Rob Breakenridge: The economics of Alberta separation would be disastrous for everyone

The flags of Canada and Alberta fly at the Syncrude Giants of Mining exhibit north of Fort McMurray on May 17, 2025. Photo by File Photo /Postmedia

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There’s a level of irony in the deep admiration so many Alberta separatists harbour for our neighbour to the south.

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After all, there is no legal process for an American state to separate from the U.S. and, thus, such a movement could not exist there. Of course, the United States underwent a far messier and bloodier process before concluding that divorce shall forever be off the table.

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In our 159 years as a nation, we’ve never had any kind of a breakup. And while there is indeed a legal pathway that exists for a Canadian province to leave, there is no precedent.

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That doesn’t and shouldn’t leave us flying blind into a potential catastrophe. It’s reasonable to assume that a dismantling of Confederation would be costly, convoluted, and potentially ugly.

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The rosy and optimistic forecasts from separatists that executing their plan would be clean, easy, and cheap have always seemed like wishful thinking detached from reality.

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And now, thanks to work commissioned by the Alberta government and undertaken by the University of Calgary’s School of Public Policy, we can see just how unrealistic those assumptions are.

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But this is not just a warning for Alberta, and it’s not just Alberta that could suffer from a breakup. This should be a wake-up call for the rest of Canada, too.

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Despite some alarming and stark conclusions, it’s actually a rather thorough and balanced report. On top of that, the report was overseen and analyzed by an expert advisory panel, chaired by noted economist Jack Mintz.

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As both the report and the panel assessment conclude: separation would entail very real and very significant short-term costs, even under a best-case scenario. There is also a considerable degree of uncertainty when looking at the longer term.

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But both conclusions are also in agreement on this point: the fallout would extend well beyond Alberta’s borders, as such a rupture would cause tremendous harm to Canada’s economy, too.

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The School of Public Policy report is focused on two scenarios: one — the “smooth” option — would entail a quicker and more favourable accommodation of Alberta’s secession. The other — the “difficult” option — entails a more drawn-out, complicated process.

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Between those two scenarios, the cost of leaving one country and establishing another ranges from $50 billion to $170 billion, just in the first five years, and that’s just the fiscal impact. The economic impact of that upheaval would come on top of that.

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There’s an obvious up front cost for any subnational government promoting itself to an independent state, and taking over those federal responsibilities and institutions.