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White-Collar Crime

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Issue: 39 Section: Opinion Geography: Canada Topics: Indigenous

September 8, 2006

White-Collar Crime

Alberta oil windfall, theft and genocide

by Stewart Steinhauer

Western Lakota drilling operation in Northern Alberta.
Last year the Alberta provincial government mailed out a $400 'prosperity cheque' to every tax-filing resident of Alberta. Currently, there is discussion about doing it again for the 2006 tax year. The prosperity cheques are funded by resource revenue earned by the Province on sales of natural gas and oil; in the past 18 years, Alberta has earned $78 billion in resource revenue.

This year, the modest official government forecast for resource revenue income is in the $7 billion range, but it could be as high as $19 billion. The Alberta Government has the lowest royalty rates in the world, including a 1 per cent royalty on oil from oil sands during operations startup. Even when oil was $19 a barrel, this was, in effect, a public subsidy of the wealthiest by the poorest, but, at $75 a barrel, it is simply theft. Nothing new, and everybody has become inured to this category of theft, but it is still theft, and theft is officially a crime. It is the main white-collar crime. White-collar crime is primarily about stealing money. Accounting procedures seem to work best.

ExxonMobil's Imperial Oil pumps upwards of 200,000 barrels of C4+ per day from their Cold Lake field to Hardisty, Alberta, where it joins with Enbridge's Line 3 and is piped to US refineries. Last year, Exxon posted all-time record profits of $39 billion; this year, each quarterly report sets a new all-time record. Every company operating in the Alberta oil patch is making record profits, including Western Lakota Energy Services (WLES), Saddle Lake Cree Nation's business partner.

Thanks to partnerships with Indian Bands, WLES has grown from a small rig manufacturer just starting out in 2002 with no assets, to the 2005 year-end in which it reported $234,893,000 in assets.

Just to refresh your memory, WLES owns 10 rigs in five separate 50/50 partnerships with Indian Bands, two rigs with my Band, Saddle Lake Cree Nation. Stripped down to its undies, the deal looks like this: We pay WLES what it costs them in cash to build a rig, of which they claim a 50 per cent share in ownership as their profits from building each rig, and then we pay them to operate these rigs. In other words, we are paying what it cost WLES to build the rigs with our 50 per cent ownership, while WLES's share is actually its profits from the sale of each rig.

Here are the statistics from WLES's 2005 year-end financial report: Rig construction earned $9,605,000 in revenue, and WLES's gross profits after net revenue recovery were $5,115000 - that's over 50 per cent. Contract drilling earned gross profits of $45,467,000 - that's nine times the gross profits from rig construction. In addition WLES earned $2,972,000 in management fees and $108,000 in interest from its "Aboriginal" partners.

While we are listing statistics, here's one from Health Canada's First Nations and Inuit Health Branch, Alberta region. In the 20 year period following Canada's official recognition via Section 35.1, Canada Constitution Act 1982, of "aboriginal treaty and inherent rights," 2,374 on-reserve "Aboriginal" people died as a result of injuries and poisoning. Fifty per cent of these accidents, as Health Canada calls them, were suicides. Almost all of these so-called accidents involved addictions.

Health Canada's official explanation for "Aboriginal" suicide is that it is a tragic personal disease. Addictions are explained in the same way. Yet, in the pre-colonial Cree culture, there was no history of either suicide or addictions. Just to prove the point about addictions, we had food, sex and gambling, but no addictions. Now we have severe addictions to those, plus alcohol, crack and crystal meth. Our cultural myths contain admonishing references to all sorts of human vices, for instance abuses of food, sex and gambling, but no references to suicide, at all.

What has changed?

"Aboriginal" Peoples are portrayed as circular folks, worshipping the circle, and, apparently, going in circles. This little story leads us back to where we started out just a few hundred words ago. Those 2,374 dead Indians held something, in law, that the province of Alberta doesn't hold: root title to land and resource, with consequential jurisdiction over said lands and resources. No court currently exists on the planet to hear this case because the white-collars referenced in this article's title encircle the necks of Supreme Court judges, Crown Prosecutors, top RCMP officials, all the membership of Canada's three main political parties, all corporations from largest to smallest, all Christian moralists - especially Canada's four Big Churches - all of the Canadian Academy, and most of the rank and file of Canadian citizenry.

Some more numbers: 29 million Canadians against one million "Aboriginal" people.

Indigenous Peoples trapped inside of the modern nation state of Canada have as a core part of personal identity a spiritual relationship with the land....trite, overstated, circular...and true. When Indigenous Peoples are separated from the land, suicide and addictions become the norm. Canada's GDP in 2005 was $1.4 trillion. Try turning it over and looking at it as theft. Who said crime doesn't pay?

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The Dominion is a monthly paper published by an incipient network of independent journalists in Canada. It aims to provide accurate, critical coverage that is accountable to its readers and the subjects it tackles. Taking its name from Canada's official status as both a colony and a colonial force, the Dominion examines politics, culture and daily life with a view to understanding the exercise of power.

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