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Monday Morning Commentary

Rick Swenson

You will all have to bear with me one more time but as a former Minister of Energy and Mines who lived with potash for 2 years, I must make a few final comments before giving this one a rest for a while. It now appears as of Wednesday, that we have a strategic resource called “potash”. So now that we have this strategic resource, what are we going to do with it?

Is Canada and Saskatchewan now going to be able to tell countries that quit taking our beef after BSE was discovered and they closed their markets to us, are they now going to reopen those markets because we are going to deny them potash? Is our balance of trade deficit with China and India going to magically disappear because we are going to dramatically increase the price of potash to balance the books? Is the court case in Illinois that is challenging the legitimacy of Canpotex offshore marketing monopoly going to magically disappear with this decision? Is the fact that there has not been a royalty increase on potash in 16 years by the government of Saskatchewan going to change this session of the Legislature?

I don’t think so to any of the above. Obviously, the potash business has been lucrative enough that the CEO of PCS is paid more than double what his next closest competitor in a Canadian company is paid. Bill Doyle, between salary and stock options, is paid double what the CEO of RIM (the Blackberry maker) is paid.

In fact, until this business with BHP-Billiton came out, no one knew that Mr. Doyle would make over $600 million on the sale of his shares of PCS to BHP. Not bad for a guy that came to a little Crown Corporation as a salesman in 1987. Are there any of you who get this little missive who have not had the cost of everything in life go up significantly in the last 16 years? And yet the only thing it seems that has not, has been the royalties on potash and it would have been nice if the royalties to the people of Saskatchewan would have stayed at the same rate of increase as Mr. Doyle’s remuneration. Yet our Premier continues to hand out goodies to the potash industry at the same time as he stands on his stump, wraps himself in the flag and saves us from the Australians. These are the same Australians who have just allowed Viterra and Agrium to buy huge chunks of their grain handling and farm supply services. Go figure.

How in good conscience can Mr. Wall give away $100,000 taxpayer-paid tax credits per employee to Mosaic so that they could move some jobs from Minneapolis and Belle Plain to Regina? Mosaic is a company whose largest shareholder is Cargill and I think that the 300 or so members of the Cargill family that control that company, could well afford to move a couple of hundred of their employees to a downtown office building in Regina (an office building owned by a big supporter of the government). Our Premier, after lavishing taxpayer money on Cargill, has the gall to say that he is saving the potash industry in Saskatchewan because it is now a strategic resource. Cargill could buy BHP twice over.

Maybe it is coincidental that Mosaic and Agrium are both huge donors to the Sask Party according to the Chief Electoral Office. But I don’t think so. I believe a lot of this has to do with some polling that was done shortly after the BHP bid. This polling showed that 64% of Saskatchewan residents were strongly opposed to the bid by BHP to acquire Potash Corp. In case anyone has forgotten - 2011 is an election year in Saskatchewan and this is one issue that Brad Wall was not going to leave to Dwain Lingenfelter to talk about exclusively during 2011. The fact that Mr. Wall tried to muscle BHP for a billion dollars upfront cash and was turned down certainly must make everyone wonder about this exercise in flag waving.

When the PC Party government privatized PCS it was done for a specific reason. Without the market and its billions of dollars of equity being able to come and work with companies, government and customers around the world, our potash resource would amount to nothing more than a drag on the taxpayer of this province and would not become the major funding source that the people of Saskatchewan have come to enjoy over the last 21 years.

We finally removed politics from the business of potash and now Mr. Wall has injected it right back in. The BHP bid for PCS – a bid which could have been for Mosaic or Agrium has shown us that a review of potash royalties in this province is long overdue and that taxpayer largess for mine expansions and provincial politicians playing silly games to keep company names on yet to be built domed-stadiums would not and should not be occurring. Saskatchewan needs more investment in potash, more companies mining and more people being employed not a government playing favourites with the three companies currently here. It’s time to level the playing field.

I believe that the PC stand on this issue, a strong government negotiating a strong set of rules of engagement with whomever comes to enhance the resources of our province and at the same time, allow the marketplace to function without the fear of politics is a good one. It absolutely boggles my imagination that in the 21 years since the privatization of PCS that we in this province and indeed the government of Canada, has now been seduced with the notion that a fertilizer which we hardly use at all in our own country and have certainly not held over anyone’s head world-wide, is now a “strategic” resource. I guess if it was, we should have left it in the hands of government and then Mr. Clement could have used it as a bargaining tool in the latest round of World Trade Organization (WTO) negotiations along with dairy subsidies and the Canadian Wheat Board. It will be interesting to see what Mr. Wall’s and Mr. Clement’s attitudes are like after the next provincial election is safely out of the way or after Saskatchewan’s 13 Conservative MPs are safely returned in another Federal election.

Thankfully this will put an end to potash for a few weeks and we can all get back to discussing how this government is going to pay the bills and how Saskatchewan’s falling economic indicators are going to affect us all going into what could be a very tough winter for a lot of folks. Mr. Wall is riding very high in the polls these days but just ask Premier Gordon Campbell how quickly the fall from grace can occur.

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These issues must be debated for “The Right Reasons”.

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