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LITTLEJOHN: A provincial Alberta is landlocked. A national Alberta not so much.

Albertans need to decide if they want to be a landlocked province without the ability to do much about it, or a nation with the leverage to reach our potential.

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Opponents of Alberta independence believe that they have a trump-card in convincing Albertans to remain a subject of the federation: it would be landlocked.

On the surface of it, they have a point. It doesn’t require a cartographer to look at a map to realize that an independent West without BC would lack a coastline.

The argument goes that without direct coastal access, a vengeful rump-Canada would have a veto over all of Alberta’s affairs, and energy exports in particular. As difficult as it is to deal with other provinces now, it would be virtually impossible if Albertans were foreigners without recourse to the courts. This side claims that British Columbia’s leverage would grow, along with their ability kibosh pipelines.

Unlike rich landlocked nations like as Switzerland, Austria and Luxembourg – whose commodities can be transported without pipelines – Alberta’s economy would tank, rendered subject to the whims of our neighbors. This is a major reason why many Albertans believe that their standard of living would suffer as an independent state.

Premier Jason Kenney shares this view.

“Landlocking ourselves through separation is not a solution. The green-left has been leading a campaign to landlock our energy. Why would we give them what they want?”

Kenney and the federalists ignore the elephant in the room: Alberta is already landlocked. 

After the passage of bills C-69 and C-48, it is highly unlikely that any private investors will bother to even attempt to build a new interprovincial pipeline. The Trans Mountain Expansion appears likely to proceed, but it is hardly a ‘future’ pipeline, given that it has been pumping oil since 1953. 

As a province, Alberta is bound by the constitution to respect the federal government’s powers over interprovincial trade. From milk, to beer, to oil, Ottawa has proven itself highly reticent to exercise these powers against offenders, giving an effective veto to politicians in Quebec and British Columbia. Even without a formal veto, these politicians have successfully intimidated potential investors with their pernicious rhetoric and threats of endless lawfare.

Alberta may eventually win long, dragged out fights in the courts, but the victory is a pyrrhic one. 

Without the ability to inflict real damage on other jurisdictions blocking its right to trade freely, Alberta is bringing a spoon to a gunfight. 

As a country, Alberta would have its hands untied, with the ability to retaliate in kind. Trade wars are almost always harmful, but the real threat of one is necessary. As Lawrence Solomon points out, “If Alberta were independent, its newfound bargaining power would certainly cause the Rest of Canada to capitulate, and speed to completion any and all pipelines Alberta needed to either ocean.”

An independent Alberta would indeed rely on imports and exports crossing foreign borders, but not without hugely expanded leverage. Threats of cutting Alberta off are hollow for the simple reason that Alberta would have an even greater ability to cut British Columbia off from the rest of Canada, and vice-versa. 

If B.C. attempted to landlock an independent Alberta, she would quickly find herself a modern East Prussia, cut off from access to the mother country. All the trucks, trains and planes carrying Eastern commodities to and from B.C. ports, and Toronto-Vancouver flights, would be forced to route either through the United States, or the Arctic.

The vast majority of Alberta’s energy trade is north-south. While it would hurt, Alberta could survive even a total embargo from a rump Ontario-Quebec state.

By contrast, the vast majority of British Columbia’s trade is with the rest of Canada. Those keen to point out that Alberta has no costal access on the map, should also note that standing between British Columbia and Ontario, is Alberta, Saskatchewan and Manitoba. A trade war would cut B.C. off from the Rest of Canada, and the Rest of Canada off from the Pacific. 

B.C. would have little incentive to turn off Alberta’s pipelines, knowing that Alberta could shut down the roads, railways and airways that keep B.C. alive. 

A war of tariffs and tolls would hurt everyone, but not equally. Alberta would be injured, but British Columbia risks being decimated. More realistically, British Columbia and the federal government would opt for a genuine free-trade agreement with Alberta than a devastating trade war. 

A vengeful rump-Canada might wish to wound Alberta, but doing so would punish British Columbia, and potentially drive it into the hands – oddly enough – of Alberta and Saskatchewan. Out of mutual self-interest, it’s most likely Canada would negotiate. 

Canadian provinces hardly have free trade as it is. Just as it is easier for sovereign nations in Europe to trade with each other than for Canadian provinces, a Canada-West trade agreement might actually free our economy to a greater extent than it is right now. 

Alberta would almost certainly obtain better access to the American market than as an appendage of Ottawa. As an independent nation, Alberta could negotiate for its interests alone, instead of horse trading to protect Ontario steel and Quebec dairy. Alberta has no need for protectionist side-deals, and could negotiate the most radically open free-trade deal it wanted. If successful, the remaining leverage of B.C. and Ottawa to landlock Alberta evaporates. 

Alberta is already landlocked. Albertans need to decide if they want to be a landlocked province without the ability to do much about it, or a nation with the leverage to reach our potential. 

Opinion

GRAFTON: Another flighty Liberal bailout, as Trudeau prepares to spend non-existent COVID-19 bucks on failing airlines

Ken Grafton writes that Trudeau is planning a massive bailout of Air Canada, owned mostly by wealthy foreign trusts.

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In the words of Virgin Air founder Richard Branson, “If you want to be a millionaire, start with a billion dollars and launch a new airline.”

Now it seems, after months of being non-committal on the issue of airline bailouts, Prime Minister Justin Trudeau is about to charge up the Canadian Taxpayer Mastercard again – not a paltry Branson $1 billion though, but a whopping Liberal $7 billion, if carriers and unions have anything to say about it.

Branson was warning that airlines are expensive and often lose money – and Branson should know. Virgin Atlantic applied for bankruptcy protection in New York on August 4th. They are attempting to negotiate a $1.6 billion rescue plan. Virgin Australia also filed for bankruptcy earlier in the year. 

These are not the best of times. COVID-19 grounded most commercial flights globally in March, resulting in plummeting airline stock prices. Airlines have been losing millions of dollars every week, and billionaire “canary-in-the-mine” investor guru Warren Buffett has sold out his entire $4 billion airline portfolio. Buffett said, “Investors have poured their money into airlines … for 100 years with terrible results. … It’s been a death trap for investors.”

Airline failures however, predate COVID-19. Airline bankruptcies since 1980 include TWA, US Airways, United, Air Canada (in 2003), Delta, American and many others.

The airline business model is problematic in a number of respects. First and foremost, it lacks scalability. This means that cost growth increases linearly with revenue growth, thereby making it very expensive for an airline to grow. A new A380 will set you back approximately $437 million USD. It costs about $83,000 for a fill-up at the pump, and a new set of 22 tires is a jaw-dropping $121,000

As Buffett explained to Berkshire shareholders in 2007, “The worst sort of business is one that grows rapidly, requires significant capital to engender the growth, and then earns little or no money. Think airlines. Here a durable competitive advantage has proven elusive ever since the days of the Wright Brothers. Indeed, if a farsighted capitalist had been present at Kitty Hawk, he would have done his successors a huge favor by shooting Orville down.” 

But, as history records, Orville made a safe landing that day in 1903.

Another problem with airlines is a sensitive dependence upon price competition. The reality is that if one airline decides to cut fares, for whatever reason(s), competitors have little choice but to follow. This can have disastrous impact financially.

Air Canada is Canada’s largest carrier. Privatized in 1989, its’ history includes layoffs, restructuring, mergers, previous bankruptcy and government bailouts. In May, Air Canada threatened to lay off 50-60 per cent of it’s 38,000 employees, saying that it is losing $20 million per day as a result of COVID-19. It is projecting a 75 per cent reduction in flight capacity during Q4 compared to 2019, and reported Q3 revenue of C$757 million, down 86 per cent from a year earlier, with an operating loss of $785 million CAD.

It has since been taking advantage of the Canadian Emergency Wage Subsidy (CEWS) program.

Now, as a result of COVID-19, Air Canada wants another bailout from the taxpayer.

Transportation Minister Marc Garneau said, “To protect Canadians, the Government of Canada is developing a package of assistance to Canadian airlines, airports and the aerospace sector. As part of this package, we are ready to establish a process with major airlines regarding financial assistance which could include loans and potentially other support to secure important results for Canadians.”

But who exactly are taxpayers going to be bailing out?

The top 10 Air Canada shareholders are all investment management funds. Letko, Brosseau & Associates Inc., Fidelity (Canada) Asset Management ULC, Fidelity Management & Research Co. LLC, EdgePoint Investment Group Inc., US Global Investors Inc., RBC Global Asset Management Inc., Causeway Capital Management LLC, Mackenzie Financial Corp., APG Asset Management NV, and CI Investments, Inc.. 

The irony of Canadian taxpayers ponying up $7 billion to bailout wealthy global investment funds would be amusing if it weren’t true. 

Perhaps Trudeau will broker a loan from Air Canada’s shareholders. They can afford it.

The likelihood of you getting an operating line of credit from your local bank because you had lost 90 per cent of your income and were billions in the red? Zero to none.

According to Intergovernmental Affairs Minister Dominic Leblanc the government is “very much discussing” the possibility of nationalizing the airlines, as Germany has done.

If the argument for deregulation and privatization is increased efficiency and cost benefit, then it follows that private sector enterprise must be prepared to bear the cost of failure. Trudeau is burdening Canadians with crippling debt as a result of COVID-19. The wealthy investment funds that own Air Canada should be prepared to do the same.

Ken Grafton is freelance columnist for the Western Standard from Aylmer, Quebec

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Opinion

McCOLL: The Cowtown Kremlin moves to stop Farkas

McColl writes that the Calgary City Council’s proposed rule against Farkas campaigning is better suited to Russia than to Alberta.

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Normally, one must go to Russia to find this kind of candidate suppression. This week, Calgary City Hall earned its nickname: the Cowtown Kremlin.

As reported by the Western Standard’s Dave Naylor, council will debate a motion that could require sitting councillors to seek permission from other councillors in order to attend or host events in each other’s wards, something that any candidate running for mayor would obviously need to do. This was rightly highlighted as a deliberate attempt to hinder Councillor Farkas’ ongoing mayoral campaign to replace Mayor Naheed Nenshi. Mayor Nenshi by contrast, would not face any similar restrictions should he run for re-election.

Councillor Farkas’ himself raised this issue at committee on Tuesday.

“This policy unfairly targets sitting Councillors running for mayor. It also unfairly targets civil debate, as well as the rights of private individuals to associate with others… Running for mayor necessitates a city-wide campaign where each of these events could be outside your ward. Keeping each Councillor apprised of a busy, everchanging campaign schedule is unreasonable and it’s ultimately unnecessary to prevent citizens from being confused about who represents them.”

The council committee voted 6-4 against the motion, but it will still go before the full city council on December 14.

Similar rules were passed in 2016 for the 2017 election. In an interview with the Western Standard, Councillor Farkas argued against the 2017 policy. “Council clearly overstepped their bounds in 2017, It’s good that they’ll likely not repeat the same mistake for this election.”

It’s worth noting that the 2017 rules were temporary guidelines specific to the period of ward redistricting, as explained in council on September 26, 2016 by then Ethics Advisor Professor Alice Woolley.

“This speaks to a councillor in a community that they do not currently represent, but that they will be seaking to represent in the next election and it says that particular activity is treated as campaigning. And the reason for that is because of the particular dangers and concerns that exist as a result of ward boundary changes.”

Professor Woolley clarified repeatedly, “This is not a policy, this is not a rule, this is simply a guideline for what I would consider good practice” calling it a “playbook for civil relations at a time of difficulty” and emphasizing: “At this point in time while the ward boundaries are in flux, I don’t think this rule would be appropriate in the same way after that time.”

Flash back to the present and current Ethics Advisor Professor Emily Laidlaw told Councillor Farkas that yes, a councillor could deny permission to attend a private function in an outside ward, but that she can’t see why that would happen if a person’s been invited.

Call me a jaded political junky, but I can imagine plenty of private events – hosted by federal or provincial Conservatives – within constituencies that overlap with wards of left-wing city councillors. Councillor Farkas is a former President of the Calgary-Elbow Wildrose Constituency Association and was a leader in the early days of merging the Alberta PC and Wildrose parties into the current governing United Conservatives. Should Councillor Evan Wooley have the power to block Farkas from attending a private event hosted by conservatives in Calgary-Elbow, or Jeff Davison block him from events in Western Calgary?

Trying to turn a temporary ethics guideline designed for ward redistricting into a rule to censor Farkas’ mayoral campaign is plainly undemocratic. Reviving it as a simple guideline opens the door for future meritless ethics complaints. Neither should be acceptable in a democracy.

Alex McColl is the National Defence Columnist with the Western Standard and a Canadian military analyst

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Opinion

WAGNER: Where Canada went wrong – the legacy of Pierre Trudeau

“For over a century, Canada was a great and noble country, justly earning a deep patriotic attachment from Westerners. That was the country that so many in the West still remember and love. But alas, those days are over.”

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The Maverick Party (formerly Wexit Canada) features the following statement on its website: “We love Canada too. But the system is broken.” It may seem strange that a political party ostensibly created to advocate Western Canadian independence openly proclaims its love for the country which it seeks to leave. However, many Westerners who favour independence do so reluctantly, and would rather have Canada fixed than create a new country. This is reflected in the party’s mission statement priorities: “(a) constitutional change, or (b) the creation of an independent nation.” Fixing Canada is the first option, however unlikely. 

It is understandable that Westerners would feel an attachment for Canada. After all, it has been one of the freest and most prosperous countries in history. Many millions of people desire to move here from other parts of the world because – let’s face it – Canada is better than the vast majority of other countries. If this wasn’t the case, people would be flooding out of Canada rather than flooding in.

However, Canada has been changing in recent decades, and not for the better. Although Westerners’ legitimate grievances against Central Canada go back over a century, they have become much more acute since the 1960s. 

There was a time when Canadian patriotism was the sensible position for Westerners. But things have changed. From the time of Prime Minister Pierre Trudeau onwards, confederation has increasingly been detrimental – and sometimes outright hostile – toward the West. Although Canada was once great, it has changed so much that the creation of a new country in Western Canada is needed.

An excellent source for information about Canada’s decline in the latter part of the twentieth century is the 1994 book, Derailed: The Betrayal of the National Dream by historian David Bercuson and political scientist Barry Cooper, both professors at the University of Calgary. In this book, they explain the original purpose of confederation, and how that purpose became subverted after the Second World War, especially under the administration of Pierre Trudeau.

Bercuson and Cooper point out that the original colonies confederated in 1867 primarily for economic reasons. By uniting, they could create a national government with the resources to build a country that would generate greater economic prosperity than each of the smaller units could do on their own. As Bercuson and Cooper explain, “Only when the national government was able to marshal effectively the resources of the nation and to direct westward expansion, settlement, railway construction, and industrial development would the real aim of Confederation be achieved – namely, prosperity as a British Dominion. As long as that happened, the New Nationality would hold together out of self-interest and the mutual support of disparate groups in the common enterprise of what we now call nation building.”

It was not intended that the new country would lead to a common identity that all Canadians could share. What kind of national identity could the English-speaking Protestants of Ontario and the French-speaking Catholics of Quebec have in common? They already had their own cultural identities, so they could only be united in one country on the basis of economic and political interests. As Bercuson and Cooper explain: “There would be no national myths to tie the disparate peoples of Canada together, other than the myths and ties of commerce. The role of the new national state that had been created to foster the new nationality was to promote economic growth and national development. The Fathers of Confederation well knew that the state could never have any other role.”

This was the predominant view of federal leaders until the 1950s, and it did not begin to change until Prime Minister John Diefenbaker came to power. He saw Canada as more than an economic alliance, but was unable to make much of a difference. 

After Diefenbaker, however, Prime Minister Lester Pearson began to take the country in a new direction. Pearson’s government wanted to establish what being a Canadian really meant. As Bercuson and Cooper write: “the new Canadian character itself was going to be created in the image of the thinkers and doers that Pearson had collected around him. So, for example, Canada was going to be bilingual and bicultural whether or not it made sense of Canadian reality, whether or not the nation could afford it, whether or not it actually drew Canadians together. They would do so by making bilingualism and biculturalism part of the national creed and, by lifting it above politics, turn it into an expression of our collective public virtue.”

This meant that by 1967 the role of the federal government had changed significantly: “Henceforth that role was not simply to administer, but to create and shape and mould a national character and, above all, to pursue collective public virtue.” Canada would henceforth be on a different path.

It was in this environment in which Pierre Trudeau entered politics and became prime minister in 1968. Even more than his predecessor, Trudeau wanted to substantially change the country of which he had become leader. 

According to Bercuson and Cooper, there were two major components of Trudeau’s agenda: “First, he would make Canada the kind of place where Quebecers would feel at home anywhere. And second, he would make Canada, including the now comfortable and well-adjusted Quebecers, a just society. His tool would be the state.”

The bottom line of Trudeau’s major policy initiatives and pursuit of a “just society” all had one thing in common: “increased intervention by the state in the operation of the economy and in the daily lives of ordinary citizens.”

Trudeau came to power facing a major challenge from the growth of Quebec nationalism. Within a few years he was also faced with an energy crisis due to the rapid rise of oil prices resulting from war in the Middle East. After his come-back re-election victory of 1980, he decided to aggressively tackle both issues. 

Bercuson and Cooper outline Trudeau’s goals as follows: “The logic was clear but never could be admitted: if Alberta’s energy revenues could be appropriated by Ottawa, and then redirected by it, the economy would hum; if the constitution could be changed, Quebec would be happy to remain in Canada. Even if it proved impossible to change the constitution, the ‘redirection’ of energy revenues as regional equalization payments held the promise of making Bourassa’s profitable federalism attractive.” The idea of “profitable federalism” was that Quebec should remain in Canada (rather than separate) because of the financial rewards it would receive.

Trudeau pushed through his constitutional changes but they did not satisfy Quebec. Nevertheless, those changes — and especially the adoption of the Charter of Rights and Freedoms — fundamentally altered Canada (for the worse, in my view). As federal Justice Minister John Crosbie said to a parliamentary committee in 1985: “The public does not realize that we already have had a revolution in Canadian society. The adoption of a charter was a revolution. It has changed the whole power structure of Canadian society.” This assertion would be confirmed by future judicial decisions.

Besides his constitutional initiative, Trudeau unveiled his infamous National Energy Program (NEP). It was predicated on the belief that Alberta was benefiting too much from high oil prices. Why should a pipsqueak province like Alberta profit at the expense of Ontario and Quebec? 

As Bercuson and Cooper explain, in the view of Trudeau and the Liberals, “it was not ‘fair’ that Alberta should collect so much revenue. The ultimate cause of this unfairness was the irrationality of nature in putting oil in Alberta in the first place. Surely it was now up to the rationality of EMR [Department of Energy, Mines and Resources] to set things right. More to the point, it was self-evident that Alberta could not be expected to use its new financial power in the interests of Canada. What made it self-evident was the undisputable fact that Albertans had shown their complete irresponsibility, not to say irrationality, by refusing to elect a single Liberal to the House of Commons.”

The NEP severely damaged Alberta’s oil and gas industry. It was later repealed by the government of Prime Minister Brian Mulroney. However, Mulroney’s government itself favoured Central Canada over the West. Both the federal Liberal and federal Progressive Conservative parties prioritized policies that benefited Central Canada because they needed to win large numbers of seats in Ontario and Quebec to form the government. Therefore, the West required its own party, and Preston Manning’s Reform Party filled that need.

Despite the Reform Party’s best efforts, however, the West is still expendable to the Liberal Party and taken for granted by the Conservative Party. Again, a new Western party is needed to represent the West’s interests in the House of Commons. The Maverick Party’s prioritizing of “constitutional change” is understandable but somewhat naïve. A number of Western initiatives have been launched to reform the country over the last 40 years, and all have failed. Not an inch of progress has been made. This means that it’s time for the Maverick Party’s Plan B: “the creation of an independent nation.”

In an ideal world, a truly conservative federal government would be elected, allowing Alberta to develop its energy resources and export them through numerous pipelines and oil tankers along the BC coast. The limitations of so-called “progressive” policies could be overcome, and Canada would emerge as the freest and most prosperous country in the world. But this is just a pipe dream; the only realistic path to this kind of freedom and prosperity is an independent Western Canada, or at least an independent Alberta. 

For over a century, Canada was a great and noble country, justly earning a deep patriotic attachment from Westerners. That was the country that so many in the West still remember and love. But alas, those days are over. Since the time of Pierre Trudeau, this has been a different country. Now, a new political path forward is needed. The time has come for an independent Western Canada.

Michael Wagner is a columnist for the Western Standard. He has a PhD in political science from the University of Alberta. His books include ‘Alberta: Separatism Then and Now’ and ‘True Right: Genuine Conservative Leaders of Western Canada.’

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