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Abstract
Canada’s political economy has been reshaped by extractivist forces based in the western tar sands. The objective of this article is to propose a model of these socioeconomic forces identifying the structures and dynamics that characterize the hydrocarbon extractive sector in an “age of extreme oil” through the development of a theory of the capitalist pressure to extract “unburnable carbon.” This aspect of our model has wider significance for an ecological and political economics given the emerging policy consensus around the need to transition from carbon-based economies because the capitalist pressure to extract acts as a powerful counterforce to this ecological imperative.
Acknowledgements
An earlier version was presented at the kick-off public conference entitled “Extreme Oil: Corporate Power, Tar Sands Expansion, and the Capitalist Pressure to Extract” for the Corporate Mapping Project, Canadian Centre for Policy Alternatives—BC Office, and University of Victoria Faculty of Social Sciences, a research initiative funded by the Social Sciences and Humanities Research Council of Canada. Finally, the argument benefitted from valuable inputs and comments from the reviewers, Andrew Jackson, Jim Stanford, and James Calvert, as well as collaborators at CMP: Ian Hussey, Emma Jackson, Shannon Daub, Bill Carroll, and Angela Carter.
Notes
Disclosure statement
No potential conflict of interest was reported by the author.
Funding
This research was supported by the Corporate Mapping Project, Canadian Centre for Policy Alternatives—BC Office, and University of Victoria Faculty of Social Sciences, funded by the Social Sciences and Humanities Research Council of Canada.
About the author
Éric Pineault teaches in the Institute of Environmental Sciences at the Université du Québec à Montréal in Montreal, Quebec, and is a Research Partner at the Corporate Mapping Project.
Notes
1 http://www.tomdispatch.com/post/175249/tomgram:_michael_klare,_the_oil_rush_to_hell/#more; http://www.tomdispatch.com/post/174829.
3 McGlade and Ekins, “The Geographical Distribution of Fossil Fuels,” 187–90.
4 Hansen et al., “Assessing ‘Dangerous Climate Change,’” e81648.
5 For example, both Bloomberg and the Financial Times have used the expression when reporting evaluations made by environmental groups such as the Rainforest Action Network (RAN) of the exposure of large financial institutions to the hydrocarbon sector. See Rainforest Action Network, Banking on Climate Change, 2018. https://www.ran.org/bankingonclimatechange2018.
6 Ran et al., “Are extreme ‘oil and gas projects that face the highest levels or stranded asset risk under 2 degrees-Celsius climate stabilization scenarios,’” 12.
7 This is a central principle of the research initiative “The Corporate Mapping Project” of which this paper is an outcome.
8 Hall, Lambert, and Balogh, “EROI of Different Fuels,” 64, 141–52. Campbell, “Energy Analysis of Emerging Methods,” 57–68. Wang, et al., “Energy Return on Investment.”
9 Vaughan, Gough, and Mander. “The Sower’s Way,” 11.
10 Parson and Ray. “Sustainable Colonization.”
11 Haley, “From Staples Trap to Carbon Trap,” 97–132. Seto et al., “Carbon Lock-In,” 425–52.
12 Huber, “Refined Politics,” 295–312.
13 Huber, “The Use of Gasoline,” 465–86.
14 Foster, “The Ecology of Marxian Political Economy,” 1–16.
15 Day et al., “The Energy Pillars of Society.”
16 We will revisit these ideas taken from John Bellamy Foster’s The Theory of Monopoly Capitalism.
17 Pineault, Eric. Le piége Énergie Est [The Energy East Trap]. Montréal: Écosociété, 2016 .
18 His seminal work being The Fur Trade in Canada: An Introduction to Canadian Economic History.
19 An ongoing criticism of the staples school of political economy by Marxist authors has been this focus on the sphere of circulation. See, for a thorough assessment, McNally, “Staple Theory as Commodity Fetishism,” 35–63.
20 One of the most famous being Marshall McLuhan.
21 Watkins, “A Staples Theory of Economic Growth,” 141–58.
22 This interpretation of the positive role of linkages as levers on diversification is particularly important for part of the Latin Americans left in Bolivia and Ecuador, where the progressive governments have inherited an intensely primarized economic situation. Here in Canada, several large unions defend a similar position regarding the tar sands industry.
23 Jim Stanford’s work, “The Staple Theory @ 50,” is traversed by a tension between this interpretation and a more critical “extractivist” interpretation.
24 Watkins. “Staples Redux,” 213–26.
25 Fast, “Stapled to the Front Door,” 31–60.
26 Huber, “Energizing Historical Materialism,” 105–15.
27 Mitchell, Timothy. Carbon Democracy. London: Verso, 2011.
28 According to the report by the International Agency of Energy in 2014, oil use must continue to expand, but according to a weaker rhythm of growth in the twenty-first century than in the twentieth century. When we examine the rhythm of the growth of the use of oil, we notice that, for countries in the Organisation for Economic Co-operation and Development (OECD), despite a rise in the absolute value of the quantity of petroleum consumption, there was a relative reduction in petroleum consumption per Gross Domestic Product (GDP) growth point after 1980. Corresponding to this is a faster increase in the consumption of petroleum per GDP growth point outside of the OECD. In the context of relative deindustrialization, we can, therefore, accept that the consumption of oil by the economies of the OECD is greater if we take into account the oil included in their imports. (International Energy Agency, World Energy Outlook, 2014, Chapter 1, “Scope and Methodology.”)
29 Stern, “The Role of Energy,” 26–51. What we call the “rebound” or “Jevons” effect results primarily from this capitalist pressure rather than from an “energivore” tendency inherent to human nature. It is a manifestation of the more general imperative which, according to Baran and Sweezy, marks the valorization of advanced capitalism, namely to absorb the economic surplus.
30 According to http://www.jwnenergy.com/article/2017/3/charts-canadian-companies-about-own-80%-oilsands-production/.
31 This figure includes public investments. The oil-and-gas extractive sector represented 30 percent of total private-sector investment in 2014.
32 Discussions about primary-sector lead development in Canada have typically focused on other data sets that examine current activity, such as staples intensity of exports, staples-sector employment share, or staples-sector GDP share, such as in Fast, 2014. Ownership data have also been an important part of a discussion concerned with the foreign control of the Canadian extractive sectors. It is also in this light that investment data have been studied, primarily as inward Foreign Direct Investment flows. By focusing on investment data, we are trying to capture the accumulation process in a Kaleckian macroeconomic framework. We are not concerned with the degree of foreign control of the Canadian economy, nor geoeconomic status as a member of the capitalist core or semiperiphery. We have explicitly broken with the neo-Innisian syllogism that primarization = peripherization. We are thus in full agreement with the critical assessment made by Paul Kellogg in 2015: Canada is definitely part of the capitalist core of the world economy.
33 According to the Canadian Association of Petroleum Producers, data for 2014, taken from “Economic Outlook for Canada's Energy Sector, 2014,” http://www.capp.ca/getdoc.aspx?DocId =253034&DT=PDF.
34 According to the 2014 report by the Canadian Association of Petroleum Producers, Crude Oil, Markets and Transportation.
35 According to the 2017 report by the Canadian Association of Petroleum Producers, Crude Oil, Markets and Transportation.
36 Under expansion thanks to the investments in the exploration and improvement of the performance of extraction techniques.
37 The International Agency of Energy estimates, in its 2014 report, that, between 2015 and 2035, 48 trillion dollars must be invested to ensure the world’s energy production. Of that amount, eight trillion will go towards energy efficiency, and of the remaining 40 trillion, 26 trillion will be dedicated to the extraction, transport, and refinery of fossil fuels. Over that period, the Agency estimates that fossil fuels will still account for at least 76 percent of the production of primary energy. As of 2014, they account for 82 percent, so the decline is very small. From the perspective of the industry, there is no short-term transition away from fossil fuels.
38 If the flow of oil consumed increases in a continuous manner, the expansion of the transport capacity of pipelines increases incrementally.
39 Denault, Noir Canada.
40 Naomi Klein's Leap Manifesto initiative has been a significant development. It has brought together leading environmentalists, many progressives, Indigenous leaders, and cultural personalities around a platform demanding a move away from carbon-based forms of energy. Although the document does not call directly for an end to tar-sands extraction, it does formulate a concrete pathway towards a just transition for Canada. This initiative follows in the wake of an earlier manifesto, launched in Québec, with similar demands. This burgeoning national movement against the capitalist pressure to extract was not able to sway or influence the major political parties during the 2015 national election, and the labour movement has only timidly signed on. Time will tell if the just-transition proposal can move out the margins and become an unavoidable perspective on Canada’s economic and energetic future.
41 A case in point is the “cheap banana” that became a staple food item in postwar North America and a staple product controlled by American monopolistic corporations. Schor, “Prices and Quantities,” 309–20.
42 Stephen G. Bunker, “Raw material and the global economy”, 419–429.
43 This is particularly true of nonconventional oil producers in North America—for tight oil or tar sands production—who, after the 2014 oil price drop on global markets, have been forced to keep production going even though markets are glutted and prices have crashed. On this, see our analysis with Ian Hussey, “Restructuring in Alberta’s Oil Industry: Internationals Pull Out, Domestic Majors Double Down.” http://www.corporatemapping.ca/restructuring-in-albertas-oil-industry-internationals-pull-out-domestic-majors-double-down/.
44 As is often the case for Indigenous communities.
45 On this, see the analysis in terms of a “northern petro-state” gathered by political ecologist Laurie Adkins in First World Petro-Politics: The Political Ecology and Governance of Alberta.
46 On this notion, see Carroll, “Hegemony, Counter-hegemony, Anti-hegemony.”
47 Of course, a hegemony of this sort is contested. But hegemonic power is also exercised against those social forces that, actively or passively, stand in the way of the expansion of extractive activities—passively in the form of an occupation and use of territory that is incompatible with the development of the extractive chain, and actively in the form of a structured opposition to extractive projects. In both cases, the extractive classes will mobilize State power in the form of a process of dispossession against these forces of resistance, a process combining cooptation and repression, as has been amply documented by political ecologists and environmental justice movements and scholars; again, see Adkins, “First World Petro-Politics: The Political Ecology and Governance of Alberta.”
48 For a more detailed account of some of these measures, see Carter, “Petro-Capitalism and the Tar Sands.”
49 Hughes, “Canada’s Energy Outlook.”