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THE OIL PRICE CRISIS: PEOPLE VS. CORPORATE GREED
(Statement by the Central Executive Committee, Communist Party of Canada)
(This article is from the October 1-15/2000 issue of People's Voice, Canada's leading communist newspaper. Articles can be reprinted free if the source is credited. Subscription rates in Canada: $25/year, or $12 low income rate; for U.S. readers - $25 US per year; other overseas readers - $25 US or $35 CDN per year. Send to: People's Voice, 706 Clark Drive, Vancouver, Canada, V5L 3J1.)
CRUDE OIL PRICES climbed ever higher in September, past $37 US per barrel, signalling yet another rise in fuel prices. European countries have been rocked by protests carried out by truckers, and North America is on the verge of similar road blockades and demonstrations.
Some environmental groups have welcomed skyrocketing gasoline prices as an opportunity to break modern capitalist society's dependence on the automobile. Given that the production of oil is expected to peak within 10-12 years, and that hydrocarbon emissions are a major factor in global climate change, an overall reduction in fuel consumption must be achieved, especially by the major industrial economies.
But today's oil crisis, taking place in the anarchy of the capitalist marketplace, is making life worse for millions of working people, including senior citizens and the poor who face huge increases in heating bills with winter just ahead.
The most powerful forces at work in the fuel crisis are the huge transnational oil monopolies, which are reaping incredible profits from the explosive climb in crude oil prices.
During the second quarter of this year, for example, 17 of Canada's largest oil and gas corporations surveyed by the Globe and Mail reported profits of $2.074 billion, a stunning 432% increase over their $413 million profits during the same three months of 1999. It's no coincidence that crude oil prices jumped from less than $20 US per barrel in the spring of 1999 to $32 US a year later.
Many observers have noted that in Britain during September, the cutoff of fuel to gas stations was largely orchestrated by the big oil companies. Instead of demanding immediate state intervention when tanker drivers refused to go through protests to deliver gasoline, the corporations stayed silent. Their goal is the same in Europe as in North America - to force governments to slash taxes on fuels, creating lower prices, more sales and increased profits.
The Canadian Alliance and Stockwell Day are demanding that Parliament act immediately to cut federal taxes on gasoline. Since the most generous backers of the Alliance and its predecessor, Reform, have been the Alberta-based oil and gas monopolies (closely tied to U.S. transnationals), this is hardly surprising. Such a move would simply open the public treasury of Canada to further enrich the oil companies.
But actions must be taken by governments, to assist truckers and consumers during this crisis, to help Canada avoid a huge economic downturn triggered by rising fuel prices, and to tackle the environmental impact of fossil fuel use.
One immediate measure would be to replace part of the current fuel taxes at the pumps with a windfall profits tax on the oil and gas monopolies. That would lower costs for working people without reducing government revenues, by forcing the profiteers to cover the difference.
Another useful step would be to restore the two-price system which existed in Canada until the 1970's - a lower price for domestically-produced oil and gas sold within Canada, and world prices for our exports. Such a policy should include subsidies for regions which depend on imported fuels, such as Quebec and Atlantic Canada. Since NAFTA and other "free trade" deals currently block such policies, Canada must abrogate these agreements and pull out of any further sovereignty-killing trade pacts.
In the longer term, steps should be taken to begin reversing the north-south orientation of Canada's energy grid, which robs our country of any real economic independence by chaining us to the USA. The Communist Party and other people's movements used to campaign for an east-west power grid; while the continuing sellout of Canada's energy and resources makes such a grid harder to create than it would have been in the past, it remains a necessary goal.
Finally, it is more urgent than ever to make the planned reduction of fossil fuel consumption a high priority. Governments at all levels in recent decades have failed to properly fund mass transit systems, forcing millions of Canadians to rely on private cars, a situation that must be changed. Similarly, the practice of provincial and local governments to give big corporations lower rates for large-scale energy and utility purchases must be scrapped.
The right-wing demands for tax cuts can only benefit wealthy shareholders of the big corporations. The Communist Party of Canada pledges to fight for solutions that meet the short and long term interests of working people, and that protect the environment and defend Canadian sovereignty.
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