Is Canada Headed for a National Breakup?

Fast forward to today, the day after the Federal election in Canada, we’re more concerned than ever that the country will be breaking up or dissolving.

The Liberals and Mark Carney, inventor of the Carbon Tax in Canada won the Prime Minister’s office and control of the Canadian Federal Government.  Carney has spoken with a forked tongue about his willingness to eliminate unfair regulatory controls and unwarranted taxes on the energy industry. Alberta knows this well.

Current situation: A battle is quietly brewing, but everyone knows where this is headed. The talk is conciliatory, but these politicians have strong convictions, on opposite sides. They’re both scanning the legislation, laws, and Canadian Constitution (rewritten by the Liberals in 1980) to fortify their strategy.

After a post from Alberta Premier Danielle Smith we know the Alberta government and a minimum of 30% of the Alberta population are significantly disappointed in the situation. The sentiment could be and might be worse, but Canadians have a strong conciliatory character that tends to long-tolerate things they shouldn’t.  Separation talk is increasing daily after the Liberal election win — a day of deep humiliation for Canada’s conservative segment.

What’s happening right now, 5 days after the election is a lot of small talk, but each side is strategically and quietly positioning itself for the battle ahead. Smith has just announced some bills that make it easier for various provincial referendums to take place. On the other side, Carney is considering his options to outlaw referendums and prevent any province from seeking sovereignty or complete separation.

Without Alberta, Canada would likely not be solvent. Even with Alberta, BC and Saskatchewan, the US import tariffs are taking a terrible toll on the Canadian economy, one that is taxed on the oil Alberta sends east through the US.

However, Alberta is landlocked and would find it very difficult to export its products to foreign markets without cooperation from BC or President Trump. Yet, the US does need Alberta’s crude for industry and to keep energy prices down. Everyone has a card to play, and Danielle Smith is in this poker match.  Some feel she may not have the fortitude to step up, while others believe she’s the Iron Lady of the West.

Bad Treatment for Too Long Has a Price

The way the Federal Liberals have treated Alberta, is just a microcosm of disrespect Ottawa feels for any of the provinces. Even Quebec, top recipient of Federal funds transfers is strongly disillusioned and may seek separation once more.  The role of the Federal Government and intent is more of dictatorial control rather than a symphony conductor and mediator. The Federal government has been ushering in a more American style of politics and the Woke Liberalism of the Democrat Party. It’s not going over well with many in the West. The Western Provinces have a 50-year bad taste in their mouths that just isn’t going away.

The point here is that the Liberal’s huge influx of immigrants in the last 9 years have skewed national votes, just as they intended.  And older and younger Canadians have strong, opposing views on Canada’s future. Younger people, particularly young men, feel there is no future for them, other than paying off an enormous national debt and facing ever-increasing housing costs and inflation. Homeownership is a foolish thought for those without rich parents.

Older Canadians, many pensioners are very concerned about invading US politics and values, and the threat to social programs in Canada. They voted Liberal last Monday.

The Tension in Canada

Americans should know there is a lot of tension within Canada.  What you see portrayed in Canadian news networks is a skewed, pro-Federal viewpoint, much like the US has with the Democrat dominated media networkds. And tensions between Western Canadian provinces and the Federal government are long-standing and intensifying. But the Western chasm is only the tip of the iceberg.

This time within a recession and US trade war, it’s more serious.  Canada’s Liberal Federal government has a long history of exerting unusual and unfair control over the Western provincial economies, trade, wealth, laws, culture and interests, while trying to implement deepening socialist policies. With Alberta, it amounts to repression of their autonomy and economy. It’s estimated that Canada has lost hundreds of billions in investment and production revenues due to anti-resource policies of the Liberals.

We’ll explore the unfairness, key politicians, and issues relating to oppression, ill will, stolen wealth, and more in this post.

As you’ll read below, the Premier of Alberta is taking a strong stand against Ottawa with a set of 19 conditions she’s given to the new Liberal Federal leader. He is unlikely to ease up on any of it including taxation, to trade restrictions to the costly Carbon Tax, which he himself advised to implement. He wrote a book that glorified zero emissions, but it didn’t sell well in Asia, India, and other parts of the world, which don’t care a lot about carbon emissions or pollution.

Foolish Confrontations with the US President: Trump Said the US Doesn’t Need Anything from Canada

What’s new with Carney, is his promise to headbutt Donald Trump’s tariff wall. And who do you suppose will win that match?

He pronounced that all previous relations with the US are gone forever. But he doesn’t have a plan for international business, and Liberals are a socialist party, with no competence in developing new business and investment. Their policies, as Pierre Poilievre (Conservative Leader who had very low voter poll ratings) pointed out, resulted in investment money fleeing Canada in the hundreds of billions.  Developing international trade deals is very difficult and take time, and Canada cannot sell out to these countries either.  Non-tariff barriers and shenanigans are a persistent issue.

Gordon Campbell, a BC Liberal, doesn’t like the outcome, and he didn’t even mention the loss on direct investment in Canada. Why would anyone invest in Canada now, other than in the coming fire sale?

Trudeau Legacies Haunt Canada

The key element of Canada’s national domestic standoff comes from the massive and ongoing amount of wealth transferred from Western Canada to Eastern Canada and political control over Western provincial sovereignty. This confiscation of wealth and rights has been happening for a long time dating back to the Era of Pierre Trudeau where he imposed onerous rules on the energy-producing sector in Alberta.  British Columbia, Canada’s most western province did not like Trudeau’s power move either. BC’s own natural resource production was hampered.

For the past 9 years, Trudeau’s son Justin had stepped in to implement the same dictatorial regimen as his father, with Alberta squarely in his gun sites. Before that, Conservative leader Brian Mulroney also tapped Alberta for its wealth and transferred substantial funds to Quebec. Mulroney, from Quebec, stated that he wasn’t running a “checkbook economy” and he felt justified in the provincial spending inequities – always at Alberta’s expense.

The Liberal government experiment to turn Canada into a socialist country has become a nightmare for Canadians. Instead of the poor, middle class and the rich, Canada now has the homeless, those on government assistance, the working poor, retirees struggling to make ends meet, the middle class, and the rich. Under the Liberals, capitalists can’t make profits off people who don’t have any extra money. The high level of Trudeau’s taxation is having a profound impact on Canada’s economy along with the high level of Canada’s national debt [money printing]. The lives and well-being of Canadians are in jeopardy. If millions of Canadians living below the poverty level is this government’s goal, then they have succeeded with that goal of socialism in this once-great country of ours — Calgary Sun on Trudeau’s big social experiment.

To add insult to injury, Justin Trudeau applied both a European-established carbon tax rate on Alberta and Saskatchewan emissions which then extracted additional wealth from the Western provinces.  Then he added a carbon emissions cap in trade limit to the energy sector to stop the province from producing or shipping the energy it could for Canada and the world. He even banned advertising on the topic so Alberta couldn’t defend itself. Truly evil in intent.

Alberta in particular has been put in a vice grip, and yet has never quite summoned the courage to say no to Ottawa.  They keep backing down like cowards.  Now the question is whether the same Liberals headed by a European-coached leader will keep the crunch on Alberta, or even raise it.  That person, one Mark Carney, who loves carbon tax and climate change regulations, has ended the consumer carbon tax, but is planning to make up for the shortfall by raising the carbon tax on Canadian industry (Alberta) – which will raise prices for Canadian consumers as these companies pass the extra cost through to them.

Carney was the governor of the Bank of England, and it is said that the UK didn’t do well during his term there.

Worries About $CAD Value and a Major Recession

With a big drop in Canadian exports, there will be less demand for the CAD and investors will avoid Canada as a dead end. There’s not much being said about a crashing loonie, but it’s already in the $US 70 cents range. However, it will be an opportunity for wealthy Americans to buy Canadian real estate, companies and other assets — a veritable fire sale.

With a Canada split, Ontario and Quebec voters might indeed choose to join the US despite protestations. This could work out for Trump, but does he even want Ontario, New Brunswick, PEI, Newfoundland and Quebec? What is the upside to that since he’s pushing for American jobs in Ohio, Michigan, Pennsylvania, etc.? These provinces would be just addtional burden states for his administration.

Canada’s major TV networks have jumped on the issue by showing strong support for the Liberals and Carney which helped skew the election results. I don’t conservatives across Canada or in Alberta and Saskatchewan will forget this.

The Big Question is Will Alberta Keep Putting Up With What Ottawa Has Been Doing?

The big question is whether the West, particularly Alberta, will put up with the Liberals for another 5 years. In fact, Alberta hasn’t been vocal enough, not taken a stand as yet. BC and Saskatchewan are not speaking loudly about it and have not been assertive.   Premier Scott Moe of Saskatchewan just posted his demands of Carney on Twitter. Similar to Alberta’s request, it is primarily about tariffs, pipelines, and the Canadian carbon tax, which are non-starters for Carney.

Carney’s proposed tax hike on energy producers is just the first shot in this battle. And the Ottawa-based regime will need to extract more revenues from Alberta as Trump’s high tariffs hit Ontario and Quebec hard, tax revenues fall, and the Canadian recession begins in earnest.

He’ll pursue, BC, Alberta and Ontario homeowners.  So ironic, given many older home owners voted excitedly for him.

His party and government could be about to lay claim on Alberta oil and gas like never before.

According to the Fraser Institute, between 2007 and 2022, Alberta contributed a net total of $244.6 billion to the federal government. This figure represents the amount Albertans paid in taxes and other federal revenues in excess of what they received back in federal spending from Ottawa, such as transfers, social payments, and program funding.

This contribution is significantly higher than that of any other province. For comparison, British Columbia contributed a net $46.9 billion, and Ontario $41.9 billion during the same period. Alberta’s annual net contribution averaged over $16 billion, highlighting its outsized role in supporting federal finances relative to its population size.

No data beyond 2022 has been reported by the Fraser Institute as of now. And how is Ottawa and the Liberals treating Alberta?

After years of blocking oil and gas exports from Alberta, the Trudeau liberals decided to allow the construction of a pipeline through British Columbia to export markets.  Later, that same government bought the pipeline from the private company that financed and built it.  By owning the pipeline, they can thwart Alberta’s independence plan. They’ve also amended their ownership rules to allow them to sell the pipeline to local indians in British Columbia. That would definitely create issues for Alberta.

Canada’s Energy Policy: A Weapon Against the West

The Liberals national energy policy was created to:

• limit carbon emissions (capping oil and gas production)
• make Canada energy independent (still importing from the US)
• provide low-cost gasoline and other fuels for Canadians (carbon tax plus restricted production actually raised prices)

So the energy policy was a grand failure, and Justin Trudeau has been kicked out of office.

Canada is left with a system of oil and gas piped through the United States to their US benefit (and at a discount price called the Western Canadian Select price) and their control. Most energy end products are imported through the US, and Alberta hasn’t been able to refine its own energy products which would be very lucrative. The US is getting rich by refining Canadian output.  It is a profitable, reliable system for the Americans, who control and enjoy cheap high-quality oil, but has forced Alberta to give away their product at a discount and has capped their production and economy.

It’s been a national disgrace in how the energy industry has been treated and taxed.

In a statement, Alberta Premier Danielle Smith specified firmly with a long list of demands that Ottawa must meet for Alberta to exist within Canada.

 

A New Leader With a Fighting Spirit

But Alberta has never had a provincial Premier willing to stand up to Ottawa. They do now with Premier Danielle Smith. She’s learning and proving to be a serious opponent to Ottawa and incoming Liberal contender, Carney. The end of the Trudeau era is important because it signifies a whole new group that will try to perpetuate or even increase the pain and loss for Alberta.

How this will play out in Alberta is hard to say. Given the financial mess and resentment, it’s almost certain Smith will call for a referendum on separation. They’ve talked about a sovereign Alberta within Canada, but how would that even be possible? Alberta demanded a significant part of the Canada Pension Plan be repaid and that the province would create their own pension plan.

This issue is the head of a matter of long-term neglect, theft, tyranny, and entitlement of Eastern politicians. Currently, Liberals are trying to paint Danielle Smith as unpatriotic and dancing to Donald Trump’s fiddle — a strategy for getting the Eastern media networks (CTV, CBC, Global) to back the Liberals.

How Much Can Albertans Tolerate?

For Alberta’s taxpaying citizens, it’s a question of whether they’ve suffered enough, and want to end that suffering. But separation is costly, and Trudeau’s purchase of the Transmountain Pipeline might have been to block Alberta’s oil if they chose to leave Canada.

For the Liberals, the message is clear: Ontario and Quebec will continue to siphon their wealth at whatever rate they wish to, and they’ll control Alberta’s resources, businesses and people.

If the Liberals win this election, this humiliation will be too much to bear for Alberta. BC and Saskatchewan too are having their resources confiscated and delivered to Quebec. David Eby the newly elected BC Premier is complaining about that. The word Quebec appears often as the end recipient of value and control.

The temperature in this war will heat up beginning with an initial battle over the contentious carbon tax. And the provinces are not aligned on the recent hype about free trade across provincial boundaries. Quebec is defying requests for a pipeline.

Conservative Leader Pierre Poilievre: No Footing Just Yet

The Conservative Party’s Leader Pierre Poilievre is campaigning on killing the carbon tax entirely and perhaps ending any notion of Europe controlling Canada, its laws, constitution, economic rules, and businesses. Currently, his popularity has dwindled as some Canadians believe Carney can build a connection with Europe as a Canadian export market and trading partner and even capture military protection from Europe. Europe is not known for its military strength and is mortally fearful of Russia’s Putin. They would not want to confront China, USA or Russia. So military protection is pretty much a farce.

Europe is a group mired in socialism, high taxes and unreasonable demands of the Euro government that has lead them into massive debt, excessive immigration, poverty and low GDP. It’s a misery that Canada should never lock itself into.

Currently, Poilievere is struggling as insignificant to the challenges, since Donald Trump says he doesn’t like him and instead favors the Liberals. That is almost certainly not true. Trump would prefer a pro free-trade conservative and the dismissal of the Woke Liberal Party at his northern border.  Poilievere has no export market connection and seemingly has no international business experience, and appears as though he might be friendly with Alberta (which is where he’s from). That might make him irrelevant to eastern voters, something he’s tackling now.

The major news networks CBC, CTV and Global TV networks are on the side of the Liberals, painting their policies and people as world leaders and saviors. Clearly, they are not friends of Poliviere or Alberta.

What’s completely absent from the national conversation is BC and Saskatchewan.  Those three provinces together would be a viable, brand new country. They have all the ingredients for success with agriculture, farming, mining, oil and gas, tourism, and room for growth. BC has good relations with Asia creating export opportunities with many countries there. One of those products which China, India and other countries buy and use is coal. Alberta’s coal mines were shut due to Federal carbon emissions programs. Coal is used to produce steel and aluminum cheaply, to help affordably build Canada’s physical infrastructure such as transit networks, pipelines, factories, and industrial equipment.

It Might be a Western Canadian Separation Solution

It’s a very complex problem which then prevents good solutions.  Where Alberta could win this battle outright is with the Western Canadian Alliance. Such an alliance makes all these provinces stronger than if they were alone.

However, neither BC or Saskatchewan are confident enough to stand on their own, which means Alberta might have to go it alone, unless a sweet deal can be made with the other two.

The Western provinces do have opportunities. Owning their own resources and land and seeing lower taxation, they would enjoy free trade with the world.  It would create a period of economic prosperity the region has never experienced. With Trump’s USA economy heating up, a good connection with the Americans also could make the three provinces wealthy.

Trump is changing the trade landscape, but those provinces who play fair with him, might successfully get access to the US markets. Eastern Canada however, has a weaker value proposition because it competes with the US businesses that Trump wants to see revived.

So while the winning cards appear to be in Carney’s hands if he wins the election, in truth, the West holds all the cards.  In fact, it’s the east who will need to come to the negotiating table to ask for forgiveness and give Alberta control over its province without any interference.  Carney likely won’t regard Alberta at all, calling their bluff on separation and keeping the usual wealth transfer and oppression. Danielle Smith’s government looks like they’re getting ready for this nasty fight.  Losing isn’t an option this time.

It’s only a matter of whether Albertans are willing to assert themselves and demand their rights. After 40 years of being abused by Ottawa, has the anger hit critical mass?  We’ll find out on election day, which hasn’t been decided as yet.

See more on the effect of the Trump tariffs on Canada, and learn more about Canada’s best oil stocks.

Vancouver and Banff will likely enjoy one of their best tourist seasons yet as Americans increasingly travel domestic yet see the affordability of BC and Alberta too much to resist.  See more on this year’s travel industry trends.