Land to the tiller, forests to the communities – Part 1 – “We did it their way”
By Peter Ewart & Dawn Hemingway
Monday, February 23, 2009 03:46 AM
By Peter Ewart & Dawn Hemingway
In this first of a three-part series of articles, we will be discussing some ideas about how to renew rural and northern communities in British Columbia that are caught in the midst of an unprecedented economic downturn in forestry and other industrial sectors.
* * *
It has been like watching the slow motion destruction of an office tower. First one floor gives away; then another and another, each section inexorably pulling down the rest, until there is only a giant cloud of dust and heaps of tangled concrete and steel girders remaining.
So have gone many banks, hedge funds, and insurance companies in the U.S. and other countries in the world during the current financial crisis. And so have many big corporations in industrial sectors such as auto, forestry, steel, and retail.
More and more economists, media pundits and ordinary citizens are reaching the conclusion that the collapse (and subsequent bailout) of the financial sector in the U.S. and other countries demonstrates that de-regulating industry and supposedly letting “market forces” decide the direction of the economy, an approach which has dominated government economic policy for many years, does not work and is now discredited.
At its core, this perspective holds that the interests of the financial elite and the big corporations must come before all else. The sole allegiance of the banks and big corporations is not to workers, communities, regions or even countries. It is first and foremost to investors and shareholders. As Martin Whitman, the CEO of a New York hedge fund with big investments in the BC forest industry, famously put it: The public be “screwed.”
So we have seen the carnage that this ideology has wreaked in the financial sector, with trillions of dollars being lost, swindled, and stolen because of lack of oversight, greed, bad debt, circulation of toxic securities, and a host of other disagreeable things.
Yet here in BC, over the last few decades, this same ideology has had a huge influence on forest practices, policies, and timber licensing, as well as attitude towards corporate concentration. Indeed, BC government forest policy is a textbook case of the application of this ideology, especially with its emphasis on allowing the big companies free rein to do what they want and set the agenda for the industry as a whole.
The late singer Frank Sinatra had a popular song in which he bragged repeatedly “I did it my way.” Well, like Sinatra, the big forest companies have done it “their way” for a long time now with the provincial and federal governments “playing along” in the “orchestra.”
But, unlike the Sinatra song, the results have been disastrous. Visit many forestry-based communities, especially smaller ones, in the BC Interior or Vancouver Island and the results are grim. Mills closed. Stores shut down. Families split up. Raw logs shipped out. For many workers, contractors, suppliers and communities, both First Nations and non-First Nations, it is a time of quiet desperation.
More than 10,000 jobs have been lost in the forest industry in BC, with dozens of major mill operations closed, and many logging contractors and secondary manufacturers gone out of business.
A lot of this can be blamed on external factors such as the U.S. housing collapse, the downturn in the economy, and the Softwood Lumber Agreement. But there have been many other signs that the BC forest industry lost its way long before, including a lack of diversification of the industry and its markets, lack of reinvestment in operations and in research and development, increased monopolization, a pronounced lack of oversight, and a resulting huge wastage of the fiber “basket.”
Things are so bad that some big forest companies are even petitioning government to turn forest assets into real estate, or, like Catalyst Paper, are threatening to shut down mills unless municipal taxes are reduced.
Despite these difficulties and shortcomings, these big forest companies continue to control vast tracts of forest in the province that resemble the feudal estates of the Middle Ages. Like feudal estates, decisions are made by investors and financiers who are far removed from production and who live in Vancouver, Toronto or New York. If the company shuts down or suspends production, everything grinds to a halt, with communities, workers, local businesses and suppliers reduced to the role of mere spectators.
Much of this has happened on the current government’s watch. But not all of it. As part of the move towards more de-regulation, the appurtenancy clause, which required forest companies to process logs in the communities where they were harvested, was removed in 2003. But previous governments had already significantly undermined it. In any case, to be fair, there was consensus among various forestry analysts that appurtenancy, as it was then constituted, had outlived its usefulness.
Unfortunately, nothing was developed to put in its place. So this has meant that companies have every incentive to close operations in communities, ship logs out of regions and even out of the province. Smaller communities, like Mackenzie, Fort St. James, and many others in the province, have felt this loss keenly with major shutdowns of mills and forestry operations.
In addition, removal of appurtenancy has deepened regional alienation, with many communities feeling that they have lost more control over their future to government offices in Victoria and far away corporate headquarters.
So, in regards to the big companies, we have, indeed, done it “their way.” But for the workers, communities and the province as a whole, this “way” has not worked, and thus we are again at a crossroads. Will the interests of the big companies continue to dominate the BC forest industry? Will the regional alienation of rural and northern communities continue to worsen? Or are there other solutions? We will discuss these issues in Part 2 and 3 of “Land to the tiller, forests to the communities.”
Peter Ewart is a writer and instructor, and Dawn Hemingway is a writer and professor. Both are based in Prince George, British Columbia, and can be reached at hemingwa@unbc.ca
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Posted by: dirtcheap on February 23 2009 8:23 AM
#1) Pat Bell led the charge to sell BC Rail claiming it was in the shippers interest. In reality Mackenzie saw inventory sore because CN couldn't provide the rail cars, and the financiers making decisions based on inventory issues cut the mill out of their plans after months of this fiasco not experienced when BCR ran the tracks... so the province now pays to hold the mill in limbo as a result.
#2) Pat Bell and John Rustad led the charge to remove appurtenancy that has killed the communities of Mackenzie and Fort St James respectively in their ridings for the benefit of large multinational forest company campaign donors.
#3) Pat Bell approved the sale of the Mackenzie mill to a person with a questionable past and with questionable off shore financial backers, and the result is a mill that will never start up in the foreseeable future as long as Pats ownership group is in the picture.
Pat Bell will get elected again with a majority, because only the 'liberals' can manage the economy... and the ndp will put us all out of business. Some sort of fear and scare stories along those lines will do.
IMO this is a prime example of why we need a competitive electoral system and not what we have now.