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Christy Clark Should Consider What's Best for Canada, Not Just B.C.

05/28/2013 07:58 EDT | Updated 07/28/2013 05:12 EDT
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Christy Clark, Premier of British Columbia, Canada, speaks during the World Economic Forum - India Economic Summit in Mumbai on November 14, 2011. More than 800 participants from 40 countries are taking part in the annual two-day India Economic Summit, which is making its debut in Mumbai having previously been held in the capital New Delhi. Delegates will focus on how to combine economic growth with essential social development. AFP PHOTO/ Punit PARANJPE (Photo credit should read PUNIT PARANJPE/AFP/Getty Images)

When Christy Clark recently asserted British Columbia didn't need the federal government, and also said "we don't need Alberta," the B.C. premier demonstrated why Canada's founding fathers were concerned about provincial politicians: when they think in isolation, such premiers harm the interests of all Canadians.

The context of Clark's election-time remark was how B.C. could become an energy superpower if more natural gas was developed and delivered through pipelines, as opposed to "allowing" oil pipelines to crisscross British Columbia more than they already do.

In particular, Clark's position on the Northern Gateway pipeline, articulated last year, is based on extracting compensation from Alberta or the federal government. (She also demanded deals with Aboriginals and environmental protection but those are de rigeur these days and thus superfluous demands.)

Clark's pay-to-play ultimatum is silly and I say this as a temporarily exiled British Columbian. The constitution is clear that resource revenues belong to the provinces. (When this tête-à-tête erupted last year, Alberta Premier Alison Redford was entirely correct to remind Clark of that unassailable fact.) As for Ottawa, should it begin paying off premiers to "allow" national resource development, there will be no end to diverted federal tax revenues or the impairment of national prosperity.

And then, there's the risk of retaliation -- British Columbia's government might need a friendly Alberta government one day. As Calgary Herald columnist Don Braid noted recently, courtesy of the Alberta Premier's office, "50 per cent of B.C.'s growing natural gas production crosses Alberta to get to market."

Alberta's politicians could just as easily demand a cut of revenues from that interprovincial flow as B.C.'s politicians do from any proposed new oil pipeline. What is good for the B.C. "goose" is just as easily extracted from the B.C. "gander."

When provincial politicians protect their own constitutional turf, or object to federal transfers that rob taxpayers in policy-smart provinces to subsidize policy-challenged governments in others, they are on solid ground.

In contrast, protectionist politicking undermines greater Canadian prosperity, which is why so many founding fathers opposed such provincialism. In 1865, George Brown, the Upper Canada parliamentarian, complained that a trip to Nova Scotia or New Brunswick was like visiting a foreign country, where a "customs officer meets you at the frontier, arrests your progress, and levies his imposts on your effects." Instead, Brown argued "heartily for the union, because it will throw down the barriers of trade, and give us control of a market of four million people."

New Brunswick legislator John McMillan also favoured confederation for the open borders it would bring: "To enter into an alliance that will enable us to have free trade with our neighbours, and this union of the provinces, I maintain, would be commercially the best step we could take."

A Royal Commission from 1940 on Dominion-provincial relations looked back to 1867 and noted how "economically, the first objectives of Confederation were to establish a free-trade area comprising the five old provinces and to develop inter-provincial transportation facilities."

The reason was straightforward. Before Confederation, the provinces imposed tariffs and duties on each other's goods. That punished consumers and business with higher prices and dampened the potential for greater economic growth in British North America.

Post-Confederation, provincial attempts to block interprovincial trade were annoyingly constant. It is why the Dominion government disallowed 65 pieces of provincial legislation in the first 30 years after Confederation, this when such laws interfered with the greater prosperity of the country. That power of disallowance is a power the federal government retains today even though it is rarely exercised.

So what's the relevance to the present? At Confederation, duties and tariffs were the main hindrance to interprovincial trade. Today, provinces often use the environmental excuse to block investment and development, even though Canada has plenty of environmental safeguards.

Such provincial thinking is shortsighted and more history is helpful to make the point.

Provincial economies wax and wane and the provinces need each other more than some people think. Prior to the opening of the Panama Canal in 1914, British Columbia's lumber was uneconomical to ship off the continent. The 1940 Royal Commission observed how British Columbia's forest industry, pre-Panama Canal, was "almost entirely dependent on the Prairie Provinces," this because the Prairies were the only accessible market. Sound familiar?

When done right and accounting for the environment -- and it can be done right -- whether lumber, mined materials, or the export of oil and natural gas, Canada's greater prosperity is helped when politicians follow the advice of Canada's founding fathers and consider the greater prosperity of the entire country. The newly re-elected B.C. premier therefore has a choice: she can continue with provincial politicking or do what is best for all of Canada and indeed, even for British Columbia -- take a national view.

Mark Milke is a Senior Fellow at the Fraser Institute.

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