Skip to main content
The Globe and Mail
Support Quality Journalism.
The Globe and Mail
First Access to Latest
Investment News
Collection of curated
e-books and guides
Inform your decisions via
Globe Investor Tools
Just$1.99
per week
for first 24 weeks

Enjoy unlimited digital access
Enjoy Unlimited Digital Access
Get full access to globeandmail.com
Just $1.99 per week for the first 24 weeks
Just $1.99 per week for the first 24 weeks
var select={root:".js-sub-pencil",control:".js-sub-pencil-control",open:"o-sub-pencil--open",closed:"o-sub-pencil--closed"},dom={},allowExpand=!0;function pencilInit(o){var e=arguments.length>1&&void 0!==arguments[1]&&arguments[1];select.root=o,dom.root=document.querySelector(select.root),dom.root&&(dom.control=document.querySelector(select.control),dom.control.addEventListener("click",onToggleClicked),setPanelState(e),window.addEventListener("scroll",onWindowScroll),dom.root.removeAttribute("hidden"))}function isPanelOpen(){return dom.root.classList.contains(select.open)}function setPanelState(o){dom.root.classList[o?"add":"remove"](select.open),dom.root.classList[o?"remove":"add"](select.closed),dom.control.setAttribute("aria-expanded",o)}function onToggleClicked(){var l=!isPanelOpen();setPanelState(l)}function onWindowScroll(){window.requestAnimationFrame(function() {var l=isPanelOpen(),n=0===(document.body.scrollTop||document.documentElement.scrollTop);n||l||!allowExpand?n&&l&&(allowExpand=!0,setPanelState(!1)):(allowExpand=!1,setPanelState(!0))});}pencilInit(".js-sub-pencil",!1); // via darwin-bg var slideIndex = 0; carousel(); function carousel() { var i; var x = document.getElementsByClassName("subs_valueprop"); for (i = 0; i < x.length; i++) { x[i].style.display = "none"; } slideIndex++; if (slideIndex> x.length) { slideIndex = 1; } x[slideIndex - 1].style.display = "block"; setTimeout(carousel, 2500); } //

The 190-word statement put out by premiers on the new agreement on interprovincial trade barriers calls the deal "groundbreaking." But it's nothing of the sort.

This isn't even the much-promised and long-delayed agreement itself, but only an agreement in principle to have officials draft something for premiers to consider. It's a patent attempt by the premiers to whistle past the graveyard by calling this infinitesimal movement progress, in the deplorable tradition of past such agreements. Until we see chapter and verse on which barriers will actually be removed and how the new agreement will be enforced, serious doubts must remain about what real progress has been achieved.

These outstanding questions reflect an inherent flaw in relying on the provinces to negotiate away interprovincial trade barriers. Only Ottawa can bring real economic freedom to Canada.

Story continues below advertisement

Proponents of the new agreement highlight that it will cover a broader range of interprovincial barriers, that government procurement is being opened up and a new working group on alcohol sales may eventually lead to liberalizing the market.

But we predict that this will prove to be pretty small beer – especially since the premiers' own statement concedes that specific exclusions will remain after the new agreement is in place and major new provincially invented barriers, such as obstacles to interprovincial pipeline construction, are outside its scope.

Add the silence on a binding enforcement mechanism, such as serious monetary penalties, and real questions about the agreement emerge.

The risk is that this new agreement experiences the same fate as the one that came before it. The Agreement on Internal Trade, which came into force in 1995, failed because of what one former senior official has called "local interests and personal ambitions."

Herein lies the inherent flaw of subjecting interprovincial trade barriers to negotiation among the provinces. The provinces created these barriers – in beer, wine, transport, electricity, labour policies and so on – in response to local interests or concerns, and thus there's little upside for these governments to eliminate them in the name of the national economy. Put differently: What political reason does a premier in one province have to eliminate protectionism to the benefit of a business or worker in another province?

This must be the responsibility of the national government. The Fathers of Confederation understood this basic imperative and thus gave Ottawa extensive powers to regulate interprovincial trade and commerce and enable a national economy free of barriers.

As Alexander Galt, Canada's first finance minister, put it: "No one can doubt that the great interests of trade and commerce will be best promoted and developed by being entrusted to one central power, which will wield them in the common interest."

Story continues below advertisement

Yet successive federal governments have been reluctant to exercise this responsibility and instead left it to the provinces to negotiate the removal of trade barriers.

It's worth noting, for instance, that the new agreement in principle was reached in Whitehorse without Ottawa at the table.

But negotiations that treat trade barriers as bargaining chips rather than an affront to the vision of Confederation are bound to disappoint. As leading constitutional lawyer Ian Blue has written: "The main objection to interprovincial trade barriers should be that they violate the Constitution of Canada."

And the cost is not just to the economic union. It's also borne by Canadians. Real people, real businesses, real workers who are trying to earn their otherwise legal and legitimate livelihoods are prevented from doing so, and their rights are ignored or denied.

One of the central goals of Confederation was that these rights wouldn't be subjected to provincial whims or political negotiation. The genius of federalism is to allow the creation of a unified economic space while preserving local social and cultural communities. Local decisions are decentralized to the extent possible.

But matters of national interest – such as the functioning of the national economy – are entrusted to the national government.

Story continues below advertisement

The upshot is that the provinces don't ask Ottawa for input on K-12 education and the federal government doesn't run military decisions past the premiers. Why, then, is Ottawa relinquishing its responsibility for the national economy and the economic freedom of Canadians?

Early signs strongly suggest that the new agreement on interprovincial trade is unlikely to live up to Galt's vision of the "common interest."

It's time for Ottawa to stand up for the Constitution and the rights of Canadians and against provincial protectionism.

That would be truly groundbreaking.

Brian Lee Crowley is the managing director and Sean Speer is a senior fellow at the Macdonald-Laurier Institute

Your Globe

Build your personal news feed

  1. Follow topics and authors relevant to your reading interests.
  2. Check your Following feed daily, and never miss an article. Access your Following feed from your account menu at the top right corner of every page.

Follow the authors of this article:

View more suggestions in Following Read more about following topics and authors
Report an error Editorial code of conduct
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

Comments that violate our community guidelines will be removed.

Read our community guidelines here

Discussion loading ...

To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies