2. Literature Review and Methodology` Four main elements will be of utmost concern to this paper: Structural

Transcription

1 2. Literature Review and Methodology` 2.1 Literature Review Four main elements will be of utmost concern to this paper: Structural realism/neo realism, Canada energy supply, China energy demand, and Canadian China oil relations Structural Realism/Neo realism To many, neo realism and structural realism are interchangeable terms. However, in the case of this study these terms are not interchangeable, as I will follow the definitions as used by Buzan (1993) when dealing with neo realism and structural realism. Before getting to the distinction of these two terms and the elements within them, it is best to give a brief synopsis of the relevant literature dealing with realism to structural realism, as realism, and neo realism, is still at the core of the main structural realist elements. Kenneth Waltz s Theory of International Politics (1979) is the seminal work on neo realist thought and thus helped pave the way for neo realism s dominance in the international relations sphere. Waltz placed added emphasis on the level of structural analysis when dealing with power politics as a kick start to classical realist thinking. Waltz s neo realism has not been without its critics, such as Keohane (1986), yet to this day neo realist thought is still the torch bearer in the international relations field. 8

2 Waltz had regenerated interest in realism; however he still wanted to make distinctions from classical realism and thus coined neo realism. Yet, what Waltz proposed was not a complete unique framework, rather a re working of some existing ideas blended with new concepts, hence the neo. Waltz extended on the core elements of realism (mainly the focus on conflict in the international sphere as compared with the neo liberal leanings towards cooperation) from the beginning realism stages of Hobbes and Machiavelli up and through to Morgenthau and Carr. As outlined by Gilpin (in Keohane 1986: 304 5) the following elements are all common realist assumptions: the nature of international affairs is conflict, the main element is the group as opposed to the individual and the key impetus is towards power and security. From the same volume Keohane emphasizes the central importance of states, and that they are unitary rational players, that desire power, and focus their needs in regards to power. Waltz took these elements and installed a structural design around this group of conflicted states to further his framework, by accentuating security and maintaining the reduction of all power down to political power. In The Logic of Anarchy (1993) the authors attempt to take Waltz s neo realism and expand it into a richer framework, which they call structural realism. 2 The following paragraphs will help to clarify the distinction between neo realism and structural realism and my rationale for choosing the latter. 2 I will follow the distinction in Buzan (1993) by referring to Waltz s theory as neo-realism and referring to Buzan s work as structural realism. For the purpose of this study I will focus on structural realism aspects as designed by Buzan and customized by the author. 9

3 As pointed out by Robert Cox (in Keohane 1986) neo realism appears too US centric and time specific in its cold war focus. By expanding on the main elements of realism and neo realism, Buzan s structural realism hopes to give a wider view with a less time and nation specific bias. Three features show structural realism as following the realist lead, however, also lead to some modifications (Buzan 1993). First, is that realism and neo realism place political power as the nucleus of all power, at the expense of other kinds of power such as economic or societal power. Structural realism emphasizes the dominance of political power, however not at the utter expense of all other forms of power. Second and third are that states are the crucial element in the international system and that Waltz s basic framework of the international structure remains in place, yet with some alteration. Buzan (1993) points to three main distinctions between neo realism and structural realism. First, is that the definition of structure is widened to envelop ideas beyond the political sphere. Second is that structure is not the only element that can effect the systemic level as the points of interaction can also have impact on the system and the outcome of the structure and lastly structural realism sways from Waltz s microeconomics stance. These three differences make four possibilities open to structural realism that are unavailable to neo realism and it is the third possibility that is a key component on the selection of this theory over neo realism. This third element, as touched upon before, is that structural realism hopes to break out of the narrow logic of political interaction that dominates neo realism and to look at the whole range of interactions (economic, 10

4 societal, as well as military and political) that have shaped both the units and the structures of the international system (Buzan 1993 p.13). I believe as Buzan does that military power has lost the distinction as the main element for great powers in international relations. 3 Globalization and the power of free market economics has played a large role since the switch from Keynesian control of the markets by governments to the more free market thinking of Hayek and the Austrian school in the 1970s. As well, environmental and resource security issues have been gathering momentum, and not just as a passing issue, in international politics and I feel that environmental concerns and resource scarcity issues are a key element when dealing with future international sticking points. As such, structural realisms wider viewpoint allows a more accurate look at what this study hopes to accomplish. Along with allowing this interaction between politics, economics, environmental and other issues Buzan s structural realism also states that advocates of power and interdependence have by and large made their peace, so that the two concepts are now generally seen as complementary rather than mutually exclusive (Buzan 1993 p. 15) and that we (Buzan et al.) are in complete sympathy with the desire of Keohane and Nye to fuse neo realism and liberalism into a full systems theory that incorporates process as well as structure (Buzan 1993 p.17). This wider scope, allowing cooperation and regimes helps to connect the theory better to the specific cases, in this case the study proposed within, while still being based on the core tenets of realist and neo realist theory. 3 Buzan (1993) points out that military power seems to have retained its prominence amongst outsider states, or outsider states and great powers, citing the second Gulf War as a case in point, however not so amongst major powers. 11

5 Along with this main structural realism approach and furthering on the work of another neo realist author will be the last element of the customized approach based on the economic work of Herbert Simon stemming from his work Models of Man (1957) and in the international relations field through the writing of Robert Gilpin (1981). In his work, Simon uses a term satisficing, which describes that in any situation a firm may settle for less than optimal outcomes in selected areas, due to the fact that they are in the pursuit of more than one goal. By doing it this way they may be able to achieve a better overall level of satisfaction through this tactic than by sacrificing one need for another 4. Neo realist scholar Robert Gilpin used satisficing in War and Change in World Politics (1981) to describe the marginal costs and marginal benefits analysis that states must make in determining whether to make changes in the international system. Change can be a benefit to a nation; however they must weigh the costs of a disruption to the structure of their relationships and the systems within. This element of the theoretical framework will be used in accordance to the additional lenses that structural realism allows over Waltz s neo realism. By looking beyond the political lens and weighing the costs and benefits of the lenses together, a more accurate depiction of the rationale behind states choices may occur Canada Energy Supply 4 Satisficing is similar to the economic concept of opportunity cost 12

6 The crux of this paper is Canada s ability (supply) to expand its oil sands exporting potential (Table 1), specifically to China. The value of the Albertan oil sands has only in recent years become a viable topic and as such, there is little depth to the literature. Table 2.1 Overview of Albertan Oil Sands Projects (2006) Kinds of Oil Sands Projects Number of Projects Value (in $ millions CAD) Finished projects Projects under development (some partially producing) 13 26,387 Proposed Projects 39 71,180 Total 54 98,357 Source: Alberta Employment, Immigration and Industry, Policy and Economic Analysis Division (2007) canada.com/statpub/albertaconstructionprojects/pdf/inventoryofmajoralbertaproje cts_2006_dec.pdf As Canada s oil is mostly locked up in the oil sands projects of Alberta, higher oil costs are needed to make them profitable to exploit. Nonetheless, in recent years, prices have made the oil sands projects more attractive to potential investors including the Chinese. Saxton (2006) and Jiang (2005) cite how Canada is becoming one of the main oil producers in the world and that their reserves are now second behind only Saudi Arabia, due mostly to the tar sands projects. Aside from these articles the majority of the literature is from government agencies such as the Alberta Energy and Utilities Board (2006), Natural Resources Canada (2006) and National Energy Board (2006), which all follow similar conclusions of the above authors stating that Canada s reserves and production are growing to the point that Canada s influence in the global market is increasing. All of these papers speak of the supply side of Canadian oil as it now has the 13

7 second most proven oil reserves and is currently eighth in overall oil production, according to EIA statistics 5. McCullum (2006) and Bennett (2002) suggests that Canada is America s gas tank as the government deregulation of the 1980 s and NAFTA have led to many of the decisions regarding Canadian oil and its production to be done through the working of US companies and agencies. Laxer (2006, 2007) and Rowat (2006) reinforce many of the same issues regarding the US power over Canadian resources and suggests that a stronger Canadian energy plan is needed. In regards to oil sands history the seminal source to date is Paul Chastko s 2004 work Developing Alberta's Oil Sands: From Karl Clark to Kyoto China Energy Demand In regards to the crushing need for Chinese energy supplies (demand), this area has received much scholarly attention. Zweig (2005), Downs (2006, 2004, 2000), Crompton (2005) and others have all written extensively on China s past, present and future energy needs. As such this paper will briefly summarize their findings on demand, and look briefly into some of the more institutional issues behind the increasing energy demand in China. In Downs (2006) she lists the following table as an example of the energy crunch expected in China: 5 See chapter 4 for data and tables 14

8 Table 1.2 Projections of China's Oil Demand in 2020 (million barrels per day) Source Date Projection United States Energy Information Administration National Development and Reform Commission (China) China National Petroleum Corporation Institute for Energy Economics, Japan International Monetary Fund Energy Research Institute (China) International Energy Agency National Administration of Statistics (China) Source: Downs (2006) Kong (2005) describes the pressures, intensity and inefficiency of the Chinese energy market. As well, he draws attention to the lack of energy policy institutions in China, which exacerbates the energy dilemma in China and the growing dependency on foreign imports of oil. Kambara (1992) in an earlier work points to many of the same findings as does more recent work such as Bustelo (2005), Farmer (2006), and Douglas (2006). The overall summary of the literature remains relatively the same, in that China s demand of energy is only increasing and especially that of foreign import dependency. The ratios and estimates may vary, but the overall message is the same: China needs (foreign) oil. Daojiong (2006, 2005) and Christoffersen (2005) delve into the issue of China s governance concerns and international relations in regards to oil politics, as again the concern is in the lack of institutions and the deepening dependence on foreign imports of energy, especially oil. In regards to the history of China s energy and oil industries Zhao (2001) and Rosen (2007) have written extensively on this topic and their conclusions will be summarized briefly in chapter 5. 15

9 2.1.4 Canada and China Oil Relations Canadian Chinese oil relations have received minimal academic attention as mentioned above. Prior to 1978, China was an inward looking state, and throughout much of its history Canada has been a tier two country behind the heavy shadow of the United States. Jiang (2005) comments directly on the potential for growth as Canada and China seem a suitable match. Francis (2005) and Rowat (2006) along with others speak of the potential for Canada to expand with China. Zweig (2005) and Romero (2004) among others have spoken on potential conflicts between the US and China over Canada s oil sands, however, this has not been done from the Canadian perspective, which return us to the rationale behind this study. 2.2 Methodology This study was done principally through extensive library, internet and field research. The first element was primarily focused on data collection from library and internet research. Relevant academic journals, business prospectuses, government publications as well as business surveys were sought out to aid with this element. For these elements key search terms were focused around the following: Structural realism, oil politics, and geo politics Canada energy/oil China energy/oil 16

10 After establishing the main criteria of the study, I then proceeded with my field research in Canada. I visited with various scholars, experts, government agencies, think tanks and visited the oil sands region in Alberta to acquire a greater understanding of the potential growth for Canada. As well, I attended the Canadian Energy Research Institute (CERI) Canada as an Energy Superpower conference in April and have maintained contact with numerous of the speakers and delegates of this conference as their first hand knowledge and experience were invaluable in conducting this study. Upon returning to Taiwan, I continued with further data collection and analyzed the field research data. For furthering my data collection I searched the government records and legislative proceedings based on the following key words: Oil (including oil sands/tar sands) Energy China Environment NAFTA Proportionality clause Finally, I analyzed all my data, in my customized structural realism framework, and finished writing the final version of this paper. 17