Saturday, September 27, 2008

Values added

Both Jack Layton and Stephen Harper made promises this week which on their face involve restricting the export of raw materials to encourage value-added jobs in Canada: Layton's dealing with the export of raw logs, and Harper's with raw bitumen. But on a closer look, there are important differences between the two which speak volumes about the respective visions the two leaders have for Canada.

First, there's the issue of sustainability. Layton's plan is one which seeks to develop opportunities related to a renewable resource - meaning that the jobs created by encouraging processing in Canada are ones with the potential to last indefinitely, and serve as the basis for communities which are able to sustain themselves in the longer term.

In contrast, Harper's plan is tied to an industry which plainly has a best-before date: not only are oil reserves themselves finite, but the current global push toward alternative energy has the potential to drive demand through the floor even before the reserves run out. Which means that any production which might be diverted to Canada would also be a temporary benefit at best.

But then, one has to ask what industries can actually handle a boost in near-term employment - which leads to the second key difference between the plans. Layton's move would encourage increased investment in value-added work in sectors which have a glut of workers in need of opportunities. In contrast, Harper's is directed at an industry whose problem is already a lack of workers to do the jobs possible based on current capital investment - a problem which would only be exacerbated by a push to require processing in Canada.

And that's particularly important in light of the third key difference. The manufacturing and processing jobs encouraged under Layton's plan would be spread across a wide swath of the country - including B.C. in particular, but also areas in northern Ontario, Quebec and anywhere else that there's a substantial forestry presence. As a result, Layton's plan would help to diversify Canada's economy based on geography as well as industry.

In contrast, it would seem virtually inevitable that any additional construction of bitumen-processing facilities would take place near the source. Which would work out extremely well for Harper's base, but not so well for the rest of the country which is already suffering from government policies which have boosted the oil patch at the expense of the rest of Canada's economy.

In sum, the contrast nicely encapsulates the respective economic values put forward by Layton and Harper. Voters will face a choice between New Democrats who favour an economy rooted in a broad base of sustainable jobs and responsible resource management, or Conservatives who want to keep increasing Canada's dependence on quick-fix oil-sands exploitation even if it means holding off on economic development which could possibly be maintained in the long term. And particularly in an election whose ballot question figures to be which leader is best equipped to manage Canada's economy through troubled times, it shouldn't be difficult for Canadians to decide they want the former.

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