Nation-Building in the North
Canada is reconfiguring itself as a strategic global power. How does that work?
All eyes seem to be on Canada. While Trump’s threats to annex us are not really an option militarily, it’s true that America is Canada’s biggest trading partner by far and can put a lot of pressure on us if it wants to. Tariffs alone are not going to bring us to heel, at least in the short term. A sustained push over several generations could wear us down, however, to the point that a puppet regime might be installed in Ottawa in return for the U.S. keeping the Amazon packages flowing.
Why would our most reliable and trustworthy ally do this? It wouldn’t be for our oil or grain—our existing trade agreements and infrastructure work for both parties (our pipelines, for example, mostly run south). What we do have are vast mineral resources, ranging from uranium to potash to rare earths, cobalt and aluminum and lumber, and pretty much anything else an industrial power could want. As the Arctic warms, some of these prizes are becoming easier to get at. It’s transparently obvious that Trump would love to be able to force the kind of ‘trade’ deal on us as he just did on Ukraine to gain privileged access to them. Again, in the short term, that won’t happen; we’re simply too rich to be bought or beggared overnight. But if what Trump is doing becomes American policy for the next few administrations, like I said, we might be worn down.
So, how do we prevent this? We don’t want to go our own way; we like Americans, as people, and their country has been the best imaginable neighbour for two hundred years. What we want is to get back to that cordial relationship, but without being over-reliant on it. There are several ways we can do this. Collectively realized, they could make Canada a strategic keystone of the emerging post-Trump economic order.
Hmm… We need a symbol for the grand plan. I know: let’s use ‘#.’
The # Strategy
Mark Carney has been talking about making Canada into an “energy superpower.” It’s perfectly possible but not in the way the Albertans he’s pandering to would like. In Carney’s rhetoric, the phrase is code for selling more oil and natural gas to Europe and the Orient, which does reduce our dependency on the U.S. as a customer but more importantly (for Albertans) opens up new markets.
The tactic for this strategy’s success is pipelines.
The problem with pipelines is that they’re incredibly costly and take a long time to build, even if you fast-track the regulations. They might be worth the investment if the markets for fossil fuels in Asia and Europe remain strong. But that’s not going to happen. They’re going to dry up, and much faster than the oil-patch barons in Alberta are willing to admit.
One example: the Trans Mountain Pipeline’s capacity was expanded, at a cost of $34 billion and 12 years of effort, to move more product from Alberta’s oil patch to Vancouver. More than a year after the expansion opened, it’s running under capacity and is expected to continue to do so for at least the next three years. Supposedly, this is because the oil companies can’t afford the toll the government is charging to move the product, but the project will never pay for itself without those tolls. The oil companies are betting that the government will have to lower the toll to make the project look like it worked, and swallow the financial loss; and that’ll probably happen.
Donald Trump and Alberta’s Premier Danielle Smith would both like to revive the Keystone XL pipeline. Smith, in an unhinged and surreal press conference on May 5, demanded that Alberta be given the right to build more (and more and more) pipelines and railroads and whatever the hell the fossil companies need to move Albertan oil and gas to market. Even if her attempt at bullying her neighbouring provinces and Canadians in general worked, their customers will have evaporated by the time any of these projects are built. Everybody’s electrifying and everybody’s shifting to renewables. A planet-wide exodus from fossil fuels is starting, driven not by environmental concerns but simple economics. Renewables are just cheaper, end of story.
Still, the “energy superpower” strategy can still work, if we pivot to electrification and overproduction. Overproduction and a modernized national power grid allow us to send energy anywhere it’s needed in Canada for clean industrial projects. That, combined with our vast natural resources, allows us to transform raw power into commodities (like aluminum and hydrogen) that we can sell to Europe, Asia, and the U.S. This national grid makes up the first horizontal bar of our cross-hatch plan: —.
Hewers of Rare Earths and Carriers of Microchips
Our first vertical, |, signifies a push to diversify our economy. Traditionally, Canadians sell commodities but not many finished products—the auto industry in southern Ontario is a notable exception. Nothing is stopping us from becoming a manufacturing powerhouse in nearly every sector because we have the resources, human capital, and energy.
Canadian innovations have a long history of failing at the last mile. We consistently produce superior product and system designs, but Canadian investors are timid. We’re going to have to become less risk-averse; maybe the government can help here with incentives or insurance to get investors to switch from pipelines and nickel mines to funding adventurous startups. Canada has a well-funded nuclear fusion startup, ingenious molten-salt fission designs, and the world’s most advanced next-gen geothermal technology, but despite having a strong aerospace industry, we have no native orbital launch capability. And what about robotics? And drones? Not to mention that the last time I checked, there were six Canadian airship companies, all of them with business models for northern shipping, and all looking for investors.
We need to stop just digging up metals, smelting them, and shipping ingots overseas; we need to insert our own manufacturing industries into the pipeline, and make our own phones, TVs, cars, and bots. This is not the same plea that Donald Trump is making to industries that the United States has outsourced, because what he wants to do is restore the native manufacturing sector that the US used to have. Canada has instead an opportunity similar to the one China faced ten years ago, when it had no automotive sector at all and hence was able to develop one from scratch. Now, Chinese EVs are the best and most inexpensive in the world, and the legacy auto-makers in America, Japan, and Europe can’t compete because so much of their capital and manpower has been sunk into building old-style, internal combustion cars. The Chinese will absolutely steamroll their way over that market. Similarly starting from scratch, Canada has an historic opportunity to do the same with key 21st-century industries such as robotics.
A Roadless Nation
Canada’s not a challenging country to live in because of the climate. We know how to survive a -40 C January. My great-great-grandparents did so in wooden farmhouses, and thrived without electricity or plumbing. Technology has insulated us almost entirely from the cruel weather that we endure for half the year.
What makes this a challenging country is that 85% of its land is unserviced by roads, and never will be. Most of our landmass is a chaos of tortuous bedrock, the oldest and most stubborn on the planet. And what isn’t bare stone or impenetrable forest is peat bog and muskeg, an unstable surface on which roads and railways cannot be built.
More than 150 northern communities are connected to the outside world only by air. That they are reliably connected is a testament to what we’ve been able to do with 20th-century technologies, but we can do better now. We have to—the ice roads that used to create a network of winter highways are dwindling as the winters get warmer. What can replace them?
As it happens, something wonderful.
The Northern Matternet
Air Canada offers a drone delivery service. You can use it to send about 10 pounds of cargo 20 miles. That’s not much, but long-distance, heavier drones are on their way. The Black Swan, for example, can transport 770 lbs 1500 kilometers. There’s no reason Canadian companies can’t match and beat that performance, with an electrified fleet that can service any community that has a couple hundred meters of open field or water; or, with eVTOL technology, anywhere that there’s a gap in the arboreal forest.
Right now, drones like the Black Swan are remotely piloted. The killer technology is autonomous, fully electric equivalents. Ironically, the Ukrainians are innovating faster in this area than anyone. They will reap a huge postwar benefit from having perfected autonomous drone technology. Canada should help them, not just because we are partners in their struggle militarily and morally, but because what they (and companies like dronamics) are doing is paving the way for the obsolescence of roads. (See what I did there?)
Seriously, though, this is huge. To the south, we have a neighbour that has spent trillions to produce a national network of blacktop and railroad, tearing up its ecologically priceless wilderness to serve them. The US is built around its road system and the car. This is also true in urban Canada, but it doesn’t have to be once we catch on to the benefits of truly diversified and complete transit and biking infrastructures, such as the ones they’re building in Europe and South America. I wrote about this recently, so I won’t belabour the point. Suffice it to say this is the second “—” of our # plan: a nationwide transport system that bypasses the implacable rock of the Canadian Shield by going over it.
“That’s ridiculous!” I hear you saying. “We need to move millions of tons of ore and oil every year; the only way to do that in bulk is with railroads and trucks.”
I agree about the railroad part of that objection—but remember, one of the things we want to do is shift from selling ore and ingots and raw lumber, to moving finished goods. So rather than having giant mines that send thousands of railway cars full of ore south to be refined, imagine having a thousand small communities, each with minimal impact on its local wildlife and forest, digging and refining small batches of the same ores. They can do this because each has access to uninterrupted, year-round power from hydro or an Eavor loop—another Canadian innovation.
The Arctic Play
The final bar in the ‘#’ is our second |, this one being the (careful) opening up of the Arctic. We want the world to have access to the Northwest Passage, but we also want all Canadian provinces to be connected to it because, as it opens and becomes more navigable every year, the attractions of shaving 5000 miles off a freight haul from China to Europe will soon make the Passage a very busy place.
At present, we have one deepwater port in the north, in Churchill, Manitoba. There was supposed to be a second nearby, and 90% of it was built a hundred years ago. Unfortunately, one day the tide rose unusually high, and the incredibly expensive, gigantic dredging barge that was opening the channel through the shallow coastal silt was picked up and delicately deposited on the wharf, where it sits to this day.
Even before Trump’s election, momentum was growing to revive the Port Nelson project, bypassing Churchill—or supplementing it—with rail access from the prairies to the ocean for potash and grain shipments to Europe and Asia. There are also plans for at least one port in James Bay, which would allow a single rail line to take shipping containers from the sea to the industrial heartland in southern Ontario and Quebec, and ship out rare earths mined just a few hundred miles away in Canada’s “circle of fire.” -Oh, and a third port is planned for Grays Bay in Nunavut.
Exactly who owns the Northwest Passage is a matter of debate and litigation. For most of its length, it passes through the extensive Canadian Arctic Archipelago, and these are clearly Canadian waters. Some countries, however (we’re looking at you, America and China) want it to be international waters, like the Bosporus Strait. If Canada wins this round, we can levy transit tolls, which could bring billions into the northern economy while still making the Passage cheaper and faster than Panama. If the US and China prevail, then other countries using the Passage won’t have to pay for the ecological impacts of using it; Canadians will.
If Canada isn’t able to defend its sovereignty in the Parry Strait, we have a Hail Mary option: build a “Taloyoak canal” across the bottom of the Boothia Peninsula. If you glance at a map of Northern Canada, you’ll likely mistake this peninsula for the biggest eastern island in the Arctic Archipelago. It’s not an island; it’s a long middle finger of the Shield that juts far enough that ice chokes its northern end long after the straits south of it become navigable. If we dug a canal at Taloyoak, Canada would own a doorway through the Passage that we could bill ships to use when the Parry Strait is frozen over.
Assuming we win our case, we still need a fleet of icebreakers to make the Passage truly attractive. But with it, the Northwest Passage could finally fulfill its promise, and Canada would reap the benefits.
This, then, is the ‘#’ strategy:
— Connect the country east-to-west in new and robust ways, with more and better highways, railroads, pipelines, and a national electrical grid.
| Overbuild our electricity capacity and use it to power made-at-home industries. We can have our own cars, phones, and operating system if we want.
— Lean into the fact that Canada is a roadless nation. Establish new ways of moving matter and people around the country, making north-to-south movement as easy as the highway system makes east-to-west driving.
| Link industry and population in the south to the Arctic Ocean, and become the masters of the Northwest Passage.
A Stronger Canada and—wait, what?
Of course, dear reader, you and I know that while some of these ideas are worthwhile—building a national electricity grid, for instance—most of what I’ve just described is a dystopian nightmare. And ‘#’? Seriously?
I may have fooled some of my audience with the breathless rhetoric of this Utopian vision. If you’ve been reading Unapocalyptic from the start, though, you’ll have guessed that there’s a thorn in this rosy picture. You’ll have noticed that this ultra-patriotic vision is just one scenario for the future of my country. It is based on only one of the theories of change I talked about in “Who Paints the Dew on the Daisy?” This model of Canada and how to change it is managerial and strictly neoclassical-economic. If we dig into the details, something truly ugly comes to light:
The strategy for an Arctic economy requires that global warming continue unchecked.
As to the rest of the measures, they all assume that economic growth is still the paradigm for our civilization. Even the matternet just makes continued growth easier, rather than addressing the problem of growth itself.
What’s missing in the ‘#’ plan is the two opportunities that would make the biggest difference:
Moving to a zero-growth economy; and
Moving to a circular economy that operates within the “planetary boundaries” of, not just CO2 emissions, but nitrogen, forestation, water quality, and biodiversity.
For example, while it looks great on paper, the Grays Bay deep-water port on the Arctic Ocean is problematic. The road to connect it to southern markets runs straight through the migratory path of two caribou herds that are already at dangerously low numbers. “What’s a few caribou?” you may ask, “in the face of economic progress?” You can ask the same question about the Dodo, the Passenger Pigeon, and thousands of other species. Some that are threatened, such as bees and other pollinators, are keystone species without which our entire agricultural system will collapse. Mass extinction happens one road at a time; this road and the these caribou really are important.
The ‘#’ plan is a great vision for a sort of future Canada. The problem is, it’s not the sort of Canada that can be safely sustained. Most importantly, making our economic growth dependent on continuing global warming isn’t just morally wrong, it’s a recipe for long-term collapse. For example, a truly ice-free Arctic will change the AMOC ocean current enough to shut down the Gulf Stream. When that happens, Europe’s climate will shift permanently into a colder, drier regime that will make Britain more like Kamchatka. A warm Canada means a frozen England.
Once we come to our senses and act vigorously to reverse the temperature trend (which the global community will do, at some point), the Northwest Passage will close again. It has to, if our planetary ecosystems are to recover. But will a Canada that’s become economically dependent on higher temperatures support any planetary cooling proposal? Based on how Alberta’s oil industry influences our current attempts at reducing our emissions, I’d say no.
Will the Americans, or the Chinese, who are currently salivating over Arctic resources?
No. ‘#’ is an example of what you get when you apply the engineering-oriented, 1900s model of economic growth to the problems we face in the 21st century. All of this stuff could work, and all of it will create jobs, make our nation more independent, and increase our significance in the international community.
It’s just that it’ll also help speed the death of the planet. Other perspectives, other scenarios need to be layered over one like this to find our true path. Some of what I’ve described here should doubtless be done; but we have to temper the neoclassical idea that if we just maximize our utility function, all will be well.
I see a new and powerful Canada emerging. But it’s not quite this one.
—K