A Natural Fit

Posted on Saturday, March 18 at 11:21 by jensonj
Logically, a country that has abundant resources and the opportunity to exploit them profitably would be foolish not to use them for profit and development. South American leaders who love to talk about their "rendezvous with history" in their incantatory speeches are about to be stood up by her once again for failure to treat gas as a tool of development rather than of power politics. The United States is fast becoming dependent on natural gas — one quarter of its electricity now comes from it. Because coal and nuclear energy have become increasingly controversial, regulations have created an incentive to build gas-burning plants. Despite the U.S.'s abundant gas reserves, a number of obstacles — including political and regulatory ones — have impeded a full development of its domestic resources. The U.S. actually imports about 16 percent of its natural gas, most of it from Canada and, to a smaller extent, from Trinidad and Tobago. However, the expectation is that U.S. demand for imported gas will shoot up, and Canada is not in a position to satisfy that demand. Unless major discoveries take place soon, at the current rate of production, Canada's reserves will be depleted in less than a decade. http://www.tcsdaily.com/article.aspx?id=031706C [Proofreader's note: this article was edited for spelling and typos on March 19, 2006]

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  1. Sat Mar 18, 2006 7:32 pm
    the AMERIKANS are the epitome of a parasitic entity,suck one host dry and find another,leave nothing behind but waste.

    with the Agreement Of The Americas you can bet any and all agreements the AMERIKANS have, will be diddled like the softwood ageement here in canada.

    and for some reason you don't hear all the trouble the NAFTA and THE AGREEMENT OF THE AMERICAS have,because they are in courts that are closed to us,the public.

  2. Sat Mar 18, 2006 8:16 pm
    The Americans, on their quest to suck the world dry of it's wealth, overlook chances to diversify their supply by going more to countries like Bolivia. Bolivia is not thier enemy and buying more from them would make them less so. Canada's natural gas would of course go to the highest bidder or more likely to the "larger market". Because of political predjudices by the current Bush administration. It would seem that a market economy only applies to friends in the political context. So as we go on with the current softwood dispute with our "friends" I ask the question. Is it good to have this relation with a country who drains our resources and renegs on payment of debt. Or like Bolivia who is an exceedingly poor country at this time, trade with everyone on a more even concept of trade. They are not the enemy of the states but are treated as such. )Perhaps it's time to drop the title "friend" and acquire the new tittle of associate.

  3. by RPW
    Sun Mar 19, 2006 12:51 am
    A country should NEVER sell it's natural resources. It should use those resources to develop a viable local economy. Consider the example given of Japan.......if that country could not buy those resources, where would it be today? Or for that matter Canada.......the sale of resources makes up a MAJOR component of our economy, simply because our corporate and political leaders are looking for a quick buck NOW, and to hell with the future. Resources are quite simply THE PRINCIPAL, and what is done with those resources constitutes THE INTEREST (or profit). Selling off your principal will only run you broke, considering that most of the money garnered from this must be used to purchase that which we have chosen not to make, and to buy instead. That was the intent of Mr. Mulroney when he signed the FTA.

    South America, KEEP YOUR RESOURCES!!!

    ---
    RickW

  4. Sun Mar 19, 2006 3:16 am
    Thats a good point RPW. But it does seem that poor economies can use the capital to invest in its own future as Chavez has done and is doing. Eventually you can ween off of global warbucks.

  5. by RPW
    Tue Mar 21, 2006 1:39 am
    Perhaps.....but it make much more sense to take the slow but steady route of using oil in the development of the petrocehemical industry, where a little oil goes a long way towards making products that have much more value in providing jobs, creatng the need for education, and for preserving the "capital" instead of squandering it.

    ---
    RickW

  6. Wed Mar 22, 2006 9:00 pm
    Damn right
    Just because Japan can't produce enough food to keep its citizens alive doesn't mean we should sell them beef!
    Just because America doesn't have enough natural gas doesn't mean we should keep them from freezing to death in the winter!
    Finders Keepers suckers! Sharing the world's wealth is a fool's game. I mean, how could we ever hope to get wealthier by trading and producing based on our comparative advantages?!
    No wait, check that. DO trade based on comparative advantage because EVERYONE who EVER has, has grown wealthier, without exception. And don't forget R&D. Imagine if no countries ever shared research? Why...we wouldn't have the computer, the Internet, the television, the radio, the space ship, the nuclear reaction, dry wall, steel, the automobile, the airplane, not even the telephone, because Mr. Bell was from Scotland, lived in Boston, and only visited his parents in Canada. But no sharing resources and information probably means no open borders, so we'd all still be living in log cabins and igloos, suckling milk straight from the cow because we wouldn't even have electricity, thank you very much Mr. Edison.
    Seriously, free trade is amazing, and if it's not a good deal then they don't need to sell. But really, since they don't have enough furnaces to use their gas, and America has too many furnaces and not enough gas, doesn't it make sense to trade?
    Why the hell should a border make a difference? If trade is a good idea within a country, shouldn't it work internationally too? Both common sense and history says yes. Only dogmatic xenophobia says no.

  7. Thu Mar 23, 2006 3:01 am
    First of all. I don't think your name means what you think it means. The United states looks after trade when it suits the United States. ((Softwood lumber)). As should all countries look after thier own. What RPW is trying to say is you could use your resourses to your advantage and build your economy from within. And that selling your resources creates a dependency for the cash flow making your country a welfare state. He's right. I do figure that they should sell enough to build a basic infrastructure and industrialize enough to improve their standard of living. Whether the Americans freeze to death, they have enough power and technology to get by. Remember, Nessesity is the mother of invention.

  8. Thu Mar 23, 2006 3:03 am
    By the way commonsense, I'm not just trying to hassle you, I'm sure you're a nice person.

  9. Thu Mar 23, 2006 5:25 pm
    Oh yeah, no problem. No offense taken. I was really just trying to be as big a jerk as possible so I'd earn whatever Internet wrath came my way. My first day on the site I saw people calling Harper Hitler and making fun a genitals and age etc. so I figured yeah, I might as well earn it when it comes.
    But still, they're really not at a point where they can afford to stop selling their natural resources, and they really can stop whenever they please. I don't believe they're involved in any sort of free trade contract with the states, and in the case of South America are involved in their own little trade pact. Unfortunately, that they haven't been involved in such an agreement is realistically what has been keeping them away from progress. Not only do they lack exclusive technology, but their cheap labour is easily offset by tariffs, so what other option remains? Only selling off primary goods. Every nation did it, and every nation who did it has won. It might be different in S.A because a huge percentage of their companies are state owned, and run terribly inefficiently. The natural resources however, don't depend on socialist management, or cheap labour, the only thing on which they depend is time. Right now oil and natural gas are useful, but the window is still limited. It takes more than fifty years to grow a competitive nation, and even more than that to get them to the point where hoarding their resources will be beneficial to their own nation (which realistically will be never. How much good are Canada's copper supplies now?).
    If you can find another comparative advantage in S.A then maybe they have a chance, but right now all they have are resources. If they build some decent infrastructure then they can hopefully get an educated workforce for decent assembly type labour, but until then they really need to sell.

  10. Thu Mar 23, 2006 8:57 pm
    I don't think being state owned qualifies as not being a good thing. State owned companies don't have some rich guy making copious amounts of profit, they don't normally pay their workers poorly. State companies generally supply better benefit packages to their employees. These better payed employees spend their large paychecks in the community sharing the wealth with others who benefit from it. Money turns over more in an economy that has a higher middle class with excess spending money. Let the rich tycoon guy rule elsewhere.

  11. Fri Mar 24, 2006 5:26 am
    Are you serious? Throughout history state owned property has been an absolute joke, and yes it does pay its employees incredibly well because it doesn't have to worry about profitability. It's absolutely incapable of being run efficiently because it has absolutely no competition. But maybe I'm wrong. Maybe the Soviets just weren't trying. And yeah, that the richest markets in the world are the most open. And what's your problem with tycoons? People who can invest their capital in appropriate place in the market, and have the ability to outperform their peers should be banned? You can do well, but only to a point? It's not like that money disappears just because it ends up in a few hands, it'll get pumped back into the markets either through consumption or investment.
    But if you want to return to a feudal or communist economy well...I'm not sure how well you'll be living.

  12. Fri Mar 24, 2006 6:29 am
    The wealthy or right wing have always sabotaged the public sector. If I were a right wing polititian I would sell my house for a third what it's worth and give the buyer a huge finders fee then rent it back twice the rational amount. After all it's probably falling apart, not that the buyer will spend any money on it. But I would still blame the guy I inherited the house from. Look at the travesties with Ontarios power and california. Both ended up paying because of the GREED of tycoons who hold ordinary people like you and I hostage. <a href="http://www.cupe.ca/www/privatization/5959#canadianattemptsderegulation">http://www.cupe.ca/www/privatization/5959#canadianattemptsderegulation</a> <br />
    At least with state run companies they are transparent enough to know whats really going on. Of course,there's always Enron.

  13. Fri Mar 24, 2006 6:24 pm
    Yes, and before that there was Chretian shaking down banks to get loans for his friends, and oh yeah, the sponsorship scandal. Saying that private industry is more open to corruption really ignores the fact that whether a person is appointed to the job or simply owns it, you have a flesh and blood person at the helm of billions of dollars and will make their decision based on personal ethics, not their title. But when someone has a personal stake in the outcome of a company, they're a lot more likely to do their best to ensure its success.

  14. Fri Mar 24, 2006 7:32 pm
    I'm assuming that you didn't read the link. The greedy plant owners in california faked brownouts to elevate power rates to the consumer. (That would NEVER happen with a public plant). Everyone bought it because there is no transparency in business. As long as you can snow someone into buying your snake oil it's "buyer beware". I believe it was your P.T. Barnum that coined the phrase "There's a sucker born every minute". And that is the cornerstone of American style business. It's these philosophical diferences that separate the left and right. The left has an us attitude and the right has a me attitude. I fall in the us camp.



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