In this episode of The Pipeline, The Western Standard's National Affairs Program, hosts Dave Naylor and Paul Holmes discuss the new coronavirus pandemic, the price of oil, and the Alberta budget. Topics covered include: - The new pandemic of the novel virus, Coronavirus and its impact on Canada's economy - How to deal with a global pandemic - Why the world should be worried about it - Why we need to be prepared for it - Why it's a good idea to have a plan to fight it - What to do if it becomes worse than we thought - How much money should we be spending on it?
00:00:36.480And featuring Dave Naylor from Calgary, our news editor back in Calgary. I see you, Dave.
00:00:43.760Yep, back from Dreary, Abbotsford, all the way to Dreary, Calgary now. I'll tell you what,
00:00:48.440Abbotsford never went below zero and we're threatening to get to minus 28 here, so
00:00:53.020hold on, hold, give me Dreary, Abbotsford over this weather.
00:00:57.340And hosted by myself, digital editor Paul Holmes from always beautiful and balmy Victoria,
00:01:06.100British Columbia. Topics this week include COVID-19 and or the novel coronavirus and some of the
00:01:16.940issues around that, some breaking news as well. We're going to discuss the price of oil and we're
00:01:24.320going to get in a little bit into the Alberta budget because those two things kind of go together.
00:01:30.040But before we get into the topics, just want to remind everybody, if you're not a member,
00:01:35.160please head over to the membership page at westernstandardonline.com and sign up today.
00:01:41.340Those of you who have become a member, you're helping us reach our goals for membership,
00:01:46.420keep us live and on the air. So thank you very much for that. So let's dive in. Some breaking news.
00:01:56.100Dave, why don't you break down the breaking news that we're breaking right here?
00:02:00.780Breaking right here. Well, just mere minutes ago, the World Health Organization officially declared
00:02:06.420this coronavirus outbreak a pandemic. I'm not sure what that means in Latin, but I think it means we're all
00:02:12.680screwed and need to buy toilet paper. So it's the next step. Basically says this is going around the
00:02:18.800world. Sort of really no way to stop it now. At the same time in Ottawa, Prime Minister Trudeau was
00:02:26.600announcing he was coming out with more than a billion dollars to help fight the outbreaks or the, I guess,
00:02:34.240the aftermath of coronavirus. That's money going to the provinces, health care and things like that.
00:02:40.500So looks like there's no stopping it now, Paul. Well, the last pandemic that was declared was 2009 with
00:02:50.580the H1N1. And before that, we're looking at 1968. Of course, 1957, there was the H2N2. And otherwise,
00:03:04.420we're heading all the way back 102 years ago to believe that was the Spanish flu. So this is, this is a big
00:03:12.740declaration today. You know, we're not, this is getting pretty serious.
00:03:16.900Well, it's scary, Paul. It's scary. You look at the Spanish flu, 1919, in terms of history, not that long ago,
00:03:23.780that's reported to have killed up to 100 million people.
00:03:26.900I've seen fatality reports of coronavirus that, you know, 3.4%, 3% to 3.4%. Then you multiply that by the amount of people in the world. It's a very, very scary figure.
00:03:41.380Well, I'm, and I'm definitely not a biology expert or a doctor. None of us are. But one thing I'm pretty good at is math. And they're telling us that the
00:03:55.380number of cases is doubling every four days. And I don't know if you guys remember this one, but you know, I can give you a million dollars today,
00:04:03.380or I can give you a penny and double it every day for the next 30 days. Uh, you're far better off to take the penny.
00:04:10.900And, uh, when we're dealing with doubling situations like that, we're looking at exponential growth and
00:04:16.420potentially, uh, you know, uh, exactly what, um, you know, we, we all fear, which is a massive global pandemic.
00:04:24.740Uh, and it certainly, that's the way, um, well, I should say, and, um, Derek, you, you probably have some thoughts on this as well.
00:04:33.460They, depending on who, which media you're listening to, we're either all going to die. And this is the
00:04:39.060worst thing ever and has been for the last several weeks. Um, or they're downplaying what seems to be
00:04:46.340something a lot more significant and sort of depends outlet to outlet, person to person. I think there's
00:04:51.780a lot of healthy skepticism and I think there's also a lot of, um, fear mongering going on as well.
00:04:57.460So I don't know. What's your take there?
00:04:58.740Well, this is something we've, we've struggled with since this, uh, first, uh, since we first
00:05:05.460started hearing of this funny sounding virus. Um, you know, I'm, I'm naturally skeptical of when
00:05:12.980governments proclaim emergencies on things like this and the media start going on about it.
00:05:17.860Governments love opportunity to flex their muscle. Uh, they love opportunity to blame outside
00:05:22.900factors on, uh, domestic, uh, domestic problems on outside factors. Uh, so when,
00:05:29.380you know, anyone with a soft economy can, can point to this and the politicians can say,
00:05:33.460none of this is our fault. Um, and then the media, uh, you know, we, we've struggled with this more
00:05:39.700directly is, uh, our, our, do we need to report on this frequently and feverishly as an important story
00:05:49.460or are we fear mongering to try and drive clicks to dry and draw, uh, advertising, uh, in the media
00:05:55.860business, uh, today it's no longer the old subscription newspaper where, uh, people are kind of in it for
00:06:03.540the long haul and you need a big story every month or two to keep people engaged. Uh, competition in
00:06:11.140the media business is fierce and it's, there's a, there's a, a very, uh, there's very tough competition
00:06:18.980to be the first out with something and to have it as loudly and, uh, a headline as alarmist as possible
00:06:24.580to drive that traffic. And so media love disasters, you know, the old saying, if it bleeds, it leads
00:06:31.780media, uh, they might personally not like it, but they love disasters. They love wars. They love
00:06:38.180pandemics. They like anything that's going to get people scared and driving things. And so we, we've
00:06:43.540really struggled with trying to find that balance, the Western standard, trying not to be fear mongers,
00:06:49.060but trying to keep people informed about, uh, you know, developments on the story. Part of the problem
00:06:56.500is, uh, none of us really know what we're talking about. We're not doctors. Uh, I, I've started to
00:07:03.940reach out in the last few days to actual doctors and experts, public health officials to try and
00:07:09.700actually get a better sense of how serious this might be because the media is in a feedback loop.
00:07:15.140Uh, CNN says it, then Fox says it, Fox says it, the Globe and Mail says it, the Globe and Mail says it,
00:07:20.500we say it, we say it, the Calvary Sun says it, and it's all in a bit of a feedback loop.
00:07:25.220So our, our sense of how important this is, is often, uh, related by the coverage of other media.
00:07:31.140And we can really end up in a feedback loop very quickly. Uh, that being said, I mean,
00:07:37.460there are some credible people out there saying that this is a very big deal. This is not fear
00:07:43.060mongering. This is very serious. Um, uh, I've not gone out and stocked up on toilet paper.
00:07:50.100Uh, maybe wash my hands a little more carefully, but you know, we, my generation or you older guys
00:07:59.460have never dealt with anything on this scale. Uh, I, I remember very vividly, uh, in Coots, Alberta,
00:08:06.180it's a little tiny, tiny border town, uh, between Alberta and Montana. And I've got, uh,
00:08:12.340uh, my in-laws side, some, uh, some relatives there and you go to the Coots, Alberta graveyard
00:08:17.860and look around and you can see, uh, the, the dates in which people died. And the number of people
00:08:25.140from 1919 is terrifying. It is just a tiny, tiny little town with some farms around it. And, uh,
00:08:34.420the old graveyard there, there's two notable things about it. One is that there's a, I think
00:08:39.620the coolest gravestone in Alberta, it says Fletcher stranger in town. And that's all it says. Uh,
00:08:45.780I kind of feel like he may have gotten in an old West shootout. Um, but the other notable thing is
00:08:50.260the number of people from 1919, more people died from the Spanish flu than from the first world war
00:08:56.420less than a year earlier. Uh, and much of it was driven by war and in a, in a, in our globalized
00:09:01.540world today where people travel so frequently and with, with relatively little restriction,
00:09:07.060uh, it is so easy for this stuff to get out. Well, and this was the point of, uh, with the
00:09:12.820Spanish flu was as people were returning from war, they were traveling and they were bringing
00:09:19.380the virus home with them. And, uh, you know, that's, I, I, you know, I don't know that epidemiology
00:09:25.620sort of has nailed that down precisely, but certainly that's the theory that, uh, I've heard a number
00:09:30.820of times when it comes to the Spanish flu. Um, again, I'm not, none of us are experts, but that
00:09:35.860was, uh, that was my understanding. There's nothing more terrible in the world than surviving four years
00:09:40.500in the Western front trenches to come home and die of a flu. Yeah. Well, and, and ultimately when you look
00:09:46.900at global travel in 1919 and you compare that with global travel in 2020, uh, everything is moving 12 times
00:09:56.180faster and, uh, you know, a hundred times as, as often. Right. And, uh, uh, uh, yeah, you know, this,
00:10:02.980this thing can move quickly and, and really the sense I've gotten from, you know, again, the coverage
00:10:08.420I've been watching, you know, as a, as a non-expert observer, um, is that, uh, really what they want to
00:10:14.980try to do is slow this down, uh, to buy time, basically buy time to treat everybody effectively,
00:10:21.620uh, and to buy time, uh, to hopefully, uh, develop a vaccine. But, you know, vaccines take a long time
00:10:29.220and, uh, you know, I, I don't think we're going to get ahead of this one at looking at the rate that
00:10:34.740it's, that it's increasing. Again, um, the math behind it is, is a bit terrifying. Um, I have stocked
00:10:41.780up on toilet paper, but you know, I'm a bit of a regular dude. You're the guy who bought out Costco.
00:10:46.420Oh, I bought out Costco like months ago. You know, don't worry, man. I've got, uh, I'm, I'm doomsday
00:10:54.020prepped to the hilt over here. Um, does anybody know where this toilet paper thing came from?
00:11:00.420I mean, the coronavirus is a respiratory disease. It's not gastrointestinal.
00:11:06.820Walking around with like 200 rolls of toilet paper, thinking, okay, we're going to eat this
00:11:11.380when the pandemic gets worse. I just don't understand. I haven't been able to figure out
00:11:16.340where this came from. Well, the best I can, I mean, you're, it's completely irrational and based
00:11:21.780on panic. Right. And, and these things build on themselves, but you know, there's a good argument
00:11:26.580to say that if you are going to be quarantined at home for four, four weeks or five weeks, you better
00:11:32.020damn well have enough toilet paper on toilet paper. Like there are so many necessities bottled, like, you
00:11:38.420know, like I, I lived right at the center of the, I would live in bonus Calgary when the flood came
00:11:43.220through. Like there are certain necessities that go, uh, water canned foods, like non-perishables.
00:11:49.460There's batteries. There's a lot of this stuff that goes, I've never heard of a panic where everybody
00:11:55.220just buys TP. Well, I mean, and if TP is really what's going to save us, Venezuela is screwed.
00:12:02.660They've been out of toilet paper for a decade. I, it's, it, I think, I think it actually,
00:12:07.540I think there is actually a logical explanation. You know, when people, people are stocking up on food,
00:12:13.700but they're not all stocking up on the exact same food. And Costco is more than happy to continue to
00:12:18.900ship, you know, crates full of food. Right. And, uh, and a toilet paper is one thing. And it's one
00:12:25.060thing that if you are in fact stuck at your house for, you know, four to six weeks, uh, you really
00:12:30.260don't want to run out of it. Ideally. Um, it would be kind of a terrible thing. And so I'm already
00:12:35.780stepping the birch bark off the trees in my yard. I think there's a logical component, but then the
00:12:40.580other part that does happen is people see other people doing it. And I know people on my Facebook that
00:12:47.540went to buy a toilet paper because they were suddenly worried that there wouldn't be any.
00:12:52.980And, uh, they were down, they were just that I could see it's a, that I could see it's a,
00:12:57.540it's the kind of feedback loop is you see a couple of people have gone out and bought a truckload of
00:13:02.100toilet paper and you might just reasonably need toilet paper and you're worried that everybody
00:13:06.980else is going to buy it. So now it's, it's almost like a run on the bank. You know, if a couple of
00:13:11.540people withdraw all their money, everyone's afraid there'll be nothing left. And then everybody runs on the
00:13:15.220bank. So we've got to run on toilet paper. The other thing is this particular, um, emergency
00:13:21.140isn't going to involve, um, not having access to water or electricity probably. Right. And so the
00:13:27.860things that you would ordinarily stock up for in situations where you're expecting power outage
00:13:32.900or water stoppage, uh, are not the things you're, you're a panic buying right now. Dave, go ahead.
00:13:38.340Well, uh, bringing up, uh, uh, you know, a serious turn of events. Uh, there's a small community in
00:13:44.260New York state that has a cluster of, uh, coronavirus outbreak and they have 172 cases that I believe
00:13:51.060it is. Uh, New York governor yesterday called in the national guard. So you're going to have military
00:13:57.060troops on the street enforcing a ring around this, uh, this neighborhood with a cluster in it,
00:14:03.460making sure nobody goes in or out. Now that's scary when you're seeing troops on the ground
00:14:08.660in, in, in your city basically saying you can't leave your neighborhood and that's, that's taking
00:14:16.260it up a notch for sure. Well, and, and you know, the other piece of this that, you know, we're not,
00:14:21.380we haven't, because we haven't really taken this seriously in North America, uh, we don't know what
00:14:28.580we don't know. And when you look at the countries that have the high counts, Hong Kong and Iran in
00:14:35.300particular, those countries started mass testing people. We haven't mass tested people. I was sick
00:14:41.860last week. Nobody gave me a test, right? Maybe I had the coronavirus. I have no idea. Right. And I,
00:14:48.180and may never know. Um, but I bet you if we went and tested a million random people in North America,
00:14:54.980we would probably find a bunch of this out there. Um, if they're without symptoms.
00:14:59.300It is the time of year for coughs and runny noses. Exactly. You cough at the neighborhood pub,
00:15:05.300you're going to be shunned. Right. The Calgary, the Calgary board of education yesterday put out
00:15:09.940a statement to parents and said, your kid is sick. Don't send them. We don't want them. That's right.
00:15:14.660Well, this is, um, at home happy. Yeah. And this is, um, really going to have economic, big economic impacts
00:15:24.020beyond just trade. Um, you know, my wife is in the hotel conference business and runs the conference
00:15:31.220center here in Calgary. And the number of cancellations there have been for big events
00:15:37.060is, is quite startling. Um, you know, I, I won't get into specifics, but I know of several conferences
00:15:43.700that, uh, I had some attention of, uh, perhaps attending. Um, uh, I, I won't name those conferences
00:15:52.100because I don't want to get them in trouble, but, uh, conferences, uh, at hotels and conference
00:15:56.820centers are being canceled across the country. Uh, because people are just, are pulling up and
00:16:01.940leaving, uh, companies and associations are walking away from very big deposits right now,
00:16:08.580uh, because they're just not going to hold an event where everyone's expected to be together because,
00:16:12.260uh, I mean, we are just getting started. Uh, I've been extremely skeptical about the seriousness of this.
00:16:18.660Um, uh, and I'm only now starting to maybe believe what we're being told. Uh, that's my tinfoil hat
00:16:28.580maybe coming off a little bit. And, uh, but, but this is gonna, this is gonna have huge economic
00:16:33.540impacts. This isn't just, uh, international travel and trade, uh, even just domestically in every city
00:16:39.460across the country. Uh, this is gonna, the hotel business is gonna be one of the first casualties of
00:16:46.340this after the airline business and the cruise business. And they, this is the, this is the,
00:16:51.060the part that where it kind of does, you know, it matters in terms of lives and in terms of,
00:16:57.300you know, all the heartache that, that this can cause when, you know, grandparents and parents
00:17:02.420start dying, uh, as we've seen in other countries. Um, but the, even if that were not to happen here for
00:17:10.020some reason, you know, they somehow managed to rush out a vaccine and, you know, get it in everybody's
00:17:16.100bodies in the next three weeks, which is not going to happen, but you know, some miracle happens like
00:17:20.900that. Um, the economic damage is already done, right? I mean, we're already starting to see this.
00:17:27.780Um, and, uh, and, uh, you know, how do you re, how do you recover from that, from that? And, uh, this is
00:17:35.220going to be a long time and the way we work and the way we communicate, this is going to change forever.
00:17:40.420Uh, I don't shake people's hands anymore. I did a month ago. I don't do it anymore. Uh,
00:17:46.580you know, we do the, we do that because that's the Trekkie thing to do.
00:17:50.740Your, your nerd, your nerd is showing.
00:17:52.580Yeah. And, uh, and definite, but other things, you know, like just, um, uh, at church on Sunday,
00:18:00.500uh, we did not know, you know, nobody shook hands, everybody, uh, bumped elbows or just said hello
00:18:06.180or, you know, whatever. And, you know, uh, there's lots of churches where they just not going
00:18:11.860because, uh, you know, there, there's that you look at South Korea, for example, was one church that,
00:18:18.580uh, spread, um, the initial, um, the initial community spread happened in one church and
00:18:25.620that's been a disaster there as well. Um, so talking about economics, we could probably move along to
00:18:33.220the next big story, which is definitely tied in, but, uh, but separate. And that is of course,
00:18:41.540it's fair to say the crash in the price of oil. You consider a 45% drop in one day, a crash. I think
00:18:51.060that's pretty safe to say, um, that was the number I saw the night before on Sunday night with, um, uh,
00:18:58.260with, uh, Canadian crude. Uh, I don't remember the exact numbers. Um, what it all sort of panned out to
00:19:04.900the next morning when the markets opened, but Dave, maybe you can fill us in a bit on the details.
00:19:09.220Yeah. When I checked a few minutes ago, it was trading at a 33 59, which is down another two and a quarter
00:19:17.140percent. Uh, the other breaking news today is the United Arab Emirates has decided that they're going
00:19:24.420to boost oil production. Uh, they're actually the third, uh, third largest producer, uh, within OPEC.
00:19:32.260Uh, as you know, there's currently a battle raging between Russia, uh, who's sort of an honorary member
00:19:38.420and, uh, Saudi Arabia that's, uh, that's pushing the price down. So it all seems to be connected.
00:19:44.740Coronavirus to stock markets are tanking. The, uh, uh, the oil prices are going down. So,
00:19:51.300uh, a lot of collateral damage there, including, you know, as we'll talk about later, the Alberta budget,
00:19:56.500uh, again, not, uh, not good out there. Derek, your thoughts?
00:20:02.180Well, when it rains and pours, I mean, uh, if, uh, if coronavirus, uh, I mean, it's just more bad news
00:20:14.020after another. Um, you know, we had a really thoughtful piece from Tesla, Little John, uh,
00:20:19.940on the Western standard yesterday on this, uh, getting into why they're really in this fight.
00:20:25.540Uh, and, and it's, there's a lot of, uh, rabbit holes to go down with it. Um, you know, Saudi Arabia
00:20:33.140wanted to, uh, wanted to set a price, uh, a higher price with Russia. Russia would not play ball because
00:20:40.980Russia is keeping its production up because it's at war with U.S. shale producers. U.S. shale, uh, has
00:20:47.140completely revolutionized, uh, over the last decade, the oil and gas market and, uh, you know, Russia,
00:20:54.500Russia really targets them. They see them as not, uh, not a player they really want on the world stage.
00:21:01.460Uh, it's, uh, not as high a cost that produces Canada's, uh, or, or our oil sands as an unconventional,
00:21:09.700but it's higher cost and, uh, shale like the oil sands requires a higher, a higher price per barrel to be
00:21:16.420profitable. And so, uh, Russia wants to flood the market to try and drive out U.S. shale.
00:21:21.780Uh, and so this pisses off Saudi Arabia, uh, who massively increases production to dropping the
00:21:29.620price to then hurt Russia to try and get Russia back to the table. Um, and now, uh, UAE, uh, or, uh,
00:21:38.500United Arab, UAE, uh, uh, sees itself getting cut out of this. So now they're driving prices down
00:21:45.540further with more production. Um, and so while OPEC is a cartel, it, um, it doesn't always exactly
00:21:54.580operate as a cartel, uh, appropriately. They don't exactly have the dairy, uh, the dairy supply
00:21:59.460management board overlooking things to enforce. It's, it's members, its member states, uh, do what
00:22:05.060they want if, uh, if they don't really like the way OPEC is going. So all, all of this has just been
00:22:11.140to a total collapse in prices. Um, I remember, uh, I, I was at downtown Calgary, uh, yesterday
00:22:19.220and, uh, there were some, uh, I was at a pub for, uh, for a pint after an event and there were, uh,
00:22:26.420at just 6 30 in the afternoon, uh, there were some, uh, oil field service workers who just happened to be
00:22:31.460in the downtown who were there, uh, who did not seem like it was a 6 30 drinking event. Um,
00:22:39.700they, uh, they had bet that if, uh, oil hit a certain price, they were going to go drinking and,
00:22:44.180uh, pretty safe to say that, that, uh, that, that, that had made it. And so this is really just going
00:22:49.620to compound, uh, bad news on top of bad right now. Well, and, and, and the knock on effect becomes
00:22:56.180further knock on effect, right? You talked about the hotel industry and cancellation of big events
00:23:01.380and stuff, you know, um, I, I mean, for our family, we were planning a big vacation in, in summertime.
00:23:08.740Um, you know, the Corona virus could stop that. Um, but even if this is passed by then we might still
00:23:16.660not go because, you know, I don't know what the economic situation is going to look like come July.
00:23:21.380Right. And, uh, so people are going to start making, um, personal and business decisions that are also
00:23:27.700going to be reductive and that's going to have a further knock on effect. Right. And, uh, it's
00:23:32.980going to be a damn big hole by the time we're finished to dig out of. And, uh, I've never taken
00:23:37.620a cruise before, but I'm considering it now because I'll probably never get it so cheap.
00:23:42.980Yeah, there, uh, we love cruising. I've been on 11 cruises and, uh, yeah, I'm not, uh, not so sure.
00:23:50.100You green, you green Victoria people, uh, with your cruises.