‘bonanza for oil companies

"By WILLIAM TUOMI
EDMONTON’ — The federal
get gave them what they
Ve been screaming for over
Me years, but the oil companies
Wanted more. They can now de-
ct the total cost of exploration
Wd nearly a third of the cost: of
Velopment of the crude oil in-
try from their federal taxes.
$a bonanza. Their profits will
ar. They will pocket at least
130-million.a year from the two
“€ms alone.
| Not only that — the federal
Midget introduced rather quiet-
7 a depletion allowance where-
Y company profits will be taxed
a descending rate annually
0m now on. This method is
“trowed from the United States
mere state governments have
Ought the federal government
' decades to end the system
ld where the huge oil trusts
Ve used it as a'most conveni-
it dodge to evade taxation.
Tories Defend Oil Trusts
But thé budget issue to hit the
adlines was the question of
kation on royalties. Premier
ugheed and his Tory govern-
ent hit the ceiling. In the white
“at of their fury. they accuse
e federal government of every-
Ming from double-dealing to de-
toying Canadian Confederation.
is to-date their most heated
fense of the right of U.S. oil
ants to exploit the Alberta oil-
tch with minimum cost and
thout interference.
Past practise has made it pos-
Hble for oil companies operating
"the province to claim exemp-
on from federal taxes for royal-

-8overnment: This has been
tended from so-many-dollars-
“barrel of oil to include ex-
“Nditures by the companies in
M0se areas of the industry
rere dollars are expended even
Sugh these come under sub-
lies from the “incentive pro-
“ of the provincial govern-
The oil companies have “gone
°ng” in a most. amiable agree-
‘Nt with the Alberta govern-
"nt. They raised no protest
N€n the government increased
oyalty rates a year ago; they”
Nderstood” when after the
eVincial-federal agreement of
March, Alberta levied a 60%
Ity on the price increase that
ght the price of crude oil
°6.50 a barrel.
*Nat the Tory :provincial gov-
"Ment has benefitted is shown
the fact that they expect to
t $1.75-billion in provincial
“fnues from the oil industry
Ming the current fiscal year.
at the oil industry has bene-
a is common knowledge.

dl

By Y. MENKES
r the first time I came: to
little island of Mannar, off
North-western coast of Sri
; in the autumn of 1972.
I came to the island near-
“= year and a half later I saw
at changes there. A tall oil
aes towering above the

{© ceremony to mark the
ing of the boring of Sri
S first oil well took place
Mannar in February of this
“The success of joint
€t-Lanka mineral explora-
Will open up entirely new
‘tunities before our econo-
ay Said Prime Minister Siri-
we Bandaranaike.
loration for oil is just one
© examples of the success-

°s they have paid to the Alber- -

Sri Lanka—oil with

Oil resources so essential
for Canadian development
are being depleted very
quickly. There is a frantic
drive on to make a fast
buck out of the fast drop of
crude. That explains the
hysteria over taxation .. .

Never have the profits of the oil-
moguls from the U.S. been: as
high. And not only they — Dome
Petroleums of Calgary (one of
so-called Independents) can re-
port that its profits for the nine
months ending September 30 this
year were 300% over profits for
a similar period last year. Union
Oil of Canada, also operating out

of Calgary, doubled its profits in

the same time.

But now the proposal that:

royalties will no longer be con-
sidered exempt from federal
taxes has been blown into a
major constitutional crisis in the
country.

The Lougheed government has
threatened to withdraw from the
March agreement that pegged
domestic price of crude at $6.50
a barrel and will begin market-
ting Alberta crude through a
provincial agency . at world
prices (although, the premier im-
mediately backed away from
this by suggesting that no
changes will be made through

- the winter months). He threatens

that there will no more discus-

‘sions with Ottawa. A virulent
campaign. has. been unleashed”

calling for the separation of
Alberta from Canada. ;
Dire disaster is predicted for
the oil industry. Rumours fly that
exploration rigs are leaving the
province in droves (driven out
by the impending tax). The life-
span of the oil industry in the

ul economic cooperation which
ne Soviet Union and Sri Lanka
have been developing for many
years,” T. B. Subasinghe, Minis-
ter of Industries. and Scientific
Affairs”, told me. With the. as-
sistance of Soviet experts we
have built such important econo-
mic projects as” the iron and
steel plant, the tire factory and
the flour mill,” he went on to

oan Huge Plantation
For centuries the natural
wealth of this Asian country was
in the hands of foreigners who
regarded Sri Lanka (Ceylon) as
an agrarian-raw material appen-
dage, a “huge plantation we
Using economic aid”, the
Western. monopolies have. made
numerous attempts to preserve

conventional fields drops by
several years with every prog-
nosticator. Horrible predictions
are made of homes without heat;
cars without gas; industry with-
out fuel in a matter of a few
years. All because royalties will
no longer be ‘exempted from
federal taxes on the oil industry!
Who Should Tax Them?

- The immediate issue here is
not the enforcing of the BNA
provision which gives the con-
trol of natural resources to the
provinces. At issue is the ques-
tion of who should tax the
multi-national corporations and
their Canadian partners whose
operations now stretch from
coast to coast in Canada. Should
it be the ‘central government or
should it be the provinces? If it
is to be the provinces, then Al-
berta is going to become a tax-
haven, but as safe as the Baha-
mas. For Premier Lougheed has
already indicated that should
the federal ruling on royalties go
through, Alberta will use its
provincial’ revenues to refund
these taxes to the oil corpora-
tions.

For all Canadians the issue is

even greater. Oil resources, sq’

essential for Canadian develop-
ment, are being depleted very
quickly. There is a frantic drive
on to make a fast buck out-of
the last drop of crude. That ex-
plains the hysteria over taxation.
Nationalization Needed:

The resource needs to be na-
tionalized and placed under care-
ful government _ supervision.
Only then will it be developed in
an orderly fashion. Only then
will Canadian needs to be met

- by cutting exports to - those

amounts that are surplus over
Canada’s long-term needs. Only
then can exploration be so or-
ganized that it industrializes the
country by developing resource-
‘based industry where the oil is
found. Only then will the Cana-
dian north be developed.

_ In the meantime, in Alberta,.

Premier Lougheed is being urged
to hold a provincial election to
prove that “every Albertan”
backs him in his fight with Ot-
tawa. Only the Social Credit and
NDP leadership disagree, assur-
ing him that they agree~ with
“his aims” and therefore an
election is unnecessary. At the
same time, a group headed by
the president of an oil company
has organized a movement to
win independence for Alberta,
because Confederation . “costs
too much”.

And it is rumoured that the
province’s Chambers of Com-
merce have dropped plans to
hold banquets through the
winter to toast Canadian unity.

a difference

the old “order” and to continue
their neo-colonialist expansion.
Entirely different in character
is. the cooperation which was
offered to the young state by the
Soviet Union and other socialist
countries. The main aims of this
cooperation “are assistance in
building an independent modern
industry, developing energy pro-
duction and manpower training.
The people of Sri Lanka hailed
the news about the visit of
Prime Minister S. Bandaranaike
to the Soviet Union in‘ Novem-
ber. “The strengthening of
friendly ties with the USSR is
an assurance that our Republic
will achieve genuine political
and economic independence,
wrote the progressive newspaper
Aaththa. : a

QUEBEC TODAY.

By SAM WALSH -

At the recent Convention of
the Parti Québécois, two ques-
tions on the agenda brought into
focus the orientation the PQ
would like to take and conse-
quently how the labor movement
should regard it. These were: the
celebrated question of a referen-

-dum on Quebec independence in

the event of the election of a

-Péquiste government with whom

the federal government refuses
to negotiate the terms of politi-
cal separation; and, the election

of new members to the PQ exe-

cutive. :
' By a curious “coincidence” the

newspaper La Presse published ~

the results of a poll immediately
prior to the opening of the con-
vention which could not help but
exercise -a considerable influence
on the debates.

The poll revealed that the sup-
port for PQ had reached its high-
est: point ever, 28%. The provin-
cial Liberal Party had lost con-

_ Siderable support since the elec-
ticns one year ago, 54.0% decla-

ring. themselves dissatisfied with
the Liberal performance as
against 33-34% during. the elec-
tion campaign, Eighty-three per-
cent of Québécois insist on a re-
ferendum before any declaration
of independence, with PQ voters
favoring a referendum by the
same percentage. Almost 40% of
Péquiste voters declared them-
selves opposed to independence.

The results of this poll streng-
thened the hand of those who

favored a poll. Nevertheless the ~

latter managed to. amass over
one-third of the delegates’ votes
against the party leadership,
both the executive and the par-
liamentary wing. The opposition
expressed the fear that a refer-
endum would file independence
in the dust-laden archives of
provincial politics together with
most Royal Commission findings.

One of the favorite arguments
of the pro-referendum people had
it that the Montreal municipal
elections showed that if they did
not insist on support for a sepa-
ratist platform, the popular.
forces could unite and wrest vic-
tories from the party in power.
They treated the, victory of the
Montreal Citizens’ Movement
(which the Montreal “left” Pé-
quistes supported) as a direct
victory for the PQ.

These arguments evoked a
lively reaction from the anti-re-
ferendum opposition. In the first
place, does this ‘not signify a
rather sneaky abandonment of
independence, the very raison-
d’étre of the PQ—a quick retreat
by the referendum protagonists?
No, a  Pé€quiste - government
would first seek a mandate from
the National Assembly (Quebec
legislature) to negotiate indepen-
dence with the federal govern-
ment and will say so openly dur-
ing the election campaign. They
intend even to proclaim that a
vote for the PQ “is a vote for
independence.” Scepticism reign-
ed, for the smell of electoral
opportunism was in the air, even
if Lévesque preferred to call it
“pragmatism’’.

A second weakness in the ar-
gument based on the victory of
the MCM in Montreal is the fact
that the MCM is fundamentally
a coalition of progressive Anglo-
phones and Francophones around

. a municipal program which was —

werked out together. And Eng-
lish-speaking voters responded,

PACIFIC TRIBUNE—FRIDAY, DECEMBER 6, 1974

NDP- Quebec should
think about its

policy

a as ai] 4
SAM: WALSH
as we know, even more decisive-
ly against Drapeau and for the
MCM than did French-Cana-
dians. Even Lévesque admitted
(after the convention) to a Gaz-
ette journalist that “English
votes which the MCM won are

not translatable for us”.

Furthermore, the working peo-
ple had no problem in identify-
ing with MCM especially when
it attacked the anti-labor policy
of Drapeau around the firemen’s
strike. This was in undeniable
contrast to the cowardly and con
temptible labor policy of the PQ
during the general strike of the
public and para-public workers
and during the provincial elec-
tions. .

The election to the executive
of the PQ was notable above all
by the election (with the help
of Lévesque and Co.) of three
“blues” (the commonly used
term for Conservatives and
Union Nationale): Robert Lussie,
former UN Minister of Munici-
pal Affairs; Jéréme Proulx, form-
er Unionist member. of the Na-
tional Assembly and Jean-Fran-
cois Bertrand, son of the late
UN prime minister Bertrand. The

election of the “pro-labor” Guy -

Bisaillon as a symbol of an open-

ing towards the workers can .

hardly balance this shift to the
right.

So that it was surprising, to .

say the least, to read that Henri-
Francois Gautrin, president of

the NDP-Quebec, had said in a _

press conference that he intend-
ed to recommend to the next
convention of his party in the
spring that they support the PQ
in the next provincial elections

(even if he did add Support for -

“other progressive groups”),
drawing a too facile parallel with
the MCM. The.victory of the
MCM points clearly to another
road for the progressive forces
on the provincial scale. That is,
a regrouping around a program
decided upon together by all
progressive elements: Franco-
phone and Anglophone, born in

the country or immigrant, in a -

mass federated party of the

_working people; and not binding

themselves behind the petty
bourgeois and manifestly oppor-

‘tunist, not to speak of separatist

chariot of the PQ.

The creation of such a party,
with the participation of the
NDP-Quebec as a federated con-
stituent, would oblige the PQ to
seek out an alliance with it,
again around a program of gov-
ernment acceptable to all, or
cede its place in the political life
of Quebec.

Let us hope that the spring-
time convention of the NDP-
Quebec will think about it seri-
ously before agreeing to sink
into.the same mire of opportun-
ism which is sucking in the PQ.

—Page 9