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What Is Kaputall?

Oxford defines Kaput as "broken and useless; no longer working or effective" - similar to our unbalanced economic system. This is a page dedicated to the intersection of capitalism and social, political, and environmental problems.

Friday, 12 July 2013

Québec and the Tar Sands

Recently a train derailed in the small village of Lac Mégantic in the Eastern Townships of Québec, devastating for the local community. The details are astonishing and I'd encourage you to have a look at as many sources as possible. While it has brought to the fore some rather predictable responses, the tragedy rests precariously on some important political and economic fault lines.

Blame is currently going around, with various groups pointing to different actors and criticising their actions. Aid relief from the federal government has allegedly been slow; the provincial government has been accused of using this event as a political firestarter; firefighters, engineers, and supervisors are the subject of investigation, the role of the rail company is being scrutinised, and the regulatory systems that govern rail transportation are under attack.

Seemingly, these are all important pieces of the puzzle, and will ultimately determine the trigger for the crash as well as its larger causes. However, there seems to be minimal attention to the reason why an event like this is even taking place, and it is rather unsurprising taken in the context of larger Canadian political and economic issues.

The oil sector in Canada is a major cause of the problem. The transportation of oil by rail has increased 280 times in the past five years. While the Tar Sands are seen as a vast fountain of wealth for Canada, they are useless on their own. Oil extracted from the Tar Sands needs to be properly processed, and it is for precisely this reason that the governments of Alberta and Canada have worked so tirelessly to establish new pipeline deals. Crude oil would then be sent either to China (via the Northern Gateway Pipeline) or to the United States (via the Keystone XL Pipeline) in order to be processed.

However, there has been an incredible outpouring of support for groups that oppose these projects, namely because they oppose the Tar Sands. Where in years past people demanded that the Tar Sands be closed, the rallying cries now are that pipeline projects be stopped in their tracks. They have become significant public relations controversies given the high risks and costs, though all the while production has steadily increased in the Tar Sands. An increasing amount of oil has been sent by rail to processing plants in New Brunswick. In order to get there, oil is sent through prime agricultural land and densely populated regions of central and eastern Canada. Places like Lac Mégantic.

The Tar Sands have a massive effect on the Canadian economy, leading various governments to make decisions about fiscal issues such as taxes and services. Domestic policy in Canada is quite strikingly predicated on the Tar Sands. Decisions about whether or not scientists should be able to criticise the oil industry or whether corporations are to be held accountable and transparent are part of the grip that the Tar Sands has on Canadian society. Now rail transportation can be added to the equation.

What's perhaps most interesting is the fact that the Tar Sands were a significant part of the NDP's attack on the government after Mulcair was selected as the new leader. Mulcair argued that Canada, by virtue of having invested so heavily in the Tar Sands, had forsaken the rest of the Canadian economy. This rationale picked up serious momentum until it was pointed out that Quebec, which is the base for the NDP's support, was reliant on transfer payments from the Tar Sands.

The cries of Dutch Disease fell silent, but sadly the money that is pumped into governments across Canada from dirty oil have started people to ask a new question. Is it worth it? While financially Canada may seem to need the oil sands, the idea of externalised costs is striking. Concerns about who will pay for the rebuilding of the levelled village, how victims will be compensated, how the oil will be cleaned up, and what happens to the drinking water are now the dominant concerns of people who, for the first times in their lives, have been meaningfully affected by the Tar Sands.

It's a long distance from the advertisements that the Canadian Association of Petroleum Producers have created, espousing the wondrous economic and social benefit of the Tar Sands for Québec. Presumably time will tell and people will hopefully not vote with their wallets on this pressing question for the future of Canada.

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