My Letter to the Financial Post

William Watson is an economist who is right to be chagrined by the presence of only one professional economist on the 16-member Economic Advisory Council ("There’s a lot more to the economy than simply business,"--FP  July 17). He argues that Jack Mintz can't be expected to be the voice of labour and consumers as well as the whole economics profession, and I heartily concur.

 But Watson fails to ask a bigger question: does this government's repeated pattern of policy errors, such as stumbling too quickly into subprime mortgages, income trusts, expansion of foreign workers into services and manufacturing, and deregulation of railways, or moving too slowly on First Nations consultation, environmental regulation,rail safety  and food labelling, all stem from a blinkered,ideological confusion of business interests with good economic policy?   If that is true--or even partially true-- then shouldn't the Economic Advisory Council act as a corrective lens that provides more economic analysis and non-business input into the formative stages of policy-making?

 The government's stubborn refusal to do so amounts to willful blindness, motivated no doubt by an awareness that the nation's top economists are a continuing source of inconvenient truth.

Here is Watson's column, reproduced with permission from the Financial Post:

William Watson: There's a lot more to the economy than simply business

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The Tsilhqot’in Decision

Tsilhqot’in Nation v. British Columbia , announced on June 26, 2014, is the most important case on native rights since the Delgamuukw  decision back in December of 1997.  Since it originates in a dispute about aboriginal title right in our own backyard, I decided to read the decision in its entirety, instead of just relying upon press and media reports. In 1983, the Government  of British Columbia granted a commercial logging licence  to Carrier Lumber on land that the Tsilhqot’in considered their traditional territory.  One of the six Tsilhqot’in bands (the Xeni Gwet’in)  sought a judicial declaration prohibiting commercial logging on the land.  Relying upon the 1973 Calder decision recognizing aboriginal title, and the then brand-new Section 35 of the Canada Act, 1982,  the band amended its original land claim to include a claim for Aboriginal title to the land on behalf of all the Tsilhqot’in people.  At trial, Supreme Court justice David Vickers found for the Tsilhqot’in, based  primarily on the ground that regular passage by semi-nomadic peoples through a given territory in search of food and sustenance in accordance with the seasons constituted "occupation" of the land. The federal and provincial governments both opposed the title claim, and the B.C. Court of Appeal overturned the trial judge’s decision, using a narrower test for determining what constitutes “occupation” sufficient to ground Aboriginal title as “only specific, intensively occupied areas.”

The crux of the Supreme Court of Canada’s decision to grant a declaration of aboriginal title after all was an understanding of sufficient occupation that compares the requirements of common law “in a culturally sensitive way” to Aboriginal culture and practices. Thus “occupation”  was taken to mean not just specific sites of settlement but tracts of land regularly used for hunting, fishing, and so on. Once this threshold was held to have been reached, it remained to simply apply the “section 35 infringement and justification framework”  first elaborated in Delgamuukw to the case.  That framework permits “provincial legislative incursions on lands held under Aboriginal title,” including the Forest Act, but  “the level of consultation and accommodation required varies with the strength of the Aboriginal group’s claim to the land and the seriousness of the potentially adverse effect upon the interest claimed.” In this case the B.C. Government was found to have breached its duty to consult.

As I see it, Tsilhqot’in is a good decision from a legal perspective, because the Supreme Court found that the trial judge (B.C. Supreme Court Justice David Vickers) had “identified the correct legal test of aboriginal title and applied it appropriately to the evidence.” Tsilhqot’in is also a good decision from an economic perspective because the basic prerequisite of economic development is clarity concerning property rights. This case clarifies the notion of aboriginal title sufficiently to enable future parties to economic development to negotiate on the basis of commonly agreed terms. Tsilhqot’in is also a good decision from a political perspective, because it will force a recalcitrant government to consult First Nations meaningfully in all future economic development projects passing through their land, without giving every First Nation an absolute power of veto.

Of course, there is a down side: this decision makes litigation look more attractive than negotiation, and that could mean more bad news for the Treaty process and more native claims clogging the courts for years to come.