Most readers would agree the crash in oil prices cannot be blamed on any particular government – it’s just the reality of a merciless marketplace. Any negative repercussions are an accepted hazard of being in the energy business. Only the foolish would dream that oil booms continue forever. Those that remember the crash of the 1980s would know that this downturn can go on for years. Typically, whenever an economic crash occurs there are demands that governments come to the rescue. Politicians make the usual promises, knowing full well that any efforts will be dubious at best. Regardless of the actual impact – political hay can be made no matter the dire circumstances. But it depends on the economic activity as to what approach the government will take. If it involves the manufacturing industry in Ontario and Quebec – the federal government will invest billions directly into companies like General Motors and Bombardier. The point is to directly save the jobs that are being lost through an economic downturn or the failures of the companies affected. But it’s different for Alberta when the energy industry faces economic devastation – unlike with manufacturing – government assistance seems to be directed away from the industry most affected.
One can’t help but notice the obvious – whenever the federal government talks of helping Alberta deal with the collapse in the energy economy, it offers not to directly help save the affected jobs like it does with manufacturing in central Canada, but instead offers money to build infrastructure. No one looks a gift horse in the mouth, but it assumes that jobs lost in the energy business can be easily replaced with new jobs in infrastructure building. That is probably cold comfort to the thousands of newly unemployed geologists, engineers, technicians and trades people who are now expected to find employment building roads, bridges and community centres. Sure some construction jobs are interchangeable but I expect most are not. Why is there this double standard – well it all boils down to political correctness – as usual.
It would seem few governments (except Alberta and Saskatchewan) want to be seen contributing economic assistance to those evil oil companies. One notes the excruciating reluctance of the present federal Liberal government to even morally commit to constructing new national pipelines – surely one of the most significant of infrastructure projects that would employ thousands in the energy sector. But the clearest indication of reluctance to support the energy industry directly involves a recent suggestion by Premier Wall of Saskatchewan. He noted that one of the most negatively affected sectors is the oil production servicing businesses, most of them located in rural and small towns across the prairies. He further noted that there are thousands of abandoned orphan wells that need to be reclaimed and that government infrastructure grant money should be directed to those efforts to provide much needed employment in the energy sector. It seemed a win-win suggestion, being it would provide jobs in hard hit small towns, and it was good for the environment. Curiously the response has either been muted, or opposed to the idea being the money would go directly to – heaven forbid – oil industry related companies. The outcry was that the rich and mighty energy industry needs to pay for the clean-up of these orphan wells. The energy industry agrees with cleaning up their own wells. What they don’t agree with is that existing responsible companies should pay for wells abandoned many years ago by other now bankrupt companies. Nor should they, although they do contribute to an orphan well fund to carry out some of the work – however there is never enough money in the fund to carry out significant reclamation. It would therefore seem reasonable to add some of the infrastructure grant money to the fund to increase reclamation projects and jobs for an industry that is in dire straits. Insisting that the industry should pay for all orphan well reclamation may be good politics from an ideological perspective, but that will not increase actual projects like an injection of millions of government infrastructure dollars.
The underlying factor with this issue is that infrastructure funding for orphan well reclamation would be good for rural Alberta and Saskatchewan. That’s where the impact of the energy industry collapse is felt most significantly – many times that industry is the main employer in small towns. One hopes that governments would consider the rest of the story – even if it involves giving money directly to energy related companies.