Coal sellout rivals Columbia deal

| By FRED WILSON
The last time that the premier of
C., the prime minister of Can-
ada, and the head of a foreign gov-
g ‘Ment go together in this prov-
f  mce, W. A.C. Bennett, John Dief-
-  @nbaker and John F. Kennedy
t Signed the Columbia River Treaty,
| «until now likely the largest sellout
. — &Ver of B.C.’s resources.
| This week, Bill Bennett, Pierre
; _ Trudeau and Japanese prime min-
. __ \Ster Masayoshi Ohira met in Van-
& | Cover to close a deal which sur-
; _ Passes the sellout of the Columbia.
. A measure of the implications
g _ Was seen in the involvement of a
. of other government offi-

_ Gals, including the whole B.C. cab-
_ Met and 12 federal cabinet min-
o . Isters,
e|| _ This time, however, the politi-
d cians did not gather to conclude a
| between governments. They
ly Were here to facilitate what one of-
__ ficial bluntly described asa ‘purely
_ Commercial deal’’ between certain
Japanese steel companies and Ca-
Radian coal companies.
i | This “commercial deal’? could
Not have been completed by the
_ companies alone. It involves the
_ Sale of about 100 million tonnes of
p B.C. coal to Japan over the next 10
9  '01Syearsto fuel the Japanese steel
45 dustry and its thermal generating
js Plants. The production of coal in
_ _ B.C. willbe doubled with the open-
a 08 of a string of new mines. The
sr NeW mines will require the opening
_ up of the whole northeast sector of

- the province and the establishment

of a massive infrastructure.
Undoubtedly the main architect
of it all is Socred premier Bill Ben-
nett who made two trips to Japan
to assure the Japanese that they
would get everything they wanted.
Bennett and the Socreds have
never made any secret that they re-
gard B.C.’s 70 billion ton coal
reserve as an ultimate panacea for
B.C.’s economic ills. The auction-
ing of our coal would make B.C. a
boom province, they calculated. :
Indeed, the coal contracts will
bring a boom — at least for British
Petroleum, Teck Corporation and
Denison Mines, the three major
corporations with rights over the

ANALYSIS

fabulous Sukunka, Bullmoose and

Quintette deposits northeast of

Prince George.

But there will be little real benefit
to the economy. And in exchange
for short term economic and politi-
cal gain, Bennett and Trudeau are
giving away one of the last great op-

- portunities to build a strong indust-

rial economy in this province.
There is even doubt about the
short term benefit, and substantial
evidence to indicate that we will be
paying the Japanese to take our
coal. NDP critic Gary Lauk made
that point last week in the legislat-
ure when he questioned the enorm-
ous public subsidies required to

complete the deal, and the relative-
ly small return in royalties.

The Socreds have skilfully used
the Liberal government’s weakness
in the West to force it to share in the
subsidy, but it’s all from the public
purse. The coal companies want a
$215 million extension of the B.C.
Railway into the coal fields, and a
$100 million improvement to the
CNR line between Prince George-
and Prince Rupert. Add to that an-
other $300 million for rolling stock
and another $60 million for a coal
port at Prince Rupert. Like all esti-
mates for major developments, the
actual cost will go much higher be-
fore completion.

One of the figures leaked out of
the provincial ministry of eco-
nomic development and picked up
in various reports of the deal is that
the province expects to collect
about $70 million per year in royal-
ties. That figure is a ruse; to collect
that amount of money on about six
to seven million tonnes of coal per
year would require a royalty of
more than $10 per ton. The present
royalty is $1.50 per ton, and it is not
likely that the Socreds are going to
increase it at all, least of all by 666
percent.

Lauk argued in the legislature
that B.C. should hold out for a bet-
ter price for the coal, but neither he
nor NDP leader Dave Barrett have
opposed the deal with the Japanese
in principle.

“Not only the price of the ex-
ports is involved, but the whole

Where the action will be
— Major B.C. coalfields —

ment of B.C., particularly that nor-
theast sector,’’ Communist Party
leader Maurice Rush said in an in-
terview Tuesday.

The area between Prince George
and Ft. St. John with the coal de-
posits, new natural gas discoveries
and extensive forest resources
could become an ‘‘industrial heart-
land for the north”’ Rush said. The
wholesale export of the coal depos-
its to serve Japanese industry was
‘giving away the whole concept of
an industrial north,’’ he said.

If the deal goes ahead as an-
nounced, he added, it will ‘‘virtual-
ly close the door to the real develop-

on
Soo

The huge coal deal between
B.C. and Japan has brought
into focus fundamental policy
questions for the B.C.
economy. Following are ex-
cerpts from the keynote ad-
ei dress of Communist Party
| Provincial leader Maurice
of | Rush to the party’s B.C. con-
al | Vention Apr. 19-20 in Van-
y; Couver which address the
al | direction of B.C. economic
Policy. :

The economic development of
B.C. has reached a crucial stage.
We are witnessing the ownership
t. | 22d control over our natural re-
es Sources passing increasingly into
the hands of a few, mostly
foreign, monopolies, which are
_| amassing huge profits from the
_}_-€XPort of raw materials to,feed in-
“il dustrial and manufacturing

_| Plants abroad. We are being left

i With denuded forests, massive
nd Oles in the ground where mines
| Used to be, decimated fisheries,
or Used up natural gas deposits,
e flooded valleys. and destroyed
he | ‘tm lands.
aa In no area is this sellout more
~ | Advanced than in the energy field.
1 The provincial government

oe Técently announced a so-called

he } “energy policy,” but that was no
in . | Policy at all. More important is
hom the real energy policy pursued by
: € government, which they don’t
Want to talk about publicly, but

_ | Which is evident.
1a That real energy policy was

If Shown by the Socred’s support of
t, | the application of B.C. Hydro to
>d | doublethe export of hydro energy
to the U.S. With this decision the
a Way has been opened for a sweep-
1¢ | 28g integration of hydro energy
in _} With the U.S. on acontinental ba-
Sis. It means that each few years
xt_—_| Additional licenses will be granted

! CP calls for new economic policy|

% economy towards manufacturing
=: and processing and use the

damned to develop hydro power
for the U.S. -

It was recently revealed that
B.C. was invited to take part ina
new hydro grid that would link
the four western provinces. This
would have been a major step
towards an all-Canada grid. But
the Socreds rejected it, and the
prairie provinces are building a
grid of their own.

The Communist Party joined
with environmental groups,
Native Indians, the NDP and
some unions in opposing the
hydro export plan before the Na-
tional Energy Board. We will
continue to seek cooperation with

all groups in the fight to block the ,

implementation of the Socred
plan to sell out our hydro re-
sources to the U.S.

One of the biggest sellouts now.

under way is in coal. Coal is a key
to industrial development and a
steel industry, as well as an impor-
tant energy source. Plans are now
in place for a vast increase in the
export of coal from the
Kootenays and the rich Sukunka
fields in northeast B.C. and the
provincial and federal govern-
ments will spend millions on rail
lines and new superports at Prince

Rupert and Roberts Banks to fa-
cilitate this. These ports will be
like open arteries through which
the lifeblood of B.C. will be pour-
ed into foreign economies.

Our first industry, forestry, is
also undergoing vast changes.
When the Socreds pushed
through the new forestry legisla-
tion last year we warned that it
would lead to a new, higher stage
of monopoly control of the in-
dustry. Now, even the public sus-
tained yield units, originally set
aside to provide timber for small
companies, have been gobbled up
by the big monopolies.

The continuing raw material
nature of the forest industry robs
this province of tens of thousands
of permanent jobs which could be
ours if the forests were used to
support a large manufacturing
and processing industry. Instead
the huge profits from the forest
industry are being reinvested in a
massive rationalization program,
causing layoffs as plants are auto-
mated and shifted from one prod-
uct line to another.

We Communists believe there
is an alternative to the resource
giveaways of the Socreds and the

: this change must be the public

big monopolies, for which it acts.
We believe a new economic
strategy is needed which will end
monopoly domination of B.C.’s
resources and restore them to the
people; which will turn the

natural wealth of B.C. to
strengthen our independence
from U.S. domination.

The key to carrying through

ownership of natural resources.
The monopolies which presently
dominate these resources have a
vested interest in keeping B.C.
raw material based.

We propose an anti-monopoly
democratic economic plan to
break with the foreign domina-
tion and monopoly control which
keeps our economy raw material
based. The Communists differ
with the plan put forward at the
last NDP provincial convention
which avoided the need for public
ownership and proposed instead
to set up ‘‘economic councils’’
with the present monopoly
owners of industry to ‘‘plan’”’
economic policy. That is a refor-
mist concept no more workable
than the ‘‘lamb lying down with
the lion.’”’? We share the NDP’s
concern for receiving a larger re-
turn from the sale of resources,
but we feel the main emphasis
should be on regaining control of
resources and using them to build
the kind of B.C. which would
serve the people rather than the
profits of the monopolies.

The Communist Party will
make the fight for its new
economic strategy the centre of its
independent activity as a political
party of the working class of B.C.
And we will seek to unite with all
those who support such a policy,
or part of it.

J

Until every major river in ma is

Also leaked from the ministry of
economic development is a sugges-
tion that part of the deal will be a
$400 million steel mill in B.C. to be
built by the Japanese. Rush put lit-
tle credence in the report, compar-
ing it to the proposal by a U.S. air-
craft company to build copper
smelters in B.C. if it received the
contract to build fighter planes for
the Canadian military.

If the leak is to be believed, how-
ever, it is still far less than a steel in-
dustry being proposed. The mill
would have an electric furnace and
rolling mill fed by scrap, something
quite different than the production
of steel using iron ore, coking coal
and alloys. Electric furnaces, where
they exist in Canada, are perpetual-
ly plagued with a lack of scrap, and
often import it from the U.S.

A real steel industry in B.C. will

need the high quality metallurgical
coal about to be sold to Japan.
B.C.’s reserves are enormous, but
the highest quality, most accessible
reserves can be quickly depleted.
_ Priority for B.C.’s thermal coal
reserves should go towards energy
use in this country as well, mainly
for conversion into liquid petrol-
eum and synthetic natural gas.

There would still be plenty of
B.C. coal for export markets, but
the exports would be used to help
build secondary industry in the
province. This deal is doing the op-
posite, straitjacketing our econ-
omy into providing raw materials
to Japanese industry at the expense
of industrial development here.

Clearly there is a lot more at
stake than a ‘‘purely commercial
deal’’ between Japanese and Cana-
dian businessmen. Not a single
dime of public funds should be al-
located for coal development in
B.C. until the whole question has
received full debate in the House of
Commons and provincial legislat-
ure

vincial NDP called for the creation
of a “‘B.C. Coal Corporation’”’ to
engage in the production and
marketing of coal to ensure that the
province gets a proper return from
its resources. In April, the Com-
munist Party provincial conven-
tion called for the establishment of
a “B.C. Mineral Production Cor-

poration” to mine and market coal .

and copper. The CP also called for
a “‘B.C. Steel Corporation”’ to es-
tablish a specialty steel industry in
B.C., using our coal, iron and al-
loying resources.

There is still time to take these
policies off paper and to inject
them into political debate, before
the largest sellout of recent years is
complete and the door slams shut
on the opportunity to use our re-
sources for the industrialization of
B.C.

PACIFIC TRIBUNE—MAY 9, 1980—Page 3

At its 1979 convention the pro-.