Atlantica: Dumbest idea of 2006

Atlantica is the brain child of Brian Lee Crowley of the Atlantic Institute for Market Studies, and current senior advisor in the federal Department of Finance. I had thought that this was a case for some sort of deep integration between the Canadian Atlantic provinces and the US northeastern states – a case that would be hopelessly undermined by the existing trade regime between Canada and the US, and limited means at the sub-national level to achieve a customs union or a harmonized currency – based on a faux nostalgic pining for what could have been had not that thing we call the Canada-US border got in the way.

But a colleague asked me to comment on a paper on the topic, and there I learned that this is not actually what Atlantica is all about. And so I nominate it for “dumbest idea of 2006”.

One part of the Atlantica proposal is to ensure ready passage for US oil and gas interests to get their booty out of the country, which is understandable from the US perspective given their hunger for energy. This is, of course, a forgone opportunity of the highest order for Nova Scotia and Newfoundland, our new oil barons, to use those resources to develop their economies.

No, what makes Atlantica truly dumb is that the centrepiece of the strategy is to make Halifax a super-port for container traffic coming from Asia. Not Europe, or even Africa, but Asia. As someone who has recently consulted an atlas, it would appear that Halifax is about as far from Asia as one can get if one’s objective is to service the North American marketplace.

It truly boggles the mind how this can become the topic of serious discussion. But as a “big idea”, in the absence of a coherent alternative industrial strategy for the region, it does manage to get a hearing.

On the west coast, the BC government is also pressing for more Asia container traffic through the Pacific Gateway initiative, including expansion of the Vancouver port and associated infrastructure plus new terminal planned for Prince Rupert. Meanwhile, Seattle and Los Angeles are also expanding.

But even if we accept the plausibility of the scheme, there will be little benefit outside of the warehousing and trucking industries. Using Halifax would still require a border crossing and there are plenty of competing US ports on the east coast. But consider this: the average productivity for warehousing and trucking is about $20 per hour compared to $35 per hour for the economy as a whole (a couple years ago, anyway). So even if this scheme was successful, it would LOWER the average productivity of the Atlantic economies.

Hopefully, common sense, and a map, will make this idea disappear as quickly as it came up. Still, it is disturbing to see how much influence Mr Crowley has garnered in Ottawa – perhaps in linking Atlantica to votes in a traditionally Liberal part of Canada. Another reason to give the Tories the boot in 2007.