Star Aerospace shifts HO to AB from ON

[mirror]

Star Serospace has announced that it is moving its HO from Mississauga to Edmonton. Is this the beginning of the end of Ontario's dominance of Canada's business community? When the bombs started going off in Quebec a lot of the business HO left, leaving Montreal to become a branch plant. Is the same thing now going to happen now between Ontario and the West? I mean think about it. If you were a business where would you locate your head office in Canada?

Spar Aerospace leaving Mississauga

[kimmy]

Yay! It is always exciting to hear of big operations moving to our humble city! Especially as we often lose out to Calgary when it comes to head offices.

Will Alberta ever overtake Ontario as Canada's dominant province? Not in our lifetimes... not while Ontario has such a large advantage in population. However, I think that success breeds more success. Calgary has already achieved the "critical mass" needed to be an important city for business and commerce. Edmonton is a ways behind, but might get there too. Once upon a time companies looking to do business in Canada would naturally locate their head office in either Toronto or Montreal. Clearly there are other players on the field now.

-kimmy

[FTA Lawyer]

Will Alberta ever overtake Ontario as Canada's dominant province?  Not in our lifetimes... not while Ontario has such a large advantage in population.

<{POST_SNAPBACK}>

I have to disagree...my vote was "YES - in 10 years". You cannot underestimate how incredible the "Alberta Advantage" will be after 10 years of building from a debt-free base. Also, the cost of oil doesn't seem to have any chance of dropping, so Alberta will consistently have billions of "extra" cash laying around to continue improving the quality of life of its residents.

Ontario will continue to lose head offices to Alberta (be it EDM or CGY) due to the favourable corporate environment. When the moves see some 85% of the employees coming like recently with the Imperial Oil move, Ontario loses critical tax base and loses more ground in the efforts to get its books balanced.

I'll see you back here in 2015 and we'll find out who's right!

[Riverwind]

I have to disagree...my vote was "YES - in 10 years".  You cannot underestimate how incredible the "Alberta Advantage" will be after 10 years of building from a debt-free base.

Population and proximty to markets has always been a more important factor than taxation. As the price of oil goes up Alberta's landlocked location that is far from everywhere will be a significant impediement to growth in industries outside the oil sector. Companies may have the HQ in in Alberta but that does not mean the jobs are there. I believe Delaware has the highest number of head offices per capita than any other state because of its tax rules but most of the actual jobs are outside the state.

[Guest eureka]

Calgary and Edmonton are both already overgrown and bloated. It may cost Alberta as much to import water in the future as it now makes from oil. Alberta is heading for a great fall in many ways.

The excess of money in the province will also bring inflation and business costs that cannot be competitive with other provinces. The number and significance of Head Offices there is exaggerated. Most that matter (outside of the energy sector) have been there since the late 1970's. They established their presence to escape the political and language problems of Montreal. It gained many not because of any Alberta advantage, but because of the instability of Montreal.

Beyond that, Sparhawk is right. There will never be markets important enough near Alberta for great things. Ontario has those in spades. Neither will Alberta ever have the climatic conditions to make it a preferred home for most.

[kimmy]

Calgary and Edmonton are both already overgrown and bloated.

Not by contrast with Canada's other largest cities. Edmonton and Calgary will be tolerable places to live long after residents of Vancouver, Toronto, and Montreal have to wear gas-masks and oxygen-tanks to leave their homes.

It may cost Alberta as much to import water in the future as it now makes from oil. Alberta is heading for a great fall in many ways.

There will never be markets important enough near Alberta for great things.

If one defines "great things" as automobile manufacturing, then I suppose not.

-k

[kimmy]

I wonder if leaving Central Canada will adversely impact Spar's ability to get government contracts?

-k

[Redneck Yokel]

  You cannot underestimate how incredible the "Alberta Advantage" will be after 10 years of building from a debt-free base.  Also, the cost of oil doesn't seem to have any chance of dropping, so Alberta will consistently have billions of "extra" cash laying around to continue improving the quality of life of its residents.

At least until we get another Trudeau and he introduces a second NEP. You can always trust the liberals to exploit Alberta in every manner they can think up.

[rbacon]

Within 7 months the majority of Alberta's crude will flow directly to Corpus Christi Texas via pipelines over the Alberta/Montana border. That will alleviate a lot of pressure on the water supply. And by the way we do have a lot of water here in Alberta. If Ottawa impliments any kind of a carbon or green tax against Alberta, it is very simple, we will withdraw from the Confederation, that is always an option for us. When Alberta already has one of the lowest tax policies in N. America provincial level of taxation is only 10% flat tax and no sales tax. We could further reduce that by dumping the communist bloodsuckers of TROC. Without that monkey on our backs we would be at 0% Income Tax, no property tax on personal, a tax free zone, and a secret banking haven such as Switzerland.

[Riverwind]

Within 7 months the majority of Alberta's crude will flow directly to Corpus Christi Texas via pipelines over the Alberta/Montana border. That will alleviate a lot of pressure on the water supply. And by the way we do have a lot of water here in Alberta. If Ottawa impliments any kind of a carbon or green tax against Alberta, it is very simple, we will withdraw from the Confederation, that is always an option for us. When Alberta already has one of the lowest tax policies in N. America provincial level of taxation is only 10% flat tax and no sales tax. We could further reduce that by dumping the communist bloodsuckers of TROC. Without that monkey on our backs we would be at 0% Income Tax, no property tax on personal, a tax free zone, and a secret banking haven such as Switzerland.

An independent Alberta may have oil but its land locked location will leave it at the mercy of its neighbors. It would risk becoming the Kazakhstan of North America. The isolated location will make it difficult for Alberta to develop its non-resource sector as people would choose places with more pleasant climate and/or more opportunities to network (due to a larger population) like Toronto or New York or Silcon Valley.

Climate is also a big reason why Alberta would never be able to compete as a tax haven with places like the Bahamas.

[rbacon]

Not at all Sparpidgeon, the Sovereign Province of Alberta already has major road and rail and air links directly to the good old USA. And within 7 months the major pipeline directly to Texas will be fully functional. In exchange for our vast oil supplies belonging to all taxpaying Albertan's our good US neighbors and relatives will give us quick access to seaports as we need them. God Bless the USA. We are by no means landlocked, but TROC will be cut off from the Left coast if we go Independent. You would have to get Albertan's to agree to let your rail and road links to BC to continue, you just might not be able to ship anymore Communist Wheat Board grain thru Alberta. Careful what you ask for, don't try and punch above your weight.

[Riverwind]

God Bless the USA. We are by no means landlocked, but TROC will be cut off from the Left coast if we go Independent. You would have to get Albertans to agree to let your rail and road links to BC to continue, you just might not be able to ship anymore Communist Wheat Board grain Thur Alberta. Careful what you ask for, don't try and punch above your weight.

It is extremely unlikely an independent Alberta would have its current borders. In the event of any break up natives groups will likely insist on their right to be sovereign as well. It is possible that the Alberta government will be able to bribe them into joining Alberta but at what price is anybody's guess.

The US wants Alberta for one thing and one thing only: oil and gas. From the perspective of Washington, Alberta _would_ be just another Kazakhstan that happens to be close and democratic but just as easy to push around because Alberta oil is only meets a small percentage of the needs of the US.

An independent Alberta would have a tough time developing technology, financial services or manufacturing sectors because of its small population, isolation and bad weather. Without those sectors the long term prospects for an independent Alberta would be grim indeed.

That said, Alberta's oil would likely be enough to become the 51th state - but that would defeat the purpose: leave a fairly decentrialised federation only to join a much more centralized one.

[Riverwind]

Not at all Sparpidgeon, the Sovereign Province of Alberta already has major road and rail and air links directly to the good old USA. And within 7 months the major pipeline directly to Texas will be fully functional.

Out of curiosity: why is it good to ship Alberta oil all the way to Texas? Alberta is only a little further than Texas from the major gasoline markets in the US - Alberta could have tried setting up its own refineries but decided to become a low cost commodity supplier instead of moving up the value chain. Just more evidence that your confidence in the 'strength' of the Alberta economy may be a bit misplaced.

Another factor to consider: liquid crude gives governments who control the resource huge windfalls since the cost of production is a fraction of the market value. This is not true for most other commodities like gold or iron. Tar sands oil is much more expensive to produce and the cost of producing tar sands oil will go up as the price of natural gas goes up. This is not bad for the companies involved since they can still make a profit, however, the Alberta government will not be able to generate much as much revenue from tar sands oil which would severly undermine your grand plans for an independent Alberta rolling in oil money.

A final note: North American natural gas supplies are running out. There are serious people looking at importing natural gas supplies by ship from Russia. It is quite possible that the cost of natural gas could rise faster that oil and, as a result, tar sands oil could become uneconomic even with oil at $100/barrel.

In short, Alberta has been supported by the rest of country in the past. Alberta is fortunate today but those good times will not last forever. If they do come to and end then Alberta would be able to count on the rest of country for help. This is the benefit of being part of federation with a diverse economy.

[rbacon]

Sparpidgeon those Natives that truly would like Freedom and Liberty will love and embrace the New Alberta, those that like handouts will quickly head for Sask. etc for you to support. Everything that Alberta has was developed and brought to fruition by Albertan's inspite of TROC. We used American money and our sweat and brains to create Alberta. We owe TROC nothing. We have paid in full in the Billions. TROC has demonstrate drepeatetly that they will brook not even modest concessions to Albertan's on Freedom and Liberty, very well then continue on as a slave and we will seek our own destiny. Do not concern yourself with our fate, rather concern yourself with who you will bilk next, if you are from Ontario set aside more of your budget to offset what you used to take for granted to maintain your Liberal Canadian Values, such as bi-lingualism etc. Maybe consider getting yourself another partime job, to achieve your goals. We will carryon to achieve our goals.

[Riverwind]

Sparpidgeon those Natives that truly would like Freedom and Liberty will love and embrace the New Alberta, those that like handouts will quickly head for Sask. etc for you to support.

It seems like whenever someone (right or left) realizes they are losing an argument the resort to a retort which is basically: 'I am morally superior to you so i can ignore whatever you say'.

Do not concern yourself with our fate, rather concern yourself with who you will bilk next, if you are from Ontario set aside more of your budget to offset what you used to take for granted to maintain your Liberal Canadian Values, such as bi-lingualism etc. Maybe consider getting yourself another partime job, to achieve your goals. We will carry on to achieve our goals.

When I see that my neighbor is about to shoot himself in the foot I make an effort to warn him - especially, if the ricochet has a chance of hitting me. Most importantly I find the 'if i don't get what i want i take my marbles and go home' attitude extremely unhelpful. All countries have problems with he system of government. Canada is not unique. Breaking the world apart into 1000 of tiny enclaves that are small enough to collect like minded people together is not the answer. Seemingly endless talking is the answer because eventually we will find a compromise that will work for a few generations and then we will need to do it again.

To answer your original point about Central Canada ignoring Alberta's desires for constitutional reform: a big part of the problem is Alberta's refusal to recognize that compromise is necessary and that Canada is not a simple union of 10 equal provinces. It is a much more complex country and our constitution must reflect that.

[Yaro]

Just out of curiosity Rbacon do you know how much equilization payments are in the US?

Oh and shipping through US ports costs about twice as much as shipping through BC ports.

Theres also the fact that the land on which the Trans Canada runs as well as the land on which the railways run is fedrally owned land. If anyone is punch WAY above there weight its Alberta whos economy (dispite there oil) is still expected to grow less then BC's.

Theres a difference between a growth economy (BC and Alberta) and a maintanince economy (Ontario & Quebec) I suspect that there are alot of people out west that will be learning some incredibly difficult lessons in the not to distant future.

[mirror]

rbacon

Cut the crap

Calgary last time I checked had the most popular French immersion program in the country. I think we all need to focus on our Canadian values together. With our abundant natural resouces we should be able to generate great knowledge based industires.

Canada needs a national program that we can all get behind like "The Avro Arrow"

Diefenbaker announces Avro Arrow cancellation

[kimmy]

An independent Alberta may have oil but its land locked location will leave it at the mercy of its neighbors. It would risk becoming the Kazakhstan of North America. The isolated location will make it difficult for Alberta to develop its non-resource sector as people would choose places with more pleasant climate and/or more opportunities to network (due to a larger population) like Toronto or New York or Silcon Valley.

Climate is also a big reason why Alberta would never be able to compete as a tax haven with places like the Bahamas.

If, heaven forbid, Canada were broken up, Alberta would seek (and receive) trade agreements with its neighbors. Our resources are a big stick that will break down that door with ease.

Access to shipping through BC would likewise be worked out. Alberta needs to send its stuff through BC, but the rest of Canada needs to send its stuff to and from BC through Alberta. These things would be worked out-- whatever acrimony there was after separation would be put aside eventually as the need to get on with business would necessitate these issues be resolved. The real obstacle to separation isn't transportation, it is the legal and constitutional process, which would be virtually impassable.

-k

[Guest eureka]

Actually, Kimmy, transportation is a huge obstacle to separation. The costs of transportation are enormous in Canada and growing rapidly with the cost of oil. Alberta's very richness in that is also a sword of Damocles to its dreams The dreams of the idiot sector, I should say) of separation. As oil increases in price, so does the possibility of Alberta's development of secondary industry decrease. The Tar Sands, too, may not be the vast resource that it was held to be for the reasons that Sparhawk gives.

One other benefit Alberta currently gets from Federation is the subsidy of its oil industry in transportation to markets and a myriad other ways. That has been estimated by some economists to be in the region of $1.5 billion per year over recent years.I think those Albertans who have such grandiose ideas about nationhood or annexation by the US would be well advised to get the tar out of their sluggish brains and face the real world. That world is one where their good fortune is temporary and their need for Canada will be as great as any other province in the not too distant future.

And, becoming the 51st. state of the US would bring them down to earth in a hurry. As Sparhawk implies, that would greatly reduce the abilities of Albertans to determine their own future. Alberta's government would be reduced to being a secondary level instead of a partner sovereign in many areas of jurisdiction.

The idea of independent nationhood is just too silly for words. A tiny landlocked nation could not survive as a first world nation without the charity of the surrounding nation. Or would Alberta really like to be equal to Botswana?

[Riverwind]

Access to shipping through BC would likewise be worked out. Alberta needs to send its stuff through BC, but the rest of Canada needs to send its stuff to and from BC through Alberta. These things would be worked out-- whatever acrimony there was after separation would be put aside eventually as the need to get on with business would necessitate these issues be resolved.  The real obstacle to separation isn't transportation, it is the legal and constitutional process, which would be virtually impassable.

You misunderstand my point. The issue is not whether Canada or the US would blockade Alberta (which they probably wouldn't unless Alberta did some really stupid things) but how the distance and transportation costs make it difficult to set up any sort of value add industry in Alberta.

[kimmy]

You misunderstand my point. The issue is not whether Canada or the US would blockade Alberta (which they probably wouldn't unless Alberta did some really stupid things) but how the distance and transportation costs make it difficult to set up any sort of value add industry in Alberta.

This is outmoded thinking. For heavy manufacturing of mass-market goods (ie, the auto industry) transportation costs are a major consideration (though I would point out that the Japanese and Koreans seem to have succeeded in our markets despite that.)

Transportation costs are a far less important consideration in technology. Pause to consider how Ottawa (the city, not the federal government) came to have a major presence in the telecommunications industry. My dad worked for one of the major players in Ottawa, so I know a bit about how things worked. The engineers and programmers might have been stationed in Ottawa, but the designs were sent with a few mouse-clicks to manufacturing operations in Asia. There was no actual transportation of any physical product between Ottawa and the end markets.

Consider that two of the world's biggest telecomm companies (Nokia and Eriksen) are located in Scandinavia (Finland and Sweden, respectively) ...countries that are miniature in population and geographically far from their major markets.

And for increasingly important industries, transportation isn't a factor *at all*. One might not think of computers when one thinks of Edmonton, but you should. Microsoft and Dell now employ thousands here, having located major support centers here-- the requirements are skilled workers, low overhead costs, and reliable telecommunications infrastructure... transportation costs do not enter into it. If you've bought Neverwinter Nights, or Star Wars: Knights of the Old Republic (two of the most successful computer games in recent history) you've bought an Edmonton-made product. The actual box you're holding in your hand might never have been in Edmonton, but the software was designed a short bike-ride from where I am sitting right now.

I could go on, but I think you can see where I am heading. Alberta can (and is) developing value-added industries. The concept that transportation of heavy products to large markets is the major factor in production costs has become outdated. There are many components to production costs, of which transportation is just one... and a decreasingly relevant one in many industries.

-k

[Riverwind]

And for increasingly important industries, transportation isn't a factor *at all*. One might not think of computers when one thinks of Edmonton, but you should. Microsoft and Dell now employ thousands here, having located major support centers here-- the requirements are skilled workers, low overhead costs, and reliable telecommunications infrastructure... transportation costs do not enter into it.

Lower transportation costs cut both ways because it also means more competition. Dell and Microsoft are moving many support centers to low cost countries like the Philippines or India. Moving support jobs overseas is one of the touchy issues in the Telus strike going on now.

If you've bought Neverwinter Nights, or Star Wars: Knights of the Old Republic (two of the most successful computer games in recent history) you've bought an Edmonton-made product. The actual box you're holding in your hand might never have been in Edmonton, but the software was designed a short bike-ride from where I am sitting right now.

There is a difference between having a few successful start ups and having the critical mass of investors and technology people that are necessary for a sustained industry. That is why Silcon Valley is still the location of choice for many companies even though the labour costs and taxes are high. Vancouver, Toronto and Ottawa are the only cities in Canada that have that critical mass for technology companies today. Calgary and Montreal are trying to catch up but with places like Banglore and Beijing eager for their piece of the pie it will be difficult for a new comer to make in roads - not impossible - just difficult.

Ultimately, my argument is not that Alberta is doomed to fail if it seperates- I just want to point out that it guaranteed to be successful either. Seperation is a costly and utilmately pointless exercise that would just allow the global competitors to Canada to take advantage of the uncertainty that would likely last a generation. If someone has a problem with the way the country is organized then speak up and be prepared to compromise. However, if that person's only 'answer' is to break up the federation then that person then that person better be prepared for equally unreasonable and intrasigent attitudes from the people they plan to negotiate with.

[Guest eureka]

And we can all happily communicate with one another for ever and ever. The reality of the world is that manufacturingand agriculture are still what makes it go around. It will always be that way. The "post-modern" society is a failing society unless it retains a manufacturing base.

[kimmy]

Lower transportation costs cut both ways because it also means more competition. Dell and Microsoft are moving many support centers to low cost countries like the Philippines or India. Moving support jobs overseas is one of the touchy issues in the Telus strike going on now.

Microsoft has discovered that their Indian support centers yield abyssmal customer satisfaction results, and is reversing this trend. I'm sure Dell and others in the industry have discovered the same.

There is a difference between having a few successful start ups and having the critical mass of investors and technology people that are necessary for a sustained industry. That is why Silcon Valley is still the location of choice for many companies even though the labour costs and taxes are high. Vancouver, Toronto and Ottawa are the only cities in Canada that have that critical mass for technology companies today. Calgary and Montreal are trying to catch up but with places like Banglore and Beijing eager for their piece of the pie it will be difficult for a new comer to make in roads - not impossible - just difficult.

But you notice we went from discussing the geographic unsuitability of Alberta to "value added" industries, to discussing critical mass. Critical mass comes from having enough skilled people and favorable economic conditions. There are a *lot* of smaller technology companies in Edmonton, there are a lot of programmers and engineers working here. Right now these people are concentrated on providing services to the natural resources sector, but the pool of programmers and engineers already exists here and will grow, and will be tapped to create things beyond oilfield communications equipment and instrumentation and sensors. The workforce is already here, and what that workforce is doing will continue to evolve.

Some people here seem to be of the opinion that Edmonton and Calgary will simply evaporate when the oil is gone, and Albertans will become dirt farmers or go back to Newfoundland. I don't view this as very likely.

-k

[kimmy]

And we can all happily communicate with one another for ever and ever. The reality of the world is that manufacturingand agriculture are still what makes it go around. It will always be that way. The "post-modern" society is a failing society unless it retains a manufacturing base.

The automobile industry as we currently know it will collapse long before we run out of oil. Parts of Canada dependent on it have bigger things to worry about than how Alberta will survive in the distant future.

-k