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Filibuster Cartoons
Title: Economic nationalism! (click to view)
Date: November 16, 2010
Apologies if this comic seems a bit more absurd than usual. For those who miss the reference, I'm paying homage to the surprisingly insightful Dinosaur Comics of Ryan North, a fellow I met last week at the big New England Webcomics jamboree. (You can see my portrait of him, and several other webcomickers here, by the way).

Anyhow...

Here's a fun fact about myself: I have a younger sister who lives and works in Dubai. My parents want to go visit her, but it's become a bit of a bureaucratic hassle as of late, because the government of the United Arab Emirates has recently imposed a visa requirements on all Canadian tourists. The move is a brazenly vindictive response to the Harper government's decision last month to not allow the Dubai-based Emirates airline corporation to set up shop in Canada, on the basis that doing so would take business away from Air Canada, Canada's notoriously troubled national airline.

And perhaps we'll soon see some vindictive gestures from Australia, too. This week marked the formal conclusion of Australian mining corporation BHP's efforts to buy out the Regina-based Saskatchewan Potash corp., a company that presently controls the mining and distribution of one of Saskatchewan's most lucrative national resources. The government of Saskatchewan didn't want one of their favorite business partners to be controlled by foreigners, so the Harper administration stepped in to veto the takeover, and send BHP home.

Canadian commerce law grants sweeping powers to the federal government to prevent foreign firms from taking root in Canada. In most cases, all that needs to be proven is some vague evidence that the foreign company's presence would not be in Canada's "national interest" — a concept often defined exceedingly liberally and chauvinistically. In most cases, the decision is a brazenly political one; usually some short-term drive to protect jobs and votes, and not the long-term financial interests of the country at large. Though one of the wealthiest nations on the planet, Canadian industry is still fairly small and uncompetitive by G8 standards, and thus must be heavily coddled by the state in order to survive even domestically.

This whole philosophy of economic nationalism tends to fall in and out of favor among the Canadian ruling class from decade to decade, but its' generally considered a cause far more fashionable among parties of the left than the right — which is what makes Stephen Harper's newfound embrace of it so surprising. If anything, it seems to be just one more entry in the long story of the decline of Stephen Harper, the conservative man of principle, into Stephen Harper, the man of expedience.

[hurley_108]

Point very well made, and I love the way you adapted Dinosaur Comics into your own style.

[bootlegga]

Your comic is rather disingenuous - at least the half about Dubai anyways.

Canada didn't turn down the request for slots in Canadian airports because of economic nationalism as you claim. They did it because Dubai tried to blackmail Canada into giving them to their two airlines landing rights in Canada in return for allowing Canada to continue using Camp Mirage - which supports our efforts in Afghanistan.

Canada said fuck you to a country trying to blackmail us and I support the government's decision to do so. Economic nationalism had nothing at all to do with that decision.

And besides, so what, lots of countries make decision like this all the time...heck just a few years ago that bastion of free-wheeling capitalism the USA refused to allow a foreign company to takeover several major seaports.

Canada has overturned two buyouts in the past three decades, so this is hardly as big a problem as you make it out to be. It is simply a government saying that ownership of a vital resource should stay in Canadian hands, rather than that of a foreign company, which would have exported jobs (I'm sure the head office in Saskatchewan would close/downsize) and profits to another country.

I'm all for it, and I'd support the same move if someone tried to takeover Blackberry or Petro-Canada too.

[BartSimpson]

"Economic nationalism", IMHO, is a rational response to the "Predatory Economics" practiced by so many countries in the world.

[hurley_108]

BartSimpson wrote:

"Economic nationalism", IMHO, is a rational response to the "Predatory Economics" practiced by so many countries in the world.

Yea, Australia sure is scary!

[hurley_108]

bootlegga wrote:

Your comic is rather disingenuous - at least the half about Dubai anyways.

Canada didn't turn down the request for slots in Canadian airports because of economic nationalism as you claim. They did it because Dubai tried to blackmail Canada into giving them to their two airlines landing rights in Canada in return for allowing Canada to continue using Camp Mirage - which supports our efforts in Afghanistan.

Canada said fuck you to a country trying to blackmail us and I support the government's decision to do so. Economic nationalism had nothing at all to do with that decision.

And besides, so what, lots of countries make decision like this all the time...heck just a few years ago that bastion of free-wheeling capitalism the USA refused to allow a foreign company to takeover several major seaports.

Canada has overturned two buyouts in the past three decades, so this is hardly as big a problem as you make it out to be. It is simply a government saying that ownership of a vital resource should stay in Canadian hands, rather than that of a foreign company, which would have exported jobs (I'm sure the head office in Saskatchewan would close/downsize) and profits to another country.

I'm all for it, and I'd support the same move if someone tried to takeover Blackberry or Petro-Canada too.

I won't comment on the Dubai bit because I don't have the background.

But the Potash decision smells funny. If it was really, solidly grounded in wanting to make sure that important Canadian resources stay Canadian, why was BHP strung along so far? Why did the federal government need to put poison pills in the requirements? Why did they wait until the 11th hour to say "No"? The Governemnt does not seem to have been open and straight with BHP, and that's not a good thing for other times when the deal isn't over something as important as Potash or RIM. Makes people wary, and perhaps more likely to look elsewhere for investment.

[DrCaleb]

BartSimpson wrote:

"Economic nationalism", IMHO, is a rational response to the "Predatory Economics" practiced by so many countries in the world.

+1. Unfettered Socialism may lead to totalitarianism, but unfettered capitalism can only lead to Anarchy.

[Zipperfish]

A different style for you, JJ, but it still works wonderfully. Great job, as per usual.

Most of the stuff I read at the time seemed to indicate that this decision was just politics over policy. As I understand it the current owner of all the potash is--correct me if I'm wrong--American and the new owner would have been Australian, so I didn't really see the "keep potash Canadian" argument.

[andyt]

DrCaleb wrote:

BartSimpson wrote:

"Economic nationalism", IMHO, is a rational response to the "Predatory Economics" practiced by so many countries in the world.

+1. Unfettered Socialism may lead to totalitarianism, but unfettered capitalism can only lead to Anarchy.

I think unfettered capitalism will also lead to totalitarianism. It won't be all Adam Smith's little shoemakers running rampant, but power concentrated in the hands of a few.

[andyt]

Zipperfish wrote:

A different style for you, JJ, but it still works wonderfully. Great job, as per usual.

Most of the stuff I read at the time seemed to indicate that this decision was just politics over policy. As I understand it the current owner of all the potash is--correct me if I'm wrong--American and the new owner would have been Australian, so I didn't really see the "keep potash Canadian" argument.

Wasn't the worry that BHP would break up the potash cartel?

[Chumley]

andyt wrote:

DrCaleb wrote:

BartSimpson wrote:

"Economic nationalism", IMHO, is a rational response to the "Predatory Economics" practiced by so many countries in the world.

+1. Unfettered Socialism may lead to totalitarianism, but unfettered capitalism can only lead to Anarchy.

I think unfettered capitalism will also lead to totalitarianism. It won't be all Adam Smith's little shoemakers running rampant, but power concentrated in the hands of a few.

Agreed. Power corrupts inevitably as well as absolutely, to put a twist on the saying. Reminds me of this partial quote a friend of mine gave me, apparently by Abe Lincoln:

"I see in the near future a crisis approaching that unnerves me and causes me to tremble for the safety of my country.....corporations have been enthroned, an era of corruption in high places will follow and the money power of the country will endeavour to prolong its reign by working upon the prejudices of the people ...until the wealth is aggregated in a few hands and the Republic is destroyed."

[DrCaleb]

Zipperfish wrote:

As I understand it the current owner of all the potash is--correct me if I'm wrong--American and the new owner would have been Australian, so I didn't really see the "keep potash Canadian" argument.

Pretty sure the owner of any natural resource are the citizens, in this case the Potash is owned by the citizens of Saskatchewan. Some of the companies that pay for mining rights from those citizens may be American, but it's my understanding that 'Potash Corporation of Saskatchewan' is a publicly traded corporation.

[andyt]

DrCaleb wrote:

Zipperfish wrote:

As I understand it the current owner of all the potash is--correct me if I'm wrong--American and the new owner would have been Australian, so I didn't really see the "keep potash Canadian" argument.

Pretty sure the owner of any natural resource are the citizens, in this case the Potash is owned by the citizens of Saskatchewan. Some of the companies that pay for mining rights from those citizens may be American, but it's my understanding that 'Potash Corporation of Saskatchewan' is a publicly traded corporation.

My understanding is that the company's head office is in Chicago - don't know who the majority owners are. Isn't BHP a publicly traded corp?

[DrCaleb]

andyt wrote:

DrCaleb wrote:

Zipperfish wrote:

As I understand it the current owner of all the potash is--correct me if I'm wrong--American and the new owner would have been Australian, so I didn't really see the "keep potash Canadian" argument.

Pretty sure the owner of any natural resource are the citizens, in this case the Potash is owned by the citizens of Saskatchewan. Some of the companies that pay for mining rights from those citizens may be American, but it's my understanding that 'Potash Corporation of Saskatchewan' is a publicly traded corporation.

My understanding is that the company's head office is in Chicago - don't know who the majority owners are. Isn't BHP a publicly traded corp?

BHP's offices are in Chicago, and it is publicly traded (they why do people refer to it as 'Australian'?). Potash's head offices are in Saskatoon, and it's publicly traded.

I probably don't need to say this you you Andy, but just to cover all bases; if there is no majority shareholder in a corporation, then the stockholders are the owner of the company. Unless citizenship of a particular region is a requirement to purchase stock, I don't consider such a company to be of any particular 'nationality'.

I think the big problem with this sale was that BHP could pull out of Canpotex, which gives the potash corps their monopoly. That could lead to yet another market crash of potash, like in the 50's, 60's and 80's. Just when Saskatchewan was starting to become a major economic force in Canada.

[andyt]

ctually, potash corps headoffices are split between Saskatoon and Chicago, while

Quote:

BHP Billiton is the world's largest mining company.[2] It is also the largest company in Australia by market capitalisation. It was created in 2001 by the merger of Australia's Broken Hill Proprietary Company (BHP) and the Anglo-Dutch Billiton plc.[3] The result is a dual-listed company, the corporate head office being located in Melbourne. BHP Billiton Limited, which is the majority partner in the dual-listed structure, is listed on the Australian Securities Exchange. BHP Billiton Plc is listed on the London Stock Exchange and is a constituent of the FTSE 100 Index.

I think a company is considered of a certain nationality where it is incorporated.