluralize that last word.

[August1991]

risk? risk?! what frickin risk?!

they've made all their money back plus billions... thats obvious. they now have a huge cartel where there is a complete lack of 'free market' at the pumps.

kiss them goodbye and with good riddance!

Look planetx, even if you "took back" the oil, you'd be crazy not to sell it to the Ametricans at $110/barrel. IOW, you'd be crazy to sell it for anything less to Canadians.

And BTW, the Albertan government "owns" the oil below the surface of Alberta and derives a hefty profit from its sale.

[planetx]

Look planetx, even if you "took back" the oil, you'd be crazy not to sell it to the Ametricans at $110/barrel. IOW, you'd be crazy to sell it for anything less to Canadians.

And BTW, the Albertan government "owns" the oil below the surface of Alberta and derives a hefty profit from its sale.

i'm sorry, did i say that we would not export at world prices?

i apologize, the oil is under albertan jurisdiction. so, what? are they going to go to war for the oil companies?

crazy to sell to canadians at the pumps less than 'free market' (whatever that is... we'll never know in our current environment)? why is that?

again... WE ARE THE SECOND RICHEST OIL NATION ON THE PLANET! why is it that big oil has us convinced that that means nothing to us?

[bush_cheney2004]

wtf?

any actual intellectual debate out there? i'm guessing that everybody is on board then besides the usual idiots?

Look...you didn't have the capital to get it, don't have the distribution network to get it East, and don't have refining capacity even if you could. Canada actually imports oil and distillates from the USA and abroad because of these quirks.

Maybe you should start there before playing the Castro card.

[Dez]

There are some reasonable arguments for taxing oil profits at a higher rate than other types of income.

The economic argument is that oil provides a "rent" (a fancy way of saying that it can be sold for much more than the cost of its production), and can therefore be taxed at a certain level without reducing the incentive to invest in its production.

A simple example would be if the government charged the oil companies a flat amount for producing a unit of output, say x dollars a barrel. As long as this amount was low enough for oil companies to make a small profit on the sale of that barrel, there would be no economic disincentive to invest.

There is also a moral argument for taxing oil profits at a higher rate. When a small group of people own all of a resource, they in effect have a monopoly on it. Monopolies can charge a higher price than the cost of production, and thus are guilty of theft from the consumer. However, this only gives the government the right to take back the stolen rents and give them back to the consumer... it does not justify them taking the rents and using them to build roads, provide health care, or whatever else governments currently do. You'd need another moral argument for that.

Of course, there are caveats to this line of thinking. In the real world it is hard to separate rents from profits... and unlike many people here, I think profits are a very good thing. Profits provide a signal to companies that they should increase the output of a certain resource as well as think up new technologies that increase the efficiency of that output. This means that the higher the rent tax, the lower the incentive to think up new kinds of technologies.

The government of Alberta had these considerations in mind when it lowered its royalty rates in the early 90s so that they could encourage more investment when the price of oil was tanking. Now that the price has shot back up again they are thinking of raising the rates in order to reap some of those benefits. Albertans are pretty smart.

[August1991]

The economic argument is that oil provides a "rent" (a fancy way of saying that it can be sold for much more than the cost of its production), and can therefore be taxed at a certain level without reducing the incentive to invest in its production.

A simple example would be if the government charged the oil companies a flat amount for producing a unit of output, say x dollars a barrel. As long as this amount was low enough for oil companies to make a small profit on the sale of that barrel, there would be no economic disincentive to invest.

Dez, that is exactly what the provincial governments do now - although it's a little more complicated than you imply. In fact, the Albertan government recently raised royalty rates and the change was met with some controversy.

i'm sorry, did i say that we would not export at world prices?

i apologize, the oil is under albertan jurisdiction. so, what? are they going to go to war for the oil companies?

crazy to sell to canadians at the pumps less than 'free market' (whatever that is... we'll never know in our current environment)? why is that?

again... WE ARE THE SECOND RICHEST OIL NATION ON THE PLANET! why is it that big oil has us convinced that that means nothing to us?

If you forced owners of oil to sell gasoline at 12 cents a gallon, you wouldn't have any oil to sell to Americans or anyone else.

Who cares what the "free market" is? Albertans can sell their oil for about $110/barrel. You still haven't explained what gives you the right to force them to sell it for much less to anyone else. According to your logic, I should have the right to force you to work for 50 cents an hour.

[Dez]

Sorry planetx, most of your arguments for higher taxes on oil profits are pretty silly.

"lets follow the lead of venezuela where gas is $.12 a gallon! and venezuela recently told big oil to get lost!"

Ummm... let's leave aside that Venezuela is a basket case -- that's the only thing you can call an oil exporting country that is suffering economic decline when the price of oil is rising like crazy -- why on earth would we want to charge Canadians $0.12 a gallon? August 1991 is right... why would we sell it for cheaper at home when we could get a lot more for it abroad? Why wouldn't we want Canadians to pay full price for the cost of gas? Pretty dumb social policy: use all those oil profits and use it to subsidize the price of gas... why not use it to provide health care, or education, or something with some positive social benefit?

"rice is cheap in china, but on the east coast the irvings import oil because they have no interests in the oil sands! what the heck?!"

??? What does this even mean? Let's leave alone the fact that the price of rice is rising all over the world... even in China. The reason the Irvings import oil from abroad is because.... they don't know the first thing about developing the oil sands, and even if they did, why would they want to build a big expensive pipeline to send it out East when they can import it cheaper from abroad? They are specializing in what they know best, and that is a good thing.

"we are being gouged like there is not tomorrow! for decades big oil has been buying everything downstream from them…"

Don't tell that to the government of Alberta... a huge part of their revenue comes from taxes on oil profits! Maybe you don't think it should only go to Albertans, but don't act like we're being duped.

Oddly enough, the major reason that Alberta has a right to all the royalties of its oil is because successive governments in Quebec wanted to ensure that the big bad federal government could never lay their hands on their electric power resources. I hope that softens all the Quebec-haters out there a bit.

"while saudi arabia is the second biggest producer of oil, oil revenue there means that there is no personal income tax! secondary education and books are free! free health care that is second to none!"

Yeah... this is true if you ignore the fact that Saudi Arabia would be falling apart if it wasn't for high oil prices. Check this article out if you don't believe me:

http://www.ccc.nps.navy.mil/si/2004/jan/looneyJan04.asp

Saudi Arabia's GDP per capita has declined from more than U.S. $15,000 in 1980 to about U.S. $9,000 in 2003 (adjusted for inflation). There is high unemployment (20 to 30 percent by some measures), while up to 20-30 percent of the population falls below the poverty line.

There is no hope for the youth of this country. Their economy is so regulated and corrupt that there is nothing for all their graduates to do. The entire system is held together by terror, welfare bribes, and a strict authoritarian culture. What a waste when you consider how much oil this country has.

I do have some sympathy for you when you say this:

"all the talk you hear in the media about lack of refineries, capacity etc… its all garbage! its all a big fog to hide how prices at the pumps rise so quickly. like that has nothing to do with oil company profits rising so quickly!"

Back in 2000 when California was going through a series of blackouts you almost never heard about price fixing on the part of the energy companies. Now it has become common knowledge that Enron and Reliant Energy were gaming the system. Could something similar be happening today? Maybe... but I believe they had a parliamentary committee look into this a while back and found no evidence of price fixing. Not sure what happened to it though, and I definitely think it's something worth looking into at greater depth.

[Dez]

Hi August 1991;

"Dez, that is exactly what the provincial governments do now - although it's a little more complicated than you imply. In fact, the Albertan government recently raised royalty rates and the change was met with some controversy."

You'll notice that I implicitly mention this at the end of my post:

"The government of Alberta had these considerations in mind when it lowered its royalty rates in the early 90s so that they could encourage more investment when the price of oil was tanking. Now that the price has shot back up again they are thinking of raising the rates in order to reap some of those benefits. Albertans are pretty smart."

Cheers;

Dez

[August1991]

Oddly enough, the major reason that Alberta has a right to all the royalties of its oil is because successive governments in Quebec wanted to ensure that the big bad federal government could never lay their hands on their electric power resources. I hope that softens all the Quebec-haters out there a bit.

Well, that's an original way to insinuate some Quebec-bashing (English-Canada's national pastime) into the discussion.

In fact, the reason the BNA Act gave provinces sovereignty over natural resources was because, in 1867, Upper Canada didn't want to share the revenues from oil around Sarnia with the rest of Canada. In 1867, in case you don't know, hydroelectric dams were still in the future.

----

And Dez, would you please learn how to press reply and quote others properly.

Edited April 22, 2008 by August1991

[planetx]

There are some reasonable arguments for taxing oil profits at a higher rate than other types of income.

The economic argument is that oil provides a "rent" (a fancy way of saying that it can be sold for much more than the cost of its production), and can therefore be taxed at a certain level without reducing the incentive to invest in its production.

A simple example would be if the government charged the oil companies a flat amount for producing a unit of output, say x dollars a barrel. As long as this amount was low enough for oil companies to make a small profit on the sale of that barrel, there would be no economic disincentive to invest.

There is also a moral argument for taxing oil profits at a higher rate. When a small group of people own all of a resource, they in effect have a monopoly on it. Monopolies can charge a higher price than the cost of production, and thus are guilty of theft from the consumer. However, this only gives the government the right to take back the stolen rents and give them back to the consumer... it does not justify them taking the rents and using them to build roads, provide health care, or whatever else governments currently do. You'd need another moral argument for that.

Of course, there are caveats to this line of thinking. In the real world it is hard to separate rents from profits... and unlike many people here, I think profits are a very good thing. Profits provide a signal to companies that they should increase the output of a certain resource as well as think up new technologies that increase the efficiency of that output. This means that the higher the rent tax, the lower the incentive to think up new kinds of technologies.

The government of Alberta had these considerations in mind when it lowered its royalty rates in the early 90s so that they could encourage more investment when the price of oil was tanking. Now that the price has shot back up again they are thinking of raising the rates in order to reap some of those benefits. Albertans are pretty smart.

its not absolutely necessary that we nationalize to get these things... but canadians _should_ step up and realize that we are worth more than we are told!

i'm sorry, we can't use taxes to pay for roads and health care? again, i was talking about using export revenues here, not domestic.

domestic prices at the pumps would be highly regulated with garanteed supply (part of the cost of doing business). thus no need to 'pay back the consumer'.

[planetx]

Dez, that is exactly what the provincial governments do now - although it's a little more complicated than you imply. In fact, the Albertan government recently raised royalty rates and the change was met with some controversy.

If you forced owners of oil to sell gasoline at 12 cents a gallon, you wouldn't have any oil to sell to Americans or anyone else.

Who cares what the "free market" is? Albertans can sell their oil for about $110/barrel. You still haven't explained what gives you the right to force them to sell it for much less to anyone else. According to your logic, I should have the right to force you to work for 50 cents an hour.

HANG ON JUST A DARN MINUTE! all this crap about 'free markets' but suddenly its all out the window when we are talking about big oil companies?!! realize, ITS NOT ALBERTANS WHO ARE REAPING THE PROFITS ITS BIG OFFSHORE INTERNATIONAL CONGLOMERATES!

albertans are already short changing themselves big time!

[planetx]

further, i don't care which province gets the money... as long as it stays in canada.

all this provincial 'nationalism' is actually a load of crap becuase i can live in any province i like!

[August1991]

HANG ON JUST A DARN MINUTE! all this crap about 'free markets' but suddenly its all out the window when we are talking about big oil companies?!! realize, ITS NOT ALBERTANS WHO ARE REAPING THE PROFITS ITS BIG OFFSHORE INTERNATIONAL CONGLOMERATES!

albertans are already short changing themselves big time!

Doh! Those dumb Albertans! All they needed was for the great, wise planetx to show up and tell them to tax the oil they own!

If you PM me, I'll send you Ed Stelmach's cell number and you can get him working on this right away. It sounds urgent.

[Wilber]

risk? risk?! what frickin risk?!

they've made all their money back plus billions... thats obvious. they now have a huge cartel where there is a complete lack of 'free market' at the pumps.

kiss them goodbye and with good riddance!

No risk? You know absolutely nothing about the oil business. You didn't want to know a few years ago when oil was 12 bucks a barrel, gas was 30 cents a liter and Alberta's economy was in the dumpster but the same people who were taking the risks to find and get the stuff out of the ground then are benefiting now and that pisses you off.

Since when was a government monopoly ever a "free market". An analyst I was listening to today was saying that oil companies aren't making much on gasoline these days, they are making it on diesel which pisses me off because both my every day vehicles are diesel. Good thing they get such great mileage compared to their equivalent gas vehicles. People who have been speculating in oil however have been making a killing.

The fact is oil, is the new gold. People who are losing faith in currency are now putting their money into energy and that can be any investor, not just oil companies.

[Alta4ever]

HANG ON JUST A DARN MINUTE! all this crap about 'free markets' but suddenly its all out the window when we are talking about big oil companies?!! realize, ITS NOT ALBERTANS WHO ARE REAPING THE PROFITS ITS BIG OFFSHORE INTERNATIONAL CONGLOMERATES!

albertans are already short changing themselves big time!

That really funny I 've done pretty well, all thanks to those big oil companies driving our economy.

P.S. i don't work in the oilfield.

[Alta4ever]

risk? risk?! what frickin risk?!

they've made all their money back plus billions... thats obvious. they now have a huge cartel where there is a complete lack of 'free market' at the pumps.

kiss them goodbye and with good riddance!

We are paying fair maket value.

We are paying the same as what others in the market would pay, not more or less. ( At least until taxes are factored in)

[planetx]

No risk? You know absolutely nothing about the oil business. You didn't want to know a few years ago when oil was 12 bucks a barrel, gas was 30 cents a liter and Alberta's economy was in the dumpster but the same people who were taking the risks to find and get the stuff out of the ground then are benefiting now and that pisses you off.

Since when was a government monopoly ever a "free market". An analyst I was listening to today was saying that oil companies aren't making much on gasoline these days, they are making it on diesel which pisses me off because both my every day vehicles are diesel. Good thing they get such great mileage compared to their equivalent gas vehicles. People who have been speculating in oil however have been making a killing.

The fact is oil, is the new gold. People who are losing faith in currency are now putting their money into energy and that can be any investor, not just oil companies.

first off, stop listening to "analysts" or "consultants" on tv... they invariably work for the industry they are "analyzing". its infuriating how much “news” we get from the “liberal” media that’s just corporate propaganda!

so you feel that the fruits of our countries wealth are only available on a “pay to play” basis? the usual hegemony motto isn’t it? which leaves the bottom two thirds to pay for stuff like roads, hospitals etc etc...

[planetx]

We are paying fair maket value.

We are paying the same as what others in the market would pay, not more or less. ( At least until taxes are factored in)

now thats a whole new thread... its completely obvious that there is not "competition" at the pumps. what short memories people have! ten years ago we had a rather large independent gas station franchise here in victoria, bc called ‘payless gas’. about 10 -15 stations. payless gas had price wars with the big guys all the time! it was fabulous.

then one day payless sold. eventually landed in the hands of shell oil. now those day are long gone! prices change at all the pumps at the same time just like everywhere else in canada! how strange that happens without any collusion at all?!

[Dez]

Sorry about the misquote, I am still learning the ropes.

Well, that's an original way to insinuate some Quebec-bashing (English-Canada's national pastime) into the discussion.

Geez, and here I thought I was anti-Quebec bashing by showing Westerners that they had something to be very thankful to Quebec for. No pleasing some people. If anything it's more a dig against rabid de-centralizers than Quebecers.

In fact, the reason the BNA Act gave provinces sovereignty over natural resources was because, in 1867, Upper Canada didn't want to share the revenues from oil around Sarnia with the rest of Canada. In 1867, in case you don't know, hydroelectric dams were still in the future.

I'm remembering that the exact distinction between who had jurisdiction over resources was not entirely clear in the BNA Act, but was enshrined as a provincial responsibility by Trudeau in the Constitution of 1982. I'll admit that I could be wrong here though, if you could provide any source I'd be more than happy to read up on it, as it has been a while since I've heard about this.