Federal NDP leader Thomas Mulcair talked his way into inevitable criticism of the oil sands this past weekend. Speaking on CBC Radio’s The House, Mr. Mulcair suggested that the development of the oil sands is contributing to a strong Canadian dollar, and thus hurting the industrial manufacturing sector in other provinces (also known as “Dutch Disease“).
The comments earned harsh criticism from Saskatchewan Premier Brad Wall.
Calgary economist Jack Mintz pointed out that the manufacturing industry malaise in Central Canada and the Mid-West United States has less to do with the western provinces and is almost entirely a result of an automotive industry that failed to compete with its international competitors.
The natural resource wealth in Alberta and Saskatchewan and the shift of political power westward may redefine Canadian politics in the next decade. The industrial base in the oil sands is driving the national economy and poses a great challenge to the traditional economic dominance of Ontario and Quebec, where the NDP found the majority of its political support in the May 2011 federal election.
Speaking from his experience as a provincial cabinet minister in Quebec, I must believe that Mr. Mulcair has a better grasp of economic issues than even most of our federal politicians. Realistically, it probably would not have mattered what Mr. Mulcair said about the oil sands. Had Mr. Mulcair said he liked the oil sands, his Conservative critics would have decried him for not declaring his love for the oil sands.
Mr. Mulcair’s NDP faces a number of political challenges in preparation for the 2015 election, including expanding its support between the British Columbia and Ontario boundaries, where the party elected only three Members of Parliament in the last federal election. For the past twenty-years, the Reform Party, the Canadian Alliance, and now the Conservative Party of Canada led by Prime Minister Stephen Harper have held an electoral monopoly over the region.
The federal NDP base of support in Western Canada, which sent strong contingents of New Democrats to Ottawa in the 1970s, 1980s, and 1990s, was weakened due to changing electoral boundaries and evaporated after finding itself on the unpopular side of wedge issues successfully leveraged by Conservative parties in rural areas. In 2011, as the Orange Wave swept Quebec and formed Official Opposition in Ottawa for the first time, the NDP placed a distant second in the West.
While his provincial counterparts in Alberta and Saskatchewan have been relegated to the political margins, the electoral success of the provincial NDP in Manitoba, which has formed moderate centrist governments since the late 1990’s could provide a template for electoral growth in the West.
15 replies on “can thomas muclair’s ndp win in western canada?”
Not in this province.
Thanks for the comment, Tom. If you mean Alberta, than I generally agree with you. The NDP have demonstrated growth in Edmonton in the last three elections, but I have a difficult time believing that it would expand beyond a few urban constituencies in 2015.
The clown always looks like he was sniffing something he shouldn’t have sniffed. The chance of this doodad winning in Alberta is as remote as Stephane Dion in an iron man competition.
Those who fail to learn from the mistakes of the past are destined to repeat them, isn’t that what they say? I don’t see the problem with calling a spade a spade and looking for a solution to an obvious problem other than that’s not the type of thinking we’re used to from most politicians in this province. Some also say the truth hurts and based on reactions to this story on twitter I have to believe Mulcair is speaking a lot of truth lately.
Did he say we need to immediately shut down oilsands production? Did he advocate for no further development and putting Albertans out of work? Has he stated anything other than he supports responsible, sustainable growth of this resource in a way that benefits the entire country? He’s not creating a wedge issue, he’s acting responsibly as a federal leader.
I do think that the NDP can win more seats in the West. However, the West is not a monotonous entity. Thomas Mulcair and his NDP may improve in urban areas, but not in suburban spots. The party may improve in small cities and non-agricultural rural areas. The NDP may gain seats in much of BC, Edmonton in Alberta, and in Manitoba (Winnipeg and north). Saskatchewan may depend on how the new ridng boundaries are delineated. If the riding are half urban/half rural like now, then the NDP may have trouble. If there are different urban and rural seats, then the NDP may win in Saskatoon and Regina.
I don’t remember any Albertans complaining that ‘dutch diesease’ caused by too much money being made by building cars was depressing the Canadian price for oil in the 1990s.
Manufacturing in Canada hasn’t declined any more than it has in the USA. If to be more competitive manufacturers need lower wages, they should seek to pay lower wages, not pine for all Canadians to be paid less, so that manufacturers lower wages don’t change their position in society.
Nothing is stopping a union from negoatiating a contract with wages pegged to a certain exchange rate. If they want a lower cost for their labour,the unions can impose one without the intervention of the state in many ways.
I actaully listened to Thomas Mulcair twice on Sunday (first in the morning and then on the evening broadcast) to see if I could follow his logic.
Yes, strong resource sales, primarily from Western Canada, have put upward pressure on the Canadian dollar. But the dollar goes up when Canadians sell more than we import. If the manufacturing sector was to surge again, there would also ultimately be upward pressure on the dollar.
Mulcair in his interview did talk about “value added” processing and manufacturing so we are not exporting so much raw material. That is a good argument. But that would also put even more upward pressure on the Canadian dollar and hurt Eastern Canadian manufacturerers, unless Mr. Mulcair is talking about Westerners shipping raw materials to Eastern Canada for the latter to do the processing and manufacturing for us.
That was the economic model of the 60’s and 70’s that led to so much political discontent in the West.
It’s not a case of a strong Canadian dollar so much as it is a weak American dollar and for Mulcair to fail to understand that reflects poorly on him, regardless of his political background.
And I don’t think westerners object to shipping the oil east to have it processed. As long as those refineries are paying the same rate as any other refinery then I don’t get the sense that we care where it’s processed. It’s when there is a suggestion that a, Eastern Canadian refinery should not have to pay world prices that the hackles start to rise.
I don’t think this is about the logic of his economic argument, or interest in appealing to western-sensibilities, but rather more likely about the politics of putting the Conservatives on the defensive in areas where their support is more likely to fluctuate.
Most in Ontario won’t care to understand the benefits to their province of oil development/revenue, so appealing on an emotional level to the plight of the eastern-Canadian manufacturing sector is easy, especially when there’s a bad-guy to blame. Harper’s west.
Ontario economy stinks? – blame Harper and the West. I suspect we’ll hear a lot of that in “Battleground: Ontario” over the next few years.
Consider the electoral math: Conservative-NDP seat breakdown in Ontario is currently 73-21. Mulcair only needs to convince 35 of those Conservative Ontario ridings that he’s something other than a lunatic, to become the next PM (all else being equal).
[…] the Liberals Win in Western Canada? Posted at 1:45 on May 8, 2012 by Volkov Daveberta did a summary piece over on his blog about whether or not the New Democrats led by Thomas Mulcair can win back the power it once held in […]
I think this is just the start of a dialogue to refine oil in the east- say Sarnia? Already pipelines are ntslking about west to east flow.
The manufacturing that does occur in the east is often in sport of the oil industry. It is easier to blame someone else than to look in the mirror.
Manufacturing in Canada is not competitive due to labor costs! Reduce those, and maybe Ontario could surprise itself.
And brefining in Ontario is good- less product entering the east coast from Saudi etc just have to compete for it like the rest of the market
The people denigrating the economics of Mulcair’s statements are missing some things, at best.
First, Darren, strong Canadian dollar / weak American dollar is a distinction without a difference for Canadian economic purposes. Most Canadian exports are to the US; the proportion is overwhelming.
Second, Michael Dawe, the dollar has gone up even though we do not sell more than we import. Canada of late years has seen our dollar increase, despite our balance of trade going negative where it used to be positive. The dollar is currently well over its appropriate value in purchasing power relative to the US dollar. This is because,
Third, Joe Edmonton, “Dutch Disease” is a problem specific to high-value resource export which is not the same as generalized issues of trade balances. Strong exports due to a strong manufacturing sector will tend to cause the dollar to rise if our trade surplus is high enough, but that’s a fundamentally different thing from “Dutch Disease” and a problem we wish we had.
Fourth, Joe Edmonton, Canadian manufacturing has shrunk over the years along with US manufacturing (less so until recently due partly to the advantage of medicare as compared to the high expense of private health insurance south of the border), but has taken a huge hit just lately, even since the “recovery” began, from the high Canadian dollar. A whole lot of jobs have been lost to the overvaluing of the Canadian dollar, particularly in comparison to the oil sector which doesn’t actually employ all that many people despite all the money it makes.
As to the wider question of whether the NDP can win in “the west”–well, first, we’re talking about “the prairies” really, because BC doesn’t have the oil and right now is likely to vote for anyone opposing the pipeline. Manitoba doesn’t have oil either and already votes NDP to a fair degree. So the question is about Alberta and Saskatchewan. Alberta? No. No way. Doesn’t matter what Mulcair says, winning in Alberta outside Edmonton isn’t on the table, so there’s no point him trying to curry favour with Albertans.
Saskatchewan is an open question, though. And there, it’s probably true that questioning oil revenue won’t help Mulcair. But there are other issues in Saskatchewan; oil isn’t as big either in reality or in the province’s consciousness as it is in Alberta. One big issue in Saskatchewan IMO is the wheat board and farming more generally, and the NDP could gain support in surprising parts of Saskatchewan if the Cons keep hosing farmers.
But frankly, Ontario is a bigger source of potential seats than Saskatchewan, and pointing out the Dutch Disease problem will play well in Ontario especially, also Quebec where there are seats to be guarded, and probably much of the Maritimes and BC. In BC we don’t manufacture that much but, specially in Vancouver, we wish we did; we want to be high tech like California, not a bunch of lumberjacks, so arguments for manufacturing and high tech will likely play well. Plus a lot of BCers find Alberta and their oil even more annoying than they find Toronto, so anything that cheeses Alberta off will likely play well, especially now that they’re ramming pipelines through our turf. It’s also true that fed-bashing is an old and popular sport throughout Canada, and now that the federal government is a bunch of wannabe-Albertans, fed-bashing means Alberta-bashing.
So, overall,
1. Mulcair’s position is actually fairly good economics.
2. It will gain him more politically than it will lose him, IMO, with the only significant downside in Saskatchewan. Alberta is irrelevant to any non-right-wing political party.
What’s so bad about a high Canadian dollar? If it would stay there, we would see a more equal trade and economy. A low dollar is not good.
Mr. Mulcair will never be prime minister if he attacks the western economies. We have enough problems without having our leaders attacking their own country.
We still don’t go to Disneyland anyway (by the way). Our Alberta province is so beautiful we don’t need a vacation.
Eastern Canada needs to get educated about Western Canada. So far, the west has saved the east’s bacon time and time again. Even people like Evan Solomon does not listen.
It’s unfortunate that so many people think that our currently unbalanced Alberta economy is a good thing and that an attack on its flimsiness is an attack on Alberta. Each recession brings back the old refrain: “Lord give us another boom; we promise not to piss it away the next time.” But we always do. When we think of lost manufacturing, we shouldn’t just look east: what about Celanese? Molson’s in Edmonton? GWG? Gainers and most of the rest of the meatpacking industry (outside Red Deer and Brooks)?
Mulcair’s views on the rate of oilsands development are similar to Peter Lougheed’s. But those views are now being painted as unAlbertan by those who opposed long-term planning of the energy sector, diversification of the economy, and at least a few thoughts spared for the environment.
Alvin Finkel makes a good point, it’s the pace of oilsands development, not the fact that we’re doing it in the first place, that’s the real issue. Corporations are pushing to develop this resource as quickly as possible (the Chinese are already on record as saying they won’t wait forever). The federal and provincial PCs know this and are doing everything they can to expedite the regulatory process, leaving many of us feeling very nervous about the process. I’m not saying that this unease will open the door for the NDP, but it’s an avenue they should seriously consider.