Reboot Alberta

Friday, April 17, 2009

Cap and Trade Sucks - Get Real Alberta and Start Taxing Carbon

There is lots of buzz about cap and trade as a scheme to reduce carbon emissions. I think it is merely wealth transfer and a petrie dish to grow a culture of more corporate corruption. To get some context read Stephen Murgatroyd's blog post on the subject.


This Edmonton Journal story on the Alberta perspective on carbon pricing is more context. And we are being told Canada has to rationalize with the US standards - and Obama is pushing cap and trade too.


The $2B Alberta investment in carbon capture and storage is pretty impressive. The Americans ponied up $1B for CCS and the Chinese are into it for $6B but look at the investment per capita and Alberta is definitely a leader in this effort. That is a longer term and capital intensive solution and will not solve the political issue of cap and trade versus carbon tax options.



This issue of how to respond to the CO2 emissions puts Alberta in the political, ecological and fiscal cross-hairs big time and on a world scale. We have dipped our provincial toes into the CO2 emissions issue with some legislation that is timid and tepid and hopefully temporary. We tax carbon now at $15 a tonne based on intensity targets. That is a start but the political credibility of this policy has lost its lustre long ago. As we grow the oil sands we allow emissions to grow in absolute terms and that is not a viable solution to the GHG issue for Alberta.


The experts say the real cost of CO2 is about $125 a tonne so we have long way to go to get realistic about paying the piper and not passing the problem on to future generations. Alberta Environment Minister Renner questioned on the Alberta price of carbon is quoted as saying: It probably would do better if it were higher." You bet Mr. Minister.


The perennial concern is what happens if Alberta pays a realistic price for carbon and others do not. Will our economy will suffer? That is known as the "Edge Effect" where everyone knows what is the right thing to do but can't agree on the right time to do it. I'm hoping Alberta takes the first serious step and taxes carbon as a carrot and a stick to get serious about encouraging new technologies and penalizing those who refuse to invest to reduce their carbon footprints.


A made-in-Alberta for Alberta carbon tax keeps the cash in Alberta. Transferring wealth out of Alberta with a cap and trade policy to pay who knows what for what kind of flaky schemes that alleged ecological advantages is stupid and breeds greed and corruption. Surely we have seen enough of that these days with the market meltdown. We are all enduring this recession/depression thanks to the under-regulated American financial system and the breathtaking personal greed and corporate corruption in that sector.


Albertans want the problem solved here - not just a fiscal surcharge penalty that somehow absolves us of the duty to adapt our economy to better serve the environment. The best way to do that is to park the ideological posturing about taxes and use taxes to change behaviour. We know that works and it is easier to monitor and evaluate effectiveness.


That way the money raised with such a tax stays in Alberta to foster investment in things like a state of the art mercantile upgrader so more bitumen gets processed here with jobs and value added benefits here too.


I think we Albertans need to get that comprehensive carbon tax happening now and stifle the efforts of those who are pushing a wealth transfer away from Alberta with their cap and trade ecological schemes and bad economic dreams.

It will not solve the Alberta emission challenges and only penalize our economy. Beat them to the punch and put in a realistic tax on Alberta carbon now Premier Stelmach.

Wednesday, April 15, 2009

When do Albertans Have a Right to Know About Environmental Law Investigations?

OK here is the problem. Which is more important, the public’s right to know or the preliminary process needs of the justice system? This kind of issue is well resolved when it comes to charges against minors. We have legislation that protects the identity of youth facing judicial proceedings. Unfortunately this law sometimes ends up protecting the identity adult bad guys from public disclosure because that might inadvertently disclose the identity of a minor so it too could be better.

We have a formal judicial process to ban publication of the names of those involved in judicial proceedings, not only accused but witnesses too. That decision is made in a formal court application before a judge who decides if a ban on publication of the identity of parties or individuals is in fact in the public interest - and not just the self-interests of the accused party.

So why in Alberta do we not hear of cases where about possible environmental law issue arise until investigations are complete and charges are actually laid? The competing values and the conflict between the various interests are very clear. The Crown Prosecutors rightfully want to gather all the available evidence, review and test it to see if it is sufficient to lay a charge before a charge is laid. If that evidentiary hurdle is overcome there is further consideration to decide if a charge is even in the public interest. Satisfaction of all this reviewing and evaluation may finally result in a charge and the public is then finally informed about the matter…but not until then.

That process and practice serves the interest of the judicial review process and the privacy of a potential accused but it does not serve the greater public interest and our right to know what is going on. The Alberta public owns the natural resources of the province. Our government, as our democratically elected agents/proxy, is legally delegated the duty to protect our environment and to ensure responsible exploitation the public’s natural resources in the service of the greater public good. Simple enough!

When an alleged breach of environmental law happens by actions of a company with a license operate and a duty to obey the law while profiting from our publicly owned natural resources, why shouldn’t the public know about any such allegations right away?

Governments talk accountability, transparency and openness with regularity but do they walk that talk with authenticity, integrity and alacrity? Not so much. This deficiency is not necessarily because government doesn’t want to be overt about such public notice. They have made a choice not to. They have decided the needs of the judicial process are the values that dominate and they dictate otherwise.

I think this is a misplaced virtue when it comes to investigations and pending charges for alleged breaches of environmental laws. The public interest and our right to know what is alleged, against who, the nature of the alleged breaches and extent of the possible damages is the public interest value set that should predominate in all such cases.

Immediate public disclosure ought to be the default position in all such cases. If a company wants a ban then let them go to court and prove to a Judge that concealment of the facts and the identity of the parties involved are in the public interest. Let the corporations and the individuals involved go to Court and get an Order for a ban on disclosure and publication.

What happens now is even the Minister of the Environment is uninformed and unaware of such allegations and investigations of potential breaches of our environmental law and therefore oblivious to the current consequential environmental damages. This is bad governing and bad public policy. Here is why.

When a charge is laid the Minister gets to rightly say he can’t comment publicly because the matter is before the courts. However if an investigation is on-going but no charge has yet been laid, than a Minister can’t use that sub judice tactic if asked about any such matter in Question Period, by the media or the public. In fact open, transparent, accountable governing principles would dictate that the Minister ought to obliged comment on such matters in an informed and comprehensive way.

So, as a consequence, to avoid the duty to comment, it seems the justice system and the government public relations systems seem to have decided not to tell the Minister anything about any such investigations. I am not prone to conspiracy theories and don't believe that is what is happening here. Keeping the Minister willfully blind and the rest of us uninformed and ignorant as a result is a long way from open, transparent and accountable governance. I don't think it is a conspiracy. I think it is cultural and the wrong governing philosophy.

There is another unfortunate consequence of not having early public disclosure of allegations and investigations of possible environmental law breaches. Many of the alleged breaches come from industry self-monitoring and reporting requirements. So the evidence they present, regardless of accuracy and timeliness, would naturally be under suspicion right away. The company and the government would both tend to be seen as not doing their jobs of protecting the environment when such incidences occur. There is no public benefit of the doubt for anyone involved in such situations.

What makes it worse is the Crown Prosecutors have to take the time necessary to carefully gather, evaluate and figure out how to prove the alleged case before they can appropriately lay any charge. The various incidences of breach are rarely simple and straight forward and if they are the evaluation of the resulting damages is always difficult to quantify. Preparing the case to see if a charge is warranted can take years to yield an appropriate answer and justify a charge. Such delay makes a suspicious public think industry and government are in cahoots and neither one is presumed to be serving the greater public interest.

Recent charges were laid resulting from an incident in the oil sands. It was about untreated human waste discharged into the Athabasca River that happened some three years ago. Even the Minister of Environment had no prior knowledge until the charge was laid and in fact he assumed the matter had been disclosed publicly at the time of the original incident. Much to his surprise that was not the case then nor would it be now. He has said this policy must change and the public’s right to know must be honoured immediately in such instances.

Under the current policy when such environmental breaches are finally made public the company and the government end up looking like they were conspiring to delay matters and hide the facts. This serves the best interests of nobody, including the government, the company, the minister, the public and ultimately the public's respect for the law.

This systemic indifference to the public interest came into sharp focus on the famous 500 dead ducks in the Syncrude tailings pond. That incident resonated around the world. Well this time we all knew about it before charges were laid because some anonymous tipster called the media. Thank you very much Anon.

The public got increasingly suspicious about the integrity of the evidentiary review process when it a year passed and yet no charges were laid. The public’s suspicions were so aroused that a private group eventually announced they were going to seek judicial leave to launch its own civil suit against Syncrude for damages about the 500 dead ducks.

Coincidentally, it would seem, the government finally laid its charges just before the private action finally got going. That kind of delayed timing adds to the public suspicions and cynicism. Then we get the icing on the dead duck disclosure cake. We find that the company and government officials knew, for some considerable time, that it was not 500 dead ducks at issue but over 1600 dead ducks that were lost in the tailing pond incident.

That unfortunate updated fact was only disclosed in a company affidavit that was filed in the courts and then caught by the media. The Minister did not find this out about the reality of 1600 ducks until he heard it on the news and read a press release by Syncrude. How does this process circus of delay and non-disclosure serve the better interests of anyone or any institution that is involved?

My solution is not perfect. There is some reputational risk to the corporations who are facing investigations in such circumstances. The public has a poorly developed understanding of the presumption of innocence. We all too often jump to a conclusion of guilt when charges are laid.
What is to prevent the public from assuming guilt at the preceding stage of mere allegation and investigation? Not much except perhaps a better educated public about the importance of the presumption of innocence and an appreciation of the checks and balances about investigations and evidence evaluation.

The judicial process eventually resolves all this one way or another by acting fairly and judiciously in service of the greater public interest. But that takes time and the unwarranted damage to reputations is done and may be irreparable. The finding of guilt will be well publicized, while the finding of innocence – not so much.

That said I think the consequences to public reputation, the need to meet certain corporate social responsibility standards and the duty of corporations to meet social license to operate obligations as the tenant on the public‘s lands and in service of the public interests is a corporate deterrent worth having. The court of public opinion can be more effective as a deterrent than the law and the justice system itself sometimes.

These corporations who are sold leases on public lands and entrusted to develop our natural resources in a responsible and sustainable way that they are all too often way out of line. They seem to think it is their oil and gas or their trees. If they provide jobs, pay taxes and our minimalist royalties and stumpage, they are meeting their obligations to the public interest. Stewardship of land, water, air, habitat and reclamation is always somebody else’s hassle and to be left for another day in the minds of the leadership in those kinds of irresponsible and arrogant corporations. NOT good enough! NOT any more!

Those modest corporate economic accountability measures of serving the public interest are the mere ante of corporations to play the 21st century resource exploitation game in Alberta. In the Alberta public’s mind, anyone who only sets merely meet the minimal ecological requirements and makes no effort to exceed the lowest allowed environmental and social standards are about to see some serious backlash from the public.

And for any government officials who choose judicial process convenience over duties of public disclosure you need to change your approaches and reassess your attitudes too. Ministers of the Crown in the Right of Alberta who may value willful blindness as a defense to avoid doing the right thing and fulfilling your sworn public duty, you are also in for some rude public awakenings too.

US Supreme Court Justice Louis Brandeis famously said “Sunlight is the best disinfectant.” That is especially true in Alberta today when it come to the public’s right to know and our need to know what our government and corporate tenants are doing with our ecological and natural resources birthright. Only with full and timely public disclosure will we see a change to a more accountable and open governing philosophy in this province.

We citizens also have an obligation to change our behaviours and adjust our attitudes. We must learn more about our legal system and especially about the place and importance of the presumption of innocence in that system. We have to respect it and to learn to be patient and not jump to negative conclusions at the mere mention of an investigation.

Democracy is messy and cumbersome. Freedoms only survive with usage and vigilance so citizens have to smarten up and show up too. Civic cynicism is a luxury we can no longer afford in Alberta. It is time for citizens to show up an put some skin in the governance game of their province.

Monday, April 13, 2009

Stelmach Gov't Pays for Police Checks for Voluntary Sector.

One of the little Alberta Budget 2009 gems that got lost in the deficit spending headlines was the province funding of $2.4 million for a three year project to compensate police services for criminal record checks for the not for profit and voluntary sector.

This is an idea that goes to the very beating heart of safe and vibrant communities. This is also an idea that has been long time coming and reflects the new focus on Premier Stelmach's personal commitment to community and values.

The need to ensure that people who volunteer time and talent to community service are not dangerous or inappropriate because of past criminal or other behaviours has been pushed by Volunteer Alberta for a number of years.

Cambridge Strategies was commissioned in 2006 by Volunteer Alberta to do a survey and analysis of "Volunteer Screening Initiative." We found that police checks were an expensive and difficult process for the not-for-profit voluntary sector to absorb and that no grants were available to pay for this protection of the public. I encourage you to read the study because it is a window into the plight of these volunteer dependent community service agencies.

The report we did, like so many in those days, fell on deaf ears as the PC government was going through a leadership transition so anything new and innovative was shelved. Well I have to say I was pleasantly surprised to see the Stelmach government step up to the plate on this concept. It will ensure that the community based not-for-profit, volunteer supported service agencies who work with our most vulnerable citizens, can do their jobs better, clients can be safer and communities can thrive from the good works of caring and committed citizen volunteers.

Congratulations to the Board and Staff of Volunteer Alberta for persevering and making this progressive policy change finally happen.

Saturday, April 11, 2009

Goldman Sachs Sues Blogger Who Takes Takes Them On

Here is an example of how powerful a blog can become and how the power has shifted to the individual with a public purpose from corporate interest with a private purpose.

When Goldman Sachs - a big Obama bailout recipient, considers a lowly blogger dangerous enough to issue a cease and desist letter, something has to be up. The claim against the blogger by Goldman Sachs' lawyers seem to be that his posts "violate several intellectual property rights" and "imply" he has "a relationship with the bank."

The blogger apparently has an explicit disclaimer on the site saying he is in no way associated nor sanctioned by Goldman Sachs. So there goes one claim. As for intellectual property of GS one can only imagine what they might be talking about. Could the intellectual property this blogger is abusing the intellectual honesty Goldman Sachs had shown through their involvement in AIG and the sub-prime fiasco?

I don't htink they are merely bullying this blogger. I htink they are genuinely afraid of what he may say that is informative and helpful to the public about what went on and how GS participated.

Goldman Sachs is another of many newly minted corporate welfare cases they are living and surviving on taxpayers hard earned money through bailout bucks. This is happening while American workers and investors have been sold out due to the self-interested decisions in such corporations and banks. A touch of humility is called for - not just continuing hubris.

I am rooting for the blogger and anyone else who wants to take on these Bastards of the Universe. The mess we are in today is due largely to the personal and corporate greed and the breathtaking indifference they showed to the common good. These are values they shared with the Bush White House. Together they have put the economies of the world in this mess.

Friday, April 10, 2009

Cambridge Strategies Commentary on Alberta Budget 2009

Here is a link to the Cambridge Strategies Inc. commentary on the 2009 Alberta Budget written by my business partner, Satya Das. I will be sharing my thoughts and doing some more specific issues based posts on the budget in the near future.

In the meantime here is a provocative take on where Alberta is and some ideas of what can be done with our fiscal strengths and challenges. One thing that we at CSI find disturbing is around the Royalty Regime. The new royalty policy that came into effect January 1, 2009 and that delay gave industry more than a year to adapt.

The only ones who seem to have really "adapted" are the provincial politicians. They are the one who have chipped away at the new Royalty Rates as the energy sector presses them behind closed doors. It now seems that the energy industry in Alberta is intent on making royalties the new NEP as see them as the major cause of all their woes.

There have been many expensive concessions made since then to encourage drilling activity and conventional energy plus commodity price sensitive royalty rates. The reality is everything in the new royalty regime that was to get a fair rent to Albertans for our energy resources has been given back to the industry. That is playing Albertans for chumps and taking away the providence of future generations as we will never again be able to collect proper rents for these non-renewable resources.

Satya talks about this and some other serious shortcomings in our pubic policy models in resources and other sectors of our economy.