A recent article from a political scientist at the University of Alberta confirms what many ordinary people already realize: the Alberta government works for the rich energy capitalists. In the article, research fellow Robert L. Asch examines how a small number of oil barons are increasingly dominating the provincial oil industry. Private ownership over this key industry means these same bosses get to use their influence to shape government policy how they please.
Over the past few years, international companies have been leaving the oil sands. Regulatory requirements, environmental concerns, and the 2014 crash all pushed a number of big players out of the province. Shell, BP, Statoil, and Chevron have all sold off most or all of their oil sands holdings since 2016.
This has left Albertan oil heavily concentrated in the hands of just a few main companies. Imperial Oil, Suncor Energy, Cenovus Energy, and Canadian Natural Resources account for 84 per cent of the province’s daily oil production. The energy industry has gone through a period of consolidation, mergers, and acquisitions. For example, in March 2021, the fourth-largest oil giant, Cenovus, bought the fifth-largest oil giant, Husky, then proceeded to lay off 25 per cent of the workforce for both companies.
Since energy is Alberta’s main driving industry, these companies all have a huge stake in the provincial economy. Just these few companies alone are projected to generate 25 per cent of Alberta’s GDP in 2022. Even this figure is based on a rather conservative assumption that oil will sell for US$70 a barrel. If oil sells for US$100 or more per barrel—which is closer to its current price—that 25 per cent jumps to over 30 per cent.
The implications this has on provincial politics should be pretty clear. Capitalist politicians pander to these corporations to keep them local, and happy. That’s perfectly clear under the current United Conservative Party (UCP) administration. While working Albertans were treated to viscous austerity, oil barons got the red carpet treatment. One only needs to look at the billions of dollars UCP Premier Jason Kenney pumped into the doomed Keystone XL pipeline to see that.
Whenever politicians threaten to get Albertans their “fair share” of the oil money, they’re usually quick to change their tune upon taking office. The oil bosses possess an integral lever of the economy, and they can use that leverage to punish anyone who seems to fall out of line.
Take the provincial NDP for instance. Alberta NDP Leader Rachel Notley won the 2014 election on the promise she’d take the barons to task and win working Albertans their “fair share” of the oil revenues. This was completely unacceptable to the bosses. They unleashed a wave of attacks against the newly elected government through the mass media, screaming that Notley was going to crash the economy. Famous Canadian businessman and one-time Conservative Party of Canada leadership hopeful Kevin O’Leary openly told fellow investors not to invest in Alberta. What they were doing was threatening economic sabotage. If Rachel Notley and co. didn’t make their program more palpable to the needs of big business, the bosses would simply leave the province and set up somewhere else.
And it worked. The Alberta NDP became staunch cheerleaders of the oil industry in just a couple years. Notley and the NDP pushed heavily for pipeline expansion, granted the barons billions of dollars in handouts, and went so far as to implement austerity forcing the working class to pay for the oil barons’ profitability.
Oil should not be in the hands of private industry. Such a vital resource shouldn’t be used as leverage for a small group of millionaires to keep their pockets fat. The energy industry should be run according to the needs of society, and not the profits of the few. It should be taken out of the hands of the capitalists and nationalized, and it should be run democratically by the workers themselves. A collectively owned and democratically run energy sector would also make it possible to begin retooling production to finally transition away from fossil fuels to sustainable alternatives.
But what also needs to be stated is that the situation with oil and gas in Alberta is far from unique. It’s a natural by-product of capitalism. As long as control of the economy is left in the hands of the capitalists, they’re going to use coercion, manipulation, and sabotage to get their way. Therefore, all the main levers of the economy should be expropriated and placed in public hands. The only way we can end the meddlings of private interest is by creating a democratic, socialist planned economy.