Wednesday, February 29, 2012

McGuinty-Redford Dollar-Tar Sands Dance

Wouldn't a lower Canadian dollar encourage both foreign investment in Canada and investment and saving by Canadians in Canada where purchasing power would be stronger than in a foreign market? And wouldn't it also make Canadian export goods, no matter which province is their source, more attractive to foreign buyers since they would have greater purchasing power given our lower dollar vis-a-vis   the U.S. dollar, the de facto reserve and trade currency of the world? And, finally, wouldn't a lower dollar also speed up paying down the deficit because the lower currency would wipe out part of the debt automatically because of its lower value? 

We do indeed have a petrol dollar albeit driven by foreign demand for our tar sands oil and the Harper Regime's desire to sell to absolutely anyone regardless of their moral or political values.  That dollar is only going to get higher as the price of oil continues to rise because of the slow but inevitable process of depletion and the increasing costs of extraction as we move more and more away of necessity from conventional sources of oil.  We have indeed reached Peak Oil  in the sense not of reserves but of a maximum point before decline begins its inevitable process. 

And why, if we had a moral conscience, would we want to make that significant Canadian contribution to the destruction of the planet the centre of the Canadian economy? Redford's appeal to Ontario is embarrassing. It's understandable from a naked capitalist point of view, of course, a perspective in which profit trumps both the environment and morality - the basic modus operandi of  the Harper Regime, her partner in environmental crime - but does that make it right? Only if you're a neo-liberal bent on increasing the wealth of the investor class, oil executives, and banksters at the expense of the rest of us.

Note: Brent Oil crude, which determines the price of gasoline in Canada, has risen 30% since last October reaching a high price of more than US $125.00. WTI oil prices have also risen by 42% to US $110 a barrel. Something's got to give. 

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