Provinces must tear down walls
In a better world, the Supreme Court of Canada would have struck a blow against parochialism and protectionism across this country. It would have helped to break down barriers that prevent Canadians from trading and working across provincial boundaries. It would have nudged us in the direction of becoming truly one country.
But it did not. Instead, the court ruled unanimously last week that the provinces are well within their rights to enact laws that have the effect (if not the intent) of restricting trade. There is, it said, no “constitutional guarantee of free trade” within Canada.
The case at hand was, so to speak, small beer. Gerard Comeau of Tracadie, N.B., was appealing a $292 fine he received back in 2012 for the offence of bringing 14 cases of beer and three bottles of liquor home from Quebec.
Comeau challenged New Brunswick’s law against importing alcohol from another province. All provinces have similar rules, designed to protect their monopolies over booze sales and the tax revenue that comes along with them.
On the face of it, those restrictions amount to a straight-up conspiracy against the consumer. And they seem to violate the plain meaning of Section 121 of the Constitution, which says the products of one province shall be “admitted free” into other provinces.
But the Supreme Court decided that it’s not so simple. If Section 121 was interpreted as allowing “full economic integration” it might invalidate all sorts of other provincial rules, such as supply management schemes, public-health regulations and environmental measures. It would “significantly undermine Canadian federalism,” the court warned.
But just because you have the power to do something doesn’t mean you should do it. A policy that is short-sighted and counter-productive doesn’t become any wiser just because it’s constitutional.
That certainly covers the provincial booze rules that tripped up Gerard Comeau and deny other Canadians the simple pleasure of sampling fine wines and craft beers from other provinces without going through their local provincial liquor monopolies.
But it’s more than just an annoyance. The consequences of provincial restrictions on the free movement of goods, services and people are serious. A Senate committee in 2016 estimated the annual cost of lost trade opportunities at between $50 billion and $130 billion in GDP.
Aside from the needless cost, this isn’t what Canada was meant to be. Confederation was intended, in part, to build a national economy by promoting trade among the provinces.
A century and a half later, we’re still not quite there. And as the bitter pipeline battle between Alberta and British Columbia shows, the issues are far from settled.
The Supreme Court might have ruled in the case of R. v. Comeau in favour of freer trade. Absent that, it’s up to governments themselves to do the right thing and tear down the internal barriers that make Canada a less united and less prosperous country than it could be.