What barriers to provincial trade?

If you believe the federal government, barriers to interprovincial trade are a big problem. James Moore, former federal Industry Minister, told CBC Radio last year:

“We shouldn’t have barriers that discriminate and deny us economic growth and prevent us from growing, and prevent us from having labour mobility and investment mobility and goods movement within the country.”

full-of-baloney

The business lobby agrees. According to the Canadian Federation for Independent Business and the Canadian Council of Chief Executives, interprovincial trade raises countless barriers and costs our economy unknown billions of dollars a year.

If true, barriers to trade and labour mobility would be a serious problem. Not so says the Canadian Centre for Policy Alternatives (CCPA).

“There are no customs inspection stations along provincial borders, nor any kind of tariffs on interprovincial trade. Canadians use the same currency and share common legal, financial and economic institutions. Canadians are free to live and work anywhere in the country. The federal government has constitutional power over interprovincial trade and the courts have consistently struck down attempts by provincial governments to obstruct it.”

What about Quebec’s ban (since removed) on yellow colouring in margarine which the business lobby says cost up to $50 billion annually?

That’s a lot of money. However, the Canadian Press ran the figure through their Boloney Meter and found the $50 billion figure to be “full of baloney.”

The guesstimate of $50 billion is arrived at by multiplying cost of barriers between B.C. and Alberta by ten ($5 billion for each province). And where did the $5 billion come from? Why, from promoters of the B.C.-Alberta trade agreement (TILMA) of course. It turns out that the estimate used to promote Trade, Investment and Labour Mobility Agreement in 2007 was based an arithmetic error by the Conference Board of Canada. When that error is corrected, the barriers cost only one-hundredth of those claimed.

They made a mountain out of molehill. True, there are some barriers to trade such as movement of wine but that’s being worked on. For more realistic estimates, the Macdonald Commission said the economic impact was no more than 0.05 per cent of Gross Domestic Product, or about $0.9 billion in current dollars a year for all of Canada.

What’s the fuss wonders the CCPA? “So if the economic impacts aren’t as large as claimed, what is this interprovincial trade sideshow really about? In a word: deregulation.”

But regulations are not the dreadful thing that the business lobby would have us believe. They can serve an important role in protecting our health and wellbeing.

What if I am making neonics in B.C., for example, and want to sell them in Ontario? They are looking to regulate the widespread use of neonicotinoid-based pesticides because they kill bees that pollinate our food and insects that birds feed on. Ontario’s regulations would affect my sales.

What if I make oil well equipment that implements fracking? Quebec’s moratorium on fracking would reduce the sale of my drilling equipment.

There are antiquated obstacles that should be removed but not all regulations are “barriers to trade” as the business lobby and their easily-duped politicians would have us believe.

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