cutandplante


Harper’s “New Vague”
08/12/2012, 19:34
Filed under: Economics, Politics

Harper’s approach to the foreign take-over of Nexen is incoherent at best, a recipe for corruption and patronage at worst.

Yesterday, Steven Harper announced that the government of Canada would allow the selling of Canadian privately owned Nexen to Chinese state-owned CNOOC. 15.4 billion dollars will exchange hands.

Harper is aware that the move will be unpopular, even among his base in Alberta. So, the Prime Minister took a reluctant tone.

But I’m not concerned by the politics of the decision. I’m concerned by how the decision was made, and, ultimately, the precedent it sets for how decisions will be made in the future.

The CBC reports:

The prime minister told reporters that future takeovers of Canadian oilsands companies would be allowed “only in an exceptional circumstance.”

The government is deliberately not defining what an “exceptional circumstance” might be, reserving for itself full powers of political discretion.

Greg Watson calls this approach Harper’s “new vague.” In short, the government will permit future take-overs if it is in their best interest… or… I mean… if it is in the nation’s best interest… or both, or neither… in fact, we have no idea!

The new vague is dangerous and irresponsible.

Criteria and process for decisions like this need to be transparent. Because the decisions are too important to be made for political reasons; and, because, with projects of this scale, the costs of buying people off can be virtually insignificant.* Leaving the decision up to, arguably unqualified, political elites makes the process vulnerable to political whim and corruption.

Decisions about foreign take-overs should be made by people qualified to make decisions about foreign take-overs.

It’s not that politicians shouldn’t have a role, but that their role should be different. The job of politicians is to oversee the experts, setting out the criteria they will base their decisions on, and making sure that they do so without corruption.

Even if the Harper Government are moral folk that would never let their private interests interfere with whether they let deals go ahead in the future,** this doesn’t mean that this will be the case with the next, and the next, and the next government.

In recent years, a number of leading thinkers (e.g.) have begun to articulate a theory of development that connects exactly the degree of transparency in decisions like these with long-term economic and social wellbeing.

With his new vague, Harper leads Canada one more step down the path of un-development.

* 1 million dollars represents only 0.006% of 15.4 billion dollars. If Nexen set aside a trivial 0.1 percent of their investment to pay people off, they would have 15.4 million dollars to soften up functionaries.

** The evidence hints at quite the opposite. This week the Harper Government removed protections on nearly all of Canada’s lakes and rivers. Of the handful that remain protected, 90% are in Conservative held ridings.

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