When I was in high school, my social studies class taught us about the basic economic principles behind industry. We were taught about primary industry, secondary industry, and tertiary industry. It was explained that primary industry involves the harvesting of natural resources. Examples of this are logging, mining, and oil drilling. Canada is famous for this, with our abundance of land and resources.
Secondary industry involves the processing of raw resources into more usable forms. Examples of this are sawmills, smelters and refineries. These industries take out a lot of the waste in the resource (slag, bark, etc.) and present a raw material that can then be used to create something useful. This processing takes industrial and technological and human resource investment, but provides much more benefit in terms of profit to the community, and to the state.
Tertiary industry involves the actual production of goods. It takes the cut lumber, the refined crude, the wood pulp, the steel, and turns it into goods - paper, houses, buildings, cars. This involves even more technology and human resources.
Every job created in industry means more taxes collected for government, more income, more employment, more services needed. It is an economic fact that every industrial job created spawns seven service industry jobs in the community. Thus, truly industrialized nations are based upon the building of secondary and tertiary manufacturing. They create more in terms of national growth than primary industry does. Colonialism was based upon this reality. Industrialized, technological nations with a surplus of population exploited colonies for primary industry, shipping the raw materials home where the processing and manufacturing was done. It made Britain, Europe, and the USA extraordinarily wealthy.
It should be pointed out, however, that the USA was a former colony. It was being exploited by this economic reality, UNTIL it simply refused to be exploited anymore. Taking secondary and tertiary production upon to itself has made America the most powerful economy in the world.
Why isn’t Canada like the USA? It is because we have never stopped being a colony. As our ties slowly disintegrated with England, we became a colony of America. Now we provide the raw materials to America’s economic engine, but the cost is that we are forever a colony, throwing away our treasured resources and allowing other nations to exploit them and turn them into goods the world needs.
This is why it outrages me when I see our governments wilfully sabotaging our economic strength. When I first moved to BC, I read in the paper about the new BC Liberals agreeing to INCREASE raw log exports (primary industry) to America and Asia, just as our lumber mills (secondary industry) were all shutting down due to lack of investment in technology and inefficiency. We were throwing away jobs, sending them overseas and destroying towns that had prospered for a hundred years. Why? Because our government didn’t have the guts to stand up to big international conglomerates and tell them, if they want our logs, they need to process them here, before shipping them to market.
It really is that simple. Canada has so much in the way of resources, and we are so close to markets like Asia and the USA that these big companies won’t find better places to get them. It is too profitable to walk away from. However, if we are willing to give away our resources, they will process them in the cheapest ways possible, which means we lose.
Flash forward to news today about a pipeline proposed to take oil from Alberta to the Gulf Coast. The main focus of the pipeline is to get oil to the “Gulf Coast Refinery Complex”. I am sorry. They built those refineries to get oil from offshore rigs and from the Texas Oilfields. If those fields are tapped out, too bad. They need to build more refineries in Alberta. It’s our oil, we deserve to benefit from the secondary and tertiary processing that come from its production.
Yes, America would love to keep the refining and the jobs and the taxes where they are, but not at the expense of Canada. That just ain’t right.
