What could Alberta possibly want? More
The giddy group of revelers pouring themselves onto the elevator of Ottawa’s Skyline Hotel was ravenously hungry. The cocktail hour had been a long one and now they were worried about whether the dining room was still open. Luckily, they seemed to be sharing the elevator with the maitre d’, a man impeccably clad in evening dress. At their command the “maitre d’ ” dutifully unearthed pad and pencil and solemnly jotted down their dinner reservations. Then the man in the dinner jacket, Alberta’s Premier Peter Lougheed broke up. In town for a First Ministers’
Conference, the Premier was in an expansive mood and the case of mistaken identity tickled his fancy. Why not? The bantam Conservative politician who runs the increasingly pivotal, resource-rich province of Alberta can afford to be tolerant.
Lougheed is equally tolerant of the eastern fantasy that Alberta will have her day in the sun, fueled by oil, that the oil will run out and the world will return to normal, with the provinces in proper orbit around central Canada. “There are some easterners who believe that,” Lougheed observes.
“We’re the new kid on the block and they haven’t been able to adjust to our con-
fidence and strength. There is still some wishful thinking that it’s all a passing phase. But the more thoughtful easterners know it isn’t and they realize Canada will be stronger when we’re done.”
When Lougheed has carried out his plan for reassembling Canadian power structures—and there is no question in his mind that he will—he believes that Alberta will lead the nation. His aim: to shift a large share of the economic decision making power now centred around Toronto and Ottawa to Calgary and Edmonton. To accomplish this, there is a master plan that has been more than a decade in the making. In the meantime, the ever-confident Lougheed is making his presence felt not only at home but on the international stage as well. At the end of May, for example, Lougheed will go to Moscow to discuss long-term wheat-trading arrangements— apparently with the blessings of the federal Wheat Board, which officially handles such matters. He will then visit a number of Middle East oil-producing nations to
discuss petroleum prices and related subjects (he will also stop off in Israel along the way). By mid-June, Lougheed will be in Geneva to sit in on the talks of the General Agreement on Tariffs and Trade. What is so striking about all this is that should Quebec’s René Lévesque attempt to establish such a prominent international profile, howls of outrage would almost certainly be heard across the country; yet Lougheed’s peregrinations have caused scarcely a ripple of criticism.
Albertans are happy to leave it all in Lougheed’s hands. They nurse a century’s worth of grievances and cherish the fierce certainty that nobody else understands how it really is with them. As they see it, easterners have always dismissed them as a bunch of red-neck farmers. Now easterners have the idea that the red-necks have money, the farmers are oilmen, and they’re all, with nouveau riche vulgarity, living out the dying days of the Alberta empire. The average Albertan sees it differently. He may not be as precise as the Premier about where the master plan is taking the province, but he damn well knows that they are getting there.
Albertans are caught on a roller coaster of privilege, sliding through a perplexing dichotomy of blatant squandering and glum laments. When oil shot Texas to prosperity 25 years ago, new millionaires scrambled for ways to blow money: some sported $ 1,000 bills for bow ties and showered the streets with silver dollars. Alber-
tans have a more Canadian reticence. True, retired oil company president Bill Herron drives a steer-horned Pontiac Bonneville emblazoned with 700 silver dollars and his poodle Peppi’s paw-print signature appears on cheques from his own Calgary bank account. But Herron is an exception. Neither Calgary nor Edmonton has an elite residential area to equal Toronto’s Rosedale or Montreal’s Westmount. But inside their houses is the good life that oil can buy.
The Establishment, a Calgary shop that sells bathroom and kitchen fixtures, typifies the unprepossessing facades that often hide the extravagances within. It’s tucked under a poolroom in a two-storey concrete building that is typical prairie functional and a dozen blocks removed from the city’s shiny new glass and chrome downtown. But that crammed nook stocks $50,000 worth of gold faucets and sells sculptured toilets that cost $1,000 each. Owner Janet Ingles is cheerful about her customers’ disinterest in price tags. “I like the Western attitude toward money. They don’t flaunt it but they feel: T have money so why not spend it?’ I know every bath supplier back east and I guarantee nobody there could run a place like this. There’s more money back east, people there could have twice what anyone out here has, but it’s old money, tucked away for a rainy day. They don’t spend it. Westerners do, maybe because a lot of them had the courage to leave a secure job back east and take a gamble out west; when the gamble pays off, they enjoy it.”
To enjoy is to equip a house with, say, seven or even nine bathrooms, a perhaps Freudian obsession in a society so recently removed from the frontier. Ingles is intrigued by the quirky sense of democracy that Albertans display. Master bathrooms boast his and her tubs, guest rooms rate their own $3,600 tubs, so the domestic help also have their own brushed gold faucets.
Of course, not every Albertan lives that way. But almost all are in on a piece of the action, gloriously entangled in a wildcat kind of shopping spree. The Conference Board of Canada calculates that Alberta’s retail sales will have soared by an astonishing 29.5% from $4.54 billion to $5.89 billion between 1975-77, more than 10% ahead of any other province’s increase. But such figures merely hint at just how nimbly money transforms landscapes and lifestyles. For a decade now, building cranes have swooped over the skylines of Calgary and Edmonton, vanquishing two-storey stucco houses and slapping up 30-storeyplus skyscrapers. Stores, restaurants, theatres, art galleries and museums have sprouted faster than spring wheat. For easterners, the conservationist society may be dawning; Albertans have only just succumbed to conspicuous consumption.
Lured by the rumors of streets paved with gold, more and more Canadians are Alberta-bound these days. Every month, some 1,300 newcomers swarm into Calgary and Edmonton, which have doubled
their populations to almost half a million each during the past 16 years. Alberta’s net migration, according to Statistics Canada, tripled to 35,000 between 1974 and 1975. Cape Bretoners—reliable economic barometers that they are—illustrate the trend. They sought their fortunes a century ago in Boston, a decade ago in Toronto. But in one six-month period last year, the Cape Breton Post counted 500 Sydney area people goin’ down the road to Calgary.
Some wing west for “money, money, money and more money” says an electrician at Mildred Lake, where 7,000 Syncrude workers, who are developing Alberta’s oil-rich tar sands, average $400 a week in take-home pay and some clear $900. Syncrude’s Pam Upshall, 20, banks $800 a month, while her fiancé, a Newfoundland ironworker, puts away $1,500. They figure to head home $30,000 richer in 18 months.
Calgary lawyer Tom Mudry argues that money isn’t the only incentive. The week he finished articling in Winnipeg, he tossed his family’s belongings into a U-Haul truck and headed west. “Alberta has taken on the romance Toronto once held for a young, ambitious person,” he says. “The East has the false impression that everyone’s here for the money, but that’s not it at all. It’s a combination of opportunities, a package that adds up to the fact that this is the place to be right now.”
The newcomers bask in an economic microwave oven turned to high. The Canadian Imperial Bank of Commerce predicts Alberta will show a real economic growth this year of 5.4%, compared to a national all year average of 4.5%. The province’s construction force has grown to 80,000, compared to 50,000 three years ago, giving Alberta the highest labor participation rate in Canada (67% of working age people are employed) and the lowest unemployment rate—a minuscule 3.9% last year compared to a national average of 7.9%. Alberta’s taxes are the lowest in the country, since there are neither sales taxes nor succession duties and income taxes are 20% lower than anywhere else in Canada.
To be sure, Alberta’s farmers are morosely contemplating a 5% decline in receipts this year, after being whittled down 6% to $1.7 billion last year. But against that, capital spending in the province will increase by an estimated 28% this year to $6.3 billion. Among the major capital projects: the $2.5-billion Syncrude plant, a $350-million Dow Chemical Canada Ltd. multi-phased petrochemical project, a $300-million ethylene plant for Alberta Gas Chemicals Ltd., two $ 150million ammonia plants for Comineo Ltd. and Canadian Fertilizers, and a $40-million polyvinyl complex being put up by Diamond Shamrock Canada Ltd. and Alberta Gas Trunk Line. Other projects are about to move from the blueprint to the bulldozer stage: four ammonia plants, two methanol plants, a new oil refinery, a rapeseed processing plant, two food plants and three coal mines.
There is a darker side to life in Alberta. Suicide, divorce, crime and alcoholism rates are among the nation’s highest—and likely to climb higher, experts predict, because rapid economic growth, urbanization and a tide of newcomers carry those social costs along with them. Moreover, Alberta’s native peoples, welfare mothers, in fact a whole host of the underprivileged, have had scarcely a whiff of the sweet smell of success.
Back in the days when he was opposition leader in the Alberta legislature, Lougheed was forever buttonholing people to expound his vision of the new Alberta; as Premier, Lougheed has retreated to a more private plane. Little else has changed. The
silver threads that were there when he ousted the Social Credit Party in 1971 have become a thatch of grey. The laugh lines around the blue eyes have burrowed in for keeps, but the 155-pound body is as neatly packaged at 48 as it was during his University of Alberta days when he was a diminutive halfback for the Edmonton Eskimos. As for his game plan, everything done so far, everything still on the agenda, conforms to the master strategy. It all seems so wondrously simple, so logical, so preordained, that Lougheed finds the innocent question “just what does Alberta want?” as vexing as any Québécois.
Alberta, between dust bowls and depressions, grubbed out a living from the
soil until Leduc No. 1 blew in 30 years ago, but the upward spiral fueled by oil is fragile and all too finite. Alberta must, before the last of the oil gurgles down a pipeline in about 11 years, convert today’s cash into an economic base for the future. Says Lougheed: “Let’s say you sell a house with the agreement that you can continue to live in it rent-free for 10 years. Obviously, you’re going to have to save during that 10 years or you’ll one day find yourself on the street without a roof over your head. That’s where Alberta is.”
That realization dawned on Lougheed in the early 1960s when he was plotting his entry into politics and deciding whether to go federal or provincial. For the first time,
he says, he thought deeply about Alberta, and concluded that the economic future was precarious, while the Socreds, after almost 30 years in power, seemed content to coast on their record. Lougheed worked out his strategy with the cool corporate efficiency he had learned at Harvard business school. Alberta would convert fleeting oil cash into permanent capital assets by establishing petrochemical and agricultural processing plants, by becoming both the service centre gateway to northern riches and the financial capital of western Canada and, with a bow to finer things, by becoming Canada’s “think tank,” a technological research capital that would drain the brains from less affluent parts of the
world. Lougheed draws a parallel with the U.S. “Alberta will never be a highly industrialized province, but neither will Ontario have it all forever,” he says. “Compare New York with Texas and California now. They have a personal income, a security, a quality of life that surpasses anything bankrupt New York offers.” That is where Lougheed plans on taking his province. As he said when the federal Conservative leadership was up for grabs last year: “Why would I want to run Canada when I already run Alberta?”
Lougheed’s political ambitions, according to those who know him, go all the way back to his grandfather, Sir James Alexander Lougheed, who served in the shortlived Conservative cabinet of Prime Minister Arthur Meighen in 1920-21. Sir James, a wealthy lawyer turned politician, then senator, still has an Alberta town and a mountain named for him. Lougheed’s late father, Edgar, a lawyer, made no mark on Alberta at all. Thus it is assumed Lougheed inherited his grandfather’s driving ambition and his father’s affable personality, coupled with a need to restore lustre to the family name—and to Alberta’s.
Lougheed has so far succeeded at everything he turned his hand to. After a brief stint as a Calgary lawyer, he joined the contracting firm of Mannix Co. Ltd. (now Loram International Ltd.) and rose rapidly through the ranks: secretary in 1956. vice-president in 1959 and director by 1960. In the early 1960s, he launched himself into politics, his only springboard a few faithful friends who believed he could topple the well-entrenched Social Credit Party. “Seven months before anyone even knew Peter was headed for the Alberta Conservative Party leadership, he had his campaign under way,” says Jim Seymore, now a Lougheed aide. He won it, of course, in March, 1965, and went on to take six seats in 1967, the biggest Tory score in 32 years. Using television with the same shrewd hand that the old Socred leader William Aberhardt once employed on radio, Lougheed prevailed in 1971, winning 49 out of 75 legislature seats; in the 1974 election Lougheed’s Tories won 69 seats.
In office, Lougheed’s instincts have led him into what Albertans of an ideological bent label state capitalism. Lougheed shies away from the term, not because he denies practising it, but “because it sounds more powerful than it is and it scares people when it shouldn’t.” Alberta’s state capitalism means that the province intervenes in the private sector as partner, competitor, and occasionally as owner, in order to force the changes deemed necessary in the economic structure. In the past two years, Lougheed has created the Alberta Energy Company to satisfy Alberta’s frustrated desire to share in some of the energy profits reaped by foreigners; he helped rescue the Syncrude tar sands plant by purchasing 10% of Syncrude and lending an additional $200 million to interested developers; and he purchased Pacific Western Airlines, a $36.5 million investment that was recently
ruled legal by the Supreme Court of Canada after a two-year court battle. Lougheed, in theory, doesn’t approve of his own interventions: he would have preferred private interests to have done it all. But the government interventions are baffling only if one considers Lougheed to be a Tory. He doesn’t. Pragmatist is the label he prefers.
There will be no more interventions, says Lougheed, unless “it becomes necessary, if there were no other choice.” Happily, if intervention is imminent, money is handy. Alberta’s savings account, called the Heritage Savings Trust Fund, was opened last August with a $1.5 billion deposit and is growing at an annual rate of 30% of all Alberta’s non-renewable resource royalty revenues; that will amount to $500 million a year, the biggest pool of loose cash held by any province.
It is not a prospect that enthralls Lougheed’s critics. While there was little opposition to the Heritage Savings Trust Fund’s recent $50 million loan to Newfoundland, there are Albertans who do not share Lougheed’s vision and who can be acidly articulate on the potentially dangerous aspects of a strategy being implemented with an almost computerized efficiency. Nick Taylor, the Alberta Liberal leader who has yet to win a seat, would relegate the master plan to the Victorian era. “Remember the phrases: bring nature to heel, conquer the wilderness, develop the hinterland, industrialize the interior? That’s the age Lougheed is stuck in. His is a buffalo hunter mentality, let loose in a civilization that for the next 500 years will deem best whatever least disturbs nature. He isn’t goingagainst Ottawa. His foe is the 20th century.”
An even deeper resistance to Lougheed’s master plan is felt by New Democratic Party leader Grant Notley, who stands alone in the legislature but who might one day rally a band of northern Albertan malcontents and become a power to reckon with. Notley’s criticism of the master plan is simple: “Lougheed has already blown it.” Because Alberta is a major energy producer at the time of a global energy crisis, Notley believes Lougheed had a heaven-sent opportunity to work Alberta a deal. “He could have bargained off low oil prices in perpetuity against federal redress of freight rate anomalies. Solving transportation and freight rate inequities is vital for the future of our renewable resources. Lougheed just blew it. He didn’t get the oil price he wanted from Ottawa and he didn’t get a solution to freight rates. It was a miscalculation of almost historic proportions for the West because we won’t get another chance. When you only have 11 years of energy left, you don’t have any more bargaining power.”
If Alberta someday comes limping back to its traditional spot in Confederation, properly subdued after a fling with fortune, Notley predicts that the province will be lugging some alarming albatrosses— the petrochemical and agricultural processing plants now under construction. Last fall. Notley acquired a closely guarded
consultants’ report that warned the government it would have to subsidize the new petrochemical industry to the tune of $28,000 for every one of the 600 jobs the industry could create by 1982. The government claims the report is out of date. Notley claims the government is. “Alberta was just a couple years too late getting started in the petrochemical plants. Petrosar [which will process crude oil in Ontario despite the Alberta government’s refusal to guarantee its feedstock] will be underway in a matter of months. Petrosar sewed up the Canadian market we were aiming for; it’s a lost cause unless we get into a price war with Petrosar and that’s absurd.” Alberta guarantees each of its own new petrochemical plants a 30-year rolling stock, but when the cheap feedstock is exhausted. Notley sees only the costly and unprofitable alternatives of coal gasification, Arctic gas and oil sands energy.
The “miniature international statesman,” as Notley dubs Lougheed. is off, meanwhile, to conquer other worlds. Quebec is thinking about political separation and economic union; Lougheed has been working on political union and economic I separation. In September, 1975, with an : entourage of 66 in tow, Lougheed swept through Europe to celebrate Alberta’s coming of age. He dispensed scholarships, square danced at Edinburgh Castle, wooed markets and money and finally missed tea with the Queen because wage and price controls summoned him home. Last year, he launched an 11-day American trade mission that took him three quarters of the way across the United States and gained him the disgruntled attention of the government he was trying to make tariff points
with: Ottawa. As a result, federal Industry Minister Jean Chrétien will submit a series of proposed concessions for Alberta industrial and agricultural products when Canada goes to Geneva this year for talks on the General Agreement on Tariffs and Trade.
Ottawa may not be overjoyed at Lougheed’s international forays; Lougheed simply considers that he is playing his cards well. With his supreme self-confidence, he happily turns around a yarn in which he was supposedly the butt of the joke. Arriving for lunch at 24 Sussex Drive during one of his early first ministers’ conferences, Lougheed was greeted at the door by Pierre Trudeau himself. But over Trudeau’s shoulder, the Alberta premier spotted another man coming down the hall. “A very distinguished looking man ... I assumed he was an earlier guest. And I’m an old campaigner from way back. When I see a hand outstretched, I just automatically grab it.” Lougheed flung his overcoat to the startled Prime Minister and energetically pumped the outstretched hand of the man who turned out to be the butler. Easterners might consider that gauche. Lougheed prefers to think that the brash, friendly West scored one on the circumspect East on that occasion, because on departure the unnerved Trudeau mistakenly handed his father-in-law’s coat to Lougheed. The butler was not seen again. Says Lougheed: “I like to think he was so impressed that he packed up and moved to Alberta.”