Why Albertans are angry
Mark Milke, The ORCA, June 6, 2019
With much of Canada booming, including low unemployment rates, rising dissatisfaction in Alberta is at best a mystery to many other Canadians. At worst, it provokes hostile reactions.
As someone born and raised in British Columbia but who has spent most of the last three decades in Alberta, I know why many Albertans are angry.
Here’s the short form:
Imagine how you might feel if not only was the Port of Vancouver on strike, but the Alberta premier demanded that it never take one additional trainload into the port, ever. Or if Calgary City council voted to end all train shipments to the port by 2040. Or if the prime minister wanted to limit any increase in commercial shipping from the Port of Vancouver and Airport to just today’s traffic and exports – and muses about “phasing out” both major B.C. economic drivers altogether.
That’s a snapshot, based on current federal and British Columbia government approaches to oil exploration, extraction, and export which hurts resource communities across Canada. The target is Alberta in particular, but collateral damage includes communities in northern B.C., Saskatchewan, and Newfoundland, and also those who could benefit from more resource extraction in Quebec, Nova Scotia, and New Brunswick but have faced local activist and political opposition. (New Brunswick’s current government is, for the record, a happy exception and pro-resource development.)
Ponder that – but now, the long list.
Unreasonable court judgments.
When the Federal Court of Appeal ruled in late August 2018 that the TransMountain pipeline expansion could not yet move forward, the kindest way to describe the court judgment is that regulatory and legal expectations were a constantly moving “football” akin to the Charlie Brown episode where Lucy snatches away the ball at the last moment.
While justices, regulators politicians, and commentators debate the supposed inadequacy of consultations—this in a country where consultations have become an avenue for activists to kill resource projects—the real-world result was this: Laid-off workers in British Columbia and Alberta, First Nations included.
Here’s another glimpse: A friend who works at a dealership just outside Calgary which refits trucks for oilfield services, said the phone started ringing with cancellations that same August day the Federal Court stalled yet another pipeline project. One example: One company cancelled a 60-truck order. The dealership still sells some trucks to energy firms. They do a booming business in the United States while their Canadian operations are shrinking.
Albertans well know that Justin Trudeau came to power promising to kill the Northern Gateway pipeline. And Trudeau kept his promise, banning tanker traffic on B.C.’s northern coast, putting a de facto spike in pipeline development. Then there is Bill C-69, the legislation that ostensibly might streamline development for energy approvals in Canada but which mandates that the energy sector is expected to tally up everything from gender-based analyses to downstream carbon emissions that, say, the aerospace and automotive sectors are not. Or Bill C-48, more properly called the “no-more-pipelines” law if passed.
All this came after then-U.S. president Barack Obama’s eight-year stall tactics on Keystone XL and after former BC Premier Christy Clark threw five conditions—wrenches really – into pipeline development, with her successor government under Premier John Horgan adding on reflexive anti-Alberta energy opposition.
Meanwhile, oil and gas production in the rest of the world—and after the 2014 oil price collapse—has continued to rise, and so too carbon emissions. The exception was Canada’s energy sector, not just in Alberta, but also British Columbia, Newfoundland and Labrador, and Saskatchewan. But despite the world reality and demand for energy, Canada’s energy sector is expected by Horgan et al. to self-mutilate itself, an entire industry six times the size of Canada’s automotive sector.
Then consider Quebec, whether former Montreal mayor Denis Coderre who labeled the now-killed Energy East pipeline “too risky”, or current Quebec Premier Francois Legault who labelled Alberta’s products “dirty energy” and claimed Quebecois oppose more pipelines. (A contrary fact: According to the Montreal Economic Institute, 66% of Quebecois prefer Western oil over Saudi Arabian oil.)
Of additional irritation to Albertans: The Quebec political rhetoric is especially galling because of how much money Albertans pay into the federal treasury on a net basis: $188.6 billion more in taxes to the federal government than transferred back/spent in the province between just 2007 and 2015. And by the way, British Columbians and Ontarians are also net contributors to Confederation, with Quebec the biggest net taker in dollar terms.
I’ve written plenty of studies about transfer payments and equalization and well know the design of both and only some of that imbalance is defensible: Above-average incomes and (until recently) lower-than-average unemployment in Alberta, meant the province was never going to see an exact proportional flow in money sent to the federal treasury.
But consider the Quebec political comments and the money flows. It is at this intersection, where irrational opposition to Western oil and gas combined with the acceptance of cascading cash into Quebec’s treasury is so maddening to Albertans – and should be equally irritating to British Columbians.
The current design of equalization acts as an inducement to not develop provincial economies. Unlike Alberta, where successive government said “yes” to oil and gas development since its inception, or even British Columbia until very recent decades (read: the 1990s and beyond) which once provided great middle-class jobs in the resource sector, Quebec mostly blunts the development of its own energy resources (and much else), thus dampening extra provincial revenues.
The result of political choices in Quebec thus makes the province eligible for lavish equalization subsidies ($55.5 billion since 2015 alone) while Quebec politicians chronically disparage the resource extraction that make such transfers possible.
To sum it up, imagine you’re in British Columbia, a manufacturer, and most of your border access is becoming ever more limited. The federal government outlaws one potential major highway for transport, buys another highway, but then ties it up in red tape before you can use it. The courts then endorse endless consultations.
Meanwhile politicians in Quebec bash your main export but are happy to profit from it, care of taxes that end up with the federal treasury.
Yes, Albertans are angry, and all of the above and more is why. It is entirely rational.
Mark Milke is policy analyst and author of Ralph vs. Rachel: A tale of two Alberta premiers. Mr. Milke was the principal policy advisor to Jason Kenney in the year leading up the recent Alberta election.
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