Who is this Peter Lougheed, anyway?

The answer to this question might seem obvious to people over the age of 35 or those who have lived in this province for more than 15 years, but the number of people who remember Lougheed’s premiership sadly comprise a diminishing proportion of our population.

Lougheed, 74, has been popping up in the news a lot lately. He spoke to a Tory gathering in Halifax last month and made headlines by suggesting Canada scrap the capital gains tax (he first proposed that idea in 1970, by the way). Late last year he lined up with Klein to suggest constitutional grounds for challenging the Chretien implementation of the Kyoto accord.

Obviously, Lougheed still commands considerable respect, even though it has been 18 years since he held public office.

Former premier Peter Lougheed remains in the public eye.

For those unfamiliar with him, it is impossible to concisely sum up this man’s achievements, but many of them are impressive.

On his departure from public office in 1985, he left this province with net assets of $12.5 billion (more than $19 billion in 2003 dollars), mostly in a single fund designed to strengthen Alberta’s future. The Alberta Heritage Savings Trust Fund, as it is now called, is a testament to Lougheed’s long-term vision.

Furthermore, he fought epic battles with Pierre Elliott Trudeau, Canada’s prime minister from 1968 to 1979 and 1980 to 1984, over the role of the provinces in Confederation. The two central issues over which the two titans clashed were the “bringing home” of Canada’s constitution and the sharing of Alberta’s resource revenues. Lougheed won the constitutional battle decisively by ensuring each province had a strong voice in Confederation. But the resource fight he initially lost, most notably when Trudeau developed the National Energy Program (later called the Oil Agreement, which Trudeau forced down Alberta’s throat). But Trudeau’s victory was hollow, since his economic plan basically stripped Canada’s oil industry, leading to the collapse of the NEP. In 1985, the Mulroney government pronounced the NEP dead.

The NEP, though, was nothing new. Under Trudeau, Ottawa taxed oil exports, artificially forcing oil prices lower than otherwise would have been the case, essentially robbing both the production companies and Albertans of resource revenue. The net effect of this and federal natural gas price controls was a subsidization of Eastern Canada’s energy-intensive manufacturing sector, eventually to the tune of tens of billions of dollars.

Lougheed argued that a strong resource sector and healthy Alberta economy wouldn’t threaten other provinces. A province’s wealth, he said, need not arise from other provinces’ poverty. Time has reinforced this truth. In fact, both Ontario and Alberta are succeeding today without price controls on resources. This is the Lougheed lesson that I think our nation has not fully grasped to date.

Another notable Lougheed achievement involves the phenomenal city provincial parks he established (Capital City Park and Fish Creek Park).

Being a man of culture, compassion and class, Lougheed was also renowned for his support of the arts, the disabled (he built William Watson Lodge, a beautiful resort in Kananaskis intended for use by the physically and mentally challenged), and Calgary’s bid for the ’88 Olympics.

But he had weaknesses that Albertans often overlook: his shortcomings boil down to his poor economic judgment.

Lougheed had extensive experience in business when he took Alberta’s reins. He even had a degree from the Harvard School of Business and worked for the famed entrepreneur Fred Mannix. But these experiences did not seem to help him in the prudent-spending department.

In the run-up to his 1971 election victory, Lougheed had accused the incumbent Social Credit leadership of having a bloated bureaucracy. It wasn’t small: when Lougheed took power that fall, Alberta had roughly one civil servant for every 87 citizens. But seven years later, Lougheed had increased the number to one civil servant for every 36 Albertans! (For comparison, under Klein today, there are roughly 140 citizens for every civil servant – think privatization.)

It did not take long for Lougheed to cast loose his fiscal ship from its moorings. He had a strange notion he called decentralization or “balanced growth,” meaning he thought it was better to have many small hospitals and airports dispersed throughout the province than a few in large urban areas. Ignoring economic advice to the contrary, he spent a lot of money building small, expensive hospitals in the shrinking rural regions of Alberta.

This was one of many politically expedient but costly moves.

In the end, Lougheed left his successor Don Getty with a stacked deck. Getty had a fiscal situation that depended on healthy resource revenue, and when the price of oil and gas decreased in the 1980s, Getty had a heck of a time trying to control his balance sheet. In real per-capita terms, Getty dramatically reined in provincial expenditures on education and allowed only modest growth in health spending, yet he could not stop the demolition of Alberta’s net-asset position. Only in 1993 did Ralph Klein finally start making the drastic, politically dangerous moves necessary to rein in those runaway costs.

The seeds of Getty’s fiscal disaster were sown by the overly optimistic Lougheed template. Everyone has a weak spot; in the grand scheme of things, Lougheed’s is (was) a common one.

But the most valuable legacy that Lougheed left this province had nothing to do with economics or money: it was the example he set.

Faced with a prime minister who was flashing Albertans the bird, Lougheed never stooped to insults. Faced with immense pressures from a conniving, covetous Ottawa, Lougheed maintained his poise and handled the strife with intelligence and tact.

Faced with the dirty business of politics, in the words of Calgary Herald legislative bureau chief Kevin Peterson in 1975: “In six years of covering Mr. Lougheed . . . he has never lied.”

I had a brief talk with Lougheed a couple of weeks ago. We mostly discussed his capital gains theories. But I also asked him about his purchase of the Mannix property for the creation of Fish Creek Park, ever so long ago. And here, too, his ethical character shines.

He told me that both Mannix and he, in order to avoid any appearance of impropriety, settled the matter of what a fair price might be amicably and publicly via the courts. No backroom deals there.

It would be my hope that more politicians, lawyers and business leaders would display as much character and integrity. I may not completely agree with Lougheed’s political viewpoints, but his is a legacy worth following.