Alberta and Canada: A Public Policy Failure in Process?

Canada faces huge, long term, destabilizing challenges. 

  • Inequality of wealth is soaring.  The richest 87 Canadian families own as much as 12 million average Canadian income earners while Alberta gives tax breaks to the rich and cuts services to the poor.
  • While much of the world surges ahead developing renewable energy and post fossil fuel economies, the government of Alberta insists that no matter what the climate change cost they will not change direction.   

At a time in the history of our country that calls for strong federal leadership, we have a disabled federal government.  It disabled itself with the failure to implement election reform.  That failure has left the country with a federal government paralysed by the election results in Alberta and Saskatchewan.  The last election in Alberta, under proportional representation, could have delivered 24 Conservatives, 5 Liberals, 4 NDP and 1 Green MP.  Instead, gambling on the first past the post electoral system to give them another majority government, the federal Liberals have managed to ensure Alberta is represented in Parliament only by 34 Conservatives.  They ensured 632,633 Albertans who voted for other parties would have no voice in the federal government.  Now we have the spectacle of a federal government desperate to meet irresponsible demands from the government of Alberta and the oil industry, regardless of the impact on the rest of Canada and the world.

So what does the Alberta Premier want?  He demands a large increase in federal transfer payments at a time when his government has reduced the overall corporate tax rate from 12% to 8%, or about $1.6 billion, and cut services to people by $1.3 Billion.   The windfall for Husky oil alone is reported to be $233 million.   He demands that the whole country help him take from the poor and give to the super wealthy oil barons.

He demands and is getting Trans Mountain pipe line with an initial outlay of $4.5 Billion to be followed by another $9.3 Billion, and perhaps more, to twin the existing leaky line.  To put that in perspective, $13.8 billion could pay 276,000 Albertans $50,000 each to kick start green energy and industry.

He demands the massive TECK tar sands mine be approved. The impact on Canada’s greenhouse gas emissions of the $20.6 billion project will be enormous.  One Barrel of tar sands oil will produce 700kg CO2 emissions   The plan is to produce 260,000 barrels of oil a day, resulting in about 6 Megatonnes of greenhouse gas emissions every year, for more than 40 years – 240 new additional Megatonnes tons!  But Canada has pledged to cut its emissions of greenhouse gasses from 730 Megatonnes to 511 Megatonnes by 2030.  The Teck Frontier Mine would make a joke of Canada’s greenhouse gas emission targets and promises. 

Alberta will likely also demand we pay a significant share of the $40-70 Billion it will cost to clean up abandoned and orphan oil wells.  These are wells where Alberta has allowed the owners, who made great profits, to walk away from the wells with no clean up.  The track record of Alberta in dealing with the challenges and of oil and gas development is not inspiring. 

Starting in 1990, Norway was able to build a $1 Trillion Oil Fund from the profits of its oil industry with production since 2000 of about 2.5 million barrels a day.  In the same period Alberta’s production levels were about 3 million barrels a day.  The Alberta Heritage fund was established in 1976.   Since then Alberta has managed to create a paltry $18 Billion Heritage Fund even with higher daily production.   The government of Alberta has become the servant of the oil industry – rather than its own people.

The threat of the Kenny government is that unless its demands are met Alberta will start working on leaving confederation.  Canada, claims the Kenny government, is the source of all Alberta’s problems.  Alberta’s government is determined to double the production from the tar sands and tie Albertans to rely on an industry which 99% of the world’s scientists tell us we must phase out.  The position the Kenny government takes is that they have a God given right to oil industry jobs no matter how many people around the globe are devastated by droughts, floods, wild fires, rising ocean levels or super storms.   Albertans need to decide if they want to let the Kenny government whip them into a frenzy of hatred for Canada.

Alberta’s energy economy has long been in a cycle of booms and busts.  The unemployment rates have gone from under 4% in 2005 – 2008, to 7.3% in August 2009, 4.3% in August 2012, 7.4% in January 2016, and 7% in December 2019. That means more than 170,000 Albertans looking for work were unable to find a job and are suffering from the current bust.  The national unemployment rate was 5.6% in December 2019, unchanged from the same period in 2018.  Alberta’s government and Premier are determined to deepen reliance on an unstable fossil fuel economy and stir up anti Canada anger and hatred if they do not get their way. 

In a province like Nova Scotia, our chronic unemployment rate, average family income and out migration make Alberta, in spite of its difficulties, look rich.  Should we support help for Alberta? How should we respond when 99% of the world’s scientists tell us we, and the rest of the world, need to leave the oil in the ground or our children and grandchildren will face the prospect of runaway climate change?  Can we look at catastrophic floods, wild fires, droughts, killer storms and heat waves and decide Alberta’s oil must go to market no matter what?  Should we invest tens of billions in ramping up tar sands oil for export to make the problem worse?  Do Albertan’s have a right to those jobs today no matter what the result, even if climate change costs left to future generations are in the many trillions of dollars?

The Trudeau government has done very little to come to the support of Albertans suffering from the boom and bust oil economy.  Twinning the Kinder Morgan pipeline will cost at least $9.3 Billion.  What would have been the impact of a $9.3 billion investment in renewable energy in Alberta?  $9.3 billion is $54,705 for every one of the 170,000 unemployed workers.  Invested in solar electricity it would produce 3,029 Megawatts, enough to power about 400,000 homes.  More important, investments in renewable energy produce more jobs than investments in oil and, the jobs are well paying and most do not require a university education.

So how should we respond to Alberta?  It is easy to understand why hundreds of thousands of Albertans are afraid for their future.  It is easy to understand why the short sighted, irresponsible ramping up of oil proposed by the oil industry and their government looks attractive.  If we truly believe in building a better Canada, we must help.  But helping by investing tens or hundreds of billions in increasing the impacts of runaway climate change is the worst possible way to tell Albertans we care.  What Albertans want is economic security and so far the federal government is offering security only to the oil industry and Jason Kenny.

We need to invest billions in a robust energy transition plan to get off oil by 2050 and a very big chunk of that federal investment should be in Alberta.  Can we afford it?  It is a bargain compared to what climate change will cost us, our children and grandchildren.  The sane choice, what is really in the national interest, is to invest in the transition off oil and forward to renewable energy.  As a Nova Scotian who cares about Albertans I could vote for that.

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