imaginary news release:
"It is a gross waste of public funds to give an 8 billion dollar tax break to the wealthiest Canadians"
Is this statement true? Much like the Sierra Club release, this is sort of true. 8 billion dollars is the amount that Canadians poured into their mutual funds this year. For the tax illiterate, every dollar you put into a mutual fund is subtracted from your taxable income. Additionally, the wealthiest Canadians spend the most on mutual funds. It is also true that mutual funds are how most people save for retirement. This money though becomes taxable when it is drawn upon making it essentially a tax deferral or as rainswept calls it, "an effective loan." It is useful though to examine what happens to this money as a form of opportunity cost to the public purse. It is true, because of the tax deferral, there is less money in the public purse, but this money gets multiplied when it is saved. This happens when the bank loans this money out, jobs get created when this money buys IPOs (initial public offerings) or other equity derivatives. Some of that money even may end up back in the public treasury if the mutual fund portfolio contains federal bonds. The point is that money is not destroyed, it is spread throughout the economy creating jobs and generating new taxes. Mutual funds are not as simple as a tax break for the rich.
Now back to the ACCA. One may think that my example is a defense of the ACCA since I'm clearly implying that tax deferred monies are buying equipment that creates manufacturing jobs, jobs for operators, mechanics, laborers, service jobs, support jobs and all the other spin offs that ultimately and eventually contribute back to the common good through tax revenue. It seems as though I could be arguing that "a tax break to big oil" is a lopsided way of saying job and wealth creation for tradespeople and others taxpayers who little resemble Armani suit wearing oil barons.
My point is this: the opposition to the ACCA is only logically grounded in the environment, not in economics. I think I have shown that the economic ramifications are not so simple. Taken on the whole, the entire economy, not just a corporate bottom line benefits from wealth creation. On the other hand, the environmental argument is much more simple.
Over the last 15 years, I have been to nearly every square foot of Alberta. I have supervised the planting of nearly 30 million trees from the US border to the tar sands. I have worked on oil and gas land reclamation (returning lands to their original condition) and road decommissioning. For over 4 years I have performed contracts for the government auditing forest management areas to ensure that government standards are being met. As opposed to the Sierra Club, I'm the guy who determines whether correct forest practices are being met and at the stroke of my pen, I can force a company to spend hundreds of thousands of dollars. I've worked oil and gas initial survey so I've seen land before oil activity and after. My knowledge and expertise of the Alberta environment is unique and thorough and grounded with real experience not ideals. The benefit of this experience is a good understanding of the balance between resource extraction and environmental stewardship, both of which are in the common good.
My direct experience with the scale of destruction in some of the most beautiful places on earth has been profound. But equally profound is my experience with the regeneration of nature.I have flown over natural forest fires that left a scorched earth hundreds of miles across. I've seen a pristine earth, maggot-ridden with the reeking stench of oil wells. I've seen majestic forests where once was man's greedy thirst for oil, trees and ore. Come to think of it, the environmental question is not that simple either.
The question then becomes: how can we extract resources and create power in a responsible way? To address this, the Alberta government showed some rare initiative by announcing a CO2 pipeline that will pump CO2 from the oilsands to underground storage in the Pembina field. One hopes that this infrastructure will pave the way for CO2 capture and storage from the biggest carbon emitter in Alberta, the coal-fired electricity plants that service Calgary and Edmonton. Curiously, the Pembina Institute, the leading environmental group in Alberta, slammed the proposal arguing that it perpetuated the dependence on fossil fuels. Do they want Canada to just walk away from trillions of dollars of infrastructure investment? Clearly this is just not on. Solutions have to slowly build concurrently with oil infrastructure before they replace it. Creating and supporting solutions requires intelligent dialogue between government, industry and the public. It is unfortunate for the common good that, in the main, those who claim to speak for the environment have squandered any credibility with rhetoric dominated with hyperbole and fantasy.
The most interesting solutions, to no surprise, come from industry. VRB Power Systems based in Vancouver is a new start-up company that has patented the vanadium redox storage battery that acts as an intermediary power storage device that regulates the peaks and dips of most renewable energy devices like wind and solar. This power storage leaves the smallest "footprint" since it doesn't use noxious chemicals and it eliminates the inefficiencies that have stalled wide scale renewable generation. Their devices are currently being tested with early success on wind farms on three continents. I invested in this company and hope to prove that profitability need not be at odds with the common good.
I might control my smugness when I mention that the ACCA may have contributed to my earnings while I was in the oil and gas industry which allowed me to invest in VRB which is paving the way for sustainable energy generation. If you want to get to the bottom of things, follow the money.