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Four: Out West

In 1929, Herman Wiebensohn, a young immigrant from Germany, began work on a wheat farm in southern Saskatchewan. During his next six years in the dust bowl, virtually nothing grew. His only pay for the entire period, aside from room and board, was a team of horses, harness and wagon. He drove them north in the mid-1930s looking for work and finally, after eleven years as a hired man, was able to rent and later buy his own farm. He married, raised an equally hard-working family, and today in his eighties retains his unquenchable optimism and curiosity about life. The Wiebensohns are representative of many Westerners.

What has grated on the Western consciousness for generations, however, is deep-seated indifference and condescension from successive national governments. Shouldn’t Ottawa represent all Canadians equally and play no regional favourites? Canadians living outside the West may feel mystified by the intense and rising disaffection across the four Western provinces towards the federal government and Inner Canada in general. Why, they ask, are so many Westerners angry when ten of their MPs have held portfolios in the Mulroney cabinet during the past six years? The region is fed up with watching jobs, opportunities and people being removed from their natural location across the West and relocated in Inner Canada. Examples are legion.

A crown corporation at the time, Air Canada first moved its head office and later its maintenance base from Winnipeg to Montréal. Many Westerners were enraged with the fact that a government in which they had placed their confidence in 1984, barely two years later rejected the better and cheaper CF-18 aircraft maintenance contract offer by a Winnipeg company and handed it to Canadair of Montréal instead.

In Vancouver, a promised project to build a Polar-8 ice breaker was recently cancelled in the name of restraint by a cabinet which had failed to reduce the deficit significantly since taking office in 1984. A promised natural gas pipeline to Victoria was abandoned on the same basis. The same for the OSLO synthetic crude oil plant in northern Alberta, which will inevitably make Canada even more dependent on imported oil from OPEC member countries. As well, Ottawa’s high interest-high dollar policy is contributing to an increase in the number of bankruptcies among Prairie farmers.

Indications of growing Western alienation can be observed in many opinion surveys. One of the first formal samplings of the Western mood, done during 1969, indicated that 55-60% of Albertans felt the Trudeau government was neglecting the West. By late 1981, following the introduction of the National Energy Program, an Environics sounding showed that 82% of Westerners agreed with the statement that "the West usually gets ignored in national politics because the political parties depend upon Québec and Ontario for most of their votes."

Another poll, conducted by the same firm shortly after the CF-18 contract was awarded, found that more than four in five Westerners thought the Mulroney government played regional favourites. Shortly before the November 1988 national election, the Winnipeg pollster Angus Reid reported that two-thirds of the residents of the four Western provinces thought the Conservative government favours Québec. With the Meech Lake process behind us, I think virtually all Westerners would now agree that some provinces are more equal than others in today’s Ottawa. An Angus Reid poll taken in mid-summer of 1990 indicated that 87% of Prairie Canadians were dissatisfied with their national government. A few months after the 1988 election, a poll by Environics found that the percentage of Westerners who then agreed with its statement about the West usually being ignored had risen to 85%. In other words, alienation across the West was higher after four years of Brian Mulroney than it was in 1981 after the introduction of the National Energy Program by the detested Trudeau government.

Most Westerners who have supported the PC party since John Diefenbaker’s rise to leadership in the mid-1950s felt we had won a government by 1986 but had lost a meaningful voice in the government party. These dashed hopes created deeply felt bitterness. The recent cancellation of VIA Rail’s "Canadian," which has in one form or another provided passenger rail service across the southern part of Western Canada for more than a century, is only one of many illustrations of this reality. One consequence of this is the rise of a new party and its subsequent success in Alberta. The Reform party’s Deborah Grey won a by-election in northeastern Alberta, and the party’s Stan Waters, a province-wide Senate election.

In short, the West is weary of being dealt with as if it were Inner Canada’s vast domestic colony. From John A. Macdonald to Brian Mulroney, Westerners have been treated mostly with polite indifference and subdued contempt by national governments. The exceptions seemed to occur only when it was in the interests of Inner Canadians to do something such as peopling the region in order to provide captive markets. Justice for the outer regions of Canada is as distant today as it has ever been. An important difference is that Westerners are now much better informed about the nature of official discrimination against us than was the case before. With a Prime Minister in office who, to many Westerners, is more an auxiliary premier of Québec than a prime minister of all Canadians, our demands for equal economic and political status are mounting.

An Anguished Past

Western discontent with Ottawa is the cumulative effect of a long series of grievances and frustrations. Let me recall a few of them.

Most Canadian students, including Westerners until more recently, were taught through the published works of Toronto historians Donald Creighton, Harold Innis and others that the National Policy proclaimed by John A. Macdonald in 1879 was beneficial to all parts of Canada. These apologists for what I call the core-periphery view of Canada gave no serious attention to the effect of the policy on, for example, generations of hard-working and dollar-poor producers in Saskatchewan.

Farmers were long the dominant occupational group in Prairie Canada. Under the National Policy, they either had to pay a 35 per cent tariff on imported machinery from the United States or Britain or were forced to purchase more expensive substitutes from Inner Canadian manufacturers like the Masseys. Somehow the latter could never locate any of their production facilities near their important Prairie customers. Since, on the other hand, Western farmers were compelled to sell grain into fiercely competitive international markets, they began as early as the mid- 1 880s to lobby for the removal of the tariff on farm machinery and building materials.

Their hopes for fair play were dashed at the end of the 1911 national election campaign when manufacturers, retailers, bankers and railroaders in Inner Canada united to defeat a proposal by Prime Minister Wilfrid Laurier’s Liberals to enter into a limited reciprocity agreement with the United States. In the Conservative rhetoric of the campaign, a Prairie grain farmer who wanted to sell his grain in Minneapolis was a traitor whereas a Toronto banker who did as much business as possible in Manhattan was a patriot. Incredible as it may sound, the disloyalty charge proved effective even in two Western provinces: virtually all the seats in Saskatchewan and Alberta went Liberal. In British Columbia, the Conservative leader Robert Borden’s moronic demand for voters to choose between the Union Jack and the Stars and Stripes won him all the seats. In Manitoba, the Conservatives elected eight often MPs, largely, it appears, due to the strong organization of Conservative Premier Rodmond Roblin. The reciprocity question does not seem to have been the dominant issue in the province. Considerable Western bitterness lingered on afterwards, partly because the reciprocity agreement, dealing mainly with natural commodities and unfinished products, would barely have affected the privileged in Inner Canada.

Another farm issue was freight rates. Why, Western grain farmers asked, did the CPR charge twice as much to move wheat in parts of the Prairies as it did in Ontario and Québec? Myopic Ottawa rail officials, moreover, later approved as "fair discrimination" railway rates by which Manitobans were to be charged more for moving the same items the same distance as Central Canadians, residents of what are now Alberta and Saskatchewan were to pay more than Manitobans, and British Columbians were to pay even higher rates. It would require decades for a united Western lobby to correct this federal government-sanctioned abuse.

There were plenty of other abuses during the era of railways. In Manitoba, for example, the first threat of secession arose during 1882 over the issue of why the CPR had been given by Ottawa a virtual monopoly over all goods moving to and from the province. When Manitoba’s premier, John Norquay, attempted to build a provincial railway to the American border, Prime Minister Macdonald used his influence to prevent a bond sale in London and New York. He later forced Norquay ‘ s ouster as premier by spreading rumours about financial irregularities he probably didn’t commit.

A decade later, the CPR obtained a cash grant from the Laurier government to build a new line from Lethbridge to Nelson, B.C. through the Crowsnest Pass. In return, the railway agreed to cut its rates by approximately a fifth on grain moving from Winnipeg to what is now Thunder Bay. In fact, however, this first Crow rate was an illusory concession because, during the 1903-1918 period, the railway accepted an even further cut. The "Holy Crow" was later shown to be rather hollow when it came to light that shortly before 1914 the charges for other freight moved on the Prairies were 30 to 50% higher than in Ontario. The additional surcharge for B.C. freight was not removed by Ottawa until 1949.

Three years earlier, as World War II ended, both the CPR and the CNR had applied for a thirty per cent general increase in rates across Canada. Seven of the nine provincial governments-- Ontario and Québec excepted -- opposed it vehemently. The government of Mackenzie King allowed a twenty-one per cent increase. Today, as inflation is eroding the real worth of the remaining Crow benefit, it is still for many Westerners a potent symbol of regional grievance primarily because it was seen as the West’s one real offsetting factor to a century of industrial benefits going to Inner Canadians as a consequence of the tariff and other protections created by Ottawa.

Wheat was a major preoccupation of Prairie Canadians for decades, but national governments rarely did much to help in its marketing. When Prime Minister Pierre Trudeau once asked "Why should I sell your wheat?" he was touching a very sensitive Western nerve. Following World War I, for example, Prime Minister Arthur Meighen, a Conservative originally with a Manitoba constituency but always with Inner Canadian ideas, stopped government control of grain marketing despite the opposition of most grain farmers. In 1920, the Canadian Wheat Board, created to cope temporarily with chaotic world grain export conditions, ceased to operate. The three Prairie wheat pools were thus forced to market grain themselves and did so with considerable success. Only with the virtual collapse of world grain prices could Prime Minister R.B. Bennett, himself a Prairie MP, be persuaded during the dying days of his doomed mandate to re-create the Wheat Board in 1935. The newly elected Liberals offered more hope to financially-desperate farmers. Yet, Mackenzie King also intended to eliminate the Board four years later. The united protest of angry Prairie producers dissuaded him from doing so.

Political Subordination

For along time, the political inequality of Western Canadians has been the most potent cause of regional alienation. In British Columbia, many resent that Ontarians and Québeckers dictate the policies of every national government. Yet, because of the province’s dependence on forestry, mining and fishing, the first two of which have until recently only rarely interested Ottawa policy-makers, the national government is not constantly obtrusive on the West coast. More Prairie Canadians than British Columbians are affected on a daily basis by Ottawa policies on transportation, agriculture, energy exports and resource taxation.

Some Prairie residents recall the shameful way their own provinces came into being. Manitoba became a province in 1870 due to the earlier successful uprising by Louis Rid and his provisional government at Red River. Yet the province was so tiny that it was simply not viable. Moreover, unlike the founding provinces, it lacked ownership of its limited land and resources. Its boundaries were later extended, but it was not able to obtain ownership of its natural resources from Ottawa until it was sixty years old, almost a pensioner as a province.

Alberta and Saskatchewan became provinces only in 1905 following long years of advocacy by Frederick Haultain, chairman of the North-West Territories Assembly, and many territorial residents. There is persuasive evidence that two provinces rather than a more viable single one were created by Prime Minister Laurier mostly because he did not want Haul-tam, a political opponent, to become premier of one large Prairie province. Neither province, moreover, even in 1905 received ownership of its land or resources. To compound the insult and leave a lasting bitterness about Ottawa politicians generally in the minds of many residents of the new provinces, Laurier appointed well-known Liberal supporters as first lieutenant-governors of the new provinces. They in turn appointed Liberals as interim premiers, and a small army of fellow partisan workers established as homestead inspectors and the like helped ensure that Liberal governments were elected in each of the two new provinces.

Progressives and Reformers

The Progressive Movement emerged on the Prairies during the 1 920s.in response to such tactics by Ottawa politicians. Essentially, it was a delayed Western revolt at the ballot box against the major features of Macdonald’s National Policy and the two old parties which were seen by many Westerners as equally committed to that policy. By 1918, many Prairie farmers who had broken virgin land with oxen or horses felt themselves engulfed by interest rates and railway and grain elevator charges. When Wilfrid Laurier’s government, in office from 1896 to 1911, repudiated the Liberals’ traditionally low tariff policy, it was the last straw for many Prairie wheat growers.

During the 1911 reciprocity election, Laurier resorted to his party’s longstanding free-trade position, but this sharply divided his own party which had become as welded to the National Policy as had the Conservatives. Clifford Sifton, the second most influential Liberal in the country until his resignation as minister during 1905, even defected noisily to Borden’s Tories. The high tariff policy of the Ottawa Conservatives helped wreck its provincial wings in both Saskatchewan and Alberta after 1911; its Manitoba affiliate all but disappeared for several decades as well.

The arrival on the Prairies of thousands of settlers from the American Midwest after 1896 weakened regional ties to both national parties because many of the new arrivals had supported American third parties. Settlers from England were frequently supporters of the Labour Party, at that time a third party as well. In short, the Progressive Movement was a unique combination of Jacksonian democracy and British radicalism.

By the time of the 1917 election, Laurier’s Liberals had collapsed across the West. Borden’s Union government, a coalition formed to maximize the war effort mainly through conscription, gave itself several legs-up in the election: disenfranchising citizens of foreign birth, and so on. It won fifty-five of fifty-seven seats in the four Western provinces as the result of its win-at-any-cost measures.

In essence, as William Morton, the most knowledgeable authority on the movement concluded, the 1917 election purged many Westerners of their previous political loyalties. Another major factor was the Union government’s withdrawal in 1918 of its promise that farmers’ sons would be exempt from the draft. This caused widespread revulsion among Western farmers. When Arthur Meighen, the successor to Borden, attempted to make trade protection the main issue of the campaign and attacked the Progressives for wanting to destroy the National Policy, he was doomed in the region. The Conservatives won only fifty seats, coming third after the Progressive Party, in the new Parliament.

The Progressives were also determined to destroy the Liberals and Conservatives in the provinces. Their allies on the Prairies, the United Farmers, were largely successful in both Alberta and Manitoba for a period. In Saskatchewan, the Liberal government of William Martin avoided the 1920-21 tide only by temporarily ending his ties with the federal Liberal party.

Whether the Reform Party is a 1990s successor to the Progressives is a very lively subject today across Western Canada. High interest and bankruptcy rates, major debt problems for many Prairie farmers, the proposed GST, the Meech Lake process and the widespread conviction that the Prime Minister sees the West primarily as a place for reliable votes and docile MPs, have helped recruit about 45,000 members for the new party, mostly among Albertans and British Columbians. A party meeting in Victoria in the summer of 1990 attracted 1,500 persons and, even more surprising, an opinion survey done at the time indicated that 59 per cent of Calgarians, the most loyal PC voters in the nation for a generation, would vote Reform today compared to 11 per cent who would vote PC.

Preston Manning, the Reform Party leader, is widely seen in the West as an articulate individual whose personal qualities contrast favourably with the Prime Minister’s. Jean Chrétien, the new Liberal leader, is also well-regarded in the West and is also an excellent foil to Brian Mulroney. He is deemed to be less right-wing than the Reformers, an advantage to some and a disadvantage to others. He favours cultural pluralism whereas the Reformers are seen as both unsympathetic to minorities and distinctly cool to immigration. The federal New Democrats are strong in much of British Columbia, across Saskatchewan, in urban Manitoba and in Edmonton. As of the late summer of 1990, the next general election is likely to be a Gotterdammerung in Western Canada. Only one party, the Conservatives (the perennial favourite), is likely as of now to emerge from the campaign as an also-ran.

Recent Years

A dreary past in terms of the impact of national policies on the West was compounded by a series of events occurring during the 1970s and 1980s. Each of them reinforced for Westerners the idea that a national government controlled by Inner Canadians for the benefit of Ontarians or Québeckers, or both, was imposing policies deeply harmful to the legitimate interests of Western Canadians.

Oil was probably the most important of these major friction points even though it affected mostly Alberta and Saskatchewan as the producing provinces. During 1974, as OPEC member governments began to raise world oil prices from about $4 (U.S.) a barrel to $11 and later much higher, the product became the focus of fierce differences between the Trudeau government and the West.

In response to the rising prices, Ottawa first imposed an export tax on oil the West was exporting to the U.S. and froze the domestic price. Alberta premier Peter Lougheed protested strongly at the time. The only reason for exporting to the south at all, he argued, was the persistent refusal by every Ottawa government since the 1960s to have the Western oil pipeline lengthened to Montréal. An extension was rejected on the premise that it was cheaper for Canadians east of the Ottawa river to buy oil from the Middle East or Venezuela. One result of this official myopia, said Lougheed, was that a good number of Canadian-owned oil firms which could not afford to operate at other than full capacity had been forced to sell out, usually to Americans.

The Alberta premier also noted that as recently as early 1973, the federal Energy Minister, Donald Macdonald, later appointed by the Mulroney government to be Canada’s High Commissioner in Britain, had again refused a Western request to extend the pipeline with the usual rationale that offshore oil was cheaper. Once again, rejoined Lougheed, the national government "had weighed Alberta’s needs for markets against the economic advantages to Eastern Canada, and decided against us."

Many across the West wondered why the non-renewable oil of Alberta and Saskatchewan was the only Canadian export to be subject to a federal export tax when renewable exports, such as Québec’s growing electricity sales to the United States, were not similarly taxed. The Trudeau government replied that oil was unique. Having been discriminated against so often in the past by national governments, Westerners were mostly unconvinced. The continuing support of the Western constitutional position by the Québec governments of both Robert Bourassa and René Levesque became a feature of a West-Québec alliance which too many Westerners later forgot during the Meech Lake process.

Eight months after Pierre Trudeau and his Liberals defeated Joe Clark’s Conservatives in February, 1980, Marc Lalonde introduced the West’s most hated of all Ottawa policies: the National Energy Program (NEP). Suffice it here to say that despite attractive features, such as promoting energy conservation, the policy was quickly seen across the West as deeply harmful to the region. For example, oil exploration and development were redirected by costly tax incentives away from the Western provinces toward the North and off our three coasts, all of which were controlled by Ottawa. The incentives being unavailable to foreign-owned companies, a number of them soon moved about 200 oil drilling rigs (each employing approximately 200 people) to the United States. This convinced many Westerners that petroleum self-sufficiency was not a goal of the NEP at all. The real objective, it appeared, was for an anti-Western regime in Ottawa to continue buying off-shore oil at $37 (U.S.) a barrel (the price as of 1980), from sources such as Libya while at the same time refusing to buy it from numerous capped wells in Alberta and Saskatchewan for $18 a barrel.

One of the unstated objectives of the NEP was to relocate the leadership of the energy industry to Ottawa. Rather clearly, the plan was to create a new community of energy leaders with a primary loyalty to the federal government. It would join the industrial-financial elites within Inner Canada who have historically identified closely with Ottawa because of various federal measures such as the Bank Act. The NEP was thus profoundly anti-Outer Canada because until 1980 the oil and gas industry was one of the very few sectors based in Western Canada.

Reorganizing the ownership for the industry was a major goal of the NEP. The federal government took advantage of the rapid rise in international oil prices to buy out some foreign-owned parts of our domestic industry. To persuade targeted firms unwilling to sell to do so, the NEP created a series of tax incentives and other measures which discriminated blatantly in favour of Canadian-owned companies. The best known of these was the twenty-five per cent back-in provision through which Ottawa was to take an automatic one quarter of the revenue from any oil or gas discovered on lands it controlled. The government of Canada soon found itself accused internationally of legislated theft. The avalanche of protests following the initial application of the back-in provision to expensive discoveries made before its enactment finally persuaded the Trudeau government to offer compensation for about a quarter of the expenditures made.

During the first year of the NEP, foreign ownership dropped from seventy-four per cent to about sixty-six per cent as Canadian companies, including Dome Petroleum and Petro-Canada, made huge buy-outs of foreign-owned properties. The prestigious Organization for Economic Cooperation and Development (OECD), however, ruled that the methods being used violated its resolutions banning member nations from discriminating against foreign-owned companies. In the international community at large, many concluded that the NEP was a key part of a general campaign by Pierre Trudeau’s last government against foreign investment of any kind.

The overall consequences for Alberta and Saskatchewan were devastating. The number of oil wells drilled in Western Canada dropped from 550 in mid-1980 to about 120 by 1982. The number of drilling rigs in service across Canada fell from 650 to 450 shortly after the NEP was introduced. Thousands of jobs in Western Canada were lost, mostly in the drilling and service sectors of the energy industry. Proposed mega-projects such as the Alsands plant at Fort McMurray were cancelled. Numerous Western businesses went into bankruptcy. Many careers and families were broken; home mortgages were foreclosed in large numbers.

During the summer of 1982, Britain’s respected Economist magazine summed up the NEP in politely brutal language: "The NEP has come close to wrecking an industry that until October, 1980 was drilling like fury finding enormous volumes of gas and much new oil, creating jobs and investment all over Canada and increasingly using Canadian-owned capacity in exploration and management ... The NEP drove Canadian exploration and service companies into the United States until only 150 drilling rigs were left, the lowest number since the 1960s de-Canadianization, in effect. Owners of capped-in gas wells had big debts and no cash flow. Oil serving companies in Alberta withered into bankruptcy."

The Ottawa-prescribed low domestic price of oil since the 1970s was calculated by Robert Mansell, a Calgary economist, to have cost Albertans alone approximately $60 billion. Yet the NEP was loathed even by Western Canadians who had no direct daily contact with the energy industry. In the West, it was a major reason for disaffection. It even provided an impetus to separatist sentiments for it blatantly discriminated against two Western provinces, maintained the domestic price of conventional oil and gas resources at about half the world price, and subsidized the consumption of imported oil. It was a Western economic and social nightmare.

1982 Constitution

As a result of the NEP and a long series of other anti-West attitudes associated with the government of Pierre Trudeau since 1968, the overall Western mood was anything but positive by 1981. One opinion survey done in March of 1981 ominously revealed that 61 per cent of respondents in all four Western provinces agreed with the statement, "the West has sufficient resources and industry to survive without the rest of Canada." Between October, 1980 and March, 1981, support for outright regional independence grew from five to seven per cent, and eleven per cent in Alberta. Part of the worsening Western attitude was created by the process and substance of Prime Minister Trudeau’s constitutional package.

Following the May 20, 1980 Québec referendum in which a sixty per cent majority rejected sovereignty-association, the premiers of all ten provinces and Mr. Trudeau agreed on a twelve-item agenda to be studied over the summer. In early July, however, the federal government revealed out-of-the-blue a set of new demands for greater powers over the economy if any other legislative powers were to be surrendered to the provinces. Later that summer a memorandum drafted by the Clerk of the Privy Council, Michael Pitfield, a quintessential Inner Canadian from Montréal’s upper Westmount, was leaked: it outlined a federal strategy for unilateral patriation of the constitution from Britain by Ottawa.

The political sky darkened even further a few weeks later when the eleven first ministers met. Another memorandum, this time prepared by Michael Kirby, an adviser to the Prime Minister, became public during the conference, causing an uproar among the premiers and later across the nation. In it, it was suggested that Alberta might be isolated on the sensitive issue of control of natural resources if the federal cabinet could make a deal with Premier Blakeney of Saskatchewan. Whether in consequence of this or because of conflicting visions of the national future, the first televised conference ended in stalemate on all twelve agenda items.

At the end of September, the Prime Minister declared he would patriate the constitution without provincial consent and have simultaneously enacted by the British Parliament a Charter of Rights to apply in both the federal and provincial jurisdictions. Joe Clark on behalf of the Official Opposition denounced these proposals the same day; the New Democrats through their leader, Ed Broadbent, indicated general support for the package, thereby dividing their caucus on east-west lines. Three Western premiers -- B.C.’s William Bennett, Alberta’s Peter Lougheed, and Manitoba’s Sterling Lyon -- announced they would join two other premiers in a court challenge to the government’s constitutional proposal. Saskatchewan’s Blakeney government joined them several months later.

In mid-March, when the cabinet introduced a form of closure in the Commons on its constitutional resolution, Conservative MPs began a filibuster that lasted for two weeks. It ended when the Newfoundland Court of Appeal, differing strongly from the majority view of the Manitoba Appeal Court on the same issues, ruled unanimously that the resolution was unconstitutional. Effectively beaten in its attempt to avoid having the Supreme Court of Canada decide the matter, the Prime Minister agreed to hold off a final vote on its resolution until that Court could decide the issue. By May, a Gallup Poll indicated that two-thirds of both Prairie and B.C. residents opposed the proposal that the British Parliament should be asked to amend the constitution by adding an entrenched charter of rights before returning it to Canada.

At that point, the "Gang of Eight", i.e., all the premiers with the exception of Ontario’s William Davis and New Brunswick’s Richard Hatfield, advanced a proposal calling for patriation alone, the Alberta amendment formula (which required constitutional amendments to be passed by Parliament and the legislatures of seven of the provinces holding half the population of Canada), and no Charter of Rights. This collided with the amendment formula favoured by Pierre Trudeau which would have provided vetoes to Ontario and Québec alone, whereas full legislative support in three Western and three Atlantic provinces would be necessary to stop a proposal. The Federal-Provincial Relations Office in Ottawa, moreover, conceded to me at the time that it knew of no other federal democracy which assigned, as proposed by the Prime Minister, differing weight to residents of different provinces for constitutional amendment processes. The notion offended Westerners deeply.

In the fall of 1981, the Supreme Court of Canada ruled by a majority of seven to two that the Trudeau package was legal, but six judges also said it violated our constitutional conventions. A first ministers’ conference was called for early November in a last attempt to reach an agreement. The famous compromise was reached in a hotel kitchen late at night on November 4th; it proved acceptable to all first ministers except for René Levesque. It quickly passed the Canadian and British Parliaments and was proclaimed by Queen Elizabeth in mid-April, 1982 at a large outdoor ceremony on Ottawa’s Parliament Hill.

The overall damage in terms of national unity was high in the West. Even those of us who favoured an entrenched charter of rights on the basis that some rights should be beyond the reach of any legislators were deeply offended by the process. A national government which held our region in barely-concealed contempt had actually tried to relegate all Outer Canadians to second-class status in its preferred constitutional amendment formula. The active role of Saskatchewan’s Allan Blakeney and Roy Romanow in the final compromise contributed to the massive defeat of the Blakeney government in the April, 1982 Saskatchewan election. The first separatist MLA in Western Canada, Gordon Kesler, was elected at about that time in a by-election in Olds-Didsbury in central Alberta.

The 1982 Constitution achieved little in terms of a constitutional vision for Outer Canadians generally and Westerners in particular. For example, the decades-old inability of majority parliamentary governments to address real problems of the West was ignored. British Columbia pushed for Senate reform but won little support from the other first ministers. The amendment formula endorsed by the four Western provinces quite understandably reinforced the premiers’ view that they alone speak for their respective residents on national affairs because future amendments became exclusively the prerogative of eleven legislatures. Direct citizen participation in the amendment process through referenda as customary in other federations, for example Australia, was blocked.

Another opportunity was lost to restructure Ottawa’s institutions so that politicians in our national capital might speak effectively for the regions.

Maintaining CF-18s

Few Inner Canadians, including Brian Mulroney, seem to understand how much the awarding of the maintenance contract for the CF-18 aircraft continues to rankle residents of all four Western provinces.

The issue arose in 1986 when the British-owned Ultramar Canada closed an essentially obsolete Montréal ore refinery. When the loss of 350 jobs in East Montréal caused an uproar in the House of Commons for weeks afterward, Prime Minister Mulroney appointed a committee of ministers, headed by Robert de Cotret, to consider ways to promote growth in the Montréal region. De Cotret soon spotted a pending contract to maintain 138 CF-18jet fighters purchased from the U.S. as a convenient way of creating some future-oriented jobs in greater Montréal. His problem was that a team of 75 technicians from three federal departments had already concluded that the tender by Winnipeg’s Bristol Aerospace was better in terms of proven expertise and about four million dollars cheaper than the competing one by Canadair of Montréal.

In the spring of 1986, de Cotret as president of the Treasury Board simply overruled the officials’ recommendation and directed that Canadair should obtain the contract. In October, the full Treasury Board of six ministers, including one from the West (B.C.’s Frank Oberle), so decided.

The reaction to the announcement in the West was uniformly vehement. Had the integrity of the federal tendering procedure vanished? Had Bristol not made a cheaper and technically better bid? The losing bidder indicated it would have to lay off a hundred employees and would probably sue the Mulroney government for the $5 million it had spent to prepare its bid in good faith. Further bad news came when it was revealed that Canadair, in order to do the work, would have to spend $30 million to purchase technology from Bendix-Avelex Inc. of Toronto and the Canadian taxpayer would have to pay. Westerners generally concluded that Brian Mulroney was indistinguishable from Pierre Trudeau on the issue of regional justice.

An Environics Research Group poll done after the decision found that, "84 per cent of Western Canadians -- the highest of any area of the country -- think the government does not treat all parts of Canada equally." Even the Calgary Herald, at that time and probably still the most loyal booster of the Mulroney government editorially among all Western dailies, observed: "Instead of a national government, we have national decisions made on a selfish regional basis for purely political reasons. There is nothing unusual in that. Just add it to the long catalogue of injustices done to the West."

The NEP and the CF-18 together highlighted for many Western Canadians their continuing colonial status within Confederation. Each of them, severely harming the region’s future economic prospects, were made by national governments of different political colours which placed other considerations ahead of the legitimate economic aspirations of Western Canadians.

The New West

Recently, I was told that many Quebeckers believe Westerners are still almost entirely people of British origin. The reality is that more than seventy distinct ethno-cultural communities can now be identified across Western Canada.

Between 1880 and 1914, several million immigrants from Europe and numerous other parts of the world settled across the West. They were attracted by the promise of a better life in "the last best West." Literally dozens of communities of diverse ethnic and cultural background arrived in the region, creating a kaleidoscope of languages, dress and customs unique in our country. A visitor first applied the term "mosaic" to Canadians during a 1922 visit to the Prairies.

The Prairie population ballooned from about 400,000 in 1901 to 2.4 million by 1931. A newcomer climbing off a train in Winnipeg just before World War I would meet people on nearby Main Street speaking almost every language then spoken. Half of the Prairie residents at the time had been born in another country; fifteen years later the share was still one in three. By the 1931 census, Prairie residents who were British by origin had already dropped to about half the Prairie total. Various East European groups, including Ukrainians, Austro-Hungarians, Poles and Russians, numbered about twenty percent, and West Europeans, German, Dutch and French, including Québeckers, also had about a fifth of the population.

Present thousands of years earlier were a host of Indian tribes which had settled on the Prairies. Later, while the fur trade flourished, French- and English-speaking Métis became the second founding community of the region. A group of hearty Scots helped found the precarious Selkirk settlement in the first decades of the 1 800s, but it was not until after the CPR was completed to the Rocky Mountains during 1884-85 that the first of four successive waves of mostly British newcomers began to arrive. The largest group came between 1897 and 1913, bringing almost equal numbers of pioneers from the other provinces, Britain, America and Continental Europe. There were also Icelanders, Mennonites, Jews and other communities.

Immigration to Canada stopped during the First World War. The next large migration arriving during the 1920s was similar to the 1897-1913 one in terms of origin. Immigration was again stopped by Ottawa between 1931 and 1941. The final wave started after 1945 and is still continuing: it consisted of Europeans uprooted by the war and, after 1962, newcomers from most Pacific Rim nations.

Much of the credit for the diversity on the Prairies goes to Clifford Sifton. As Immigration Minister in Laurier’s government between 1897 and 1905, he spent large sums of tax money to lure farmers from Europe, Britain and America. His successor, Frank Oliver, increased recruitment in Britain and reduced it in Europe. The government of Robert Borden and Arthur Meighen held the door open to unskilled British immigrants between 1911 and 1921, but continued a Laurier measure which in practice barred most Asians and Arabs. In the mid-1920s, Mackenzie King as Liberal Prime Minister restarted recruiting in Central and Eastern Europe; almost 370,000 Europeans came to Canada before 1931, when R.B. Bennett closed the gates to almost everyone.

The pattern and sequence of settlement in British Columbia differed from that on the Prairies. Thousands of years after the province’s aboriginal peoples arrived from Asia came the province’s first settlers in the mid-1800s, including a number from south China. Most of those arriving before 1890 came from Britain and it was then that Victoria took on its pronounced British flavour. The 1890-1914 wave included Americans, Britons, Chinese, Japanese, Scandinavians and Germans. People from Central, Western and Eastern Europe comprised the largest numbers of those entering B.C. during the 1920s. The catastrophic impact on the Prairies of the Great Depression caused hundreds of thousands of its residents to move westward. Since 1945, enough newcomers have moved in from virtually everywhere that the province’s population is now about three million.

In consequence, the demographics of all four Western provinces were significantly different from Canada as a whole by the time of the 1986 national census. In all three Prairie provinces, less than forty per cent of the residents claimed a single country of origin in Britain or France. British Columbia was slightly over forty per cent, contrasted to Ontario and all four Atlantic provinces where considerably more than forty per cent of residents claim descent from a single family in the British Isles.

Today, and increasingly since the beginning of this century, the West has developed a character that is pluralistic in culture, religion and politics. This has been possible partly because no ethno-cultural community was numerically dominant. Some might say the British were, but no one who knows the history of those islands would group the Scots, Irish, Welsh and English together indistinguishably. In practice, most members of every cultural community, including the larger ones, today believe that all people are of equal worth and that all should have the right to choose their own lifestyle within the framework of cherished Canadian values like non-violence, civility and respect for others.

Consequently, a pattern of permissive differentiation, not coercive assimilation, emerged at an early date and has set very firmly in the West. More than in any other part of Canada, multiculturalism is all-inclusive. No one’s community has been left out, because each one is seen as an integral part of the regional kaleidoscope. Bitter experiences of prejudice and discrimination are gone. The region has emerged confidently from its aboriginal past into a multicultural present and future. A unique mixture of ethno-cultural co-operation now exists.

There is a Western consensus that the survival of all ethno-cultural communities is beneficial to the individual satisfaction and self-development of their members, since it builds a sound climate in which cultural differences do not limit social participation. The preservation of cultural communities also advances and enriches the community as a whole since each of them has a valued contribution to make to the whole. Sustained interaction between diverse groups on the basis of mutual respect and equality is an enriching social experience: each group affects the others, while maintaining its identity.

The various communities can provide wise counsel at a time of national tension and stress. Former Czechs and Slovaks know from experience the dangers of national fragmentation that have long imperiled the existence of their land of origin. Many Flemish- and French-speaking Belgians, Serbs and Croatians from Yugoslavia, and newcomers from Pacific Rim, African, and Caribbean nations also know just how fragile can be the human glue which holds countries together during periods of adversity. Newcomers from Lebanon similarly can tell what happens where one’s membership in a particular religion or cultural community is the most important component of citizenship and that Canada must avoid the Lebanese experience at all costs.

Western Economy

British Columbians and Albertans, who constitute just under three quarters of the labour force in Western Canada, did not do well during the economic swings of the 1980s. Recent improvements in both provinces were caused by differing factors: in B.C., rapid interprovincial migration into the province fuelled booms in its construction and service sectors; in Alberta, improved oil and natural gas prices sparked new energy investments and a comparative boom in housing.

The 1990 forecasts for Prairie farmers are poor, due to four previous years of droughts, collapsing world grain prices, high interest rates, the highest dollar value in a decade, and some major international assaults on Canada’s supply management programs. In early 1990, Statistics Canada foresaw a more than two-thirds drop in net farm incomes for all three Prairie provinces. European farmers receive $700 a metric ton for wheat compared to the $150 Canadians receive. Prairie grain families are being crushed by the ongoing multi-billion dollar export subsidy battle between Washington and Brussels. By the end of 1990, an estimated one-third of Saskatchewan farmers could face lawsuits from creditors. Overall, despite the excellent Prairie crops indicated for 1990, world conditions remain worse than 1986 and 1987, themselves among the worst since the Depression. Westerners also know that our regional share of jobs in the deeply depressed agricultural sector is virtually twice the national average.

Major adversity in the farm sector invariably leads to difficulties elsewhere. Saskatchewan’s population is continuing to drop, urban homes remain unsold in Regina and Saskatoon for long periods (in the late summer of 1990, I observed a home for sale in Yorkton for $26,500), and pessimism returns across the province. The large agricultural sectors in Alberta and Manitoba are similarly affected.

Fortunately, spontaneous diversification is occurring across the West, assisted by a highly-motivated entrepreneurial spirit and a dynamic technical sector. Aerospace, agricultural machinery, petrochemical and construction materials are doing particularly well at exporting. The skills of Westerners in communications, recreation and resource development are well known and many of them are marketable outside Canada.

A major obstacle to further diversification across the West is lack of investment in manufacturing. A recent study by the Canada West Foundation showed that regional manufacturing investment amounted to a negligible six per cent of total national investment. In order to even remain competitive in national resource exploration, Westerners must adopt new technologies such as computer-aided design.

Research and development spending in all four provinces is below the national average. While doing more than half of such spending nationally, the private sector does only just over a third of it in the West. As for the federal government, only nineteen per cent of its research and development spending is applied to the West, though this part of the country holds almost thirty per cent of the national population. Ontario and Québec together receive three-quarters of overall science and technology spending. This makes it more difficult for high-tech manufacturing in a number of sectors to expand in the West.

Is it any wonder that the relative generosity of the Mulroney government toward the West’s traditional oil and grain sectors has been compared so negatively to its support for various industries of the future in Inner Canada? The CF-18 contract is a continuing reminder of Ottawa’s inability to see Westerners as anything other than wheat farmers, tree chokers and oil wildcatters. The vast majority of Westerners, like other Canadians, are in services of various kinds. The way to a less volatile future obviously points in the direction of processing natural resources, adding value to them and pursuing technological advances. Prairie Canada canola seeds should not be exported in unprocessed form to be crushed into cooking oil in Japan. B.C. logs should not be shipped to Asia for processing into finished plywood.

Canada-U.S. Free Trade Agreement

It is probably too early to measure the full impact of the Canada-U.S. Free Trade Agreement (FTA) on the Canadian economy. Some consequences are already observable: Canada’s trade surplus with the States has been reduced, jobs have been lost and plants shut down, companies have relocated to the U.S. or Mexico and pressure from American firms has intensified. The critics claim that 250,000 jobs were lost in the first year; its defenders insist that 200,000 have been directly created.

Two years ago, I supported the FTA believing it was in the best interests of both Western Canada and all other parts of the country. I saw in the agreement a way to reduce the colonialism created by national governments over decades at the expense of Outer Canada in general and the West in particular. Today Jam inclined to think that some provisions are hurting parts of the country that can least afford further decline in economic growth.

In the opinion of some economists, the FTA could increase the instability which characterizes the Western Canadian economy because many of our exports are concentrated in very volatile markets and dominated by a comparatively small number of natural resources. Despite the agreement, the likelihood of continuing trade disputes with the U.S., especially in natural resource matters, remains very high unless both nations can negotiate over five to seven years a mutually agreed-upon definition of "subsidy." Some Canadian practices, including provincial Crown ownership of most natural resources, and some non-market pricing rules, are otherwise likely to lead to more anti-dumping and countervail lawsuits to follow the softwood lumber, potash and hog trade ones already completed.

The future of marketing boards across Canada is in issue because rural Westerners, like many people in all ten provinces, see them as essential to the viability of important farm sectors. The agreement requires the elimination of Canadian tariffs on the importation of processed foods from the United States. If this happens on a host of processed foods, the result will inevitably be that much of Canada’s very large food processing industry will relocate production to the U.S. and export back to Canada. Our marketing boards would then virtually cease to operate because fewer and fewer processors in Canada would buy their products.

In the matter of ice cream and yogurt, a test case emerged when the Canadian dairy industry learned that the twelve to fifteen per cent tariff on these products was to be phased out. In response, the Mulroney government attempted to replace the tariff with what are termed in trade law as quantitative restrictions on American imports of both products. The U.S. government sought a ruling from a tribunal of the General Agreement on Tariffs and Trade (GAY!’). It concluded that the use of such restrictions to protect our food processing industry was illegal. The prospects of amending the GATT to allow the use of quantitative restrictions, according to the Ottawa trade expert Mel Clark, are virtually nil. The probable result therefore is that thousands of Western, Atlantic and other Canadian farmers, who have earned a decent living within our marketing board framework, face an uncertain future because of this feature of the bilateral agreement. Many of them who supported free trade in the past, assuming their marketing boards could survive under it, have changed their minds.

The FTA was never intended to be a panacea to Canada’s economic problems. I believe it might still assist us to enter the wider global trading arena if GATT succeeds in further liberalizing world trade. Some of its provisions might well have to be re-negotiated if it is to work the way it was intended and before all the hopes Westerners and other Outer Canadians invested in it are completely shattered.

"Rich Uncle Alberta"

The lack of Western diversification doesn’t satisfactorily explain the volatility of the Alberta economy. Why were the province’s booms and busts since 1980 significantly worse than in Texas or Oklahoma, two American states with similar reliance on oil and agriculture? Why did the province experience a net loss of about 100,000 people between 1980 and 1989? During the decade, home prices collapsed, fourteen provincial financial institutions failed or were forced to amalgamate and approximately a third of the credit unions were placed under direct government supervision. The social and human costs to thousands of Alberta families and individuals were enormous.

The Calgary economist Robert Mansell points out that employment in the province did not return to its pre-1981 recession high until May, 1987, compared to November, 1983 for Ontario, 1984 for Atlantic Canada and June, 1984 for Québec. Contrary to the conventional wisdom in Ottawa that it was a drop in oil and farm prices that caused the most severe Alberta recession since the Great Depression, Mansell notes that the average price for oil and gas producers did not decline until 1986 and farm receipts remained quite stable during the period.

By 1980, Alberta’s petroleum industry accounted directly for almost one-third of the provincial economic output, approximately one-half of all construction starts, and about 80 per cent of the provincial government’s yearly spending. The growing dependence on the oil industry made Albertans increasingly vulnerable to anything that threatened new investment in the sector, including the NEP and high interest rates. Another important factor was that by 1980 Ottawa’s taxation, spending and energy policies as a whole were withdrawing about $15 billion more each year than the national government was injecting into the province through all forms of federal spending. A major consequence of this was the transfer of numerous jobs and incomes out of the province, which severely weakened the provincial economy.

After 1982, the Alberta government increased its spending significantly in an attempt to stimulate the economy. Federal policies, however, were simultaneously more than neutralizing the provincial efforts and creating a major drag on the economy. In short, the lingering post-1981 recession in at least one Western province was mostly induced by discriminatory Ottawa policy rather than caused by over-dependence on natural resources. Ending discriminatory fiscal, monetary and energy policies is essential to restoring prosperity in Alberta.

Albertans wonder why Alberta, and not our largest and richest province Ontario, has continued between 1980 and 1988 to be the only province from which Ottawa removes more in federal taxes than it spends. Why should parts of Outer Canada be the cash cows of Confederation, providing cheap inputs for the industrial heartland? For example, while the Mulroney government continues to spend more in Ontario than it raises in federal revenues, thereby increasing inflation there, his Finance Minister argues that sky-high interest rates are necessary to dampen inflation. In August, 1990, the Prime Minister told his constituents in Charlevoix that the national economy was neither in recession nor approaching one. High interest rates, he declared, were pushing inflation out of the economy. That same week wages across the country went up at a 5.3 per cent yearly rate, prices rose by 4.3 per cent and economic growth was zero.

Some additional data on federal spending and taxation by province released by Mansell in August of 1990 were equally disturbing. Between 1961 and 1988, Albertans contributed $145.7 billion (expressed as 1990 dollars) more to Ottawa’s revenues than they received in federal spending and transfers (Fig. 4). British Colurnbians were the only other net contributors to Confederation during the same period. Ontarians, who might have been expected to have contributed generously to "have-not" provinces, received $24 billion more in spending than they paid in taxes during these years. Most of the national government is located in Ontario and the argument is frequently made that this explains the anomaly. Yet how then to explain that between 1970 and 1979 Ontario made a net contribution to residents of other provinces of about $3.6 billion? Mansell ‘s latest figures also indicate that since 1980 alone Québec received $95 billion from Ottawa more than it contributed to the national government.

The Cost of Unity
to the Federal Government
1961-1988

Figure 4

Prospects

Overall, the West’s experience within Confederation remains a story of buoyancy, optimism and confidence meeting continuous rebuffs from the various agencies of the national government. In consequence, the region has yet to achieve political and economic equality with Ontario and Québec.

Containing approximately 7.5 million residents, who constitute the second largest population grouping in the country after Ontario, Western Canada continues to feel largely overlooked and neglected, frustrated and impotent. The time has clearly arrived for the region to achieve equal partnership with all other regions of the country. Political and economic equality is the only means of ending Western alienation.