- Erin points out that there's a relatively simple cure for Dutch disease - just as long as provincial governments are willing to put citizens ahead of resource extractors:
(S)ince resources are priced in American dollars, the higher exchange rate further reduces provincial resource revenues in Canadian dollars. Saskatchewan’s recent budget estimates that each U.S. cent of appreciation in the loonie reduces non-renewable resource revenue by $34 million.
The solution is to increase royalty rates, which would moderate the flow of foreign funds into our resource industries and collect the public revenue needed for the provincial savings funds that MacPherson advocates.
Of course, if Saskatchewan did so alone, it would have relatively little impact on the national exchange rate. That is why Mulcair’s comments were directed at the unbalanced development of Alberta’s oilsands – a larger-scale giveaway of public resources.
But Wall is defensive because he has mimicked and even undercut Alberta by guaranteeing ultra-low royalties to the private corporations that extract Saskatchewan’s non-renewable resources. This policy would be short-sighted even if it had no effect on the exchange rate. Dutch disease, including a proportionally larger loss of manufacturing jobs in Saskatchewan than in the rest of Canada, is just another negative consequence.
Mulcair has articulated a balanced approach to resource development that would generate more public revenue, a more competitive exchange rate, and more manufacturing jobs. Saskatchewan is well positioned to help implement and benefit from this approach by raising provincial resource royalties.
- Chris Selley suspects that the Cons will really be in trouble when Canadians start laughing at them - and suggests there's ample reason to do so. But that doesn't mean we shouldn't also work on building outrage where it's justified - such as where the Cons hand million-dollar giveaways to their cronies for projects which have been soundly rejected on their merits.
- Meanwhile, there are also serious issues in play as the Cons work on dismantling any semblance of environmental protection in the name of resource-sector profits. And Thomas Walkom highlights the citizen-driven opposition to the Gateway pipeline as one type of dissent the Cons may have trouble silencing.
- Fortunately, it may simply be enough for everybody who's under gag orders from the Cons to decline to comply. Which may make the Cons' partial climbdown on F-35s interesting in light of the news that the aerospace sector was ordered not to comment on the subject.