Stephen Harper
hasn’t depended on public servants or public policy executives in Canada’s commercial
banks to govern credibly as a market conservative. Doing Canada’s part to fight
a global recession didn’t require reshaping his core beliefs: that governments
should be more efficient but shouldn’t then try to run businesses, and that businesses
best serve all of us when they compete in robust markets.
However, the
enthusiasm of Chinese state-owned enterprises (SOE) to buy oil and resource
companies in small market economies has put Harper in an especially dangerous
corner.
It will be mighty
difficult for his government to reject or
approve China’s state-owned CNOOC’s Ltd.’s bid for Nexen Inc., a private
Alberta-based oil company. Harper’s fated to look reckless amongst those who
see China’s good opinion—and money—as the performance-enhancing drug that will
free Canada from a mediocre future with the US or just a phony amongst market
conservatives—and a majority of Albertans.
Unsurprisingly,
he’s turned to wordsmiths in government to justify what’s almost impossible:
allowing the equity sale of a growing share of what Harper’s called Canada’s
economic growth engine to a superpower state-owned enterprise. Simply, they’re
assigned to try to find a convincing way to say that state capitalism can be a
positive force in free markets—even better in Canada than it is now in France
and China, for instance.
The political fallout of accepting the $15-billion bid by CNOOC, however, will not be limited to
those who are impressed by government framework statements. A survey of Alberta opinion
by the
China Institute at the University of Alberta produced rather awkward news:
“However, the poll said 64 per
cent of Albertans opposed Chinese investment in Alberta in the form of full
ownership, with 15 per cent saying it's acceptable and 21 per cent neither
agreeing nor disagreeing.
“In
the same vein, 53 per cent of Albertans opposed investments in Alberta's oil
and gas sector by Chinese state-owned companies, while 24 per cent
supported it and 23 per cent were on the fence, according to the poll.
Albertans were largely split on allowing Chinese investment in Alberta in the
form of partial ownership, with 37 per cent supporting it, 36 per cent opposing
it, while 27 per cent neither agreed nor disagreed.”
This shouldn’t surprise Harper. Albertans and Western
Canadians generally are passionately attached to local self-government and are wary
about outside big government influence, Canadian or otherwise.
Along with grass-root skepticism in his political base,
Harper will also have to contend with growing opposition to SOEs amongst
conservative opinion leaders. The
National Post, English-speaking Canada’s Wall Street Journal for literate conservatives, has decided to raise
hell. Today, on its front page, it ran a comment by Terence Corcoran
entitled “Fascism by another name: state ownership makes mockery of markets.”
Corcoran nails the problem for Harper’s wordsmiths:
“If Canadians have sound economic
and political reasons for rejecting Canadian SOEs, how can we embrace foreign
SOEs?”
Choosing to think that Chinese state capitalists will evolve
to be even more “commercially oriented” than the mediocre state capitalists who
operate in Canada and elsewhere in the West, needless to say, will be born of
fear, not of any realistic hope that China will de-politicize its government
businesses—fear, that is, of offending China, and fear that Canada can’t prosper
without their equity.
These concerns may prevail. However, Harper’s vision of
Canada as a selfreliant energy superpower should then be put in storage for
another costume party, out there in the distant future.
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