Alberta Politics
Kinder Morgan's Houston headquarters, at night.

The Kinder Morgan pipeline brouhaha shows why it’s time for Canada to pull the plug on NAFTA

Posted on April 12, 2018, 1:11 am
8 mins

We’ve got the chance, thanks be unto Donald J. Trump. Obviously, it’s time to get the heck out of NAFTA!

Why would I say such a crazy thing? Well, as has been said here before, most actual evidence suggests that “trade deals” in general, and the North American Free Trade Agreement in particular, have very little to do with actual trade, which would happen anyway under the rules of the World Trade Organization. The NAFTA is a corporate rights agreement engineered to keep a lid on workers’ rights and environmental regulation.

Journalist Andrew Nikiforuk

Case in point: the latest gambit in the continuing brouhaha about Kinder Morgan Inc.’s Trans Mountain Pipeline Expansion Project.

If the pipeline isn’t built on terms Kinder Morgan likes, the CBC informed us on Tuesday, “the Houston-based company could go on the offensive to try to recoup billions of dollars.” How? “It would likely use NAFTA, since Chapter 11 of the agreement allows foreign companies to file compensation claims in countries where they have investments and believe a government action is unfair and discriminatory,” the CBC explained.

Now, whether this suggestion is being floated by Kinder Morgan as part of an effort to shake down the federal and Alberta governments, or by pipeline proponents in Ottawa and Edmonton to stampede British Columbia’s NDP government into an agreement is not yet 100-per-cent clear, and may never be. But it’s important to note that the “unfair and discriminatory” problem Kinder Morgan would be taking action against if such an action proceeded could be summed up in a single word: Democracy.

This pipeline wouldn’t be a problem if large numbers of people in British Columbia, especially on the Coast, were not opposed to it and saying so loudly, as is their right in a democracy. And it still wouldn’t be a problem if they hadn’t, you know, voted based on their views in the last British Columbia election in May 2017. This eventually led to the fall in the Legislature of the thereafter much-diminished B.C. Liberals (who are really modern neoliberal conservatives), and the swearing in of an NDP government led by Premier John Horgan in July 2017.

And it wouldn’t now be a problem for either Alberta Premier Rachel Notley or Prime Minister Justin Trudeau – both of them elected in 2015 in similar outbreaks of democracy – since the deal they thought they had with former B.C. Premier Christy Clark would have allowed the project to move ahead without impediments.

Alberta Premier Rachel Notley

But that’s democracy, isn’t it? If you don’t like a government’s policies, you vote in a government with different policies at the first available opportunity. As Andrew Nikiforuk asked in The Tyee yesterday, “aren’t democracies supposed to challenge projects that impose unprecedented economic and environment risks on their citizens?”

Mr. Nikiforuk was arguing Kinder Morgan is looking for an exit strategy, and NAFTA gives it an opportunity fleece Canadian taxpayers while exiting.

So we now see precisely what we were warned about by opponents of the original Canada-U.S. Free Trade Agreement back before the deal was done in 1987 – to wit, that NAFTA is a mechanism of last resort to overcome the will of democratically elected governments and the people who for vote them when the marketplace of ideas interferes with the almighty market.

Now, I’m not an expert on trade agreements, so I can’t tell you if a compensation claim as described by the CBC and apparently contemplated by Kinder Morgan would work before a NAFTA panel.

What is clear is that a certain amount of “uncertainty” – supposedly anathema to business – is an inevitable outcome in jurisdictions governed by democracy. You can only have certainty of the kind Kinder Morgan seems to want if you can’t really change the government when you vote, the way “democracy” apparently works in the United States.

Prime Minister Justin Trudeau

Since we still don’t know what the B.C. government is contemplating when Mr. Horgan says it will “use every tool in the tool box to defend B.C.’s coast, our economy and our interests,” it simply can’t be said that B.C. is sure to lose in court, as Alberta pundits keep insisting.

It depends, actually, on what the B.C. NDP’s law will say if it ever gets drafted. If the legislation merely requires Kinder Morgan to hand over its emergency plan – which the company has been reluctant to do – the court might well uphold it. And what happens then if the company doesn’t have a meaningful plan?

The CBC’s expert noted that even if Kinder Morgan’s problem is with the government and voters of B.C., under NAFTA the company would have to go after the federal government. Maybe that’s a good thing, since it’s Ottawa that’s trying to renegotiate the NAFTA.

Mr. Trudeau’s intellectual heft seems each day more like that of a helium balloon, so I suppose this message should be directed to Foreign Affairs Minister Chrystia Freeland instead, since she seems to do the prime minister’s thinking for him:

Back away from the deal! Back away from the deal!

Either that, or stop pretending we’re a real democracy.

Of course, it’s also possible Kinder Morgan has overplayed its hand in a game of bluff because the brainiacs at head office in Houston never imagined that Premier Notley would come right out and say she’d buy a stake in the pipeline.

This could well have happened if it didn’t occur to them that Canadian New Democrats weren’t exactly the same as American Democrats, good neoliberals to the man and occasional woman who would never utter such a proposal.

Corporate bosses sure as heck don’t want a government sharing their profit or, even worse, having some clout at the boardroom table!

They just want Canadian governments to do what any reasonable petro-tyranny would do: crush dissent.

PHOTOS: Kinder Morgan Inc. headquarters in Houston Tex. (Photo: H-town-visually.blogspot.ca). Below: Author and journalist Andrew Nikoforuk, Alberta Premier Rachel Notley, and lighter-than-air Prime Minister Justin Trudeau.

10 Comments to: The Kinder Morgan pipeline brouhaha shows why it’s time for Canada to pull the plug on NAFTA

  1. Sam Gunsch

    April 12th, 2018

    re: ‘Either that, or stop pretending we’re a real democracy.;’

    AB presents as a democracy, but it’s a shell/facade: elections, legislature, gov’t departments… But in practice, political power in AB is functioning as a corporatist polity… private interest groups, like the oilsands industry, determine/negotiate government (public) policy, with gov’t as the junior partner in a joint venture. The AB NDP have taken to heart the lesson of the oil industry political hit on Stelmach for daring to suggest royalties should be raised to get an owner’s share for the citizenry.

    Kevin Tafts explains: ‘Taft is not the first author to criticize Alberta for being a willing hostage to the oil industry, but he doesn’t call the province a petrostate. He calls it an “oil deep state”: “Petrostates are conceived in petroleum, while oil deep states are captured by petroleum.”

    In other words, we had democracy in Alberta until we discovered oil.

    Taft’s argument is exhaustively researched and presented with a confidence that will irritate his critics. And there will be plenty of those.’

    http://edmontonjournal.com/news/insight/graham-thomson-oil-deep-state-controls-alberta-former-liberal-leader-kevin-tafts-new-book-says

    Reply
  2. Sam Gunsch

    April 12th, 2018

    Below find an explainer on how corporations are empowered by “free trade” agreements to make gov’ts(citizens) pay for any infringements, real or projected, on their corporate “right” to profits. If you’re not convinced of the merits, further faith-based indoctrination of the righteousness of these corporate rights is available from UCP/Kenney, Fraser Institute, Calgary Herald/Sun columnists, et al.

    https://www.desmog.ca/2018/04/11/how-kinder-morgan-could-sue-canada-secretive-nafta-tribunal

    EXCERPT: ‘Basically, if an investor — aka a large corporation — thinks that a government has acted in a way that’s unfair and disadvantaged their ability to make profits by introducing a new policy, it can sue the government for alleged losses.’

    EXCERPT: ‘But it can also be used as a tool to pressure governments to back down on policies.

    “In the present case, a NAFTA claim would allow Kinder Morgan to team up with Alberta and perhaps the federal government too to pressure British Columbia politically,” Van Harten said.’

    EXCERPT; ‘It sounds a bit bonkers, hey? The federal government effectively using a lawsuit against itself to pressure a province to reduce its opposition to a project that it legitimately believes may have calamitous impacts on Indigenous rights and the environment?! Well, it’s worked before.’

    EXCERPT: ‘For 20 years, Canada has been and still remains the only Western country that allows these aggressive international claims by U.S. multinationals against the country’s sovereign and democratic choices. ‘

    https://www.desmog.ca/2018/04/11/how-kinder-morgan-could-sue-canada-secretive-nafta-tribunal

    Reply
    • tom in ontario

      April 12th, 2018

      “For twenty years, Canada has been and still remains the only Western country that allows these aggressive international claims by U.S. multinationals against the country’s sovereign and democratic choices.”

      The corporate oligarchs who run the affairs of both countries will make certain NAFTA is re-negotiated with this provision intact.

      Reply
  3. Albertan

    April 12th, 2018

    This NAFTA Chapter 11 investor-state dispute mechanism has made Canada the most sued country in a trade deal. So far, it has cost Canadian taxpayers $315 million in settlements and legal fees. Chapter 11 has also come under scrutiny, and concern to many, to do with the Canadian water export controls and obligations. Imagine, Canada being sued by the USA for an American company not being able to import bulk Canadian waters.
    But, re: Trans Mountain, possibly in the end, there is this:
    ” ‘A tough lesson’: Do First Nations hold trump card on Trans Mountain debate? Despite sparring between provinces and Alberta, pipeline’s future likely depends on court challenges.”
    http://www.cbc.ca/news/canada/british-columbia/first-nations-kinder-morgan-transmountain-1.4615263

    Reply
  4. Ryan H

    April 12th, 2018

    It’s rare that I find myself on a corporations side in any discussion, but I can’t help but feel that if a government approves a massive development project and then years and billions of dollars later goes “Just Kidding!”, there should be some meaningful repercussions.

    At what point is any approval final?

    Reply
  5. Albertan

    April 12th, 2018

    Here is an interesting article by Andrew Nikiforuk, who like it or not by some, is no slouch when it comes to the foibles of the oil and gas industry:
    “Kinder Morgan’s Blackmail. Notley and Trudeau hint at propping up uneconomic pipeline with taxpayers’ money.”
    http://www.thetyee.ca/Opinion/2018/04/11/Kinder-Morgan-Blackmail/
    Nikiforuk also addresses the issues which could arise from the catastrophe of a spill, thought by some which would be when, not if. I think we might be kidding ourselves if we think Canada is ready to deal with a spill of this nature on Canada’s west coast. I don’t think we would even be ready if $millions would be thrown at it.
    Perhaps Trudeau and Notley would care to say what they would say if there was a bitumen spill in west coast waters. If this pipeline goes through, they might want to have their words ready.

    Reply
  6. Lars

    April 12th, 2018

    I believe that it’s “Andrew Nikiforuk” (check your figure caption).

    Reply
    • David Climenhaga

      April 14th, 2018

      Thanks, Lars. Twice, I think. The original error was mine, of course. (I DO know how to spell Andrew’s name … I used to put his byline on his stories at the Calgary Herald.) I corrected it, and the correction was lost in the change to the new WordPress theme, which is now operational. It is to be hoped that, this time, it will stick. many thanks as always to my reader-editors. DJC

      Reply
  7. Pogo

    April 12th, 2018

    I am very sad to report, our leader does not have the intellect to govern. How we came to this is much the same as the Trump travesty. We chose a polite and benign, if not vacuous, simulacrum of a leader. Our neighbours to the south chose a simulacrum of bowel disorder! Are we enjoying our total f*cking over? I’d say no. Do we have an alternative? We’re screwed, and bound for learning!

    Reply
  8. David

    April 12th, 2018

    Now as I recall when Brian Mulroney was our Prime Minister he wanted the free trade deal with the US signed. And if I recall he was a member of the Progressive Conservative Party. So since corporations can sue governments under the said free trade agreement it was the Conservatives who had a majority who signed the deal which effectively gives away Canada’s democracy thereby nullifying Canadians’ right to make changes from time to time as we see fit in our own country. Not too bright if you ask me.

    With Jason Kenney an influential member of the Conservative government of Stephen Harper being fully in favour of the free trade deal, one has to wonder how he proposes to square that with Canada’s right to govern and his right to govern if he becomes Premier of Alberta or does he just proposed to ask the oil industry what it wants and do their bidding for them at the Alberta legislature.

    Hardly seems like the kind of guy we want running the province.

    Reply

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