Good morning,
Lest anyone forget that our economy is still overly dependent on resource extraction, this week’s political response to the Trump tariff threat is a harsh reminder. In just one week, moves were made to mine more coal and speed the extraction of critical minerals.
Calls also grew for yet more pipelines to ship Canadian oil and gas to markets more friendly than our currently hostile southern neighbour as panic ensued over the tariffs and what they would do to our economy. Most came from predictable quarters like Danielle Smith, premier of oil-rich Alberta, echoing Trump’s ‘drill, baby, drill’ mantra.
B.C. Union of Indian Chiefs Stewart Phillip spoke this week about the double “abyss” of climate change and Trump’s tariff threats, showing again just how rattled all Canadian leaders are at this moment. It’s easy to see how politicians might view a tradeoff weighted in favor of resource extraction as one worth making in the face of the punitive tariffs; a time to chuck climate under the bus and redouble our efforts to capitalize on our most lucrative resources.
This is, of course, a familiar course of action for Canada. Even before Trump took office, plans were in the works to extract more oil and speed mining efforts for critical minerals, which are needed for batteries and decarbonization efforts but cost the environment. Canada’s response could play out quickly.
U.S. President Donald Trump backed off on his original plan to impose 25 per cent tariffs on all Canadian goods on day one of his presidency. But it seems the deadline has only been pushed back until month’s end. Whether the threats are a mere opener to more prolonged negotiations is anyone’s guess. But Trump seems a bit drunk on power at the moment so he just might follow through.
Should the 25 per cent tariffs come to pass, Canada’s economy would suffer a three percent or greater hit, even with exemptions for core commodities we have that the U.S. wants — primarily oil and gas. Although Trump now claims he doesn’t need Canadian oil, the U.S. sure imports a lot of it. About 60 per cent of U.S. crude oil imports come from Canada, nearly a quarter of the oil used by Americans every day.
But instead of using this moment as a reason to cut back on oil production, Canada is now desperately scrambling for new buyers. The easiest response in the face of this upheaval is to stay the course — drill, dig and pump out more.
And that’s a shame. Because Europe has already proven there is another way. When war broke out between Russia and Ukraine, cutting the gas supply to Europe, the response was to turn to renewables. Almost all the EU nations have drastically reduced their fossil fuel dependency and with it reduced their planet-heating carbon emissions. Of course, most EU countries had little choice. They aren’t trading in fossil fuels and were forced to pivot.
It wasn’t easy. I have friends in Germany who spent a couple of chilly winters wearing layers of sweaters so they could dial down their very expensive heat. But sadly in Canada, our political and business leaders seem unable to imagine a future that doesn’t depend on fossil fuel industries that will soon be obsolete.
Britain shuttered its last coal-fired power plant this year and the International Energy Agency says demand for oil will begin to drop this year. As my colleague Seth Klein points out in a Linkedin post this week it would be far better to use this moment to redouble our efforts to build up renewables and finally wean ourselves off fossil fuels. “The oil and gas industry is deeply embedded in the Trump White House. LNG expansion in B.C. is being driven by investors who are close allies and donors of Trump — let's not reward them!”
Adrienne Tanner - Editor-in-Chief
TOP STORY
Pierre Poilievre has gotten a lot of mileage on Trudeau-hating. Slogans and nicknames have rocketed him to the top of the polls, but unfortunately for the Conservative leader, keeping a cross-country coalition together is going to get messy fast, particularly in the face of divisive tariffs from Trump. The time may be coming when Poilievre will have to choose between Ontario and Alberta, and that’s a no-win situation for him — the first he’s had to face as leader.
John Woodside reports.
Quote of the week
— Don Desserud, political science professor at the University of Prince Edward Island, on carbon taxes.
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🖥️If AI data mega-centres are in Canada’s future, we’re going to need a heck of a lot more power. Businesspeople, including Kevin O’Leary of Shark Tank fame, have been pitching data centres, and Alberta Premier Danielle Smith appears to be all-in. But the famously power-guzzling operations don’t have a source ready to draw on, leading even true believers like Smith herself to caution investors to BYOE: bring your own electricity.
Darius Snieckus reports.
🙄Ontario is probably getting an early election. But does it need one? Doug Ford is trying to make the case that his government needs a fresh mandate to tackle Trump’s tariff threats. But, that’s false on two levels: first, he’s been signalling an early election is coming for months now, since well before the threat emerged. And perhaps more to the point, the tariffs are coming soon, and Ford has more than a year left in his existing government. Is now really the time to dissolve the Legislature?
David Moscrop writes.
🛒The U.S. may buy more of our stuff than we buy of theirs, but we buy way more of their services. And yet Trump, in his determination to cast Canada as a country the U.S. is “subsidizing” with a trade imbalance, somehow never mentions it. We all know why — it undercuts his argument — but it’s an important factor to consider in our cross-border trade negotiations, and all the more so as Canada prepares to introduce the Digital Services Tax.
Jim Stanford writes.
🔥It’s not wildfire season here yet, but it will come around soon enough. So now is a good time to look at best practices to keep the homes of people living in fire zones safe. Oregon just passed new rules for building in fire-prone regions of the state. Brush clearing is mandatory as are certain types of fire-resistant building materials. At least one Canadian municipality has passed similar rules, but fire experts say national policies are a better way to go.
Cloe Logan reports