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Alberta Faces Skepticism for War Room Announcement, Trashes Its Own Claim that Carbon Tax Hurts GDP

Alberta Premier Jason Kenney is having a rough week, with two veteran journalists questioning the potential impact of his much-anticipated fossil war room and his own government’s court documents undercutting his claim that the previous NDP government’s carbon levy harmed the province’s economy.

Kenney formally announced the “hopeful, uplifting” war room last week, after months of railing against Alberta’s perceived mistreatment by opponents of unbridled fossil fuel development. But at this point, the Canadian Energy Centre “is a bit of a flop,” writes Toronto Star columnist Gillian Steward.

In its initial release, “there was no mention of harassing specific environmental groups, even though Kenney had slammed several when he announced a year ago his intention to go to war with environmentalists who were spreading lies (according to him) about Alberta’s oil and gas industry,” she states. “Instead, according to CEC Director Tom Olsen, a former United Conservative Party operative and defeated candidate, it’s all about telling everyone that ‘Canada’s oil and gas makes the world a better place.’ Yawn.”

Steward notes that Albertans and Canadians have been seeing that kind of messaging from years, delivered by everyone from Stephen Harper to Rachel Notley, from the Canadian Association of Petroleum Producers to the Canadian Energy Pipeline Association. She recalls a 2013 federal ad campaign, launched by a call for proposals that “spelled out the mission: to defend Canadian energy’s reputation against hostile groups and lawmakers threatening anti-oil sands measures in the U.S. and Europe.”

The advertising and social media blitz “lasted two years and ate up C$24 million of taxpayer’s money,” Steward recalls. “Add to that the millions of dollars spent by oil and pipeline companies promoting themselves and their projects. But despite all the money sunk into promoting Alberta’s oil and gas to the rest of the country and the world, the future of oil has not improved and seems to get worse by the day.”

In this round, cash-strapped Albertans will spend $30 million per year to keep Kenney’s war room in operation, “another public relations effort even as they are cutting into post-secondary education budgets, laying off nurses, de-indexing support payments for people with disabilities, and cutting corporate taxes,” Steward writes.

On CBC, Senior Producer Tony Seskus says it won’t be easy for the Energy Centre to “flip the script” in the oilpatch’s favour. “Creating a new, ‘positive’ narrative seems like a difficult and even amorphous goal in a charged, global debate about fossil fuels, carbon emissions, and climate change,” he writes, noting that on the day the CEC launched, Olsen “found himself answering questions about climate activist Greta Thunberg, who was named Time Person of the Year.”

Mount Royal University political analyst David Taras came up with an almost climate-related metaphor when asked about the centre’s odds of shifting North American public opinion on the climate crisis and Alberta’s tar sands/oil sands. “I would say the chances are the same as putting your finger in the dike,” he told Seskus.

“During his march to the premier’s office Kenney certainly succeeded in exploiting people’s anger over the downturn in Alberta’s economy by talk of going to war with environmentalists,” Steward writes. “But the money spent on touting the oil industry, which can well afford to toot its own horn, would have been better spent on assuring Albertans that the government will stand behind them as the cornerstone of the province’s economy shifts away from oil and gas and toward more promising endeavours.”

And for all the time, attention, and money he’s investing in the war room, Kenney has only a vague idea of what success will look like, telling media it might be hard to gauge success through public opinion research. “We are facing a significant challenge by these same organizations trying to misinform prospective investors about our environmental performance,” said Kenney. “It’s kind of hard to measure exactly what impact we can have there.”

Both journalists pointed to last week’s decision by Moody’s Investors Services to downgrade Alberta’s credit rating to illustrate the rough road the Energy Centre now faces, with Seskus noting that Moody’s did not withdraw its credit report after Kenney attacked it.

Meanwhile, in economic modelling it submitted to the Alberta Court of Appeals to back its constitutional challenge to the federal floor price on carbon, Kenney’s government laid waste to his long-standing claim that the Notley-era carbon levy harmed the province. “The court documents show the economic effect of the Notley government’s Climate Leadership Plan, which included a C$30 per tonne carbon tax, was an average reduction in annual growth of Alberta’s gross domestic product (GDP) of only 0.05%,” CBC reports.

“I think not surprisingly to those of us who have studied carbon taxes, [Kenney’s claims] seem quite exaggerated,” said University of British Columbia political scientist and climate specialist Kathryn Harrison. Across five different carbon pricing scenarios, originally generated by the Alberta-based Pembina Institute, the modelling found “that there is healthy economic growth and healthy job creation under all of the scenarios from 2020 to 2030,” with even a $50 per tonne carbon tax having only a minimal impact on GDP.

“The difference in the average growth of GDP at the maximum is a difference between 2.57% per year and 2.5% per year,” Harrison told CBC, though the report did claim reduced job creation at a rate of 10,000 to 16,000 per year.

CBC goes into detail on how the province selected the model and Pembina’s explanation of the findings.

In court this week, a lawyer for Alberta said the federal carbon price destabilizes Canada’s constitutional balance, the Globe and Mail reports. “It would greatly distort and alter our constitutional system, our balance of power between the federal government and the provinces,” Peter Gall told a panel of five judges, allowing Ottawa to regulate a large chunk of Canadians’ lives.

“If you uphold this legislation, you’re opening the door to exactly that type of thing,” he said. “Not just the piecemeal regulation of those matters, but wholesale regulation.”

He added that provincial governments “are capable of facing climate change alone and should be free to adopt weaker rules than Ottawa’s standard if economic conditions require it,” the Globe writes. “It’s invasive in terms of taking away policy options that would otherwise be open to the provinces,” Gall said.

“The context of this case is the greatest existential threat of our time,” countered federal lawyer Sharlene Telles-Langdon. “There has been a constitutionally important transformation,” she added, and “we’re now in a situation where the dimensions of the problem are international and global.”

“Climate change is a national emergency that affects our heath, our way of life, and actually, our lives. We’ve seen the wildfires here in Alberta, we’ve seen floods,” agreed Ecojustice lawyer Josh Ginsberg, representing the David Suzuki Foundation as one of 13 intervenors for or against the federal tax. “This is an emergency and we need national action to tackle it,” he told media Monday.

Alberta Justice Minister Doug Schweitzer said the province would “use every legal tool at our disposal to fight the federal carbon tax and stand up for the rights of Albertans,” adding that “our Constitution is not based on the idea that ‘Ottawa knows best.’ Each province is unique, with different economies, different demographics, and different geographies. That is why our federation is structured to give provinces the right to make our own laws and regulations over businesses when it comes to issues like reducing greenhouse gas emissions,”

[Developments in this case may continue while The Mix is on holiday break. We’ll aim to recap after we resume regular publishing January 6.—Ed.]