Environment, oilsands

[Jerry J. Fortin]

Do you have an example of a 'value added consumer good' that we produce ?

We want to export raw materials because that is one area where we have an advantage.

In what sector? Like OSB from our forestry industry, or plastic from our oil industry? What I suggest is using our available resources to produce value added stuff. Of course we need many more products to export than we currently have and that is the point.

It seems to me that we need to start small, and work our way up. Use what we have to OUR advantage. Look at the export of potash, we ship it over there and then turn it into fertilizer with additives, we can do that here before we ship it. As long as we export raw materials we are losing out on jobs and revenue. We have trouble competing with their labour costs so we need to eliminate their advantage by using an automated process. We have the people to retrain already on the government dime. We have the production facilities already built and sitting idle . We have a lot of little pieces, but we need to put them together in a concentrated effort focused on an end goal.

[Michael Hardner]

In what sector? Like OSB from our forestry industry, or plastic from our oil industry? What I suggest is using our available resources to produce value added stuff. Of course we need many more products to export than we currently have and that is the point.

It seems to me that we need to start small, and work our way up. Use what we have to OUR advantage. Look at the export of potash, we ship it over there and then turn it into fertilizer with additives, we can do that here before we ship it. As long as we export raw materials we are losing out on jobs and revenue. We have trouble competing with their labour costs so we need to eliminate their advantage by using an automated process. We have the people to retrain already on the government dime. We have the production facilities already built and sitting idle . We have a lot of little pieces, but we need to put them together in a concentrated effort focused on an end goal.

If we use an automated process, there is still labour involved in running it, which they can undercut us on. I don't think there are a lot of people on welfare ready to be retrained in working in an automated manufacturing setting. There are some on EI, but they will find work in the auto sector or other areas soon enough.

Maybe we can train people to write better facebook applications ?

[Jerry J. Fortin]

If we use an automated process, there is still labour involved in running it, which they can undercut us on. I don't think there are a lot of people on welfare ready to be retrained in working in an automated manufacturing setting. There are some on EI, but they will find work in the auto sector or other areas soon enough.

Maybe we can train people to write better facebook applications ?

So what you are suggesting is to simply keep doing what we are doing?

[Oleg Bach]

It would be better for Alberta to be clean happy holy and poor than filthy rich. I worked in Alberata years ago during a previous boom. Making money hand over fist...and where did it go? It went right to the rich people that control the liquor trade...MOST of the young men working in Alberta are young fools and a fool and his money is soon parted - You would be better to retire in Newfoundland and eat fish.

[Michael Hardner]

So what you are suggesting is to simply keep doing what we are doing?

I don't have a suggestion. I wish I understood economics more, then I'd have one.

My best guess is to focus on futuristic things: software, bio-genetics, bionics, jet packs, etc.

[Wild Bill]

If we use an automated process, there is still labour involved in running it, which they can undercut us on. I don't think there are a lot of people on welfare ready to be retrained in working in an automated manufacturing setting. There are some on EI, but they will find work in the auto sector or other areas soon enough.

Maybe we can train people to write better facebook applications ?

As I keep saying, there is precious little manufacturing done here that is NOT heavily automated! This has been the case for some years. This of course has reduced the number of available jobs. The labour left over is not a big a cost as you might think, when amortized against the high volume of goods produced for relatively few workers in a factory.

No, the real significant cost disadvantages are taxes, paperwork and anti-pollution measures. Our taxes tend to be higher than countries like China. As for the paperwork, has no one ever thought about how StatsCan gets all its stats about business? Do you really think they have a huge army of bureaucrats that sit in most every business in Canada? Nope, they don't need to. Every business of more than a couple of employees has mandatory info paperwork they have to fill out, at their own expense. The bigger the employer, the more detailed the paperwork. The employers have to pay people to do collate the info and fill out the forms. It is a SIGNIFICANT cost!

The cost of going green is obvious. One country's steelmakers spend millions of dollars on smokestack scrubbers. Other countries have no such costs. When it comes time to sell your steel, the dirty guy has a HUGE advantage!

Like it or not, we either impose green tariffs or we lower the taxes, paperwork and loosen up on the "green" laws. There are no other solutions possible. The left in this country is either going to have to learn how to be more practical or they can kiss what's left of their worker support goodbye. Not because the workers will have had a change of political heart. There simply won't be that many workers!

[eyeball]

Like it or not, we either impose green tariffs or we lower the taxes, paperwork and loosen up on the "green" laws. There are no other solutions possible. The left in this country is either going to have to learn how to be more practical or they can kiss what's left of their worker support goodbye. Not because the workers will have had a change of political heart. There simply won't be that many workers!

We should tighten the green laws and then impose the tariffs and lower the taxes and paperwork. For what it's worth I'd eliminate income taxes and raise consumption taxes.

First things first though, we need big changes not just reforms, in how we govern ourselves. None of the above are likely so long as we remain stuck in the past with our horse and buggy democracy.

You want practicality? The sooner there aren't that many workers left the sooner big change will come to pass.

[Michael Hardner]

As I keep saying, there is precious little manufacturing done here that is NOT heavily automated! This has been the case for some years. This of course has reduced the number of available jobs. The labour left over is not a big a cost as you might think, when amortized against the high volume of goods produced for relatively few workers in a factory.

Ok.

No, the real significant cost disadvantages are taxes, paperwork and anti-pollution measures. Our taxes tend to be higher than countries like China. As for the paperwork, has no one ever thought about how StatsCan gets all its stats about business? Do you really think they have a huge army of bureaucrats that sit in most every business in Canada? Nope, they don't need to. Every business of more than a couple of employees has mandatory info paperwork they have to fill out, at their own expense. The bigger the employer, the more detailed the paperwork. The employers have to pay people to do collate the info and fill out the forms. It is a SIGNIFICANT cost!

How significant ? More than the basic accounting that you have to do to run a business ? And, in fact, isn't that where most of the stats come from - submissions to revenue Canada and the like ?

Like it or not, we either impose green tariffs or we lower the taxes, paperwork and loosen up on the "green" laws. There are no other solutions possible. The left in this country is either going to have to learn how to be more practical or they can kiss what's left of their worker support goodbye. Not because the workers will have had a change of political heart. There simply won't be that many workers!

Well, there isn't as much work to be done, so why are we forcing ourselves to do "make work"...

[Jerry J. Fortin]

Are you folks serious? There are tens of thousands of Canadians who are not working. We just handed out billions of dollars to an industry that literally put thousands of those citizens out of work over the last decade. Then we see comments related to the technological advancements that have already put many out of work, and in the same breath we complain we are losing jobs to Asia. Its well past the time to start building more infrastructure and repairing the existing infrastructure, our cities are falling apart as fast as our hiways. It is well past time to invest in high tech industries, they have already moved out of the nation seeking cheaper labour.

Folks it is time to consider where this is all going. We will be reduced to a primary resource society, with few jobs. Is that what you folks want?

[Michael Hardner]

Folks it is time to consider where this is all going. We will be reduced to a primary resource society, with few jobs. Is that what you folks want?

I think we voted on that question in 1988 and voted 'yes'.

[Jerry J. Fortin]

I think we voted on that question in 1988 and voted 'yes'.

I was against the free trade agreement if that is what you are talking about. Bad plan in my view.

[Wild Bill]

Are you folks serious? There are tens of thousands of Canadians who are not working. We just handed out billions of dollars to an industry that literally put thousands of those citizens out of work over the last decade. Then we see comments related to the technological advancements that have already put many out of work, and in the same breath we complain we are losing jobs to Asia. Its well past the time to start building more infrastructure and repairing the existing infrastructure, our cities are falling apart as fast as our hiways. It is well past time to invest in high tech industries, they have already moved out of the nation seeking cheaper labour.

Folks it is time to consider where this is all going. We will be reduced to a primary resource society, with few jobs. Is that what you folks want?

Quite right, Jerry! Resource based business is important but the problem is, it's always those countries that are strong in manufacturing that are the richest!

A resource based economy is really the definition of a third world country. That's because such countries don't have the money to establish a strong manufacturing base so they try to earn foreign income by selling what resources they have. The problem is that every other third world country is trying to do the same so they all slit their own throats reducing their pricing to try to be more competitive!

Look how rich Japan became, with essentially ZERO domestic natural resources! They're economy is essentially ALL manufacturing and while they've taken some hard knocks the past few years their living standard is still higher than ours!

Meanwhile, we all fool ourselves by claiming that somehow we're smarter and will stay rich by doing the R&D, as if a handful of engineers dreaming up new products represents as many jobs as dozens of manufacturing plants employing hundreds if not thousands. For that matter, we should stop being so arrogant and wake up! China, India and ESPECIALLY Russia have a huge, well-educated engineering workforce! They don't NEED our R&D engineers!

I'm starting to get rather frightened. All I keep hearing is the sound of academics trumpeting that our key to prosperity is to start making windmills that the Germans and Norwegians have perfected and have been exporting for at least a decade now! I guess we're just so smart that we will push these industry incumbents aside, while they will do nothing to react to attack us as a competitor in their marketplace!

Actually, just the sound of ANY academics is enough to scare me! If we still have any hands-on experienced people in positions of power we never seem to hear about them anymore.

[Michael Hardner]

Quite right, Jerry! Resource based business is important but the problem is, it's always those countries that are strong in manufacturing that are the richest!

Ok, I'm mostly just reading what you say here, as you seem to have good knowledge about industry - so I'm just trying to learn.

However, what you just wrote is wrong. Rich countries can be rich from lots of things. Hong Kong is rich, and Singapore and I think that's mostly from banking no ? Switzerland ?

A resource based economy is really the definition of a third world country. That's because such countries don't have the money to establish a strong manufacturing base so they try to earn foreign income by selling what resources they have. The problem is that every other third world country is trying to do the same so they all slit their own throats reducing their pricing to try to be more competitive!

This is what they taught us in high school, when we were building our manufacturing base up. But, again, I don't think this holds true in a post-industrial economy. The US, for example, is not getting weaker by offshoring its manufacturing.

Look how rich Japan became, with essentially ZERO domestic natural resources! They're economy is essentially ALL manufacturing and while they've taken some hard knocks the past few years their living standard is still higher than ours!

Cite ?

Meanwhile, we all fool ourselves by claiming that somehow we're smarter and will stay rich by doing the R&D, as if a handful of engineers dreaming up new products represents as many jobs as dozens of manufacturing plants employing hundreds if not thousands. For that matter, we should stop being so arrogant and wake up! China, India and ESPECIALLY Russia have a huge, well-educated engineering workforce! They don't NEED our R&D engineers!

But if we develop new products and technology, they will need those won't they ?

I'm starting to get rather frightened. All I keep hearing is the sound of academics trumpeting that our key to prosperity is to start making windmills that the Germans and Norwegians have perfected and have been exporting for at least a decade now! I guess we're just so smart that we will push these industry incumbents aside, while they will do nothing to react to attack us as a competitor in their marketplace!

Actually, just the sound of ANY academics is enough to scare me! If we still have any hands-on experienced people in positions of power we never seem to hear about them anymore.

I concur with you that it doesn't stand to reason that we would *manufacture* green technology here, but we can still develop the products and do the research.

[eyeball]

Resource based business is important but the problem is, it's always those countries that are strong in manufacturing that are the richest!

Michael asked for an example of a 'value added consumer good' that we produce.

Here's my example, dogfish!

Every boatload my crew and I produce creates a full days work for about 70 - 80 labourers and there is probably another full days work for IT specialists (electronic monitoring) & data collection etc and I wouldn't be surprised if there is at least another days worth of work generated for a government employee or two. Then there are the stores that provide us with supplies and services. These are all Canadians jobs.

The meat goes to Europe, the fins and cartilage are sent to Asia and I suspect what's left is used for liquid fertilizer for grow-ops.

That seems like a pretty good amount of industry for just one small boat's contribution out of a fleet of about 15. Kinda makes you wish we'd taken better care of our fish stocks earlier doesn't it?

Meanwhile, we all fool ourselves by claiming that somehow we're smarter and will stay rich by doing the R&D, as if a handful of engineers dreaming up new products represents as many jobs as dozens of manufacturing plants employing hundreds if not thousands. For that matter, we should stop being so arrogant and wake up! China, India and ESPECIALLY Russia have a huge, well-educated engineering workforce! They don't NEED our R&D engineers!

No, what foreign manufacturers need are our unprocessed resources.

I'm starting to get rather frightened. All I keep hearing is the sound of academics trumpeting that our key to prosperity is to start making windmills that the Germans and Norwegians have perfected and have been exporting for at least a decade now! I guess we're just so smart that we will push these industry incumbents aside, while they will do nothing to react to attack us as a competitor in their marketplace!

Actually, just the sound of ANY academics is enough to scare me! If we still have any hands-on experienced people in positions of power we never seem to hear about them anymore.

The world is running out of many resources that we still have and we're running out of many jobs that the world is doing. It seems we're the one's in the driver's seat. Whatever the academics are trumpeting it's being trumped by the economists who argue against us making rules that say our natural resources can only be exported after adding value to them.

[Michael Hardner]

Michael asked for an example of a 'value added consumer good' that we produce.

Here's my example, dogfish!

That's a commodity - nothing added.

Whatever the academics are trumpeting it's being trumped by the economists who argue against us making rules that say our natural resources can only be exported after adding value to them.

Here's the simple (ridiculous for the purposes of analogy) version:

Let's say Canada puts an orange tariff up against Florida to help Canadian orange farmers. Florida retaliates and puts a maple syrup tariff up against Canada to help protect Floridian syrup producers.

After these actions, Canadians can buy one of the 2,000 oranges produced in Canada for $10 each. That industry provides work for the Canadian farmer that produces them (in a greenhouse), and Floridians can buy maple-flavoured syrup extracted from palm trees that tastes bad at $20 a bottle, and employs the Floridian palm syrup provider. Canadian and Floridian jobs are thus protected.

Now, if there was no tariff, Canadians could buy oranges for 30 cents each, and they would be employed in greater numbers in the maple syrup industry exporting to Florida. The 'competitive advantage' of each region permits a better, cheaper product to be produced.

[fellowtraveller]

You'll have to forgive the Alberta separatists. They don't really understand what Canada, the Constitution or representative democracy are about.

That is quite true.

We have gotten increasingly confused by watching the actions of Quebec, the Maritimes, Ontario(hello from Copenagen!) and most curious of all: the federal government and their love of side deals with provinces.

We are not a country of equal citizens, we are a weak federation of regions.

[eyeball]

The 'competitive advantage' of each region permits a better, cheaper product to be produced.

What you're talking about makes sense for plentiful resources. I guess my perspective is coloured by the fact that the commodity I produce is becoming rarer, which I might add could be likely also be true about oil.

So what about tariffs based on human rights? I think this is an option that needs to be explored further where the lack of them in competitor countries may be contributing to the hollowing out of our economy. Sub-standard human rights must constitute some sort of tangible subsidy to foreign producers and manufacturers that abuse them.

The link between respect for environmental values and human rights is I think, the principle on which these tariffs should be based. You cannot have the former without the latter.

[fellowtraveller]

A resource based economy is really the definition of a third world country

Hardly, since the resources themselves imply that there is or will be an economy.

No, the real third world couintries have little or no resources, physical or human...... Countries like Somalia, Yemen, Chad and most of the Sahel in Africa, Afghanistan, and others are the truly poor because they have very little arable land, very little physical resources, and an untrained and illiterate workforce. You could send every citizen to Oxford for an advanced degree, and when they went home there would still be no jobs at all. There are no answers in the conventional sense for these places. Even their neighbours cannot be bothered to invade, nothing worth stealing really.

I don't put Canada in that class or anywhere near it.

[Michael Hardner]

So what about tariffs based on human rights? I think this is an option that needs to be explored further where the lack of them in competitor countries may be contributing to the hollowing out of our economy. Sub-standard human rights must constitute some sort of tangible subsidy to foreign producers and manufacturers that abuse them.

Human Rights aren't an off/on thing. Some places have rights, others have RIGHTS.

I think we need to not trade with countries that have terrible human rights records, and help the people in marginal countries by trading with them.

The link between respect for environmental values and human rights is I think, the principle on which these tariffs should be based. You cannot have the former without the latter.

I think one could quantify environmental costs and assess tariffs based on those, as others have suggested. I can only guess that this hasn't been done because resolving trade matters is so complicated that adding environmental assessment to the mix would make it impossibly so.

[Wild Bill]

However, what you just wrote is wrong. Rich countries can be rich from lots of things. Hong Kong is rich, and Singapore and I think that's mostly from banking no ? Switzerland ?

This is what they taught us in high school, when we were building our manufacturing base up. But, again, I don't think this holds true in a post-industrial economy. The US, for example, is not getting weaker by offshoring its manufacturing.

I concur with you that it doesn't stand to reason that we would *manufacture* green technology here, but we can still develop the products and do the research.

Hong Kong and Singapore have been manufacturing the lion's share of electronic parts like semiconductors, resistors and capacitors for some decades now. I'm not sure if China has surpassed them yet. They are strong in banking because they have so much money from local manufacturing!

As for the US not getting weaker, I suppose it depends on your yardstick. Are you including unemployment? Also, shouldn't we wait a bit and see if their unemployment seems permanently high, along with a drop in living standard?

As for a cite about Japan and living standards, I was rather surprised when I googled for one. I used to look this up all the time and never had a problem finding a number of sites with plainly labeled lists by country. It's been a year or two and this time it's like nobody wants to make a definite statement! Especially Wiki! Everyone has all these cautions about how you have to include quality of life and how that's dependent on subjective judgements and on and on and on...

Here's one anyhow that expresses Gross Domestic Product per Capita, or how much money the average citizen of that country makes per year! We can nitpik about cost of living and such but those differences tend to be rather small when you compare them. So I would submit that this list at least gives a qualitive expression of how well a country's people are living.

http://www.nationmaster.com/graph/eco_gro_nat_inc_percap-gross-national-income-per-capita

Japan is number 3 and Canada is number 18, which is pretty well unchanged from what I recall the past few years. Back in the late 60's and early 70's we were MUCH higher, ranking 6th or 7th if memory serves. China is 108 at the moment! It would be interesting to find its ranking from 10 years ago and follow it for the next 10.

Yes, we can develop new products and technology but as I said, that only provides jobs for a few R&D people. If we send the manufacturing offshore it will put a lot of profit in the hands of the corporations but it will do little or nothing for the citizenry in general. How do we afford to buy those new products when we are lucky to have a low paying service sector McJob?

Lastly, you had also asked in another post about just how significant is the cost of keeping StatsCan happy with all their forms. I have a farmer friend with a greenhouse business. They have a total staff of 6 people. His wife does the accounting and she tells me she spends about 1 day each week just on filling those forms out. Not just for StatsCan. Apparently there are many levels of government making these demands, both provincial and federal. However, just as there is only one tax payer it all represents a total of labour hours for a business. I have friends who have worked in the local steel company's human resources department and they claim these things keep at least 5 people working full time. That's a total of 5 yearly salaries that has nothing to do with the profit picture of the company. It's just buried in the cost of their steel Multiply that sort of thing by the number of businesses in Canada.

[Wild Bill]

Human Rights aren't an off/on thing. Some places have rights, others have RIGHTS.

I think we need to not trade with countries that have terrible human rights records, and help the people in marginal countries by trading with them.

I'm surprised to see you post this, Michael. This was Harper's stance on China, for exactly those reasons. He has faced severe criticism for thinking this way.

[Michael Hardner]

Hong Kong and Singapore have been manufacturing the lion's share of electronic parts like semiconductors, resistors and capacitors for some decades now. I'm not sure if China has surpassed them yet. They are strong in banking because they have so much money from local manufacturing!

As for the US not getting weaker, I suppose it depends on your yardstick. Are you including unemployment? Also, shouldn't we wait a bit and see if their unemployment seems permanently high, along with a drop in living standard?

...

Here's one anyhow that expresses Gross Domestic Product per Capita, or how much money the average citizen of that country makes per year! We can nitpik about cost of living and such but those differences tend to be rather small when you compare them. So I would submit that this list at least gives a qualitive expression of how well a country's people are living.

http://www.nationmaster.com/graph/eco_gro_nat_inc_percap-gross-national-income-per-capita

Japan is number 3 and Canada is number 18, which is pretty well unchanged from what I recall the past few years. Back in the late 60's and early 70's we were MUCH higher, ranking 6th or 7th if memory serves. China is 108 at the moment! It would be interesting to find its ranking from 10 years ago and follow it for the next 10.

I think we should talk about GNP.

People talk about China as though all good produced by China are produced by Chinese companies. I have asked this elsewhere and my question didn't get a reply:

Is Microsoft China part of China or the US ?

I believe if you use GNP, then it counts MS China as American.

Yes, we can develop new products and technology but as I said, that only provides jobs for a few R&D people. If we send the manufacturing offshore it will put a lot of profit in the hands of the corporations but it will do little or nothing for the citizenry in general. How do we afford to buy those new products when we are lucky to have a low paying service sector McJob?

Not just R&D people, but the owners of the technology and the people employed by those firms.

The people who used to work in manufacturing will have to work in something else. The aforementioned companies and their workers will have more money from producing higher-end goods, and from generally cheaper goods from freer trade.

McJobs ? Let's see: videogame developer, massage therapist, home renovation workers, interior designers. These are some of the jobs of the new economy. They are in some respects better than factory jobs, but they may not all pay as much as a factory job.

Lastly, you had also asked in another post about just how significant is the cost of keeping StatsCan happy with all their forms. I have a farmer friend with a greenhouse business. They have a total staff of 6 people. His wife does the accounting and she tells me she spends about 1 day each week just on filling those forms out. Not just for StatsCan. Apparently there are many levels of government making these demands, both provincial and federal. However, just as there is only one tax payer it all represents a total of labour hours for a business. I have friends who have worked in the local steel company's human resources department and they claim these things keep at least 5 people working full time. That's a total of 5 yearly salaries that has nothing to do with the profit picture of the company. It's just buried in the cost of their steel Multiply that sort of thing by the number of businesses in Canada.

These sound like activities which are meant to get government subsidies though, or satisfy regulatory requirements specific to the industry. Stats Canada generates business statistics and employs staff to gather data too.

I think we need some very specific examples to talk about.

[Michael Hardner]

I'm surprised to see you post this, Michael. This was Harper's stance on China, for exactly those reasons. He has faced severe criticism for thinking this way.

From Whom ? From the Liberals who do the exact same thing ? From NDP who will likely never hold federal power ?

Of course they criticize because that's their job. Luckily, we here at MLW don't believe everything we read.

[Smallc]

We are not a country of equal citizens, we are a weak federation of regions.

All citizens are equal. That's the whole point of all the programs. Equal opportunities and equal outcomes.

[nicky10013]

I'm surprised to see you post this, Michael. This was Harper's stance on China, for exactly those reasons. He has faced severe criticism for thinking this way.

Peoeple criticize because it's a stupid, emotional, reactionary policy. We trade with authoritarian states because the money from the goods they produce and sell to us can't possibly ALL go to the authorities. The more money the people make, the less they have to worry about the every day struggles of putting food on the table and the more they can worry about their political rights. It also opens up their economies. Look at China. They're still authoritarian but China is struggling desperately to clamp down on the internet which is nothing more than a free exchange of thought which is the arch enemy of the Chinese "communist" party. They opened up because it helped people get rich but now we're starting to see the offshoots of making people rich. Look at Tibet in 2008. There are 70,000 protests for democracy a year. 30 years ago the Chinese were starving. Remarkable, no?

Trade creates money and money creates democracy.

To prove my point in a counterintuitive way: Cuba, North Korea. The US hasn't traded with Cuba since the Cuban missile crisis. The DPRK is sanctioned almost to death yet the party is in firm control there. THe thought that people will rise up because their situation is bad is a good one despite it being false. We naturally think that if things get bad for us, we rise up and throw the bastards out. The people in the DPRK can't rise up because they're too poor to begin with. They've got bigger fish to fry. Like not starving to death.

Though I could've sworn it was 3,000-5,000 dollars GDP apparently it's 5,000-10,000 dollars GDP. Either way, it's a window of GDP per capita in dollars which accurately depicts the transition period between authoritarianism and democracy. Democracies can exist below 5,000 dollars GDP per capita but without exception there are no authoritarian states above the GDP ceiling.

Not trading with these countries make ourselves feel better but only allow to shut out more open and liberal voices from having an effect in those countries. Most people in the DPRK don't know man has walked on the moon and you'd better believe that they don't want people to find out.

Edited January 12, 2010 by nicky10013