Mausoleums and Dinosaurs
Jeff Rubin is the former chief economist and chief strategist with at the CIBC World Markets who resigned this position a few days ago when his book Why Your World is About to Get a Whole Lot Smaller was released. Today The Globe and Mail "Report on Business" did a feature on Rubin and his book. This is what their columnist Derek DeCloet wrote.
"The newish Terminal 1 at Toronto's Pearson International Airport--light, bright and cavernous in size--is a monument to the power of debt and to grand visions of the future. Five years ago, when phase one of the $3.6 billion facility received its first passengers on an Air Canada flight from Vancouver, its promoters rhapsodized about how wonderful it was, then turned their attention to the next set of their expansion scheme. Pearson, they boldly predicted, would need to be big enough to handle 50 million people a year by 2020. (It's at 32 million today.)
Forget it, Jeff Rubin says. Stop building and stop worrying about a wave of travellers that will never come. Long before 2020, we'll see airlines shutting down, Boeings being mothballed, airports closing. The gleaming glass palace of Terminal 1 is a "mausoleum to the past age of energy," he says. It would be a nice place to play a floor hockey game, though, and if Mr. Rubin's forecast comes true, will certainly be empty enough for one."
Rubion's analysis sounds like one of those pessimistic prophesies that "the sky is falling," but it is not like that at all. He claims that the high cost of all forms of petroleum products will create a new set of economic conditions that will stimulate manufacturing in Canada and North America. Transportation costs will go up and that will undercut the cost advantage enjoyed by counties like China, India and others. This will give an advantage to local producers.
Other economist point out that as fossil fuels become more expensive it will stimulate environmental industries like high speed trains, mass transit, alternative forms of energy like wind and solar power and the retrofitting of houses. We could well be on the brink of a new age of prosperity driven by environmental concerns. In ten years time we will live a different type of lifestyle but one that is much more in tune with nature.
At the centre of these changes will be a transformation in the way that we travel. If airport terminals are going to become "mausoleums," then airlines will be dinosaurs.
So if this is the case, tell me why the federal government and the Toronto Port Authority have allowed a new mausoleum to be built at the Island Airport, especially in light of the recent enormous investment at Pearson?
Bill Freeman
"The newish Terminal 1 at Toronto's Pearson International Airport--light, bright and cavernous in size--is a monument to the power of debt and to grand visions of the future. Five years ago, when phase one of the $3.6 billion facility received its first passengers on an Air Canada flight from Vancouver, its promoters rhapsodized about how wonderful it was, then turned their attention to the next set of their expansion scheme. Pearson, they boldly predicted, would need to be big enough to handle 50 million people a year by 2020. (It's at 32 million today.)
Forget it, Jeff Rubin says. Stop building and stop worrying about a wave of travellers that will never come. Long before 2020, we'll see airlines shutting down, Boeings being mothballed, airports closing. The gleaming glass palace of Terminal 1 is a "mausoleum to the past age of energy," he says. It would be a nice place to play a floor hockey game, though, and if Mr. Rubin's forecast comes true, will certainly be empty enough for one."
Rubion's analysis sounds like one of those pessimistic prophesies that "the sky is falling," but it is not like that at all. He claims that the high cost of all forms of petroleum products will create a new set of economic conditions that will stimulate manufacturing in Canada and North America. Transportation costs will go up and that will undercut the cost advantage enjoyed by counties like China, India and others. This will give an advantage to local producers.
Other economist point out that as fossil fuels become more expensive it will stimulate environmental industries like high speed trains, mass transit, alternative forms of energy like wind and solar power and the retrofitting of houses. We could well be on the brink of a new age of prosperity driven by environmental concerns. In ten years time we will live a different type of lifestyle but one that is much more in tune with nature.
At the centre of these changes will be a transformation in the way that we travel. If airport terminals are going to become "mausoleums," then airlines will be dinosaurs.
So if this is the case, tell me why the federal government and the Toronto Port Authority have allowed a new mausoleum to be built at the Island Airport, especially in light of the recent enormous investment at Pearson?
Bill Freeman
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