Trudeau’s Grand Bargain/Gamble

When the Liberals came to power in the fall of 2015, they promised Canadians a different style and tone of government (Real Change). They proposed a major direction shift dealing with indigenous peoples, climate change and co-operation with provinces. Elements of these three policies came together to form what you might call “Trudeau’s Grand Bargain/Gamble”.

It all began with three high minded ( and maybe borderline naive) ideas

  • Canada shows its climate leadership chops and signs the Paris Accord promising to reduce emissions by 30% from 2005 levels by 2030.
  • Canada endorses the United Nations Declaration on Rights of Indigenous Peoples UNDRIP.
  • The federal government changes intergovernmental relationships to something called “collaborative federalism”.

Those were the heady days of selfies, fun socks and proclamations …

The ambitious program would:

  • Implement the recommendations of the Truth and Reconciliation Commission.
  • Include Indigenous representatives in Canada’s federal-provincial-territorial dialogues.
  • Replace the Indian Affairs department.
  • Change environmental assessments and revamp the National Energy Board (NEB).
  • Phase out inefficient fossil fuel industry subsidies.
  • Implement the national carbon tax policy.

But the raised expectations and fears the ‘toothpaste is out of the tube …’

  • Environmental groups and some provinces want project assessment processes expanded so that the energy industry will be completely curtailed. Or in the Prime Minister’s unfortunate choice of words “phased out”.
  • Expectations were raised when the Prime Minister declared that “Only communities can grant permission”.  Later the federal government tried to walk that rhetoric back to “fair and robust” regulatory processes.
  • Indigenous groups saw themselves as national players with a pliable federal government and a friendly Supreme Court.
  • The language in the UN declaration says that “free, informed prior consent” is required for projects.  But the Canadian Constitution doesn’t say consent is required. Justice Minister Raybould has tried to reduce that expectation, with little success.
  • Some bands aligned themselves with environmental groups and positioned and postured themselves as extra-legal protectors of the land.
  • The energy industry watched their US market share shrink and an industry wide recession took hold. Multi-national companies departed the oilsands and capital investment in energy projects collapsed.
  • Liquefied natural gas projects aimed at foreign markets languished until their proponents took their losses and departed BC.
  • The federal government’s ‘trash talk’ about environmental regulations and the NEB put a chill in the resource development sector.

Then there were the pipelines

Access to market was vital to industry, and environmental activists believe choking access to markets will cause the oilsands to die a death it richly deserves.  Indigenous groups were eager to cement and test its ‘nation to nation’ status. Pipelines through their ‘territory’ were just the right target.

The Grand Bargain /Gamble

The government believed it could get a ‘Grand Bargain’ on pipelines. Just enough market access to allow the energy industry to be maintained. But restricted enough to meet Paris Accord targets.  And the regulatory bodies that would be revamped so that environmental and indigenous groups would give the plan a “social license”:

The Bargain / Gamble recipe includes:

  1. A minimum national carbon tax that escalates over time thus causing emissions to be reduced.
  2. A moratorium on tankers in Northern BC waters.
  3. Cancellation of a northern BC pipeline approval (Northern Gateway).
  4. Approval of expanded capacity for the pipeline to Wisconsin (Enbridge Line 3).
  5. General happiness with the US willingness to approve an expansion of a pipe to the US Gulf coast. (TransCanada Keystone).
  6. Stall a pipeline from Alberta to the Maritimes until the proponent read the writing on the wall and gave up (TransCanada Energy East).
  7. Approve a pipeline from Alberta to Vancouver to access international markets (TransMountain).
  8. $1.5 Billion to improve marine safety off the coast of BC.

But a minority government In BC tossed the Grand Bargain / Gamble into disarray

  • The BC government uses threats of lawsuits and delays in permitting stalled the project.
  • Seven small First Nations in the mainland went to court (joined by various environmental groups). Governments joined as intervenors.
  • 23 First Nations saw economic opportunity and signed benefit agreements with the pipeline company.
  • Activists staged demonstrations to protest and disrupt construction in Burnaby and the Municipality did all it could to thwart construction.
  • The federal government “slow walked” the issue estimating that court challenges would fail, protests would diminish, and pipelines would be built. All before anger in BC caused the Liberals to lose the 8 seats in the next election.
  • Finally, the pipeline company issued an ultimatum – give us certainty or give us death.

All of this has deepened interprovincial animosity that will be long remembered

  • BC continues to threaten court action that it knows it can’t win.
  • Alberta and Saskatchewan will pass ‘Go Ahead…Make My Day’ deterrent legislation that would restrict gasoline or jet fuel reaching the Vancouver mainland should the BC government try anything –  like, say, file a lawsuit…..
  • The environmental and indigenous activists promise violent protests and evoke threats of “Oka-like” consequences.
  • Pro-pipeline interests will continue to ferret out instances of hypocrisy (e.g Coal shipments from Vancouver).
  • The federal Court of Appeal will soon issue a judgement on the Indigenous lawsuit. Should the court conclude that there was insufficient consultation or that indigenous consent was required, the project will likely die.

The Federal government says the project will be built in the National Interest

The tactical plan has changed from ‘benign neglect’ to reinforcing federal jurisdiction over the project.  Severely Normal Albertans can expect to see the following actions:

  • A promissory note between Kinder Morgan, the federal government and the Alberta government to protect the company from BC delaying tactics.
  • Legislation to clarify that the constitution says federal rules are valid and paramount over BC rules. The Legislation is aimed at forestalling any BC lawsuit that its environmental legislation overrides federal jurisdiction.
  • More cash to “fill the gaps” in the marine safety program that Horgan has recently discovered.
  • Continuing arrests of protestors, particularly now that the BC Attorney General will prosecute the arrests as criminal contempt of court.
  • The Supreme Court will decline to hear the City of Burnaby’s lawsuit that municipal bylaws can’t be set aside by the NEB.

And regardless of the outcome, the next election will be fought over the carbon tax, the go forward model of federalism and indigenous relations.