How Canada made the Koch brothers rich

Author’s note: Until this past February, I worked as a contracted television producer for Global TV and its current affairs program,16×9. Last fall, I was commissioned to do a story for the program about the Koch brothers, their holdings in Alberta’s oil sands and their interest in getting the Keystone XL pipeline built. In January, two days before the 22-minute documentary was about to air on16×9, Global’s senior management pulled the story. After Jesse Brown’s Canadaland published a story about its sudden disappearance, Global fired me, although I was not quoted in that story or had any involvement with it. What you’re about to read includes some of the material that has not yet been permitted to be shown on Global.

The attacks were nasty.

In the winter of 2011, Karen Kleiss, a reporter with the Edmonton Journal, wrote a story about how Koch Industries Inc. had hired a lobbyist in Alberta. The story provided background on the Wichita, Kansas-based energy conglomerate, its presence in Alberta, and its American billionaire owners, Charles and David Koch.

Kleiss reported at the time that no one from Koch Industries addressed her questions. Nevertheless, after her story appeared, Koch Industries went on the offensive. On their website, kochfacts.com – and in vivid red type – they lashed out at Kleiss’s article, claiming it was “slanted,” that it “parroted partisan political rhetoric and other distortions” and that its coverage of the Koch brothers registering a lobbyist in Alberta was a “purported story.” The Koch Industries representative summed up by saying:

“There is a place for opinion on the op-ed pages, on blogs, and on Twitter. It does not belong on the news pages of an objective journal.”

What the paragraph-by-paragraph rebuttal did not dispute was Kleiss’s assertion that Koch industries is “an American energy conglomerate owned by two powerful billionaire brothers who help fund the Tea Party and climate change denial movements in the U.S.”

The attack was so strong that Lucinda Chodan, editor-in-chief of the Journal at the time, felt compelled to write a lengthy response to Koch defending her reporter’s work. The company replied by taking further potshots at the newspaper and at Kleiss’s judgment.

Around the same time, a similar scenario was playing out after Reuters ran a story entitled “Koch Brothers Positioned To Be Big Winners If Keystone XL Pipeline Is Approved,” that also detailed Koch’s holdings in Canada. It discussed how the Koch brothers would benefit if the Keystone XL pipeline was built.

Written by David Sassoon, a journalist who runs InsideClimate News— a Brooklyn, NY-based, Pulitzer prize-winning website that covers climate change issues— the Reuters piece eventually elicited a ferocious response from Koch’s PR department. The company accused Sassoon of publishing “falsehoods” and of being an “environmental activist,” and Reuters of printing “advocacy journalism.”

Koch Industries even took out ads via Facebook and Google with a photo of Sassoon under the headline “David Sassoon’s Deceptions.”

Once again, a Reuters editor had to intervene with a lengthy letter to Koch defending their use of Sassoon’s reporting. These attacks went on for some months. Today, Kleiss and Sassoon refuse to discuss these events.

But at that time Koch Industries’ campaigns against the media were not unusual. Their website, KochFacts, criticized reporting in The New York TimesThe New YorkerMother JonesForbes.comThe Washington Post and Bloomberg’s Markets Magazine.

By 2011, the Koch brothers – currently the sixth richest people in the world, with US$42.3-billion apiece – were attracting attention because of their efforts at influencing the US political system, helping foster the Tea Party movement, and attacking attempts to curb climate change. They were also emerging as political kingmakers: two weeks ago, the brothers were in the news for endorsing Scott Walker, the governor of Wisconsin, as their choice for the Republican presidential nominee (Walker is well-known for his attacks on labour rights in his state).

 Tax records show that since 2007 the Fraser Institute, one of Canada’s oldest conservative think tanks, has pocketed a total of US$765,000 from one of Charles Koch’s foundations.

Koch Industries, the second-largest private company in the US, has become infamous for playing hardball.

Yet the broadsides on articles linking the Koch brothers to Canada might have had another purpose: to direct prying eyes away from their company’s history in this country. After all, few people know how Canada and its oil riches have been central to creating their vast fortune.

And what a fortune it is: today, Koch Industries is a global behemoth with annual sales of US$115-billion and a presence in 60 countries and employing more than 100,000 people worldwide. It has invested US$70-billion in capital expenditures over the past 12 years. They produce a wide range of products, and not only from the 750,000 barrels of oil they process every day: fertilizers, drywall, windowpanes, carpets, Brawny paper towels, Dixie cups, chemicals, and fibre optics.

As it turns out, Koch Industries also controls anywhere from 1.1 million to as much as two million acres of Alberta’s oil sands – or the equivalent of around 4,500 square kilometers – thereby guaranteeing the company’s prosperity for decades to come. The value of their oil sands holdings is in the tens of billions of dollars. MORE

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Koch brothers go deep in Alberta tar sands

Few people know how central this country’s oil riches have been to the U.S. Big Oil billionaires’ vast fortune. Most of their tar sands holdings remain untouched, but that may soon change.

 

Major global firms accused of concealing their environmental impact

More than 700 companies, including Amazon, Tesco and ExxonMobil, lack transparency, campaign group claims


ExxonMobil is accused of failing to reveal the full extent of their impact on the climate crisis. Photograph: STAFF/Reuters

A $10tn (£7.9tn) investor alliance has accused more than 700 companies, including Amazon, Tesco and ExxonMobil, of failing to reveal the full extent of their impact on the climate crisis, water shortages and deforestation.

The major global companies, with a combined worth ofmore than $15tn, lack transparency over their effect on the environment, according to the intervention by some of the world’s biggest financial names.

Campaign platform CDP has brought together a record number of investors, including banking giants HSBC and Investec, to demand companies reveal data on the environmental cost of how they do business.

The group said it was targeting 707 companies because of their “high environmental impact and lack of transparency” to date. The list includes the world’s largest fossil fuel companies such as BP and ExxonMobil as well as palm oil giant Genting Plantations and UK high street brands including Tesco, Ocado, WH Smith, Marks & Spencer and JD Wetherspoon.

The CDP said 546 companies were being targeted to disclose information on the climate crisis, 166 on water security and 115 on deforestation. More than 7,000 companies already disclose their environmental impact through the CDP platform.

The US is home to the highest number of companies named in the campaign, accounting for a fifth of the list, followed by Australia at 16%. UK companies make up 3.5% of the companies named and include constituents of the FTSE 100.

Many of the companies on the list report on their environmental impact in their own sustainability reports but the CDP claims this is insufficient because their reports do not use standardised data. This makes it difficult to compare company performances on the environment, according to CDP. MORE

The secretive role of SNC-Lavalin in the Site C dam

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Site C dam costs likely over $10 billion, completion date in doubt. Photo by Bob Fedderly.

The embattled company is reaping millions in public money from no-bid contracts for British Columbia’s third hydro dam on the Peace River — a project that is already billions of dollars over budget

SNC-Lavalin has received approximately $120 million in direct award Site C dam contracts, obscuring the embattled engineering firm’s role in building the largest publicly funded infrastructure project in B.C.’s history.

For one contract, SNC-Lavalin provided BC Hydro with a “shadow estimate” — number-crunching to confirm BC Hydro’s figure — for its forecasted $8.335 billion price tag for the dam, The Narwhal found after reviewing Site C documents.

The estimate proved to be wildly wrong, missing the mark by $2 billion.

But that hasn’t stopped SNC-Lavalin — which has been banned from World Bank infrastructure contracts for 10 years following allegations of bribery schemes in Bangladesh — from reaping years of no-bid work on the Site C dam for engineering design services.

Direct award contracts allow BC Hydro and other public bodies to decide which companies or consultants get contracts, instead of going through a more transparent and competitive tender process.

On Wednesday, a Quebec judge ruled that SNC-Lavalin must stand trial on charges of fraud and corruption for allegedly paying $47.7 million in bribes to public officials in Libya between 2001 and 2011. The RCMP has also charged SNC-Lavalin, its construction division and a subsidiary with one charge each of fraud and corruption for allegedly swindling almost $130 million from various Libyan organizations.

SNC-Lavalin also grossly underestimated cost of Muskrat Falls dam

SNC-Lavalin also played a major role in the cost estimate for the hugely over-budget Muskrat Falls dam on the lower Churchill River in Labrador, now the subject of a two-year inquiry to determine why the project proceeded. MORE

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Nine things B.C. can learn from the Muskrat Falls dam inquiry

‘You disappointed us’: Why is Canada opposing more transparency in drug prices?

Why was the Trudeau government fighting the international effort to force drug companies to commit to transparency about R&D costs, information that  is needed to evaluate what is a reasonable price for drugs?  If you believe something doesn’t smell right, you are justified.

Pharma industry says high prices are necessary to cover costs. Some nations want to see the data


Delegates to the World Health Assembly are expected to consider a transparency resolution demanding the pharmaceutical industry release confidential data about the costs of R&D, the outcomes of clinical trials and the actual prices that countries pay for drugs after secret negotiations and rebates. (L. Cipriani/WHO)

Behind closed doors at the World Health Assembly (WHA) meeting in Geneva this week, health officials from around the world began hammering at the black box of secrecy surrounding the pharmaceutical industry.

As the debate in the room heated up, observers were surprised that Canada was among the countries that seemed to be trying to weaken that effort.

The fact that transparency is even on the agenda for government health officials at the WHA is evidence of the mounting international frustration over high drug prices. The meeting sets priorities for the World Health Organization (WHO), which is already grappling with the global impact of drug prices on public health.

The WHA’s transparency resolution would demand unprecedented disclosure by drug companies about how much they spend on R&D, including the cost of clinical trials.

The resolution would also call for a system for countries to compare the true prices they pay for individual drugs. Right now, no country knows what another country is paying for the same drug. That’s because companies hold secret negotiations with individual governments, forcing officials to sign non-disclosure agreements preventing them from revealing any price discounts that they were able to negotiate.

But battle lines quickly appeared in the meeting room, with Germany, the United Kingdom, the United States and several other countries, including Canada, proposing changes to the wording that would soften the resolution and protect industry secrecy.

“You disappointed us this week, Canada,” Love told CBC News. “You guys are supposed to be the good guys, right?”

Love described several examples where Canada requested changes that softened the resolution. MORE

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Jagmeet Singh: NDP Will Bring In Universal Pharmacare In 2020

Canada leads G7 in oil and gas subsidies: new report

 

In spite of Canadians’ objection to fossil fuel subsidies, Justin Trudeau always backs the fossil fuel corporations while, at the same time, pretending he has a robust environmental policy. His priorities are clear; but are they yours? Tell your MP you want environmental protection for your family and future generations.

New research shows vast majority of Canadians support phaseout of government support for fossil fuel companies

Justin Trudeau G7
Prime Minister Justin Trudeau flanked by Donald Tusk, president of the European Council and German Chancellor Angela Merkel during 2017 G7 summit in Taormina, Italy. Photo: European Council President via Flickr

Canada provides more government support for oil and gas companies than any other G7 nation and is among the least transparent about fossil fuel subsidies, a new report reveals.

“Fossil fuel subsidies undermine carbon pricing, work against the achievement of Canada’s climate targets, encourage more fossil fuel exploration and production, and allocate scarce public resources away from other priorities like health care, education and renewable energy,” says the report, which ranks the progress of G7 countries in meeting their pledge to phase out fossil fuel subsidies by 2025.

Accompanied by a new Ekos poll, the research found a large majority of Canadians are strongly opposed to using public money to support oil and gas companies and want to see billions of dollars a year in subsidies phased out.

The exception was Alberta — the heart of Canada’s oil and gas industry — where people polled were concerned about the economic impacts of removing government support for oil and gas corporations.

Even so, 48 per cent of Albertans polled disagreed with public subsidies for oil and gas companiesMORE

Canada Revenue Agency writes off $133M owed by one taxpayer

“The whole issue of corporate taxation will be a stronger part of what we offer to Canadians, bolstered by the PBO [independent parliamentary budget officer] report. You will hear us repeating what was found in the PBO report. Whether that number is $10 billion or $15 billion or $20 billion or higher… And we will be talking about the fair tax system as a foundation for making the kind of investments that will make a difference in people’s lives.” –Peter Julian, NDP House Leader

Tax agency refuses to identify person or corporation getting writeoff


The Canada Revenue Agency, under National Revenue Minister Diane Lebouthillier, wrote off a large tax debt of $133 million last year but refuses to provide details. (Justin Tang/Canadian Press)

As the April 30 deadline approaches for filing income tax returns, there’s word of an unusually large tax writeoff by the Canada Revenue Agency (CRA).

Sometime in the first six months of 2018, the agency wrote off more than $133 million in taxes owed by one taxpayer. It’s not clear whether the recipient of the writeoff was a person or a corporation.

The amount was for unspecified excise taxes or excise duties; the CRA has offered no further details.

Etienne Biram also said the agency could not state whether the amount — $133,416,922.33, to be precise — has set a record for a single federal tax writeoff in Canada.

The massive writeoff is cited in a Sept. 14, 2018 internal CRA memo to explain a big jump in the total tax dollars declared uncollectible, compared with the total for the same period a year previous. CRA won’t say who got it.

MORE

Back to top Recycle, Reuse & Redos – A Trans Mountain update

Neb "Redo" press conference - (Photo: Kai Nagata, Dogwood BC)
Press conference with Indigenous leaders and environmental organizations following the release of the NEB’s reconsideration report, Feb. 22, 2019. (Photo: Kai Nagata/Dogwood BC)

There are a number of recent developments on the Trans Mountain file – from the reconsideration (“redo”) of the environmental assessment to unanswered questions about the federal government’s purchase price for the pipeline, and another (much quieter) NEB decision regarding rates for the existing Trans Mountain pipeline. And all of these events have made it increasingly clear that Trans Mountain is a bad deal for Canadians.

The “redo”

The National Energy Board’s (NEB) recent reconsideration report on the Trans Mountain Expansion (TMX) was, not surprisingly, a huge flop. But at least the report upholds one environmental value: the NEB recycled and reused the vast majority of its previous report, leaving 10 of the 14 chapters completely unchanged, aside from updating footnotes and changing “Aboriginal” to “Indigenous” throughout (because, reconciliation).

The “new” report (which recommended approving the project) did include one new chapter, one rewritten chapter, and minor changes to two chapters, following the 22-week NEB redo. Unfortunately, this did not ‘reduce’ the volume of the 689-page report.

The NEB’s reconsideration process was required after the Federal Court of Appeal quashed the 2016 federal approval of TMX in August 2018. The court found that the NEB’s exclusion of marine shipping from the initial environmental assessment resulted in a report so deficient that it could not be considered a valid report for the Cabinet to rely on in its decision.

The court’s ruling also held that constitutionally-required consultation with affected First Nations – a separate process from the NEB review – was “well below the standard” set by the Supreme Court of Canada.

Unsurprisingly, the NEB once again recommended approval of the Trans Mountain Expansion project, suggesting 156 conditions (one less than the 157 it suggested last time), and 16 non-binding recommendations.

As expected, the Board found that the project would likely cause “significant adverse environmental effects” on the endangered southern resident killer whales, and the Indigenous cultural use associated with them. They also found that greenhouse gas emissions from project-related marine vessels would be significant, and that a worst-case oil spill would be significant (duh). MORE

Opposition MPs accuse Liberals of shutting SNC-Lavalin investigation down

Liberal MPs wrote letter saying it’s time to end SNC-Lavalin probe


The Commons justice committee’s five Liberals wrote chair Anthony Housefather, shown here March 13, on Monday night, saying any further examination of the SNC-Lavalin affair should be left to the conflict of interest and ethics commissioner. (Adrian Wyld/Canadian Press)

The opposition is accusing the Liberals of shutting down the investigation into the SNC-Lavalin affair following a rocky day at the justice committee.

The House of Commons committee is looking into allegations the Prime Minister’s Office and other officials inappropriately pressured Jody Wilson-Raybould, justice minister and attorney general at the time, to allow Quebec engineering firm SNC-Lavalin to avoid criminal prosecution on bribery charges providing it met certain conditions in a remediation agreement.

Tuesday’s meeting was held behind closed doors, although opposition MPs pushed for it to be on the record.

After about two hours, members of the Conservative and NDP parties emerged and said the Liberals — who hold the majority — voted in favour of a motion to “consider the meetings on this topic to be concluded.”

“They want Canadians to believe that everything that needs to come out has been said,” said NDP MP Tracey Ramsey.

Wilson-Raybould testified for nearly four hours during her appearance in front of the committee last month, but has hinted she has more to say.

Opposition MPs had been pushing for Wilson-Raybould to return to the committee to talk about why she later resigned from cabinet.

“It’s now time for the justice committee to do its work,” said Liberal MP Randy Boissonnault.

On Monday night, the committee’s five Liberals  wrote to chair Anthony Housefather, saying their work is done and any further examination of the SNC-Lavalin affair should be left to the conflict of interest and ethics commissioner.  MORE

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Opposition MPs briefly storm out of committee meeting as Liberals end SNC-Lavalin investigation

Ottawa gets sealing order on court document that undercuts ‘reconciliation agenda,’ says NDP MP

Case addressed reopening of residential school abuse compensation cases if new evidence surfaces


NDP MP Charlie Angus rises during Question Period in the House of Commons Thursday February 21, 2019 in Ottawa.(Adrian Wyld/The Canadian Press)

A British Columbia judge has sealed a document filed by Ottawa in a court case over the residential school compensation process that an NDP MP says would ‘blow apart’ Prime Minister Justin Trudeau’s reconciliation agenda.

B.C. Supreme Court Justice Brenda Brown issued an order on March 6 sealing a “request for direction (RFD)” filed by Ottawa laying out their legal arguments against the reopening of residential school abuse compensation cases if new evidence surfaced.

Ottawa asked for the document to be sealed.

Sealed court documents are not available to the public. Sealing orders are generally seen in civil cases on matters involving national security or specific types of commercial information. They are also commonly used during criminal investigations for wiretap, search warrants and production orders.  MORE

SNC-Lavalin announced confidential deal with feds, four days after Trudeau’s first throne speech in 2015

File photo of a light rail construction site at LeBreton Flats in Ottawa in 2017. SNC-Lavalin was a lead partner for Stage 1 of the city’s LRT project, which has been repeatedly delayed. Photo by Alex Tétreault

Four days after Prime Minister Justin Trudeau’s Liberals opened their first session of Parliament with a throne speech in 2015, the federal government entered into a new confidential deal with SNC-Lavalin.

The Quebec construction and engineering giant touted the deal in December of that year, noting that it would allow it to continue scoring lucrative public contracts with the federal government. But to this day, the details and content of this deal remain a secret.

The agreement is different from the deferred prosecution agreement (DPA) that former attorney general Jody Wilson-Raybould has testified she was improperly pressured into pursuing by the prime minister, his senior officials and the country’s top public servant.

Both agreements are meant to address the fraud and corruption charges hanging over the Montreal-based engineering firm. But while Wilson-Raybould’s replacement, David Lametti, is still considering offering a DPA, the administrative agreement was long ago successfully enacted. It remains on the books, more than three years later.

SNC-Lavalin also entered into a voluntary compliance agreement with the Commissioner of Canada Elections in 2016, in relation to a political contributions scheme that broke federal election financing laws.

The company agreed that “certain former senior executives” helped funnel $83,534 to the Liberal Party, another $13,552 to Liberal riding associations and $12,529 to 2006 party leadership hopefuls, along with $3,137 to the Conservative Party of Canada and $5,050 to Tory candidates and ridings. MORE