When in Doubt, Use Caution

When in doubt, proceed with caution! When an input is scarce, use it sparingly! To my way of thinking, these are two core conservative values. I believe in these values, and find it puzzling that these values seem absent from many of the policies and actions of our current conservative government.

Take the promise, in the recent federal budget, to streamline environmental approvals. In general we all agree that streamlining is good thing. It removes unnecessary bureaucratic blockages. But if statements made by Joe Oliver, Minister of Natural Resources, are any indication of government intent, the intent of this streamlining is to not to assess the process. Instead, it seems, the government simply wants to get the environmental review process out of the way as quickly as possible so it can get on with its real agenda. Where is the caution here?

Why the rush? A successful business needs to know when to bring its product onto the market. It is not uncommon for a business enterprise to have to make a choice. It can choose to bring an inadequately developed product onto the market early and capitalize on an “early delivery” premium. Or it can spend more time on product development, sacrifice the “early delivery” premium, but deliver a good product.

I can understand why the oil companies are in a hurry to get things done. Each company wants to get in ahead of the other company because there is a premium in that. I can understand why the oil importing countries are lining up to fund the building of Canada’s pipelines. If they get in early, they have a better chance to get Canada’s oil.

But I can see no reason why Canada needs to be in a hurry. Why the hurry in exporting Canada’s oil resources? Why the desire to shorten the environmental approval process? Why the desire to attract non-Canadians to invest in the extraction of Canada’s oil? Why create jobs in the oil industry, when the jobs need to be filled by attracting immigrants? I could understand the hurry if it would be likely that we would lose if there were a delay in getting our oil onto the market.

But Canada won’t lose if we take our time in getting our oil onto the market, if we “take the time to develop a good product.” As the world oil supplies become harder to get; as the oil the world depends on comes increasingly from sources hard to get at (such a deep sea wells and Alberta’s tar sands), the price of oil will only go in one direction – up. The longer we delay in bringing this resource to the market, the higher will be the price. What’s to lose?

If Canada slows the delivery of tar sand derived oil onto the market, this delay will accelerate the rise in world oil prices. And this will affect what we pay at the pumps. That will hurt. It always does. Be that as it may, a substantial increase in the price of oil is inevitable. If not sooner, then it will be more later. Higher prices mean more pressure to find alternatives. We need that pressure. We need it soon.


By Eric Rempel