Category Archives: BC Politics

Cannabis Crunch

Cannabis, pot, marijuana, Canadian legalization of marijuanaI have been joking for a year that when Legalization Day arrives in BC we won’t notice any difference. I suspect that will be true tomorrow simply because very little of the infrastructure of legalized pot will be ready to go on Day 1.

The biggest difference will be that the people who will assemble to enjoy being able to smoke pot without the slightest chance of arrest (not that there is much chance of arrest now) will all be smoking illegal pot because there is, according to the Globe and Mail, exactly one fully licenced pot shop ready to go for Day 1. Plus there is and will remain a significant supply shortage as the various licenced growers ramp up the production of their “biological assets”.

The great error of the Canadian marijuana advocates was to accept “legalization” rather than demanding “decriminalization”. This has doomed Canada to repeat the American experience of creating a heavily regulated cannabis industry with so called “seed to sale” product tracking, licenced pot shops, provincial wholesale monopolies and all manner of other state intrusions. The layers of regulation might even suggest that the idea that pot is harmless does not reflect the Liberals’ actual thinking.

At the same time, the personal grow show exemption allowing the cultivation of up to four plants for personal use is going to hole the great barge of regulation under the waterline. It will not take all that many people growing to provide an abundant, unregulated, supply of potlatch pot. The potlatch element comes from the fact you cannot sell your crop, but you can give it away. A mildly competent grower – and there are plenty out there – should be able to grow a pound of pot per plant. An ambitious grower should be able to harvest 3 or 4 times per year. A pound is roughly 450 grams and if you think about that at the notional rate of $10 a gram, that is $18,000 worth of untaxed pot every quarter.

There is no question that home grows in closets will be a thing, the only question is how big a thing.

At the moment there are some very big companies involved in the cannabis business in Canada. Companies whose market caps are several times the estimated size of the Canadian retail recreational marijuana market. There are also plenty of large scale growers who have not jumped through the Health Canada regulatory hoops. There will be pressure on the federal and provincial governments to enforce the seed to sale regulation of legal pot. But there will be market pressure to ignore the regulatory scheme from pot activists, “independent growers” and, I suspect, urban and rural First Nations who have no particular stake in the regulatory scheme. Just as I can drive three miles from my home and buy fireworks on a nearby reserve in defiance of municipal and provincial law, it would hardly be surprising to see excise stamp free marijuana for sale in those same locations.

Astoundingly, the legalization of marijuana is likely to be the only basic accomplishment of the first Trudeau government. The early indications are October 17 will be celebrated with clouds of illegal pot, regulatory chaos and a boost to the grey and black markets as police and Crown will no longer have even the threat of possession charges. A few months from now there will be the inevitable “oversupply” of recreational marijuana with the corresponding drop in wholesale and then retail prices. Which, in its turn, will collapse such tax windfalls which legal pot were promised to bring.

The chaos of the Canadian “legalization” of marijuana will take a year or so to really hit home. Just in time for the October 2019 federal election.

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It’s Complicated, Intentionally Complicated

Transmountain pipeline, First NationsCanada’s Federal Court of Appeal ruled against the Trans-Mountain pipeline’s going ahead. It is a long decision but it came down to two things: first that the Federal Government did not sufficiently consult with First Nations, second, that the National Energy Board’s report upon which the Federal Government relied in finally approving the pipeline did not consider the impact of the shipping required to carry the oil.

There are lots of political angles on this most of them entirely predictable. But what interested me was that the consultation requirements and the consideration of shipping seem so self evidently a necessary part of the process.

The NEB seemed to have taken the position that its expertise did not extend to oil tankers, potential spills and attempts to mitigate marine risks. Which, realistically, is almost certainly true. However, it would not have been beyond the Federal Government to order up a seperate risk assessment from people with the necessary expertise.

The issue of the adequacy of the Federal Government’s First Nation consultation is much more difficult. The decision outlines what the government did in terms of consultation, but it also describes what the government did not do which includes taking account of traditional First Nations knowledge and several other fairly vague deficencies.

What the Court essentially asked was, “Did the Federal Government consult  enough?” and then concluded, “No, not enough.”

How much is “enough”? That is a question which this decision really does not answer. And I suspect it does not answer it because there is actually no answer which is even close to true.

In a normal process a reasonable level of public consultation would be reached when the public has been given an opportunity to comment on the matter at hand. Which is a bit vague but there is case law which fleshes out what such an opportunity might look like.

However, once environmentalists and First Nations are engaged it is not at all obvious that merely having the opportunity to comment is sufficient. Unlike a rezoning application, an application to build a pipeline (or, realistically, virtually any other large undertaking) creates the opportunity for First Nations to talk about everything from ancient hunting rights, to sacred grounds, to former village sites, to disruptions to present First Nation culture and so on. Having the enviornmentalists involved ensures that the relatively easy solution of simply paying the First Nations’ people for their consent, is off the table. That solution will be denounced by the enviros as cultural genocide and worse.

All of which creates, and might arguably have been intended to create, a Gordian knot when it comes to considering major projects. Consultation becomes an endless task and one which has no defined parameters. The decision today indicates that an extensive consultation process is not enough but it does not indicate what might be enough.

Delightfully, the shareholders of Kinder Morgan – which owns TransMountain – voted today to sell the project to Canada’s feckless Federal Government for several billion dollars.

I suspect the CEO danced a little jig relieved that he no longer had to guess at how far consultations have to go. But Canada is stuck with a completely disfunctional system which is being exploited by enviornmentalists and First Nations to prevent infrastructure from being built. That will have to be fixed.

[A fix in this sort of case might well be to sit with the FN people at the outset and ask what they would like to be consulted about. Make a list, discuss the list and then take the list to a supervising court for certification. Once that list is certified it would then be incumbent upon the proposing party to consult on those topics and only those topics. If a new concern arose it could be taken back to the supervising court which might add the topic to the list if there was a good reason or if the parties had no objection. But, if people are thinking about spending several billion dollars on a project, they have to have a process they can be certain of rather than being blindsided well down the road.)

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Oh Joy…The NDP

John Horgan, BC-NDPI always like it when things work as planned. The BC Liberals lost a non-confidence vote. The Liberal Premier went to the L-G and apparently asked for a dissolution of the Legislature and a new election. The L-G said she’d think about it, did, and called the leader of the NDP to form a government.

Now it would have been much more fun if Christy Clarke had refused to resign and had to be dragged from the Premier’s office by…well who actually? It was a fun dinner table conversation last night. But the fact is that John Horgan, with Green support, can command a majority in the Legislature and is going to be Premier.

We will now go through the ritual period in which the NDP will discover that the cupboard is bare and there are no dollars to fund whatever grand promises the NDP has made. And then we discover whether the NDP, in its current incarnation, is rational or driven by ideals. If the former the promises will be put off for another and better day, if the later the debt will balloon and in a matter of a couple of years BC will be broke.

It was long past time for a break in the Liberal hegemony in BC. Not because the Liberals were especially awful; rather because they had long since lost the thread. Where they should have been going gangbusters for growth they imposed dumb carbon taxes and fretted about social licence for LNG and pipelines. Time to get real and recognize that the Greens hold the cards.

To win the Liberals need to lose Clarke. They need to lose the silly, unscientific, Green agenda. They need to come up with an actual, conservative, pro-business, leader and they need to erode the NDP/Green lock on the urban vote.Winning will be about defining and selling a clear pro-growth agenda. But it will also be about actually noticing that the insanity of the BC real estate market, the huge barriers to family formation, the anti-resources bias baked into the bureaucracy, all needs to change.

The good news for the Liberals, or the party which succeeds them on the right, is that the housing market (and the rental market) is about to collapse in a spectacular style. Which will make the urban vote both actually poorer and, eventually, feeling poorer. And that collapse will happen on the NDP’s watch. (It will not be their fault but they will carry the can.) People who were once “rich” and are now underwater on million dollar mortgages will want a way out. Serious economic growth is that way out.

Righty policy wonks in BC need to be gearing up for what happens when the bubble bursts. How should the right position itself to take maximum advantage of a near certain crash?

There is no point in trying to defeat Horgan and the Greens at the moment. Wait for the collapse and then push hard.

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Is it Something I Said?

Pooktre-man-tree-shapeSince moving to Vancouver Island twelve years ago we’ve lived in Oak Bay, the Cowichan Valley and North Saanich. All three ridings seem to have gone Green tonight.

My own sense is that Green voting is a class and virtue signifier. Oak Bay and North Saanich are very, very well off communities. Cowichan is less affluent but it is very much a retirement world where people live on not terribly generous pensions. But they are fairly secure knowing that their cheques will come.

These three ridings are also, compared to Vancouver and its suburbs, remarkably white.

The NDP and the Liberals have a see-saw battle in the Chinese and Sikh communities. In First Nations communities both parties are competitive. (I note that the winning Green candidate in my riding is a First Nations person named Adam Olsen.) But the Greens are currently confined to largely white enclaves.

Now, here is the thing: in 40 ridings the Green Party broke 15%, in 17 they broke 20%. They ran second in 6 and won 3.

There are two losers tonight: the Liberals and the NDP. And there is one winner: the Greens. They managed to split the NDP vote and likely cost the NDP a majority government.

However, where the NDP and the Liberals have no obvious room to grow their electorate, the Greens have a very good shot at expanding theirs. The fact is that the people who shop at Whole Foods, send their kids to “French Immersion” if they can’t afford private (not for racist reasons of course) and think recycling is an act of benediction are legion. They used to vote NDP, now they have an alternative.

Andrew Weaver may be a lousy climate scientist but he is not an unintelligent man. He can count (so long as it does not involve climate change time series) and there are six ridings where the Greens came second. A rational, non-coalition, support of the Liberals would let him pass legislation of greater consequence than a ban on mandatory high heels for women in serving jobs. The Liberals, who will likely be reduced to a rural rump despite having likely won the most seats, are basically being elected by BC’s version of “deplorables”.  Nice people think they are a bit, well, common.

Dr. Weaver, well educated, Oak Bay resident and articulate guy that he is should be able to target those nice, white, very liberal people and peel them away from both the Liberals and the NDP. Plus, Weaver has the children who have grown up on Green ideology masquerading as education.

One winner tonight: the Greens.

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