Alberta Separation: A Costly and Uncertain Gamble

A report commissioned by the Alberta government and undertaken by the University of Calgary's School of Public Policy has found that separation from Canada would be costly, convoluted, and potentially ugly. The report, overseen by an expert advisory panel chaired by economist Jack Mintz, concludes that a breakup would entail very real and significant short-term costs, even under a best-case scenario.

The report examines two scenarios: a 'smooth' option and a 'difficult' one. In the smooth scenario, the cost of leaving Canada and establishing an independent state would range from $50 billion to $170 billion in the first five years, with a fiscal impact on top of the economic one. The difficult scenario is even bleaker, with a GDP contraction of 10% and employment loss, as well as a massive debt of over $400 billion.

The report also notes that the fallout from separation would extend beyond Alberta's borders, causing tremendous harm to Canada's economy. A breakup would lead to a decline in the Canadian dollar, a hole in the federal budget, higher inter-provincial trade costs, and a reduction in GDP and per-capita GDP.