Saturday, February 18, 2012

They Thought They Were So Bloody Clever.

To know anything about the extreme peril Canada has been drawn into lately you need to roll back the tape to September, 2009. That was the beginning of a sort of experiment that certain cabinet ministers (who have since decamped to more lucrative sinecures) thought it would be amusing to run on the Investment Canada Act, by amendment and quiet regulation: Hey, let's see what happens if we try to turn Canada into one of those postmodernist dystopias where nothing is objective, everything is a social construction, and national security is whatever Dear Leader says.

Well, I hope you're pleased with yourselves now, because the Khomeinists' lifeline to nukes is now Canada's 'lifeline to economic prosperity' in China.

Experiment Result Number 1: A rapid succession of weirdly generous and way-above-market offers for key Alberta oilsands properties has now established a wholly unearned and privileged place in Canada's energy sector for the acquisitions arms of that vast military-industrial complex known as the Government of the People's Republic of China, I've already set it out the grisly details here.

Experiment Result Number 2: I set it out in my column in today's Ottawa Citizen (which has been picked up by today's National Post with an even better headline - 'Canada's Iran Sanctions Stop at the Alberta Oilpatch'): Prime Minister Stephen Harper is now inches away from fatally undermining Canada’s own sanctions against the Khomeinist regime in Tehran after throwing Alberta’s oilsands wide open to Beijing-owned corporations running multi-billion-dollar joint ventures in Iran’s energy sector. As in Petro-China, as in CNOOC, and mostly, as in the Enbridge pipeline financier and Syncrude veto-holder Sinopec.

Former Justice Minister Irwin Cotler weighs in, as does Israeili President Shimon Peres's guy in Canada Arie Raif, the slightly more Bibi-Netanyahu-friendly CIJA board headed by Shimon Fogel (who is a damn good man) and Sheryl Saperia of the Foundation for Defence of Democracies, who pointed me to the relevant bits in the law.

Now that Professor Einstein and Doctor Pavlov have moved on, it fell to Industry Minister Christian Paradis February 9 to misspeak, or misinform, or misguide the House of Commons. His Parliamentary Secretary, Edmonton MP Mike Lake, was left to try and pick up the pieces in the House this past Wednesday, which just made things worse. All set out here. Mr. Lake ended up looking like one of those Parliament Hill types who are always obsessively fiddling with their Blackberries. He left Minister Paradis looking like a fire chief who hadn't read the bit in his job description about seeing to it that people's houses don't burn down.

The upshot is this. In Alberta, where they used to scream about Ottawa nationalizing the oilpatch with that Maoist nightmare Petro-Canada, now it's Petro-China instead and it's Beijing that's doing the nationalizing. Bloody money corrupts everything it touches, and the container-loads of cash suddenly circulating in this country come from the same cold-eyed autocrats who were ordering live rounds to be fired into crowds of unarmed Tibetan monks while they were making kissy face with Prime Minister Harper, in China, only last week.

Canada's own version of Dear Leader now gets to decide what the words "national security" mean, what a threat to national security is, what the word "threat" means and whether national security is even involved in any of this at all. When it comes to protecting Canada's national interests in the matter of multi-billion-dollar takeover strategies run out of the politburo in Beijing, the Dear Leader with the foreign money portfolio in the current politburo configuration in Ottawa is Christian Paradis.

The Bill C-30 ruckus is a sideshow, as the wise Robert Fulford has effortlessly made plain. Comrade Minister Paradis is the guy who now gets to make stuff up as he goes along by the shiny seat of his own committee-going pants, unburdened of annoying legal “definitions,” or "objective criteria," or indeed any irritating obligations at all regarding "transparency." After all, in the words of the Investment Canada Act regulations that Cabinet does not want you to notice, that would “limit the government’s flexibility.”

And after all, who would want a “Criminal Code” with all its nuisance definitions encumbering the “flexibility” of Public Safety Minister Vic Toews or the RCMP? If the hoi-polloi insist on having foreign-power takeovers subjected to national security reviews conducted according to "concrete, objective and transparent criteria,” the next thing you know the proles will be demanding open courtrooms, fair trials, rules of evidence and habeas corpus.

And thus it came to pass that for starters, the Special Economic Measures Act (SEMA), the statute that is supposed to enforce Canada's sanctions against the nuke-wanting ayatollahs in Tehran, was end-run, up-ended, and rendered moot. It is why, when Foreign Minister John Baird can rightly claim that Canada's Iran sanctions under SEMA are the toughest in the world, Irwin Cotler is forced to observe: “But we are now in a situation where we are not even taking our own sanctions seriously.”

That's just where it starts. There will be more here soon.

Elswhere, I see Andrew Nikiforuk at The Tyee has put together a disturbing and quite thorough profile of the ghastly global juggernaut Sinopec that Prime Minister Harper has so foolishly drawn to his bosom: The Sinopec File. I was once a Tyee columnist, and while I rarely have cause to look in on what they're up to over there, when I do I look for Andy. Today, his stuff is tremendous.


Blogger Max Fernet said...

Terry, you are a bit too paranoid. There haven’t been that many deals with the Chinese, although the ones that have been made have received a disproportionate amount of media attention. The size of the Chinese deals haven’t been that large relative to non-Chinese deals; and (with the lone exception of the recent Athabasca Oil Sands deal—which will probably end up proving to be exceedingly expensive for the Chinese, the deals have been for minority non-controlling interests.

Hardly threatening stuff.

2:24 PM  
Blogger Terry Glavin said...

Paranoid? Max, you should grow up. If you can't handle the mere facts I've reported here and would rather imagine something sinister about my state of mind, then you're being paranoid.

You're quite right that there haven't been many all that many big-money Beijing deals ($20 billion all told?). They've all been very strategically and cautiously run. And that's not me talking - that's when Beijing's oil company acquisitions people say, on the record.

You are also right to notice what paltry sums these are in this particular context, but inways you would not want: 1. The PetroChina Athabasca deal you mention was for $1.9 billion retroactive. Not one new job opened up in Canada as a result. You are wrong to suggest the PetroChina deal was the biggest. 2.The Synchrude veto Sinopec bought for $4.65 billion didn't add a penny to Canada's public treasuries because it was a transaction between Sinopec in China and ConocoPhillips in the US. 2. That's $4.65 billion, and it didn't even make a statistical blip on Fort MacMurray's economic radar, let alone Canada's.

4:15 PM  
Blogger Max Fernet said...

Thanks for your reply. We obviously disagree. You selectively report "facts", and then put your ideological spin on them. You are not the only one holding sinister views about oil sands-related issues. For another example, just look at the claims made by the environmentalists. Everyone has a right to their opinion. You seem to have enough faithful followers to have some media pay you for articles. If your business model works, go for it. It works for Fox News. My personal preference is to hear all sides of a story, as is the case with most adult Canadians.

4:58 PM  
Blogger Terry Glavin said...

You do insist on telling my what my opinion is, don't you? And you insist on telling me you disagree with it. And now you're entertaining fantasies about what my "ideological" purposes are. And this after saying that I'm the one who's paranoid.

Check your own damn head. You'll quickly discover that you don't have the faintest idea what you're talking about.

11:05 PM  
Blogger Unknown said...

The Chinese need resources and have invested in the oil sands and in mining to encourage the development of these resources. China is a creditor nation, like Britain a century ago, or America a generation ago. Canada benefits from investment inflows.

6:48 PM  
Blogger Unknown said...


China is a creditor nation, like Britain a century ago, or America a generation ago. They consume about 40% of the world's commodities and want to secure sources from all around the world. Canada benefits by investments by the Chinese and others since there is insufficient capital (savings)from just our internal savings. The Chinese investments free up capital for redeployment elsewhere in the economy.

6:53 PM  
Blogger Terry Glavin said...

Say, Unknown: You wouldn't be one of those "50 centers" the embassy pays to post comments like this are you?

Three things:

1. See above. Chinese SOEs could buy up every bitumen lease in Alberta and it wouldn't add a single job in Fort MacMurray's economy.

2. As for Chinese investment "freeing up capital", didn't you also say we didn't have and that's why we need Chinese capital?

3. I can cite neoliberal gospel better than you and it still won't change a thing. Neoliberalism's great prophets dont even believe it any more. They baled in '08.

Actually, a 4th thing. Your comments have absolutely nothing to do with my concerns here. You might want to read a blog post first before you comment on it.



7:26 PM  
Blogger Unknown said...


No I am not one of the '50' getting paid to post comments. I am not paid for posting, but if you know someone willing to pay, let me know.

Yes, I suppose you are right about the Chinese investments not creating jobs. But on one is investing to create jobs in Canada. They are investing to a)earn a return; b) gain access to resources (supply).

We do not need Chinese capital specifically, we need capital generally. The Chinese/Japanese/Koreans etc. are creditor nations. Canada is a debtor nation.

The other point I think you are missing is what happens to the capital investment when the Chinese (or others) invest ? For example, a Chinese SOE invests $1B in the oil sands. That means that $1B is released to the seller for other purposes. So this would be beneficial to that company , right ?

I enjoy your blog a great deal. Keep up the good work.

6:49 PM  
Blogger Terry Glavin said...

Unknown: We may be beating dead horses here.

"The other point I think you are missing is what happens to the capital investment when the Chinese (or others) invest ? For example, a Chinese SOE invests $1B in the oil sands. That means that $1B is released to the seller for other purposes. So this would be beneficial to that company, right?"

Beneficial to "the company," sure, but not necessarily of any benefit to me or anyone I care about or any Canadian at all. ConocoPhillips got $4.65 billion from Sinopec for its Syncrude share. I didn't see a penny. The people of Canada did not see a penny of that. Do I expect to benefit from that sale somehow? Should any Canadian expect to? I haven't the faintest idea.

After a while, the theory just goes round and round. Here's the best way to attract a spectacular windfall of job-creating investment in a town, and make its GDP go through the roof at the same time: Burn half of it down.

Not reassuring.

8:27 PM  

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