by John Orrett and Barry Weisleder
In the future, if the human race survives, it will look back at the concept of individual ownership of natural resources, that took nature millions of years to form, as an absurdity. It will seem only sensible that the richest potash deposit in the world would be owned and controlled by the people who work in the mine and who are affected by its operation.
Totally unacceptable will be the idea that a stock-holding CEO like Bill Doyle could make over $400 million if he sells his shares in Potash Corporation of Saskatchewan. Such a bonanza from flipping shares in a resource so valuable to a growing, increasingly hungry world population, would be anathema. It will be obvious that the fate of the massive reserve of potassium and phosphorous, the two key ingredients of fertilizer that reside in the prairie province (23 per cent of the world supply), should be determined democratically, and that the revenue derived from its sale should be put to social purposes for the good of agriculture and the working people of Canada and the world.
But commercial media ‘experts’ and editorialists seem to be wearing blinders, unable to see beyond the priorities of the capitalist profit system. A Toronto Star editorial of August 22 cannot envision the Bank of Canada coming up with the investment capital needed to retain and develop an extremely lucrative resource industry, should such capital be lacking. The Star’s business commentator David Crane cries that the sale of the company to foreign interests may have adverse effects on the Canadian economy. Crane’s customary mission is the defense of Canadian Capital, as if our business elite is in some way more progressive and deserving of mega-plunder. The last decade of Canadian resource sell-offs (Westcoast, Inco, Falconbridge, Alcan, LionOre, and by increments, the Alberta oilsands), not to mention the sale of major steel companies Dofasco, Stelco, Algoma and Ipsco, show that the allegiance of Canadian capitalists is first and foremost to their pocket books.
The real story of Potash Corporation is hidden by recent media coverage, but it goes something like this.
In the 1970’s the New Democratic Party provincial government of Allan Blakeney nationalized much of the potash industry in Saskatchewan. The company grew. But in the mid-1980’s the price of potash declined significantly. The company ran up a debt of around $800 million. Keep these figures in mind. Anyone paying attention would have known, given growing world-wide agricultural demand for the fertilizer, and given its limited supply, that the price would rebound in a big way.
When the Grant Devine Conservatives were elected to govern Saskatchewan in the late 1980’s they privatized the Potash Corporation. They got $1.5 billion (i.e. $630 million for the shares and $800 million in debt relief). It was one of the biggest give aways of a public resource in Canadian history. The price of potash took off almost immediately following the sale. The profits from just the first three years of operation completely paid for its purchase. Yes, the Conservatives know how to treat their friends.
Now, a little over 20 years later, the company is subject to a hostile take over bid by BHP Billiton of Australia for $38 billion. Most analysts think the final price will top $40 Billion. This represents an increase in value of more than 2600 per cent. Did your wages rise 2600 per cent over twenty years; did the value of your home? Did the cost of running a mine rise that much?
This $40 Billion is a sum representing assets that should be publicly owned. Imagine how many schools, hospitals, rapid transit systems and social housing units could be funded by a fraction of that sum.
How can this abysmal situation be rectified? First all, major resource industries like nickel, iron, aluminum, oil and gas should come under public ownership. So should the steel industry. The responsible, democratic management of those assets is far too important to the environment, far too important to the rational planning of the economy to meet human needs, to be left to the tender mercies of the corporate elite, foreign or domestic.
For public ownership to become a live alternative it is crucial that the NDP be won to this policy. And that would entail an abrupt, but indispensable turn to the left for the party, and the unions on which it is based. Without a struggle for socialist policies, nature and labour will continue to be squeezed dry by the pirates of private profit – leaving the world destitute.