Editor:
My October 15 Letter to the Editor attracted some comments on November 5 from Mr. Jay Ritchlin of the David Suzuki foundation (“B.C. royalty regime involves subsidies”). While I apparently “offered some useful clarifications about royalties and subsidies” in my letter, his second sentence insists that “B.C. subsidizes new fossil fuel extraction”, later mentioning it three more times. I thought I had shown pretty clearly that B.C. does not subsidize the oil and gas industry but perhaps I wasn’t clear enough.
Merriam-Webster’s definition of a subsidy is “a grant or gift of money: such as … a grant by a government to a private person or company to assist an enterprise deemed advantageous to the public.” So, if government pays money to an individual or company for that reason, it’s a subsidy. If government does not pay money to a person or company, it’s not a subsidy. The Government of British Columbia is not, nor has it ever been, in the business of paying money to oil and gas companies. Cash flows between the industry and government are in one direction: from industry to government, as royalties and taxes. Period. Remember that the government makes all the rules and unilaterally decides what royalty rates shall be; if it chooses to vary them for its own reasons, that’s its prerogative. While I actually agree with the conclusions from the recent royalty review paper in B.C., I would point out that simply not taking all the industry’s money as royalties does not constitute a subsidy and claiming that it does is disingenuous.
Does anyone remember that delightful quote from The Princess Bride, when Inigo Montoya says to Vizzini, “You keep using that word. I do not think it means what you think it means.”? It seems appropriate here.
Richard Corbet, P.Eng., Sechelt
