Trudeau must act forcefully on pipeline issue

Canada’s prosperity is at risk, Laura Jones writes.

British Columbia’s petty pipeline politics are now threatening the entire country’s economic security. This can’t be allowed to stand. We need Prime Minister Justin Trudeau to apply all his negotiating skills and political power to fix this mess.

The province continues to “use every tool in the tool kit” to create mayhem and uncertainty around a project that has been approved by the federal and previous provincial governments, after an extremely rigorous process. B.C. is behaving so badly that on Sunday, Kinder Morgan took the highly unusual step of issuing a statement calling out its bad behaviour and setting a deadline for getting it resolved. It doesn’t get much clearer than this: “If we cannot reach agreement by May 31, it is difficult to conceive of any scenario in which we would proceed with the project.”

What does this mean for Canada? In the narrowest terms it means losing a project that would bring $46 billion of government tax revenue to the country over 20 years, including $5.7 billion directly to British Columbia. That’s a lot of teachers, MRI machines and social housing that we will forgo. We will also forgo another billion dollars in revenue for British Columbia to spend on community environmental projects courtesy of Kinder Morgan. And we haven’t even started talking about jobs.

What else does it mean? Could Kinder Morgan sue the province? That might be expensive for B.C. taxpayers.

What about Alberta — will it forgive B.C. for land-locking its oil? Or will it shut off our oil supply and drive up gas prices, bringing the Lower Mainland to a grinding halt? Empty grocery stores? No flights from YVR? No ships at the Port of Vancouver? These scenarios aren’t as far-fetched as they sound. Like it or not, we are heavily dependent on oil. And Alberta’s mad enough that they just might decide to remind us of that. Even a short reminder would be painful to paycheques.

But that’s not the worst of it. The province is putting the country’s international reputation at risk. We are sending a very strong message that natural resource development projects are off limits. We are sending a strong message that you can’t trust the rule of law here.

In a recent speech, John Manley, the former Liberal deputy prime minister, pointed out that Canadians need to remember that 30 per cent of our economy is natural resources. “That’s what our business is in Canada. We may like to think we can survive off making solar panels and medical devices, but we can’t.” He’s right. That doesn’t mean we should say yes to every project, but it does mean that when we do say yes, we should mean it.

Economist Patricia Mohr, recently retired from Scotiabank, puts it this way: “Crude oil pays the rent in Canada.” She explains that the export of crude oil created a trade surplus of $32.9 billion for Canada in 2016, while our trade deficit in the category of electronic equipment was $34.8 billion. In other words, oil pays for our iPhones. She argues that opposing this project is equivalent to opposing our prosperity.

In response to Kinder Morgan’s statement, B.C. Premier John Horgan said, “the interests of Texas boardrooms are not the interests of British Columbia.” This is immature behaviour and it’s not cute. It’s incredibly destructive.

Horgan’s statement makes it clear that Trudeau will have to do more to rein in the rogue province, and he needs to act quickly. He needs to state clearly that the project is in the national interest and all federal powers will now be brought to bear to ensure it proceeds smoothly. Further, all federal-provincial funding partnerships with the province should be put on hold until the provincial government grows up.

Allowing a province to trample over federal rights and smear Canada’s international reputation puts our economic security at risk. And it looks like there is only one man in a position to do anything about it. Prime Minister, will you protect Canada?