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Mark Milke: Imitate the Fathers of Confederation

In Canada’s pre-Confederation days, one selling point for uniting the then-disparate British provinces was to drop existing barriers to commerce.
In Canada’s pre-Confederation days, one selling point for uniting the then-disparate British provinces was to drop existing barriers to commerce. The hope was for a country with a free flow of trade and services in which all could potentially prosper.

For example, in 1865, George Brown, the Globe newspaper founder and Upper Canada politician, argued passionately “for the union, because it will throw down the barriers of trade, and give us a market of four million people,” to which his colleagues responded “hear, hear.”

Similarly, in 1866, John McMillan, from New Brunswick’s Legislative Council, spoke to his fellow legislators about his vision: “To enter into an alliance that will enable us to have free trade with our neighbours, and this union of the provinces, I maintain, would be commercially the best step we could take.”

We need some of that optimism today, especially as there are multiple opposition points to a flourishing, prosperous country even if opponents don’t characterize it that way.

Bizarrely, 147 years after Confederation, we still face some trade barriers between provinces.

But the main impediments to jobs, an improved standard of living and even tax revenues are different than the ones faced by Brown, McMillan and others of their age.

Pre-Confederation, provinces imposed tariffs on goods from other provinces; that hampered the general prosperity of all. Today, some provinces injure their own potential by simplistically and reflexively opposing sensible economic opportunities.

Examples abound. New Brunswick’s incoming premier, Brian Gallant, promised to impose “a moratorium on hydraulic fracturing” if he and his colleagues won the recent election. So, New Brunswick will limp by with just $94 million in resource revenues (from mining and forestry) this year and for the foreseeable future.

In a nearby contrast, Newfoundland and Labrador has followed the optimism of Brown and McMillan by developing its energy sector. This year, that province will garner an estimated $2.5 billion in resource revenues, including mining taxes and royalties. Success matters, especially to the tax coffers of governments.

Similar positions can be found among native politicians. A group of First Nations leaders from Vancouver Island and Washington state just signed their own agreement to “prohibit” an expansion of the Kinder Morgan pipeline.

On the other side of the Rockies, Fort McKay First Nation, in northern Alberta near the oil sands, has expanded local prosperity. They’ve capitalized on oil with their own businesses, including service companies, heavy equipment operations, environmental services and an industrial park.

Opposition to development stretches beyond energy. Potential mines and ski resorts now take decades to bring online, if allowed at all.

Then there are the policy decisions that make life difficult for the manufacturing sector in Ontario. Ontario’s provincial government was correct to bring down business taxes over the past decade to attract new investment.

(That tack also imitates the advice of Confederation-era politicians: Keep taxes low and outmanoeuvre the U.S.)

But then the province nullified a potential Ontario advantage with an ill-advised energy policy that has increased electricity rates in a manner that makes Ontario unattractive for investment. It translates into less job-creation, less income growth, fewer opportunities, migration out of the province and a squeeze on provincial revenues.

Unlike Confederation-era debates, there are obviously many more voices in today’s public square. Most have legitimate concerns that range from environmental protection to respect for a treaty (or signing one where absent).

Still, while it always makes sense to look at economic decisions in a broad context, a flourishing human society matters, and that includes the ability to find a job and make a living.

Reflexive opposition to economic development is not realistic.

Nor is it helpful to human flourishing.

The spinoffs from a flourishing economy include everything from increased personal and family choices and charitable donations to tax revenues for social programs, schools, hospitals and public parks.

The possibilities for personal and community benefits are, of course, limitless.

Confederation was a grand idea for many reasons, but the Fathers of Confederation had it right when they saw the potential for widespread and increased prosperity. Their bias is still worth an imitation today.

Mark Milke is a senior fellow with the Fraser Institute.

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