“I am disappointed with U.S. President Donald Trump’s decision to place tariffs on all Canadian goods. This decision will harm Canadians and Americans alike and strain the important relationship and alliance between our two nations.

“Alberta will do everything in its power to convince the U.S. President and Congress, as well as the American people, to reverse this mutually destructive policy.

“We note the reduced 10 per cent tariff for Canadian energy. That is partially a recognition of the advocacy undertaken by our government and industry to the U.S. Administration. We’ve pointed outthe substantial wealth created in the U.S. by American companies and tens of thousands of American workers who upgrade and refine approximately $100 billion of Canadian crude into $300 billion of product sold all over the world by those same U.S. companies.

“It is also worth noting that if oil and gas exports are excluded, the United States actually sells more to Canada than Canada sells to the U.S. As I’ve stated to every American policymaker I’ve met with in these past months, Canada buys more from the U.S. than does any country on earth – more than the U.K., France, Germany, Italy and Vietnam combined. There is, therefore, no economic justification for tariffs imposed on any Canadian goods.

“Alberta will continue diplomatic efforts in the United States to persuade the U.S. President, lawmakers, administration officials and the American people to lift all tariffs on Canadian goods as soon as possible and to repair our relationship with the United States. I encourage all premiers and federal officials to do the same, especially as the effects of these tariffs begin to take their toll south of the border. Americans need to understand the detrimental consequences of this policy decision.

“Alberta will also work collaboratively with the federal government and other provinces on a proportionate response to the imposed U.S. tariffs through the strategic use of Canadian import tariffs on U.S. goods that are more easily purchased from Canada and non-U.S. suppliers. This will minimize costs to Canadian consumers while creating maximum impact south of the border. All funds raised from such import tariffs should go directly to benefit the Canadians most harmed by the imposed U.S. tariffs.

“Alberta will, however, continue to strenuously oppose any effort to ban exports to the U.S. or to tax our own people and businesses on goods leaving Canada for the United States. Such tactics would hurt Canadians far more than Americans.

“We also continue Alberta’s call for the appointment of a border czar to coordinate the securing of our border against illegal migrants and drugs moving in both directions, and to achieve our nation’s two per cent of GDP NATO commitment by 2027. These things should be done for the safety of all Canadians regardless of our trade dispute with the United States

“Despite the disappointment of today’s decision there is also an incredible opportunity before us as a nation. Canada can and must come together in an unprecedented effort to preserve the livelihoods and futures of our people and expand our political and trade relationships across the globe. We can no longer afford to be so heavily reliant on one primary customer. We must stop limiting our prosperity and inflicting economic wounds on ourselves.

“Rather, we must unleash the true economic potential of our country, which possesses more wealth and natural resources than any other nation on earth.

“To this end, Alberta calls on the federal government and our fellow provinces to immediately commence a national effort to fast track and build oil and gas pipelines to the east and west coasts of Canada, construct multiple LNG terminals on each coast, increase internal refining capacity, unleash the development of critical minerals, lower taxes, reduce red tape, tear down interprovincial trade barriers and re-empower provinces to develop our unique economies without constant federal interference and imposition of anti-resource development laws.

“Our province and our nation can overcome the formidable economic challenges ahead. But we can only do so if we start acting like a healthy and functional country that supports every province to export their best resources and products to world markets, thereby achieving their unique potential. By so doing, Canada can become one of the most prosperous and powerful nations on earth. Alberta stands ready to do our part if this true Team Canada approach is taken.”

From the Fraser Institute

By Tegan Hill

The Smith government on Wednesday released its plan to grow Alberta’s Heritage Fund to at least $250 billion over the next 25 years, mainly by reinvesting all investment returns back into the fund. But even Smith recognizes her plan will “take political will over a long period of time.” Of course, political will is subjective and can change from government to government. If Smith wants to establish a sustainable plan to grow the Heritage Fund, it should pay dividends to Albertans.

First, some quick history. When the Alberta government created the Heritage Fund in 1976, it established a rule that the government must deposit 30 per cent of resource revenue (including oil and gas royalties) into the fund annually. That quickly fell to 15 per cent by 1982/83, and after an oil price collapse the government eliminated the requirement in 1986/87. Since then, governments have routinely failed to make deposits into the fund, the fund’s value (after accounting for inflation) has eroded over time, and governments have spent nearly all of the fund’s earnings. Consequently, this fiscal year the fund will be worth less than $26 billion.

In other words, political will hasn’t been a successful strategy in growing the Heritage Fund.

Which brings us back to dividends. Here’s where Alberta can learn from Alaska. Alaska’s resource revenue savings fund (the Permanent Fund) was also created in 1976, but is now worth about US$80 billion (roughly CA$115 billion). What does the Alaska government do differently?

While various rules contribute to the fund’s success, the dividend rule is arguably the most critical. The Alaskan government pays a share of the fund’s earnings to Alaskan citizens via a dividend each year. Crucially, this gives citizens an ownership share in the fund. And therein lies the political will for governments to responsibly grow and maintain the fund. Any government that tried to use the fund for irresponsible purposes (e.g. raid the fund to spend money elsewhere) would likely face the wrath of Alaskan voters, given their understandable attachment to the dividend cheques.

Indeed, while the Alaskan government can reduce or eliminate the annual dividend, it has consistently allocated funds to the dividend for more than 40 years, even though this reduces the amount of money available for government spending. Overall, the fund has paid out more than US$30 billion to Alaskan citizens via dividends. Last year, each Alaskan received US$1,702.

According to its plan released on Wednesday, the Smith government will rely on “political will” to grow the Heritage Fund. But that’s not a recipe for success. Instead, the Smith government should learn from Alaska’s success and start paying dividends to Albertans who will provide the political pressure necessary to grow the fund over the long term.

Tegan Hill

Director, Alberta Policy, Fraser Institute