Wall Street banks are asking a key regulator to drop a proposed rule that would force them to do business with energy and firearms companies, due to potential public scorn they may face.
The “fair access” rule proposed by the Office of the Comptroller of the Currency (OCC) on November 20 would create undue burdens for lenders and could threaten their business models, banking industry groups, said in comment letters to the agency.
The industry groups also challenged OCC’s authority to issue the rule and argued the 45-day comment period that ended Monday gave them insufficient time to respond, reports Bloomberg.
OCC wants to bar banks from refusing to serve legal businesses – such as those in the oil, prison and firearms industries – because of the potential PR blow-back. The new rule would require banks to complete a risk assessment on any prospective customer, and proceed with the loan unless the numbers don’t make financial sense.
The “fair access” rule was proposed in response to Republican complaints that banks were declining to finance energy projects on the basis of climate-change concerns.
Environmental, Social and Governance (ESG) are now becoming critical criteria in determining profitability, and investors are quickly cooling to non-sustainable industries.
The transformation into sustainable energy is being led by the world’s largest global investment management company – New York-based Black Rock, Inc., with US$7.81 trillion in assets under management as of Q4 2020.
BlackRock says its clients will double their ESG investments in just five years.
Its 2021 Global Outlook refers to a New Investment Order: “We have entered a new investment order. The Covid-19 pandemic has accelerated profound shifts in how economies and societies operate across four dimensions: sustainability, inequality, geopolitics and the joint macro policy revolution. We believe this calls for a fundamental rethink of investment portfolios – starting now.”
“The proposal’s fundamental practical problems are compounded by its basic legal deficiencies,” the Bank Policy Institute commented. It would “effectively replace the traditional business of American banking” by dumping a firm’s risk-management decisions for a system in which the regulator dictates “to whom financial services must be provided,” reports Bloomberg.
“This proposed rule directly undermines the OCC’s responsibility to ensure a safe and sound banking sector,” said Senator Brian Schatz of Hawaii, who co-signed a comment letter with a group of congressional Democrats. “It is extremely troubling that a federal regulator is using its supervisory authority to pressure banks to finance projects the banks themselves have deemed too risky.”
Bankers also questioned OCC’s reliance on Dodd-Frank Act language directing the agency to ensure “fair access to financial services” as a basis for the rule. It “strains credulity” to anchor a “significant, burdensome, and novel rule” on that clause, the American Bankers Association said in its letter.
In 2019, 130 international banks at the UN Climate Action Summit in New York committed to decreasing their support and investments in the oil and gas sector in the coming years, promoting renewables instead.
Ken Grafton is the Western Standards Ottawa Bureau Chief. He can be reached at email@example.com
KAY: Green extremists ignore indigenous voices that don’t fall in line
Barbara Kay’s debut column with the Western Standard.
In mid-November, a handful of Wet’suwet’en hereditary chiefs in BC spearheaded yet another attempt — thwarted by the RCMP — to scuttle Coastal GasLink’s $6.6 billion natural gas pipeline. The half-completed pipeline will run 670 km from Dawson Creek in northeast BC to Kitimat on the west coast, there to be processed in an $18-billion terminal financed by LNG Canada’s joint partnership, then exported as low-emission liquified gas to replace high-emission coal-based energy in client Asian countries.
In their latest act of mischief earlier this month, the scofflaws blockaded a workers’ camp, trapping up to 500 workers without food or water before the blockage was dismantled; they stole or vandalized heavy machinery, and they caused destruction to forestry roads sufficient to bring the movement of police and industry personnel to a halt.
It certainly doesn’t help matters when prominent voices on the left egg on the activists. Longtime political gadfly David Suzuki was roundly criticized when he opined, at an Extinction Rebellion event, that “there are going to be pipelines blown up if our leaders don’t pay attention to what’s going on.” This was a shockingly imprudent impulse. Most of Canada’s energy and transportation hubs run through native lands that cannot be adequately policed against sabotage. (He has since apologized, but the unfiltered instinct to say it remains “problematic,” a word frequently trotted out by progressives when critiquing the manifold perceived sins of conservatives.)
It also doesn’t help when our political and cultural elites continually harp on Canadians’ inherent shame as collective genocidaires, not to mention endless land acknowledgements that beg the question of why we seem to admit the land was “stolen,” but don’t give it back.
Instead of inviting reconciliation, our various forms of breast-beating are inspiring revanchism. The mantra one hears with increasing frequency amongst indigenous activists these days, “Land Back,” means exactly what it says. Those chanting it have been encouraged to believe, by non-indigenous allies in government, academic and environmental-activist circles, that their hunting and gathering ancestors understood the concept of land “ownership” as we do today, and that consequently, 3% of the Canadian population deserves legal title to a third of our land mass.
That is not going to happen, and such lines of thought should be discouraged by everyone with political and cultural influence. The 1997 Supreme Court Delgamuukw ruling made clear that Wet’suwet’en land title is limited, and that the Crown has use of the title land for the public good.
Environment Minister Steven Guilbeault recently tweeted: “Indigenous peoples have been stewards of this planet since time immemorial. The fight against climate change is not possible without their knowledge and leadership.” But whose leadership exactly? Elected band council leaders who signed on to the pipeline project, or a small group of unelected hereditary chiefs who do not enjoy support from more than a tiny fraction of their people? There is little clarity on this important distinction from government officials.
And whose “knowledge”? The CGL met the highest environmental standards in planning its project. They complied with all provisions set out in eight provincial and federal regulatory environmental Acts. They requested meetings with the Office of the Wet’suwet’en (which represents the hereditary chiefs) to discuss issues related to the project over 40 times, with no response from them. If the hereditary chiefs had “knowledge” it was important for CGL to know, they had ample occasion to share it and chose not to.
None of our climate-obsessed progressive elites ever emphasize what an economic boon and lifeline to independence this pipeline and other eco-responsible projects are to indigenous peoples (a far greater boon than government handouts). While indigenous Canadians make up 3.3% of our general workforce, they represent 7.4% of the country’s oil and gas sector workforce.
As for indigenous peoples being “stewards” of the planet: Even if we all agreed that indigenous people are “stewards” of the land, why should we assume that all indigenous people are of the same mind as Steven Guilbeault in his opposition to resource development? There is plenty of diversity amongst stakeholder populations, including amongst the hereditary chiefs. Yet the establishment media rarely draw attention to this diversity, preferring, as befits the modern, culturally self-loathing progressive spirit, to romance the anarchic dissenters.
Majority Wet’suwet’en opinion is pro-resource development, and it is time their voices were heard and respected. I, therefore, recommend a visit to the Canada Action site, where you will find many strong statements such as these below:
- “There’s quite a bit of support for this project,” says Bonnie George, Witset First nation, Wet’suwet’en. “But people are afraid to speak up because, in the past few years, people that [have] spoken up were either ostracized…[or] ridiculed, bullied, harassed, threatened, and being called a traitor – a sellout….There’s a small group of members from the Wet’suwet’en Nation that doesn’t support the [CGL] projects.”
- “Twenty First Nations participated extensively during five years of consultation on the pipeline and have successfully negotiated agreements with [CGL]. This is on the public record,” says Karen Ogen-Toews of the First Nations LNG Alliance.
- Theresa Tait-Day, a hereditary chief of Wet’suwet’en Nation, says the voices of female hereditary chiefs “are not being heard. “We have been working particularly with LNG and [CGL]. Our people wanted a benefit and they wanted to be able to make a decision on a positive note. However, we’ve experienced lateral violence and coercion since then by the five chiefs who claim to represent the nation” (since then, two chiefs of the five have dropped out of activating)…The protest organizers are conveniently hiding beneath our blanket as indigenous people, while forcing their policy goals at our expense.”
- The Haisla Nation are associated with the Kitimat terminal project. Speaking for them, Crystal Smith says, “I’ve seen the impacts first hand. I’ve felt the impacts firsthand. The focus for us is the long-term careers. For the first time, we’re funding culture and language programs…This independence is what we want. This is what we need more of in our community. We need to heal our people. No other government…has been able to heal our people the way they need it.”
- Also for Haisla Nation, former chief councillor Ellis Ross: “Professional protesters and well-funded NGOs have merely seized the opportunity to divide our communities for their own gains…and ultimately will leave us penniless when they suddenly leave.”
- “This is one of the biggest projects in Canada, who wouldn’t want to be a part of it?” asks Derek Orr, former chief, McLeod lake Indian Band.
Who indeed? Only virtue-signalling enviro-alarmism obsessives, irresponsible disruptors who get a thrill out of “direct action” that sows chaos and disorder, and patronizing Nanny Statists who prefer that indigenous peoples continue to boil their drinking water than admit that responsible capitalism providing work, resources and human dignity is the way forward for Indigenous populations.
Barbra Kay is a Senior Columnist for the Western Standard
Why oil and gas matters to Ontario
Many Canadians may not be aware that the first commercial oil production in North America started in Ontario in 1858.
By Ven Venkatachalam and Lennie Kaplan
The headline screamed: “The end of oil age” in the Economist in 2003. Fast forward 18 years and that still doesn’t make sense in many ways. The demand for oil is increasing across the globe. Even U.S. President Joe Biden is now asking OPEC to produce more oil.
You don’t have to go far to fill your gas tank to see the rise in fuel prices in recent months. Who says oil is dead? Just look at the growing global disconnect between supply and demand, where the need for natural gas threatens all sorts of shortages.
Many environmental groups have been calling for divestment from oil and gas, yet, they ignore the realities on the ground. Divestment from oil and gas harms not only the many energy companies that are creating jobs in the economy, but also investors, such as the middle-class and seniors, and other value chain sectors that depend on oil and gas.
Let’s look at Ontario, as a prime example.
Many Canadians may not be aware the first commercial oil production in North America started in Ontario in 1858. Since then, the oil and gas sector has played a significant role in the provincial economy. Though Ontario is not a major producer of oil and gas, there are still some 3,000 oil and gas wells active in the province.
There are many ways the oil and gas sector benefits the Ontario economy, in addition to reliable energy supply. Thousand of kilometres of pipelines in Ontario move oil and gas to the U.S., creating many jobs in Ontario. The refining industry also creates employment and contributes to the provincial economy. And many value chain sectors in Ontario supply goods and services to oil and gas companies.
Looking at the most recent (2017) comprehensive data available from Statistics Canada, it turns out the oil and natural gas industry was responsible for adding $7.7 billion in nominal GDP to Ontario’s economy and more than 71,000 jobs. Many of these jobs are indirect, but just as critical to the oil and gas sector. Think of oil and natural gas employment in Ontario as engineers and manufacturers hired to design and build oil and gas operating equipment and facilities, a building in Edmonton or in downtown Toronto, or an investment firm tasked with raising capital for a natural gas company operating in northern Alberta or B.C. Also think of an Alberta oil sands company whose local spending on office furniture results in jobs created in the Ontario firm that produces that furniture.
In 2017, the oil and gas industry purchased $7.3 billion worth of goods and services in Ontario, including $4.3 billion from Ontario’s manufacturing sector alone. Other “big ticket” purchases include $700 million from the Ontario finance and insurance sector, $600 million from the professional, scientific and technical services sector, and $300 million from transportation and warehousing. Overall, $2.1 billion in salaries and wages were generated as the result of oil and gas industry spending in Ontario.
Beyond the impact of the oil and gas sector, let’s widen the look at Alberta’s impact on Ontario’s economy. In 2017, Alberta’s population was 11.6% of the national total, while Alberta’s share of purchases from Ontario’s manufacturing sector was 21% of Ontario’s total interprovincial trade in manufacturing. That’s nearly twice Alberta’s share of Canada’s population. In fact, Alberta’s consumers, businesses, and governments were responsible for nearly 24%, or $32.5 billion, of Ontario’s total interprovincial trade in 2017. This was second only to Ontario’s next-door neighbour, Quebec.
Now consider Alberta’s share of Ontario’s interprovincial and export trade and how it compares to selected countries. Alberta’s $32.5 billion in purchases from Ontario in 2017 was behind only the United States ($197 billion), but ahead of the United Kingdom ($14.7 billion), China ($3.4 billion), Mexico ($3.2 billion), and Germany ($1.9 billion), among others. Add up the goods and services purchased by Alberta consumers, businesses, and governments from Ontario firms between 2012 and 2017, and the total value was about $193 billion.
Economies may be locally based, but local businesses and jobs are impacted by investment and trade flows from other places. Whenever someone says oil and gas doesn’t matter to Ontario, tell them to look at the “on the ground” realities. From Bay Street to Yonge Street to Main Street, people living across Ontario benefit from a thriving oil and gas sector.
Ven Venkatachalam and Lennie Kaplan are with the Canadian Energy Centre, an Alberta government corporation funded by carbon taxes. They are authors of $193 billion and 71,000 jobs: The Impact of Oil and Gas (and Alberta) on Ontario’s Economy.
Top US Dem senator demands reversal of Keystone XL ban
Biden was elected running on a campaign that promised to kill Keystone XL on his first day in office, and he did exactly that in February.
A leading Democratic senator is demanding US President Joe Biden reverse course and allow construction of the Keystone XL pipeline expansion.
Biden has been under mounting pressure as gas prices in the States have been soaring. Earlier this week it was announced the US would be releasing from strategic reserves 50 million barrels of oil to try and ease the rising costs.
“I continue to call on President Biden to responsibly increase energy production here at home and to reverse course to allow the Keystone XL pipeline to be built which would have provided our country with up to 900,000 barrels of oil per day from Canada, one of our closest allies,” Sen. Joe Manchin (D-W.Va.) said in a statement.
“To be clear, this is about American energy independence and the fact that hard-working Americans should not depend on foreign actors, like OPEC+, for our energy security and instead focus on the real challenges facing our country’s future.”
Biden was elected running on a campaign that promised to kill Keystone XL on his first day in office, and he did exactly that in February.
At the time, Manchin reportedly sided with Republicans who urged the president to rethink canceling a permit for the pipeline, arguing that pipelines across the country “continue to be the safest mode to transport our oil and natural gas resources, and they support thousands of high-paying, American union jobs.″
“The cost they see every day. And every day they go to fill up is a dollar and a quarter more a gallon,” he said last week of the 30-year high inflation rate in the US.
“Three twenty-nine, $3.39.
“A gallon of milk is now $4 in many places. It’s taking a toll. And I hear it when I go to the grocery store or if I go to the gas station. They say, ‘Are you as mad as I am?’ and I say, ‘Absolutely,’ ”
Earlier this week, in one of the largest trade appeals in history, Calgary-based TC Energy demanded $15 billion from the US after Biden cancelled the Keystone XL expansion project even after it started.
“The U.S. decision to revoke the permit was unfair and inequitable,” Bloomberg reported TC Energy said in its filing, blaming the U.S. for putting Keystone XL on a 13-year “regulatory roller coaster.”
The claim is being launched under provisions of the North American Free Trade Agreement that allow foreign companies to challenge U.S. policy decisions.
Alberta had billions of dollars tied up in the project, with $1.5 billion of taxpayers’ money handed to TC Energy already, along with $6 billion in loan guarantees.
The Keystone pipeline runs from Alberta to refineries in Illinois and Texas.
The new pipeline would have run from Hardisty, Alta. to Steele City, NE and carried 900,000 barrels of oil a day.
Bloomberg said even if TC Energy is successful in it’s claim, they have no plans to restart the project.
“We had all the permits and requirements in place to start construction on the line, and did so, and we worked with federal and state regulators in both countries for a very long period of time. This is just about recovering that destroyed value of investment,” said Richard Prior, senior vice president for liquid pipelines.
The cancellation drew barely a murmur from Prime Minister Justin Trudeau, while Alberta Premier Jason Kenney was livid.
Kenney claimed when Biden cancelled Keystone XL, he broke several free trade regulations.
“At the very least, I call upon the government of Canada to press the US administration to compensate TC Energy, and the Alberta government, for billions of dollars of cost incurred in the construction of Keystone XL to date,” Kenney said in a letter to Trudeau in January.
“These costs were incurred on the assumption the United States had a predictable regulatory framework, and based on the presidential permit authorizing the Keystone XL border crossing which was installed in the summer of 2019.
“For the United States to retroactively cancel the permit on the basis of which investments were made is a clear violation of the investor-protection provisions of the North American Free Trade Agreement, which were extended as a result of your government’s successful negotiation of the Canada-US-Mexico Trade Agreement.”
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