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Saturday, January 30, 2010

Absentee Federalism (Op-Ed at The Mark)

Canada enters this new decade in dangerous territory. Our national government is missing in action – preferring partisan political calculations to governing in the national interest. A popular protest against the lengthy parliamentary shutdown is an encouraging sign of citizen engagement, but too many others remain on the sidelines.

The challenge for 2010 is to go beyond protesting the proroguing. Canadians must engage in a serious debate on where we should be going as a nation, and why it is wrong to settle for incremental progress on serious issues.

One important area that demands our urgent attention and action is our national energy and environmental policy, particularly in light of Canada’s less-than-inspiring performance at Copenhagen in December. Strong national leadership in energy and environmental matters does not mean creating new intrusions into provincial jurisdiction. It means a clear articulation of what the federal government will do within its already established jurisdiction and competency to set Canada on a more credible and cost-effective clean energy path.

Indeed, a more attentive federal government would notice that leaders in energy-intensive industries are on much the same page as the environmental community – and most Canadians – in realizing the value of a real energy plan. We need national standards to ameliorate the patchwork of federal and provincial initiatives and allow for more constructive long-term planning of clean energy development.

The national interest in guaranteeing all Canadians equitable access to long-term supplies of clean energy is certainly affected by the proposed $3.6-billion Hydro-Quebec takeover of New Brunswick Power. There can be no doubt that New Brunswick faces a serious energy security crisis, and that obtaining cheaper hydro-electricity from Quebec makes sense. But the bilateral Quebec-New Brunswick deal works against Canada’s responsibility to promote inter-provincial equity in the transmission of electricity across Canada and to the U.S. The federal government should be involved in helping New Brunswick address its clean energy challenges.

By strengthening Hydro-Quebec’s monopoly on transmission access to the U.S., the Quebec-New Brunswick hydro deal (together with expected parallel hydro deals with Nova Scotia and Prince Edward Island) will cement Quebec’s control of Eastern Canada’s power grid and increase Hydro-Quebec’s ability to extract a greater share of Newfoundland‘s profit from Churchill Falls.
Newfoundland has a huge new hydroelectricity project on the Lower Churchill in Labrador, including electricity from large-scale wind projects, which will eventually be available for transmission to Ontario and the eastern U.S. Quebec is competing with Newfoundland for the same American markets and has already delayed Newfoundland’s application to use Quebec transmission lines to export electricity to the U.S. for almost four years. Newfoundland, in turn, had been examining ways to transmit electricity from Labrador through Nova Scotia and New Brunswick (via underwater cables), bypassing Quebec altogether.

To assuage Newfoundland’s concerns about the Quebec takeover, New Brunswick has argued that the American Federal Energy Regulatory Commission is Newfoundland’s guarantee of access to the U.S. market, since the FERC requires owners of power lines (whether Quebec or New Brunswick) to give equal access to competing power suppliers. Canadians should be shocked and dismayed that our national government is so missing in action that we now rely on American authorities to maintain the bare minimum of a Canadian economic union.

As opposition intensifies among residents of Atlantic Canada, questions will also be raised elsewhere in Canada about the equity of our complex equalization program and massive transfers of money between Ottawa and the provinces that are intended to discharge our collective commitment to ensure comparable public services across Canada. Fiscal arrangements under which a province receives billions in equalization payments while its hydro utility borrows and spends billions to control Eastern Canada’s power grid, rather than engaging in more profitable investments that could increase provincial government revenues, are problematic and divisive to say the least.

Canadians must realize that this is not just a central/eastern Canadian issue. The Quebec-New Brunswick hydro deal unquestionably engages the national interest in establishing a strong economy and a clean energy future for the benefit of all Canadians. Our national government, not foreign authorities, is responsible for matters of interprovincial trade. Our national government, not just the provinces, is responsible for strengthening the national economic union and ensuring national equity. It is time our national government stopped “going prorogue” and spoke up for Canada.

Tuesday, January 12, 2010

The year that was: peeling the onion, only to find…there is no onion.

At year-end, much ink is spilling over the legacy of the year of the “great recession”.

A serious assessment is next to impossible as most Canadians still struggle to catch their breath while navigating a tough recession with many family members and friends, unemployed or underemployed.

Few could describe with any certainty the exact contribution of the national government to mitigating the effects of the recession. Yes, our banking system did not melt-down, but that was the result of long-standing coherent national regulations (including strict capital ratios) – the kind of national action the current government rejects in many other areas. Any positive impact of the unprincipled hodgepodge of spending on short-term job creation and credit-easing initiatives is highly questionable, especially in light of a massive $54 billion deficit racked up in under a year.

The government spin doctors notwithstanding, what should be clear is that we did not respond to the worst economic crisis in decades within a fair and equitable framework. We did not seize the opportunity to aim high and commit to pulling out of this crisis with a greener, more sustainable economy, and an educated, more-productive workforce employed in 21st-century industries.

When we needed foresight and long-term planning to restructure the Canadian economy around industries based on innovative technological advances and our vibrant service sectors, we got government through the rear-view mirror – short-sighted subsidization, rather than transformation, of declining industries like the auto industry; failure to adapt Employment Insurance and other social security provisions to the challenging environment; and too much focus on our admittedly crumbling physical infrastructure, however important, to the detriment of our social infrastructure, notably much needed investments in scientific innovation and basic research, and better quality and available education at every level.

Then, at a time when we required, more than ever, informed and engaged citizens, Canadians appeared dangerously disengaged from national politics. Most of us ignored the superficial parliamentary melodrama that consumed official Ottawa. Our national government conveyed no sense of public purpose or narrative other than obtaining a submissive majority in Parliament. Our leaders preferred to drown us in a sea of obfuscation, as well as dampen expectations and encourage skepticism, rather than to inform and challenge us. And when this was not enough, they shut down Parliament… again.

On almost every issue – the environment, clean energy, Afghanistan, gun control, safe food, much-needed reforms of EI, pensions, health care – the government stifled intelligent open debate, attacked and intimidated those with whom it disagreed, from the National Science Advisor to the head of the Canadian Nuclear Safety Commission, shrank from national action, and opted for all spin, all partisan political calculation, all of the time.

As fewer and fewer coherent national policies were adopted that advanced our ideal of a fair, compassionate and innovative country and could attract world-wide respect, we lost influence and credibility in global forums. Canada was increasingly regarded as irrelevant in global affairs. Our foreign policy was conducted on the fly, more for photo-ops than substance, revealing no strategic thinking about global approaches to the challenges we face, or about how to build up valuable alliances in the international community especially with the emerging powers of China, India and Brazil. Turning next summer’s G-8 meeting into a G-20 was an essential defensive move, but we are still no less on probation on the world stage.

Nowhere was Canada’s irrelevance more evident than at the global environment conference in Copenhagen which closed out the year. The crucible issue of our time – climate change – has been cast by our government as an irritating distraction, rather than the great moral imperative that must inspire us to act for future generations. Canada attended with no national initiatives worthy of discussion and no credible national plans for the future.

We conclude 2009 with little achieved and much that is troubling. The government record can best be summarized as peeling the onion of conservative government initiatives, only to find….there is no onion (with thanks to the brilliant satirist Jon Stewart).