It’s been 30 years since Mancur Olson, wrote The Rise and Decline of Nations. The premise is the longer a society enjoys political stability, the more likely it is to develop powerful special interest groups that erode economic prosperity. His words have proven prescient as we witness Europe’s debt-burdened stagnation and degeneration of the U.S. Congress into fractious ideological gridlock
Canada weathered the 2008 economic crisis better than other countries. The cornerstone that distinguishes Canada’s prosperity is our rich resource endowment, which generates some two million jobs, more than half of all merchandise exports and one-third of all capital investment.
Resource companies are planning capital investment of more than $600-billion over the next decade, creating hundreds of thousands more new jobs each year. But a new dynamic has emerged that threatens to stymie these investments. Each project must pass examination by regulatory agencies applying stringent environmental standards. Now almost every project meets strident opposition from what Mr. Olson terms “powerful special interest groups.”
As a result, the length and cost of regulatory hearings has grown exponentially as regulatory authorities strive to ensure all voices are heard. But being heard is never enough for zealots ideologically opposed to almost every pipeline, mine or hydroelectric project.
As the New Year dawns, multiple such court cases have been filed across the country.
A second and potentially even more serious barrier to our country’s resource dependent economy came last June, when the Supreme Court, awarded Aboriginal Title to a huge tract of B.C.’s interior to the Tsilhqot’in First Nation.
Paradoxically, the impact on resource development isn’t the transfer of title to the lands in question, but rather the investment-chilling uncertainty the decision creates around access to other lands claimed by First Nations.
Most First Nations leaders understand Aboriginal Title will not improve the lives of their people without job and revenue creating development on these lands. Resource industry leaders understand the level of consultation and accommodation required is basically the same whether traditional lands are under claim or Aboriginal Title. This provides a bridge for visionary leaders from both sides to accomplish resource developments that not only benefit each another, but also the entire country.
Canadians need to know without a thriving resource sector, the living standards of virtually every one of us will decline.
One of the key messages in Mr. Olson’s Rise and Decline of Nations is societies who don’t understand how their wealth is generated are destined to lose it.
(Full comment by Gwyn Morgan at Globe & Mail)