Canada’s constitution and federal system is almost as dysfunctional as America’s, only different.
Last week, a national tragedy continued thanks to newly elected politicians and others in British Columbia who have about as much respect for the rule of law as does President Donald Trump.
On July 25, the province’s $36-billion liquefied natural gas (LNG) proposal was canceled by the Malaysian giant, Petronas. Others, now on blueprints in B.C., will do the same.
The official reason given was not the real reason why: the company diplomatically blamed poor global conditions for LNG.
Pacific NorthWest LNG, 2012-2017: How to kill an LNG project in Canada
But identical global conditions have not halted the booming LNG export industry in the United States or Norway or Qatar where mega-projects sprout like daisies.
The real reason is the new NDP-Green government declared war against the fully approved $7.4 billion Kinder Morgan pipeline. It also issued a raft of expensive demands on LNG developers that ranged from higher taxes and more money for First Nations to new environmental requirements.
These actions were abusive and illegal attempts to retroactively alter decisions, agreements and laws. And they are a red flag to anyone intending to invest billions.
The Kinder Morgan project has been approved by every regulatory and political body at every level of government, a process taking years. Even so, the new government declared war.
Its “Confidence and Supply Agreement between the B.C. New Democrats and the B.C. Greens” stated the alliance would “immediately employ every tool available to the new government to stop the expansion of the Kinder Morgan pipeline, the seven-fold increase in tanker traffic on our coast, and the transportation of raw bitumen through our province.”
This is simply illegal.
This is not protecting democracy or the will of the people. This is about a group of politicians who are threatening a legally-constituted project to transport legal products to export customers.
The two controversies loomed last week. On the one hand the B.C. government said it was upset about the Malaysian cancellation, but did not stand down on demands or on its attack against Kinder Morgan.
Premier John Horgan bluntly asked his attorney general, David Eby, to find ways to stop the pipeline.
Eby, a lawyer, should have simply said no. Instead, he obfuscated and took a swipe at courts which would award damages to Kinder Morgan.
“I’ve been tasked by the premier to identify our options. There is an important piece to that, which is that we must do so within the laws of British Columbia and Canada, because if we don’t, we’ll be sued,” Eby said in a radio interview.
“We’ll end up paying hundreds of millions of dollars that should be going to schools and hospitals to an oil company and that is not a goal that anybody’s looking for,” he said.
But Green party leader Andrew Weaver dismissed Eby’s remarks and said the government must use “every legally available tool to stop the pipeline from going ahead.”
But no such tools will ever be legal, and any government that stalls, delays, or damages the project will be guilty of deliberate sabotage and bad faith, say lawyers.
This catastrophe is simply the latest in what can be described as Canada’s existential plight. Resource development is the cornerstone of the economy and it’s been stunted for decades. Anti-development interests will turn the country into a park for polar bears and grizzlies.
They trample the rights of developers and the 150-year-old constitution enshrines a federal government too weak to challenge provinces. Constitutional amendments are virtually impossible. Open defiance is constant from First Nations blocking the Mackenzie Valley pipeline or Ring of Fire mega-projects to B.C. blocking Alberta oil shipments and Quebec blocking the development of hydro-electric projects in Newfoundland for export.
The country is balkanized and a de facto European Union, with competing interests that paralyze economic development.
Ottawa has powers to govern on behalf of all Canadians, but doesn’t. This time, the feds must forbid any interference in the building of that pipeline by the Province of British Columbia and provide security if needed.
As for the Malaysians, they are gone, having witnessed a government disobeying laws, breaking promises and retroactively changing contracts.
Canada’s reputation is tarnished. The Malaysians invested $10 billion in good faith in a country with the rule of law to build a 30- or 40-year project. Now they will dis-invest and ship as much Canadian gas as they can south of the border to the United States where dozens of high-tech plants will produce LNG for export across the U.S. and around the world.
And one of the world’s largest natural gas resources will be stranded forever, equivalent to Norway walking away from its energy bonanza.
This represents an abrogation, threatened or real, of the rule of law, civilization’s pre-eminent organizing principle.
This time it’s about reneging on promises to corporations. Next time, it could be about ignoring the rights of regions or individuals.
Meanwhile, democracy is subordinate to the rule of law. At best, it is a popularity contest and at worst it’s a mechanism to give power to contemptuous fanatics and demagogues.
It’s unacceptable.