Mulcair, Trudeau, another NEP: the threat to Canadian unity – by Tom Flanagan (Globe and Mail – June 4, 2012)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

In 1980, a newly elected prime minister from Quebec, Pierre Trudeau, decided to mobilize the resource wealth of Western Canada in order to subsidize Eastern Canada. The result was the national energy program (NEP 1), which fixed domestic prices for oil and gas below world levels, levied an export tax to boost federal revenues and confiscated producing assets to give to Petro-Canada.

In 2012, a would-be prime minister from Quebec, Thomas Mulcair, has resurrected the idea of diverting Western Canadian income, but with an environmental gloss. According to statements by Mr. Mulcair and other leading members of the New Democratic Party, there should be a carbon tax to raise federal revenue, environmental controls to limit or even terminate oil sands production, and requirements to refine hydrocarbons in Canada rather than in other countries, even if it’s uneconomic. Call it NEP 2.

NEP 1 was an economic disaster that had to be repealed within a few years, but the political consequences lasted longer. It jump-started the development of Western separatism, previously a fringe phenomenon. A separatist candidate was elected in an Alberta by-election in 1982, and his party got over 10 per cent of the vote in the general election that followed within a few months.

Western separatism, however, gradually petered out, not least because Preston Manning convinced Westerners that their grievances could be rectified within Canada. Under the inspired slogan “The West Wants In,” many who had flirted with Western separatism were attracted to Mr. Manning’s Reform Party.

It was a long and winding road, through the Reform Party, the United Alternative, the Canadian Alliance and the merger with the Progressive Conservatives, but those whose livelihood was threatened by NEP 1 became part of a new electoral coalition controlling the federal government through the Conservative Party of Canada – a protracted but ultimately happy ending for those who believe in Canada and Canadian democracy. But the ending might not be so happy if the NDP rides to power on Mr. Mulcair’s NEP 2.

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