Stephen Harper compromises on Nexen and everyone gets half a baby – by Andrew Coyne (National Post – December 11, 2012)

The National Post is Canada’s second largest national paper.

See, the thing about Solomon is, he never actually cut the baby in half.

Nevertheless, the prime minister’s split decision on foreign takeovers is being praised as Solomonic in some circles. But then, for some people cutting the baby in half — you can have the head and one of the shoulders, but the rest of it you get only in exceptional circumstances — is always the right decision. Because, you see, it’s a compromise, and compromise shows maturity, and maturity is the beginning of wisdom, and, well, it’s a compromise. God forbid he’d decided it on principle.

Aside from the baby-severing community, however, the reaction was, as you might expect, mixed. Perhaps the most memorable was Tom Mulcair’s devastating putdown, that the only clear winners from Harper’s decision to allow the sale of Calgary-based Nexen to China’s state-owned CNOOC were the “Nexen shareholders” — oh, them — in “Mr. Harper’s oilpatch.”

I wasn’t aware until now that it was Mr. Harper’s oilpatch. Still, you could make a case that, as of Monday, it is. The prime minister may not have gone so far as to dismiss Nexen’s shareholders, à la Mulcair, as some sort of bit players in the whole drama, but current and prospective owners of other oilsands firms should be on notice: they no longer truly belong to you. They are, at least in part, Stephen Harper’s.

You might have paid for them. The legal title might reside with you. But practically speaking, they have been nationalized, at least in part. What part is that? The part of their value you would have obtained, had you been permitted to sell them to the highest bidder. Henceforth, some of the most likely bidders, especially for control stakes, will be excluded from consideration — but for “exceptional circumstances.”

The ease with which this issue — who owns the shares? — is passed over, in a debate that is supposedly all about ownership, is striking. If ownership means anything, it means the right to dispose of your assets as you see fit, and to reap the rewards that such ownership confers. If you don’t have that right, you don’t really own the asset. Someone else has helped themselves to it.

Certainly it never came up in all of the many accounts of “how the decision was made” that have appeared since. In some reports, it was a political fudge, offering something to each side of a divided caucus and, so we are informed, cabinet. In others, it was a shrewd move to preserve a bargaining chip in future negotiations with China: before we will allow your companies full rights to invest in Canada, you must grant our investors the same right in China.

For the rest of this article, please go to the National Post website: http://fullcomment.nationalpost.com/2012/12/10/andrew-coyne-stephen-harper-compromises-on-nexen-and-everyone-gets-half-a-baby/

 

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