Question 10: The Separatism Question
Hundreds of thousands of words have been written about the separatism question over the last many months, not to mention hundreds of hours of podcasts, speeches, debates, news reports and interviews.
Providing a brief analysis of the essential points might seem a daunting task. But in fact, it’s quite simple.
The entire premise of the separatist argument is that Alberta would be wealthier as an independent state. Everything else they promise – a rosier, freer, old-fashioned utopia - is based on that central assumption: we would all be richer if we didn’t have to pay taxes to Ottawa.
But study after study by economists, business analysts, experts in trade, law, and governance, have debunked that idea. In fact, an independent Alberta would be smaller, poorer, isolated, and face an uncertain future.
The Alberta government’s report, prepared by the University of Calgary’s School of Public Policy, said separation would cost $50 to $170 billion. Running an independent government would cost up to $67 billion a year with annual deficits of at least $25 billion. In the worst-case scenario, the report forecasts Alberta’s GDP dropping 16.2% with substantial government deficits, higher taxes, lower employment and lower wages. The Canadian economy would suffer as well, with a weaker dollar and reduced investment.
The Calgary Chamber of Commerce’s study this month, prepared by economist Trevor Tombe, predicts separation would shrink Alberta’s economy by as much as $62 billion annually. Higher trade costs could translate into as many as 69,000 job losses in Calgary alone.
While Ottawa currently collects about $19 billion more in taxes from Albertans than it spends here, the Chamber study said an independent Alberta government would have to spend $18 billion of that “surplus” taking over the functions the federal government now performs, including defense, while revenues would fall by more than $10 billion because of the smaller economy.
The Chamber study also emphasized that businesses and investors require certainty. Montreal was the financial capital of Canada until the uncertainly created by the prospect of the Quebec separatist referendum in1980 drove businesses and head offices out of the province.
A Canada West Foundation report estimated setting up an independent Alberta would cost more than $200 billion and would shrink the economy by $39 billion.
Lennie Kaplan, who spent many years as a top fiscal and economic policy official in the Alberta government, described the separatists’ financial analysis as having “magic as the prevailing theme.” His own research suggests employment would fall by 45,703 jobs in year one of separation, personal income would fall by 6.2 percent, housing starts would fall by 10.5 per cent and business investment would decline by 8 percent.
The research is clear: separatism would be costly and risky.
Most Albertans inherently understand this. An Angus Reid poll found 77% of Albertans say they would leave if Alberta separated.
Separatist leaders argue these studies are too pessimistic. They say the U.S. would sign trade deals and support an independent Alberta. Alberta Prosperity Leader Jeffrey Rath said earlier this year the group would seek a $500 billion line of credit from the U.S. administration to fund the transition.
That disheartening scenario was made even more disturbing in recent days with the Globe and Mail investigation that found when Alberta separatist leaders went to Washington to meet with the U.S. State Department, they offered up valuable assets, including access to fresh water and royalties on crude oil, in exchange for help transitioning to independence.
Some separatist leaders, it appears, would cut ties with Canada, only to bind us closer and make us indebted to the U.S.
Polls taken over the last few months consistently show a large majority in the province oppose separatism. (The latest Ipsos survey on October 1, found 74 percent of Albertans said they will vote to stay in Canada. Just 14 percent said they will vote to leave and 12 percent were unsure.)
But that should not make anyone complacent about the outcome on October 19. Separatists have a point to make and they will be out to vote in force. The majority who oppose them may be less motivated. They may think it’s a slam-dunk for the “remain” side and they don’t need to worry about voting.
Equally worrisome are those who think they should vote for the separatist option “to send Ottawa a message.”
To be clear: there are only two choices on the ballot. You vote to remain in Canada, or you vote to start the process to separate from Canada. If you vote for the latter, you won’t be sending a message, you will be telling the government you want another referendum and you want Alberta it to start down a long and economically perilous path to leave Canada.
Most of us think being Canadian is like winning the lottery. You look around the world and think how truly lucky we are to live in country that’s peaceful and beautiful, and wealthy; where the rule of law prevails, human rights are entrenched and governments over decades have stitched a social safety net that strives to respect human dignity. Canada is far from perfect. There is a long list of things that need to be done to make the country a fairer and more promising place for our children and their children. But our democracy makes that list do-able.
This Thanksgiving, as you sit around the table with family or friends or enjoy a walk in Alberta’s magnificent outdoors, think about all we have to be thankful for as Canadians. And how important it is to protect that gift by voting in a referendum that is crucial not just for Alberta but for the entire country.
ON QUESTION 10, WE ARE VOTING FOR OPTION 1 TO REMAIN IN CANADA.