Ottawa Ontario - The Teamsters union must be loving the B.C. government and the protestors blocking Kinder Morgan's Trans Mountain
pipeline.
The Teamsters are about to strike Canadian Pacific Railway Ltd. (CP).
On Friday, the railway said it was pleased the federal government had stepped in to force 3,000 Teamsters to vote on the company's last offer.
However, the boss of the union's railway wing said a strike was "inevitable", intervention or no intervention.
Efforts to block pipelines to the West Coast have made railways much busier.
Indeed, railways have probably not been this integral to the West's economy since the 1970s or earlier.
Without a major new pipeline to move oil and bitumen to the West Coast, the East Coast, or Texas's Gulf Coast, oil-by-rail has gone from a few tens of
thousands of barrels per day three years ago, to 150,000 barrels in 2017, an estimated 250,000 this year, and nearly 400,000 barrels daily by next
year.
Shipments might even jump to 600,000 barrels a day in peak times in 2019 if energy companies decide it makes more sense to pay higher transportation rates
instead of higher storage charges.
Now add to this spiking demand for oil-by-rail the fact that last fall there was a bumper grain crop on the Prairies, 71 million tonnes versus the usual 65
million.
Lots of that grain is still sitting in grain elevators (or even in bins on farms), because moving all this oil had bumped lower-paying grain trains off the
shipping schedule.
There's also a shortage of locomotives.
No one expected the higher demand for trains.
And since locomotives aren't something railways can just whip out of duffle bags, there are now backlogs for trains of all kinds in Western
Canada.
And the backlogs are likely only to get worse.
Keith Creel, the CEO of CP said back in January that his railway would not be investing in too many more tanker cars, for instance, because it recognized that
the new, higher demand would disappear as soon as a pipeline or two was finished.
The continuing lack of pipelines means the Teamsters (TCRC) who represent 3,000 engineers and conductors, and the International Brotherhood of Electrical
Workers (IBEW) who represent more than 340 signal maintainers, have CP over a barrel.
Railway strikes in the 2000s were barely noticed.
But a strike now could have almost as much of an economic impact as a railway strike in the 1950s or 1960s.
I don't blame the unions for taking advantage of their newfound leverage.
But I do blame all the activists and "green" politicians who are holding up pipelines.
And, most of all, I blame the federal Liberal government for doing everything it could to kill the Energy East pipeline last fall and for doing next to nothing
to get Trans Mountain built.
Back in February, Scotiabank's economic analysts calculated that the lack of pipelines was costing Canadian businesses, workers, and governments $11 billion a
year in lost economic growth.
That could shoot up to $15 billion if rail shuts down.
Then Monday, the Parliamentary Budget Office said the upcoming federal carbon tax will cost Canada's economy $10 billion a year in lost growth.
Ten billion is one-fifth of a good year of growth.
Coupled with the $15 billion Scotiabank estimated the lack of pipelines and rail would cost, and the cumulative loss is equal to about half of the average
annual growth of the Canadian economy, $25 billion out of $50 billion.
With their impossible new pipeline approval rules and their timid activity on Trans Mountain, much of this can be laid at the feet of Prime Minister Justin
Trudeau and his government.
Lorne Gunter.