MORTON: Here's how the Liberals sabotaged Alberta's historic rights
By Ted Morton (Originally published in the Calgary Herald on November 30, 2019, published here with permission of the author)
We are at a pivotal moment in Alberta’s history. Once again, Alberta has no representation, no voice in a newly elected federal Liberal government. We are in in our fifth year of recession and unprecedented unemployment. Premier Jason Kenney has responded by creating the “Fair Deal” panel to consult Albertans on how best to respond to this crisis.
To make informed decisions, it’s time for Albertans to do a policy audit of the past 30 years. Where have we been? Where are we today? The results are not happy.
Alberta is worse off today than it was 30 years ago. Despite the considerable efforts of such exceptional leaders as Peter Lougheed, Preston Manning, Ralph Klein and others, Alberta is more vulnerable to destructive federal policies than we were in the 1980s. Here’s the balance sheet:
Lougheed’s greatest achievement was the addition of Section 92A to the 1982 Constitution Act. Section 92A affirms and protects all provinces’ rights to develop their own natural resources. For Alberta, this meant primarily oil and gas and was intended to prevent a repeat of Pierre Trudeau’s National Energy Program. But today, his son’s carbon tax and Bill C-69 — the no-pipelines-ever law — are NEP 2.0. They make section 92A almost meaningless. This stranding of Alberta’s oil is aggravated by the Liberals’ tanker ban off the north coast of B.C., Bill C-48. Of course, there is no similar ban on oil tankers in the St. Lawrence River bringing OPEC oil to refineries in Quebec.
Lougheed also was familiar with the centralist bias of the Supreme Court of Canada. He understood that the adoption of the 1982 Charter of Rights amplified this risk. As a precaution, Lougheed insisted on the addition of the Section 33 Notwithstanding Power to protect Alberta (and other provinces) from policy vetoes by judges appointed unilaterally by the prime minister. Today, the notwithstanding power is in disrepute and disuse.
Lougheed was also the strongest advocate for the new constitutional amending formula that treated all provinces equally and gave no special veto to Quebec. This was a major victory for all the western provinces. In 1996, Liberal Prime Minister Jean Chretien gave the veto power back to Quebec via ordinary legislation.
A final Lougheed achievement was his insistence on limiting the scope of Section 35 to “existing aboriginal rights.” He successfully demanded the insertion of “existing” to prevent it from becoming a “blank cheque” for judicial policy-making. The Supreme Court subsequently ignored the framers’ intent and invented the “duty to consult,” words found nowhere in the Constitution. The result is that Canadian pipeline policy is now made mainly by unelected, unaccountable judges.
Alberta’s economic collapse has been exacerbated by Ottawa’s abdication of federal responsibility for interprovincial pipelines. In the 1980s, it was unthinkable that a province could block the construction of an interprovincial pipeline that had been approved by the federal government. Now it’s happened twice: Energy East by Quebec and Trans Mountain by British Columbia. Nothing falls more clearly under federal jurisdiction. But in this fall’s election campaign, Justin Trudeau pandered to Quebec voters with the promise that he would “fight (premiers Kenney and Ford) and the energy companies that support them.”
Equalization and other federal transfer programs continue to drain billions of dollars a year out of Alberta — over $300 billion since 2000. Meanwhile, Quebec continues to see its share of equalization dollars increase — from less than $3 billion a year in the early 1980s to over $13 billion a year today — or 66 cents of every dollar Ottawa sends out.
While shocking, these numbers are not that surprising. The Liberal party can and does form majority governments without electing any MPs from Alberta or Saskatchewan. But winning a big chunk of Quebec’s 78 MPs is key to the Liberals’ strategy to build a majority government. Indeed, in 2015, Trudeau was the first Liberal leader to win a majority of Quebec’s seats since his father did it in 1980. That hasn’t changed.
What has changed is the federal civil service that administers all these programs. When Pierre Trudeau introduced bilingualism, it was sold as only a language proficiency test. But in practice, it has meant that a disproportionate number of federal bureaucrats, especially in the upper levels, are Quebec francophones. The result: administrative decisions in Ottawa are made through an ideological lens that is sympathetic to Quebec’s concerns and interests.
In the 1980s, Preston Manning helped to form the new Reform party under the banner, “The West Wants In.” During the 1990s, Manning and the Reformers did well. They swept the Mulroney Conservatives off the electoral map in 1993 and in 1997 formed the official Opposition in Parliament. Fiscal reform, balanced budgets and Triple E Senate reform all seemed within reach. Today, federal deficits and debt are at record levels. The project of an elected Senate is dead, killed by an arbitrary 2014 Supreme Court ruling and a new Liberal government that was only too happy to let it die.
In the early 2000s, foreign capital investment poured into Alberta. ConocoPhillips, Marathon, Apache and Chevron all made major new investments. But it wasn’t just American energy companies. New investors included Shell, BP and Centrica from the U.K.; Total from France; Statoil (now Equinor) from Norway and a host of smaller companies from South Korea, China and Japan.
Today, they are almost all gone. Since 2015, there has been a $50-billion exodus of foreign capital. Add the equity sell-off of Canadian oil and gas companies, and the loss soars past $100 billion. As noted, this collapse has been driven by policy, not oil prices. Where Alberta used to rank near the top in terms of energy sector competitiveness, we now rank 16th in a recent survey of 20 North American states and provinces. The problem: regulatory uncertainty, lack of pipeline access and taxes.
This explains why even Canadian energy companies are bailing out of Canada. TransCanada Pipeline has purged “Canada” from its new name, TC Energy, and is re-allocating its investments to Texas and Mexico. Encana, which began as Alberta Energy Corp. and grew to the highest-valued Canadian-owned energy company in the world, has changed its name to Ovintiv and slinked away to Denver.
The bottom line is clear: The political strategies of my generation of Albertans have not worked to improve Alberta’s position within Confederation. It would be a disservice to our children’s generation to say otherwise. Today, we are even more vulnerable to the Liberals’ tried and true strategy of pillaging Alberta’s economy to buy votes in Quebec and Ontario.
It’s time for a Plan B.
Ted Morton is a former finance minister for Alberta and a senior fellow at the University of Calgary’s School of Public Policy (Originally published in the Calgary Herald on November 30, 2019, published here with permission of the author).