The Blueprint: Canada's Conservative Podcast - Canada’s inflation reaching 8.1%

00:00:00.000 Hello, everyone. Welcome once again to The Blueprints. This is Canada's Conservative

00:00:07.000 Podcast. I'm your host, Jamie Schmael, Member of Parliament for Halliburton,

00:00:10.360 Co-Orthal Lakes Brock, with new content for you every single Tuesday, 1.30 p.m. Eastern Time.

00:00:15.920 We're not taking time off this summer because the Liberal gender is always moving. And because it 1.00

00:00:20.800 is, we ask that you like, subscribe, comment, share this program. Together, we can push back

00:00:26.020 against what the Liberals are doing. And this is probably content you're not getting in the

00:00:30.240 mainstream media. Because it is, we ask that you, if you can't watch or listen to this entire program

00:00:35.880 right this second, download it, listen to it on platforms like CastBox, iTunes, Google Play,

00:00:40.020 Spotify, you name it. It is out there. Today, we're going to talk about the world energy market.

00:00:45.720 We're going to talk about Canadian energy. We are going to talk about the importance of energy

00:00:50.200 independence. And to talk about that, we have a great friend in the show, the Member of Parliament

00:00:55.400 for Calgary Centre, the Shadow Minister for Natural Resources. Greg McLean, welcome back

00:01:00.040 on the show. Always a pleasure having you.

00:01:02.460 Jamie, thank you for having me. It is always a pleasure being here. So much appreciated.

00:01:06.720 Well, I remember last time we had you, we were in the studio and we talked about this topic

00:01:10.680 in particular, not focused a whole show on it, but we did touch on it. So let's follow up on that

00:01:16.720 domestic energy and what is going on in the world. You had a National Post article and I'll pull it up

00:01:23.260 in front of me on July 28th, 2022. Energy ignorance on display in Canada and Germany. Why don't you

00:01:31.800 tell us a bit about that? Well, thank you, Jamie. The article I wrote at the time, and obviously

00:01:36.880 you got to fit it in that 600 word format to get inside a publication. It really is about how

00:01:43.400 our policies on energy around the world have led us to where we are today. And where we are today is

00:01:48.900 best exemplified by Germany in the fact that they are losing energy security. That is, they're

00:01:54.580 entirely dependent on a hostile party at their borders in order to keep their economy rolling

00:01:59.940 this winter, in order to heat their homes, in order to light their homes. They are dependent on

00:02:04.540 Russia supplying them gas, not just gas though, but also oil. This is all based on a historical energy

00:02:11.620 policy that Angela Merkel came up with when she was Chancellor of Germany. It was called Energiewind.

00:02:17.320 And what that was is a pushback towards solar and wind as the solution to how they exit from

00:02:26.140 nuclear power. Germany's wanted to exit from nuclear power. Angela Merkel made this compromise

00:02:32.680 in order to gain the support of the Green Party and, you know, really support her coalition.

00:02:38.440 The cause of that, of course, now is over-dependence on Russian supply of the resource market,

00:02:43.140 oil and natural gas in particular. But let's talk about natural gas,

00:02:46.960 because this is exactly what I spoke with the German ambassador about a year and a half ago when I

00:02:52.800 met with her. At that point in time, they were looking at approving a project called Nord Stream 2,

00:02:58.480 which was a doubling of the pipeline supplying gas from Russia directly to Germany. And I was speaking

00:03:05.120 against it, how it would put them in a position where they were so dependent upon a hostile foreign

00:03:12.400 party potentially cutting off their gas supply and more or less making them completely energy insecure

00:03:18.240 at that point in time. And I pushed, of course, as my job is to try and get them committed to some

00:03:22.640 Canadian LNG supply and develop that infrastructure. So they'd also have a balance, a diversification,

00:03:28.800 if you will, of their natural gas supply. And those projects in Canada would take anywhere up to five

00:03:33.520 years, if you will, to actually get rolling. Remember what happens in Canada is projects get held up by

00:03:39.360 our current regulatory environment. So things don't get done. But we need this to get done. I think it's

00:03:44.160 the big impetus for us at this point in time. The one thing we've learned in this, of course, is that

00:03:49.840 get stuff done because the world needs our energy. If we had these LNG plants 10 years ago, there were 18

00:03:56.560 Canadian proposals for LNG export from Canada. If we had one of those up and running right now, we don't even have one,

00:04:02.640 we'd be able to provide some of the security the world requires while one of the world's

00:04:07.200 biggest energy suppliers is cutting off supply Western Europe. Well, that's where we have the

00:04:13.120 conversation. We're not, I don't think conservatives are against, well, we're definitely not against

00:04:17.520 green energy. We support that, but what we support is an abundance and a variety of options within the

00:04:23.600 energy market. So it's A plus B, not B minus A. We like abundance equals peace, right? When there's

00:04:30.640 shortage, there's conflict. And, and that's what we're trying to get across. Like if you want to

00:04:35.040 add to the energy supply, that's a good thing because competition is good. We see a lowering

00:04:41.600 of prices. We have a variety of options, but when you, when you totally take away sectors of our economy,

00:04:49.280 like the liberals are doing with oil and gas here in Canada and, and relying on other unproven

00:04:55.360 technologies at this point, you are going to cause shortage. We need to add different options to this

00:05:01.200 energy portfolio. You're correct. We are the whole thing that you're looking at as far as energy

00:05:07.520 supply and recall the energy, the article I wrote is about energy ignorance. There is no forecast out

00:05:14.720 there that doesn't have us consuming more energy in the world in 20 and 30 years. It's all forecasting.

00:05:20.800 The world will need more energy. Where does that energy come from is the question. Wind and solar,

00:05:26.160 as we point out in the article there at points in time in Germany, it provides less than 2% of the

00:05:32.160 required energy to run the factories, to eat the homes, to light the homes. So the compromises are

00:05:37.440 going to have to be made at some point in time there. The base load is going to continue to provide

00:05:42.080 the power force. No different from Canada, by the way. And I'm in Alberta, we have the Alberta electrical

00:05:47.120 system operator here. And there's points in time in this winter in Alberta, you can imagine it's

00:05:53.040 minus 40 below in parts of Alberta. My part of the country got down to minus 37 below this past winter.

00:05:59.200 At that point in time, our alternative energy, which we'll classify as wind and solar,

00:06:04.640 supplied less than 1% of the power required in Alberta. And they represent about 17% of our capacity.

00:06:13.440 So 70% of our built capacity providing less than 1% when we really need power. Therefore,

00:06:20.960 we need to continue to have those base load power mechanisms, whether they be

00:06:25.440 natural gas, which we're mostly moving off of coal, natural gas or nuclear. Now, nuclear is something

00:06:31.280 I think you and I have spoken about before. If we're going to address greenhouse gas emissions,

00:06:36.000 one of the technologies we need to look at is how we economically deliver nuclear power to Canadians.

00:06:42.560 And that's something that, again, the Germans have turned away from by choice here. France,

00:06:47.520 by the way, right on the door of Germany, has increased their nuclear power supply. So they're

00:06:52.320 trying to rebuild some of their power by nuclear in France, and Germany's turned completely away from

00:06:58.320 it. These are political choices. So recognized as the European Union, it covers one broad political

00:07:04.160 entity, but there's a bunch of other entities within that one broad political entity, France and Germany,

00:07:09.280 that are going different directions, and how they see that base load power. The problem that Germany 0.53

00:07:15.120 encountered right now, it's turning on a whole bunch of coal, and it's dirty coal in Germany,

00:07:19.920 it's way dirtier than Canadian coal. And that's how they're going to fund, they're going to feel most

00:07:24.800 of their base load power this year. But the point I'd like to make, and I'll quote Sabine Sparwasser,

00:07:30.160 who's the ambassador, but she came before the committee of House, the House Commons Committee

00:07:35.440 on Foreign Affairs last week, and said, we made a huge strategic mistake by creating such

00:07:41.920 a dependency on Russia. It is a grievous mistake. It happened over many, many decades, since the 1970s,

00:07:49.360 actually. Adding that Germany has made legislative changes to fast track its energy transition. I think

00:07:56.400 there's a reckoning on the part of the German government that for too long they relied on cheap

00:08:00.240 gas. That's Melanie Jolie's comment, okay? Well, Melanie Jolie, the reason they relied on cheap gas

00:08:07.440 is because getting gas from Russia was about half as expensive as getting LNG from North America,

00:08:14.480 because of the process we have to go through to supply that gas. Nevertheless, that is part of the price

00:08:20.080 and the cost, if you will, of energy security. This winter, Germany will enter energy poverty.

00:08:26.080 If they have a cold winter in Europe, we are going to see much dislocation, much discomfort. However,

00:08:32.640 it's our job to push forward with a world where we believe in the rights of democratic states to

00:08:40.320 continue to exist. What Russia's done in the Ukraine, the invasion, is abysmal. And I think we need to

00:08:46.480 continue to stand by Ukraine and make sure we enforce all the sanctions against Russia to make 0.55

00:08:52.160 sure that we come up with the support of one of our democratic partners in the world. The energy

00:08:57.760 issues we're going to have to recognize is going to be more expensive, but let's start getting those

00:09:02.640 energy solutions built to help Europe. Well, you remember back in Ontario, probably 16 years ago,

00:09:10.080 the provincial liberals at the time decided to start the Green Energy Act, which resulted in billions of

00:09:18.160 dollars in subsidies going to wind and solar plants and solar farms. And when the money ran out,

00:09:25.680 the jobs went away, unfortunately, and a lot of them were shipped off overseas. But at the same time,

00:09:33.760 people went into energy poverty because the cost of electricity went up substantially to make up for

00:09:39.840 these subsidies going elsewhere to these individuals. And it really caused problems

00:09:45.680 within our grid. And it was less than 5% at peak of our energy supply here in Ontario.

00:09:51.760 So it was a lot of pain for very little gain. But what happened in the House of Commons in the last

00:09:58.800 session, the NDP had a motion to tax the oil and gas companies because they made, Airfingers quote,

00:10:05.760 record profits. Well, if you're going to tax the oil and gas companies, what do you think is going

00:10:11.760 to happen to the price of oil and gas? It is absolutely ridiculous, their line of thinking. 0.90

00:10:18.560 It is. The inflationary suggestions that this government goes through is ridiculous. Of course, 0.99

00:10:23.600 the NDP piles on all the time because they think that corporations are taking money. Well, corporations

00:10:29.440 are making money. Yes, they are. And in the high oil and gas prices, yes, there are some profits being made by oil and gas

00:10:35.760 companies. That makes up for seven years of losses. There aren't too many companies in Canada, too many

00:10:41.680 industries that have gone through seven years of losses the way the oil and gas industry has. So some

00:10:46.480 of this is a makeup from some of the losses they've had over the last seven years to repair some of their

00:10:51.680 investors for the losses they've taken. You do not judge an industry on one year's performance.

00:10:57.360 Let's make sure we understand that. Let's also make sure that when the oil and gas industry

00:11:01.120 proffers, that prospers, pardon me, the Canadian economy prospers immensely. We have a way, you know,

00:11:08.880 the economic rent we get from the oil and gas industry in Canada is far superior to that used in

00:11:15.840 almost any country around the world. Norway is our only real competitor on how we perform 0.87

00:11:21.120 environmentally and from a social cost perspective on our oil and gas industry. So this year it looks like

00:11:27.840 the oil and gas industry is going to provide about 50 billion dollars of economic rent to Canadian

00:11:35.520 taxpayers. That's money that's going to fund schools, hospitals, all kinds of government programming,

00:11:41.760 and at the same time this government is going to continue to run a 52 billion dollar deficit. 0.84

00:11:46.560 That's ridiculous. We've got to start to get to paying our bills. Part of those bills get paid when

00:11:51.520 these companies are prosperous and they actually provide that money back to Canadian taxpayers so we have

00:11:56.640 the services that we do need to pay for. Inflation's at nine percent here in Canada. My goodness,

00:12:05.600 all they're doing is spending. As you just pointed out, they're going to keep spending.

00:12:08.960 It's like fighting, trying to cure cancer with more cancer. They're just spending again and again and

00:12:14.000 again. This is going to be, I think, very long-term pain for a lot of Canadians. Now they're talking about

00:12:21.200 reducing fertilizer use for our farmers by 30 percent. This is just on and on and on. We're

00:12:28.880 going to see hurt by the government. On average, Canadians just trying to get by.

00:12:35.840 You're right. The cost of food is going to go up under this government's plans from both a

00:12:40.560 production perspective if they cut back on fertilizer. Farmers will go out of business,

00:12:44.480 so we're producing less. Therefore, there'll be less supply. So cost of food will go up. Cost of

00:12:50.160 distributing food will go up as we continue to press down upon our distributors across Canada and their

00:12:56.720 cost of getting food to market. So there's all kinds of inflation this government's building into it.

00:13:02.320 But on top of that, they don't recognize the virus they're causing here with this overspending

00:13:08.160 is causing the inflation. Continue to watch this because you've already seen some protests finally

00:13:13.840 arrive from the governor of Bank of Canada. Now that I think he realizes that he's being judged

00:13:19.200 on his performance here in his, well, let me be quite blunt about it, his non-performance

00:13:24.480 in managing inflation. And that is his main job. He's completely failed at it. The whole Bank of Canada has.

00:13:31.120 So they've stumbled into bed with the Liberal government. Yes, we can continue to spend and spend

00:13:35.680 with these endless deficits. Well, we've doubled our debt in Canada and we're 1.3 trillion dollars

00:13:42.800 in debt as a country. That doesn't include our sub-national debt. That is our debts of all the

00:13:46.960 provinces. Ridiculous overspending going on. It does have a consequence. It has a consequence in 0.69

00:13:52.320 inflation, most likely seen in the housing debacle. And we've only seen the start of that at this point

00:13:58.960 in time, Jamie. It is absurd. These, you know, these decision makers are not coming to the conclusion

00:14:05.280 that they need to step back and actually stop causing the problems that are becoming more and

00:14:10.720 more severe in the economy. It seems the government seems to be creating one problem after another and

00:14:15.440 then trying to fix the problem that they caused in the first place. But I think I said 9% inflation.

00:14:20.640 It is 8.1. So I do apologize. We are running out of time. I wanted to continue this about inflation,

00:14:27.760 but I just, in the absence of an abundance of time, I'm just going to quickly go back to the article that

00:14:33.840 you talked about and we've been referencing in the National Post and Financial Post. Canada did do

00:14:40.720 something quite interesting, which was help along the Nord Stream 2 pipeline, the twinning of that

00:14:46.000 pipeline by releasing the turbines back to Russia. I'm glad the President of Ukraine, not exactly overly

00:14:54.480 happy about that either. Jamie, that's Nord Stream 1. Nord Stream 2 has been built, but never turned

00:15:01.200 on. So Nord Stream 2 is a twinning of Nord Stream 1. And before it got turned on, you had significant

00:15:07.360 lobbying from the United States in particular of Germany. So don't turn this on because look at what

00:15:13.040 Russia is doing. Russia had, you know, Germany had lots of foresight on what was going to happen. They 0.60

00:15:19.200 had all kinds of warnings, including for me, that this is where you are putting yourself as far as

00:15:24.320 energy dependency goes. So please look for other options. And now they're coming saying, well, we,

00:15:30.320 you know, we shouldn't have done what we did. Well, you know, how many people had to tell you that in

00:15:34.320 the first place? If Nord Stream 2 had been turned on, think about the double dependency Germany would

00:15:40.240 have right now on Russian gas. So this is something, the actual compressors, the turbines we talk about

00:15:46.720 that get repaired at a facility in Montreal. Canada reneged on its sanctions on Russia

00:15:54.080 to support our partners in Ukraine in order to deliver these compressors back.

00:15:59.120 And the false narrative that I've heard the two ministers, Minister Jolie and Minister Wilkinson

00:16:03.760 deliver on this is that we had to do that so that we could call Russia's bluff. We'd make them kind of 0.85

00:16:12.080 say that they, you know, it's not Canada's fault. Well, it doesn't matter whose fault it is. It doesn't

00:16:16.560 matter who gets blamed. We know Russia is not a reliable partner. We know they're at war with the

00:16:22.080 democracy in Europe. We know what they're going to extract a whole bunch of value for their,

00:16:29.680 for the resource this winter from a dependent Europe. Now, let me just go into that one final

00:16:34.320 bit here, Jamie. Recognize that when you're, when Russia is in that much control of European energy,

00:16:41.840 it gets to term, gets to determine supply supply, therefore determines price and scarcity. It would

00:16:49.120 surprise you to know the natural gas deliveries in Europe are about seven times more expensive than

00:16:54.480 they are in Canada. It's ridiculous what they have to pay for natural gas supply right now in Europe.

00:16:59.360 And that's because of the position they put themselves in. We need to make sure we don't

00:17:04.400 put Canada in that same position where Canadians are paying seven times more for energy because of bad

00:17:11.200 government policy. Well, the carbon tax here in Canada that keeps going up for every single year

00:17:16.640 isn't exactly helping either. Greg, we are running out of time. I have a whole slew of other questions

00:17:22.080 for you, like I always do. But as you know, the guest always gets the last word. So I turn the floor

00:17:27.040 over to you. Well, thank you, Jamie. Great being here. And I hope everybody takes a look at these.

00:17:31.520 Like I say, the article is about energy ignorance. We have a follow-up article on it as well.

00:17:36.000 People need to understand that energy is a system. Energy has to be on and to be available all the time

00:17:40.960 in order to fuel our economy, heater homes, lighter homes. These are things you cannot turn off or

00:17:47.040 depend on for a little switch. We're going to be consuming more of it. Let's make sure we transition 0.93

00:17:52.320 in any way effectively and with our eyes wide open about the costs and what the effects, including the

00:17:58.480 environmental effects, of every one of those transitions look like. Thanks for the time today,

00:18:02.960 Jamie. Really appreciate being here. Always a pleasure. Greg McLean, the Member of Parliament for

00:18:07.600 Calgary Centre, also the Shadow Minister for Natural Resources. Always a pleasure and always

00:18:12.240 too short of time to tackle all the issues you're dealing with. But again, we always have them back

00:18:17.440 and we'll do so again. We appreciate your time as well with new content every single Tuesday,

00:18:22.160 1.30pm Eastern Time. We ask that you like, comment, subscribe, share this program. If you can't

00:18:26.880 watch or listen to it at the exact moment, please download it. Tell your friends about it. Listen to it.

00:18:31.520 Platforms like Castbox, iTunes, Google Play, Spotify, you name it. It is out there. Until next Tuesday,

00:18:37.280 remember, low taxes, less government, more freedom. That's the blueprint.

The Blueprint: Canada's Conservative Podcast - August 09, 2022

Canada’s inflation reaching 8.1%

Episode Stats

Summary

Transcript