There was an interesting op-ed Saturday in Canada's National Post entitled, "U. S. needs Alberta's oil sands." According to the authors
For an investment of at least US$200-billion, the Americans, Asians or both could underpin projects that would guarantee the production of about four million barrels a day of non-OPEC oil from the oil sands.They argue that the oil sands currently aren't viable with private investment, and need a large injection of government support. That sounds strangely familiar. Since the bulk of their oil production goes to the United States, they make a case that the U.S. should provide the needed investment.
I'm not sure of the exact details of the situation, and I'm inherently skeptical of any call for government investment in industry, let alone foreign industry. But if 200 to 300 billion or so could really guarantee us four million barrels a day from Canada, I'd rather spend the money there than on most of what is contained in the bloated, wasteful stimulus package, or on more bailouts. Naturally of course, it won't be an either/or situation, since increased spending never seems to be offset by spending cuts in other areas.
For 200 billion dollars, the US could just invest in technology to reduce its demand by four million barrels a year: mass transit, high speed rail, retrofitting buildings for higher energy efficiency, alternative energy, cleaner industry.
ReplyDeleteOr the US could spend the money on propping up oil in Alberta, the richest sub-national entity in the world, where unemployment is still 4.1%, and where oil production per capita is higher than in Saudi Arabia.
"For 200 billion dollars..."
ReplyDeleteMaybe, but all of that involves longer-term projects that will probably cost far more money than initial estimates.
The only major projects in US history that came in under budget are some of the Great Depression-era bridges. In eras of growth (i.e. not now), especially high-inflation growth, budgets are fiction; the interstate system was budgeted at $25 billion and ended up costing $100. There's no reason to believe subways and clean energy incur more cost overruns than oil projects.
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