Fair Deal wave really amounts to a distraction

Main merit lies in derailing silly idea of separatism

After Premier Jason Kenney’s unequivocal rejection Friday of the idea of Alberta separatism as either a goal or a bargaining tactic, I think it’s fair to put to rest the idea that his focus on a “fair deal” is somehow pandering to separatists.

It’s more likely the premier is trying to take the wind out of the sails of any would-be separatist movement. Kenney is certainly correct when he notes the political uncertainty and instability that an active separatist movement creates, as evidenced in Quebec. The upheaval from an independence vote or an attempted secession is far worse.

But many of the recommendations in the Fair Deal Panel report, which was released earlier in the week, do little to address Alberta’s current plight. The main recommendation — holding a referendum on equalization — seems especially pointless.

So that creates a bit of a Catch-22: Either we waste time and money holding this referendum and investigating some of these other ideas, or we embolden those who want an even more aggressive posture on this quixotic quest, thus creating the very problems the premier warned about.

Equalization seems to be at the centre of this whole conversation about the relationship between Alberta and Ottawa. Perhaps a better understanding of how this program actually works would help.

The panel’s report initially does a commendable job in trying to explain it. As the report notes, “equalization is financed entirely from the federal government’s general revenues” and “provincial governments do not contribute financially to this program.”

Yet the report then goes on to list Alberta’s “contributions to Equalization,” including, for example, $17.2 billion in 2018. But let’s be clear: that number represents the difference between the amount of federal tax revenue collected in Alberta and the amount of federal spending in Alberta. It is not specific to equalization and, in fact, has nothing at all to do with equalization. Changing the program would not have any impact on that gap whatsoever.

(And if the existence of that gap is somehow an argument for separatism, then it’s an argument for Calgary separating from Alberta and for Roxboro or Britannia separating from Calgary.)

The panel report then seems to concede this point, but notes that we could push for changes to the “Fiscal Stabilization Fund,” which is described as a “component of equalization.” Except that the Fiscal Stabilization Program (there is no “fund”) is separate from the equalization program.

Still, though, the premier’s commitment to holding this referendum seems almost reasonable when contrasted with those who wish to hold this vote as quickly as possible and those who naively think that we can unilaterally change the Constitution and bring about equalization’s demise (which, again, wouldn’t mean any money coming to Alberta or staying in Alberta).

Perhaps the wisest advice in the Fair Deal Panel report is for Alberta to steer clear for now of the idea of collecting our own taxes. The idea of Alberta setting up its own tax collection agency has to be one of the strangest and silliest ideas to come out of this whole “fair deal” conversation. We would be spending billions of dollars to create and sustain such a bureaucracy and gain nothing in return. The idea that we could somehow hold federal tax revenue hostage is such an insane fantasy that it’s hard to take its proponents seriously.

There are some aspects of this report that might merit some consideration at some point, including the idea of a provincial pension plan or a provincial police force. But given our disturbingly low levels of employment and economic growth and the uncertainties of our post-pandemic future, such ideas really don’t seem like a priority right now.

Defusing a potential Alberta separatist movement is a laudable goal. That doesn’t change the fact that much of this “fair deal” push is a costly distraction from much more pressing matters.