The reaction to a new breakthrough in energy generation through fusion was swift and jubilant. After decades of research around the world, a fusion reaction was finally achieved that created more energy than had been expended into it. This is indeed a milestone and in time may be an energy gamechanger..Activists and pundits are already using this new development to call for the end of petrochemical development. They see the light at the end of the tunnel and want to shut down those nasty oil and gas companies once and for all..Alas, they didn’t read the fine print in the stories about the fusion breakthrough..To begin with, the power generated was about enough to power a single lightbulb for a short period of time. Secondly, even the most optimistic of researchers admit it will likely be decades at the least before we see fusion used commonly as an energy generation source..Climate activists remain undeterred once the cold wash or reality is poured over them. They simply shifted the goalposts and demanded we start diversifying our economies to prepare for what surely will be the end of demand for oil and gas soon. The problem is, they tend to feel the best way to diversify the economy is through the punishment and eventual shutdown of oil and gas production. They feel if conventional energy can be made expensive enough, we will be forced to embrace new industries and energy sources. They are utterly misguided and blinded by their own ideology..The goal of economic diversity is a fine one. In Western provinces where we ride waves of economic feasts and famines due to variable world energy prices, it doesn’t hurt to have other industries to rely upon. The energy sector makes up about 22% of Alberta’s economy and 16% of Saskatchewan’s. The West isn’t quite as dependent up on conventional energy resource revenue as some would imply. All the same, broadening the economic mix won’t hurt..The problem with the way progressives want to diversify the economy is that they think government intervention is the way to do it..Take Calgary and its much-vaunted Calgary Economic Development (CED) corporation. CED was gifted in 2018 with a $100 million slush fund from the City of Calgary which had been soaking existing businesses with massive tax hikes. CED was tasked with seeking out and trying to draw in new and diverse enterprises through gifting new arrivals with subsidies from the fund. While millions have been spent, it has been a terrible failure. Calgary’s downtown sits with a 30% vacancy rate while businesses are setting up shop outside of the city’s limits at a record rate. Why move to a city that punishes its existing businesses and gives the money to competitors?.People pushing for government induced economic diversification provincially want to use the same strategy as the city of Calgary. They want to heavily tax energy companies and pour those funds into new enterprises. This concept is hardly new. The Getty government blew billions of tax dollars investing in dogs such as magnesium plant that was only open for weeks to a cell phone manufacturing company that soon went broke. Governments can never pick winners effectively..If the goal is economic diversification, what we need is for government to get out of the way. We need a massive reduction in regulations and red tape, and we should be cutting corporate business taxes to the bone. We should be signaling that Alberta is open for business and that profit is encouraged..The path to such a program runs through the oil and gas sector. Not through adding taxes upon it though. We should be fast-tracking energy projects and increasing our production and exports of hydrocarbon products. Royalties garnered through energy production and taxes collected from people employed in the sector can allow for the reduction of corporate tax rates..Turning Alberta into a tax haven for enterprises will draw more new investors than any number of cute tax funded advertising programs could. Businesses locating for a low tax environment rather than for direct subsidies are far less likely to fail as well..If we want to reduce our dependency upon oil and gas, we need to expand our production of it. We are gifted with great resources, and it gives us the opportunity to create a prosperous environment for all sorts of business enterprises..If we continue to listen to progressives on the issue and treat energy producers as pariahs to be punished with the intent of phasing them out, we can look forward to a short run of energy revenue while investment steers clear of us.
The reaction to a new breakthrough in energy generation through fusion was swift and jubilant. After decades of research around the world, a fusion reaction was finally achieved that created more energy than had been expended into it. This is indeed a milestone and in time may be an energy gamechanger..Activists and pundits are already using this new development to call for the end of petrochemical development. They see the light at the end of the tunnel and want to shut down those nasty oil and gas companies once and for all..Alas, they didn’t read the fine print in the stories about the fusion breakthrough..To begin with, the power generated was about enough to power a single lightbulb for a short period of time. Secondly, even the most optimistic of researchers admit it will likely be decades at the least before we see fusion used commonly as an energy generation source..Climate activists remain undeterred once the cold wash or reality is poured over them. They simply shifted the goalposts and demanded we start diversifying our economies to prepare for what surely will be the end of demand for oil and gas soon. The problem is, they tend to feel the best way to diversify the economy is through the punishment and eventual shutdown of oil and gas production. They feel if conventional energy can be made expensive enough, we will be forced to embrace new industries and energy sources. They are utterly misguided and blinded by their own ideology..The goal of economic diversity is a fine one. In Western provinces where we ride waves of economic feasts and famines due to variable world energy prices, it doesn’t hurt to have other industries to rely upon. The energy sector makes up about 22% of Alberta’s economy and 16% of Saskatchewan’s. The West isn’t quite as dependent up on conventional energy resource revenue as some would imply. All the same, broadening the economic mix won’t hurt..The problem with the way progressives want to diversify the economy is that they think government intervention is the way to do it..Take Calgary and its much-vaunted Calgary Economic Development (CED) corporation. CED was gifted in 2018 with a $100 million slush fund from the City of Calgary which had been soaking existing businesses with massive tax hikes. CED was tasked with seeking out and trying to draw in new and diverse enterprises through gifting new arrivals with subsidies from the fund. While millions have been spent, it has been a terrible failure. Calgary’s downtown sits with a 30% vacancy rate while businesses are setting up shop outside of the city’s limits at a record rate. Why move to a city that punishes its existing businesses and gives the money to competitors?.People pushing for government induced economic diversification provincially want to use the same strategy as the city of Calgary. They want to heavily tax energy companies and pour those funds into new enterprises. This concept is hardly new. The Getty government blew billions of tax dollars investing in dogs such as magnesium plant that was only open for weeks to a cell phone manufacturing company that soon went broke. Governments can never pick winners effectively..If the goal is economic diversification, what we need is for government to get out of the way. We need a massive reduction in regulations and red tape, and we should be cutting corporate business taxes to the bone. We should be signaling that Alberta is open for business and that profit is encouraged..The path to such a program runs through the oil and gas sector. Not through adding taxes upon it though. We should be fast-tracking energy projects and increasing our production and exports of hydrocarbon products. Royalties garnered through energy production and taxes collected from people employed in the sector can allow for the reduction of corporate tax rates..Turning Alberta into a tax haven for enterprises will draw more new investors than any number of cute tax funded advertising programs could. Businesses locating for a low tax environment rather than for direct subsidies are far less likely to fail as well..If we want to reduce our dependency upon oil and gas, we need to expand our production of it. We are gifted with great resources, and it gives us the opportunity to create a prosperous environment for all sorts of business enterprises..If we continue to listen to progressives on the issue and treat energy producers as pariahs to be punished with the intent of phasing them out, we can look forward to a short run of energy revenue while investment steers clear of us.
