The Globe and Mail does Tar Sands for a week

January 27, 2008

The Globe and Mail does Tar Sands for a week

Immitation is the sincerest form of flattery.

The first of the Globe and Mail's week-long series on the tar, I mean, oil sands has at least one interesting insight, though it'll be interesting to keep track of all the things that they don't mention.

And money is getting tight in Thunder Bay. Anyone who looks closely may see some irony in the fact that the closing of local paper mills is at least partly because the loonie has been driven to record heights thanks to Alberta's staggering wealth.

But one person's downturn is another's upswing. While places like Thunder Bay suffer, many Canadians enjoy the proceeds of rising oil stocks. The spotlight on Alberta ended the long-lamented discount attached to Canadian oil company shares, which have outperformed their U.S. counterparts of late. (Suncor, for instance, has become the world's best performer among big oil companies that are traded publicly.)

It's something that the Globe can toss out there casually and then forget about, but it's actually a huge economic issue in Canada. The oil boom in Alberta allows investors to continue to pretend that the economy is ok, while sectors like timber and manufacturing approach a full-blown crisis.

The "many Canadians" who enjoy "enjoy the proceeds" of the tar sands are finding enjoyment proportional to the amount of money they have invested in stocks. Coupled with the gutting of other industries, I don't think it's too much of a stretch to say that the tar sands are directly exacerbating what is already the crisis of the current economic system: rich richer, poor poorer (at least after you account for inflation).