15, 2014 - No. 83
A New Direction for the
An Election Issue!
• A New Direction for the
Economy -- An Election Issue! - Peggy Morton
• Stop Paying the Rich!
Increase Funding for Social Programs!
• Federation of
Labour Releases Study on Upgrading and Refining
Bitumen in Alberta
• Education Is a Right -- Another Election
A New Direction for the Economy -- An Election
Four by-elections will take place on October 27,
in the ridings of Calgary-Elbow, Calgary-Foothills, Calgary-West and
Edmonton-Whitemud. The unelected Premier Jim Prentice, Health Minister
Stephen Mandel and Education Minister Gordon Dirks are all seeking a
seat in the Legislature. The elections are supposed to provide
legitimacy to the direct takeover of the Alberta government by the most
powerful energy monopolies merged with the banks, and the government's
agenda of austerity and selling out the resources, which belong to
First Nations, Albertans and Canadians.
Working people can say no to the anti-worker,
anti-social, anti-immigrant agenda of the rich by going all-out to
defeat the PC candidates while keeping Wildrose out! The by-elections
are also an opportunity for the Workers' Opposition to put forward its
own independent politics and to discuss a new human-centred
direction for the economy. In this way, the working class plays its
leading role in setting the agenda and providing a vision for a
direction that favours its interests: nation-building not
nation-wrecking, a path to progress for society and humanization of the
social and natural environment.
The current direction of the economy includes
monopoly right to rip and ship raw resources, a low wage agenda using
local and international worker traffickers, and a royalty regime to pay
the rich. This direction has led to insecurity, demands for austerity
and a negation of the rights that people have by virtue
of being human. A new direction for the economy is required, which
includes upholding the rights of Albertans, First Nations and the
working class. A new direction would stop paying the rich and increase
investments in social programs. It would exercise public control over
decisions concerning upgrading and
Albertans and Canadians should not be held hostage
to narrow private monopoly interests and unbridled greed. A new
direction for the economy would include a Crown corporation to foster
upgrading, refining and value-added petrochemical industries and/or
that the oil monopolies be required to upgrade bitumen
rather than rip and ship it down the pipeline.
Albertans share a broad agreement that the current
royalty regime is not serving the public interest. The energy
monopolies reap profits while Albertans are told they have to accept
cuts to health care, education and other social services that are
theirs by right. A new direction for the economy would require
the current royalty regime that favours monopoly interest with a direct
public claim on the value resource workers produce to serve the public
interest and good.
The Prentice government openly states that its
main mission is to transport oil to markets and make sure that the
energy and other monopolies can enrich themselves. Meanwhile the
government announces schools will no longer even have playgrounds and
new communities promised schools will receive trailers
instead. The government acts as though hospitals and other health care
necessities for Alberta's fast growing population are extremist demands
of those who refuse to accept austerity.
Workers through their hard work, skills and
knowledge create the wealth that the owners of capital seize. Oil and
gas and construction workers have the right to safe workplaces, wages,
benefits and working conditions commensurate with the work they
perform. They have a right to modern, cultured living conditions.
They have a right to demand that at the very least when our resources
are exploited, projects should be planned so that workers have secure
livelihoods, local stable economies fueled with value from the resource
industry, and communities in which to live and raise families where
workers do not suffer through booms
An aspect of this planning must be to deal
consciously with the price of oil. A solution to wild swings in the
price of oil, which provoke a boom-and-bust cycle bringing instability
and hardship, would be public control of the wholesale energy sector.
In this arrangement, the government would pay the monopolies
a contracted price for the oil based on an average rate of profit, and
market the oil at a price that serves the public interest.
The rich are blocking all-sided and socially
responsible development of our resources. They have taken direct
control of the state to push their reckless expansion and pursuit of a
fast buck and big score. An urgent need exists for public control over
the exploitation of oil and gas and other natural resources. Public
control is required to sustain and increase investments in social
programs, respect the rights of First Nations, provide modern and
humane living and working conditions for oil workers and their families
including stable communities with a robust manufacturing sector, and
big effort to reverse environmental
In summary: the oil and gas cartels are making
obscene profits, robbing the public treasury and benefiting from a
multitude of pay-the-rich schemes, while the people are told they face
no alternative to austerity. A Crown corporation established to upgrade
bitumen, refine the synthetic oil and develop a vibrant
petrochemical sector as the basis for manufacturing is an alternative
to paying the rich and shipping raw resources. Establishing public
control of wholesale trade over energy resources would ensure the
viability of the industry and conscious public input on prices.
Replacing the toothless royalty regime with a direct
public claim on energy value would allow tremendous value to be
channeled into local manufacturing, and increased investments in social
programs and public services.
There is an alternative! Workers can do their own
thinking based on what is in their interest. We should reject with
contempt the cries of the rich and their PC and Wildrose
Let us bring forth our own independent working class
nation-building project, economic direction, solutions and
representatives. It can be done!
Stop Paying the Rich!
Increase Funding for Social
How should the working people
respond to the
refusal of the energy monopolies to act in the public interest and the
general interests of society? A study recently released by the Alberta
Federation of Labour (AFL) notes that the Alberta and federal
have paid both the energy and construction monopolies
in numerous ways to increase private profit from the oil sands. The
trend has been for increased subsidies and handouts to the rich. This
includes direct subsidies and investment, research and development, tax
incentives, royalty reductions, and handouts in the name of greenhouse
gas and pollution reduction.
To this list can be added the public education of
the workers they employ, including the skilled trades, technicians,
engineers and others who produce the value arising from the people's
energy resources, which along with health care and other social
comprise human social transferred-value. Also important
is the public material infrastructure of roads, bridges etc., the
material social transferred-value, supplied with huge investments from
public revenue or debt. The energy monopolies could not operate a
single day without publicly supplied human and material social
transferred-value for which they do not pay.
The AFL study provides examples of numerous
pay-the-rich schemes or "incentives," which have handed tens of
billions to the oil monopolies alone. These include the pioneering of in-situ
extraction technologies by the Crown corporation Alberta Oil Sands
Technology and Research Authority and
other publicly-funded research and development entities.
the capital cost allowance tax incentive are estimated to deduct $2
billion a year in renounced royalties.
The one per cent generic royalty regime introduced
in 1997 reduced royalty payments a further 20 to 30 per cent from the
previous royalty regime. As a result, although oil sands production
increased 133 per cent from 1995 to 2004, government royalties
decreased by 30 per cent.
If the value generated from the transformation of
the people's resources into useable products were under the control of
a public authority, this value could be poured back into the
responsible development of the people's resources and local economy
without the necessity of private capital. The value under the
people's control would also be used to exchange and properly realize
the enormous human and material social transferred-value presently
provided to the private energy sector free by the state. Also,
added-value from energy production would be available for increased
investments in social programs. The truth found
in modern industrial production is that the working class does not need
the monopolies to provide capital for economic and social development.
Not only do the monopolies presently seize the
value created by the hard work of oil and construction workers
transforming the bounty of Mother Earth, they rob the public treasury
and have the state provide them needed infrastructure, educated workers
and much more.
A pro-social program to Stop Paying the Rich and
Increase Funding for Social Programs would divert funding into public
enterprise and break the stranglehold of the oil cartels with their
incessant demands for more at the expense of the well-being of the
working class, people and environment. An alternative
to providing more subsidies for the rich is to establish Crown
corporations to extract, upgrade and refine bitumen and develop a
petrochemical industry. The state could extend public control and
ownership over the people's natural resources and their development and
establish a public authority to control the wholesale
market of energy commodities including prices.
By taking a stand that the economy must be organized to
meet the people's needs and opposing the misconception that an economy
that enshrines monopoly right will trickle down benefits, the working
people and their organizations can put themselves in a position which
brings into being new arrangements which open society's path to
1. Surface mining is only feasible for the shallow oil
sands deposits found north of Fort McMurray. More than 80 per cent of
Alberta's oil sands are too deep for mining and require "in-situ"
(Latin for "in place") extraction techniques.
Federation of Labour Releases Study on
and Refining Bitumen in Alberta
The Alberta Federation of Labour (AFL) has
released a report titled In-Province Upgrading Economics of
a Greenfield Oil Sands Refinery, which provides important
information to support the upgrading and refining of bitumen in Alberta.
Until recently, major surface mining projects
included upgraders to upgrade bitumen to synthetic crude oil. Imperial
Oil's Kearl Lake project was the first major oil sands mining operation
to be built with no upgrading capacity. All indications are that no
upgrading is now the preferred option for the
monopolies in control of oil sands production.
In-situ extraction now
comprises almost half of all oil sands production and these in-situ
operations do not presently include upgraders. The Alberta government
indicate that with the current direction the percentage of bitumen
upgraded in Canada will drop from the current 55 per cent to just 26
per cent by 2025. It has been more than 50 years since a new oil
refinery was constructed in Alberta, the study points out.
The report says the Alberta government
commissioned the "Alberta Bitumen Processing Integration Study"
an integrated bitumen
upgrading, refining and petrochemical complex in Alberta. The
government has taken no action on this study and instead both
the Harper and successive Alberta PC governments have declared that
pipelines to export dilbit (bitumen diluted with condensate to make it
flow) to the U.S. Gulf Coast and Asia are a "national imperative." This
led the AFL to commission a new study with the objective of examining
the economics of in-province
upgrading of oil sands products and an associated petrochemical
The study points out, "At present, Alberta's
economy is highly dependent on mineral resource production and export,
such as oil sands. The level of value-added processing is limited
compared with other developed countries. Therefore the impact of the
recent financial crisis on the province was much more pronounced
than the rest of Canada." It argues that Canada needs to find ways to
ensure that the benefits of Alberta's oil reserves are captured and not
Don't Ship Raw Resources and Jobs Down the
The study commissioned by the AFL confirms the
stand of Alberta workers that upgrading and refining in Alberta is in
the interest of the workers and society. It is a significant creator of
permanent jobs directly, as well as opening the potential
for a petrochemical industry and related manufacturing in Canada.
The study states, "The added benefits of job
creation, energy security and contributions to expanding other parts of
the provincial economy would be significant as well, thus enhancing the
potential benefits of appropriate public participation in
upgrading/refining in Alberta." Upgrading and refining in Alberta
also have the potential for government to claim more added-value to be
used for much needed increased investments in social programs including
health care and education.
The Clash of Interests Between the Working
People and Owners of Capital
The authors of the study also confirm that
upgrading and refining in Alberta is profitable for the energy
monopolies. However, the energy monopolies go after the big score and
try to seize the most added-value in the shortest
possible time. In the conditions that prevailed following the 2008
financial crisis, six upgrader projects in Alberta were cancelled in
favour of shipping bitumen to be upgraded and refined in the U.S. or
Narrow private interests are clashing with what
favours the working people and the general interests of society. The
fact that the interests of the monopolies have been taken up with such
zeal and fervour by the Harper and Alberta PC governments shows the
extent to which private interests have been politicized
and public interests depoliticized.
Why did the monopolies make the decision to cancel
six upgrader projects in Alberta? The study states, "Until recently,
refining margins in North America were quite low. The international
integrated companies have been scaling back downstream operations and
focusing on the upstream sector. [Giving
monopoly mania to build more pipelines for bitumen and rip and ship
-- TML Ed. Note.] Similarly smaller mid-size companies have been
consolidating existing assets through acquisitions and restructuring."
However, this may now be changing. The study
argues, "The emergence of shale oil production in the U.S., beginning
in 2012, created a steadily rising surplus of crude oil that under
current law cannot be exported. This has caused crude prices in the
U.S. to drop sharply, so much so that they are disconnected
from world oil markets. In turn, there has been a surge in refining
In other words, the people of Alberta are
subjected to the narrow considerations of the owners of capital to make
big scores. Wild swings in the price of oil are the norm in the
capitalist economy. They reflect in part the damage to the socialized
economy from speculators not
directly engaged in production who move capital around the globe. They
buy and sell this fictitious
capital that is once, twice or more removed from workers and capital
involved in production and distribution. Their capital is mainly
involved in derivatives (derives from something else), a fancy word for
fictitious capital that speculates on the prices
of almost all commodities including oil. They have the power and means
to manipulate prices up or down in a manner that suits their narrow
private interests but which damages the socialized economy becoming a
factor for both local and international economic crises.
A new direction for the economy is needed where
decision-making and control are public, not private and where the aim
is the responsible development of the socialized economy, protection of
Mother Earth, the well-being of the workers who produce the wealth, and
to serve the general interests of society.
The study reports that in 2012, there were 22,300
direct extraction jobs in Alberta's oil sands. Eighty per cent of the
jobs were in mining and in-situ operations at 40
per cent each, and 20 per cent were in upgrading. If all the bitumen
currently extracted were upgraded in Alberta,
this would create an additional 4,600 permanent direct upgrading jobs.
In addition, the regular maintenance shutdowns and
less frequent major maintenance turnarounds involve thousands of
skilled workers. For example, the Shell Scotford upgrader turnaround
involved 2,500 skilled tradespeople working 1.5 million hours over two
months. This adds thousands more direct jobs.
The study did not investigate indirect jobs or the
potential to develop Canada's manufacturing sector including the use of
Canadian steel, pipe, components and equipment.
Mount Royal University Students Oppose
Tuition Fee Increases
Education Is a Right -- Another Election Issue!
Mount Royal Students rally
October 9, 2014, against proposed tuition fee increases.
About 150 Mount Royal University (MRU) students in
Calgary rallied at noon hour on October 9, against proposed tuition fee
increases. The students converged in front of MRU's East Gate and
marched around and through the campus, carrying signs and shouting
slogans. Petitions were circulated and a table
was set up to facilitate a mass letter writing campaign to the
provincial government. The student Facebook page for the rally states:
"Take a stand and show your stance on tuition increases by collectively
joining your student body in a student-led protest."
Alberta post-secondary educational institutions
(PSEs) are currently under a government-imposed restriction that
tuition fees can only be raised to meet the cost of living increase.
This was installed to force the PSEs to make internal cuts after the
government's savage slashing of $147 million to the PSE operating
budgets in March 2013. The fee increases proposed by MRU, and by
the University of Alberta (U of A) and other PSEs, aim at making an end
around the tuition freeze by basing the increases on so-called market
modifiers. The legislation allows PSEs to apply to the government for
market modifiers as a one-off
increase to bring tuition fees in line with other comparable
institutions who charge higher fees.
October 9, 2014
rally at Mount Royal.
The MRU student Facebook page provides students
with useful information, "[At MRU] programs such as business, nursing
and science(s) could be subjected to an increase of $50-$400 per class.
That could be up to an 80 per cent increase in your class costs per
semester; these increases could be implemented
as early as next semester. In case you are unaware of how expensive
that is, it's almost the equivalent to how much a master's student pays
per course at the University of Calgary, or possibly over $900 per
This affects everyone, not just students in business, nursing or
science. Why are students bearing the burden
The proposed fee increases at University of
Alberta would be even greater in dollar amounts. For example, if
accepted by the government, U of A's Faculty of Law would use
market modifiers to raise annual tuition to $15,995 from the current
$10,121, an increase of 58 per cent. A U of A student union
spokesperson points out: "These modifiers are essentially differential
tuition increases. They effectively go around the regulations set in
place to cap tuition. Similarly, loopholes exist in the Post Secondary
Learning Act Tuition & Fees Regulation, which allow for
additional fees, known as mandatory non-instructional
fees, to be put in place. Combining the cost of fees and tuition,
Alberta has some of the highest costs of education in the country."
Students across Canada are fighting for the
reduction and eventual elimination of tuition and ancillary fees at
post-secondary institutions, the elimination of differential fees, and
increased funding from provincial and federal governments. Over the
last 20 years, the portion of PSE operating budgets funded by the
public has decreased from 81 per cent to an average of 57 per cent,
while tuition fees have increased from 14 per cent of operating funding
to over 35 per cent. Accounting for much of the remainder are steadily
increasing research grants from private corporations, which can then
dictate what research can be carried
out and what personnel they require to be educated or trained.
Rising tuition and ancillary fees give rise to
massive levels of student indebtedness. Students in Canada owe more
than $14 billion in Canada Student Loans alone, with provincial student
loans and private bank loans and credit card debt making the real
figure much higher. Twelve per cent of students have loans
from commercial lenders; the median amount borrowed is $6,000 per year.
While universities claim that they have no alternative but to increase
tuition fees, this does not solve the problem and only perpetuates an
unsustainable situation. As the Canadian Federation of Students points
out, "Rising tuition fees are symptomatic
of government underfunding, not a cure to solve the problem. Wherever
tuition fees are allowed to increase, governments simply withdraw an
equal portion of public funding."
The post-secondary education system in a modern
society like Canada requires that it be properly funded by governments.
The fact that this basic requirement is not met creates instability for
the students, teaching staff, and researchers and is detrimental to the
quality of education provided and the economy. Canadians
stand with students in demanding that the right to education be
provided with a guarantee. Education is one of the claims people have
on society by virtue of being human. The role of education is not just
to provide a work force equipped with the skills required by the
monopolies to attain maximum profits. It must
concern itself with the level of culture and educational attainment of
the society, which faces increasing complexities on both the
technological and social front.
Public education must be constantly expanded and
developed to fulfil its role in developing all that which makes us
human. For the youth of Canada who are striving to have a bright future
in which they can flourish and make their contribution to society, the
right to education is indispensable. Governments must
increase funding for post-secondary education so that the high level of
education required by the youth and the society is not left to chance
or the financial wherewithal of the individual.