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Passing the buck: federalism and Canadian environmental policy Harrison, Kathryn J. 1993

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PASSING THE BUCK: FEDERALISM AND CANADIAN ENVIRONMENTAL POLICY by KATHRYN JO-ANNE HARRISON B.E.Sc., The University of Western Ontario, 1980 S.M., The Massachusetts Institute of Technology, 1984 S.M., The Massachusetts Institute of Technology, 1986 A THESIS SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE DEGREE OF DOCTOR OF PHILOSOPHY in THE FACULTY OF GRADUATE STUDIES (Political Science)  We accept this thesis as conforming to the required standard  THE UN VERSITY OF BRITISH COLUMBIA March 1993 © Kathryn Jo-Anne Harrison  In presenting this thesis in partial fulfilment of the requirements for an advanced degree at the University of British Columbia, I agree that the Library shall make it freely available for reference and study. I further agree that permission for extensive copying of this thesis for scholarly purposes may be granted by the head of my department or by his or her representatives. It is understood that copying or publication of this thesis for financial gain shall not be allowed without my written permission.  (Signat  Department  ofIgJ„,,04-,00coAtc,e  The University of British Columbia Vancouver, Canada  Date  ^  DE-6 (2/88)  0  %/ 9  Abstract This thesis examines how the current division of federal and provincial responsibilities for environmental policy in Canada evolved, and the implications of that arrangement for protection of the environment. At a theoretical level, the example of environmental protection is used to explore the relationship between federalism and public policy more generally. It is accepted wisdom that governments seek both to claim credit and avoid blame. However, to date, students of Canadian federalism have been much more attentive to the dynamics of intergovernmental credit claiming than to opportunities for intergovernmental blame avoidance. A central argument of this thesis is that the implications of federalism for public policy are very different when both levels of government are eager to assume responsibility for a particular policy than when one or both are content to vacate the field. It is argued that because environmental protection typically involves diffuse benefits and concentrated costs, it offers few political benefits and significant political costs. Thus the case of environmental protection is used to explore the implications of policy inaction within the federal system. The thesis presents a study of the evolution of the federal government's role in environmental protection and of federalprovincial relations concerning the environment between 1968 and 1992. The exclusive focus of the thesis is the federal government's role in "federal Canada," that is, within the ii  provinces, rather than the Northern territories. It is argued that the federal government has taken advantage of overlapping jurisdiction to shirk its responsibility for environmental protection for most of the last two decades. In light of federal deference to the provinces, federal-provincial relations concerning the environment have been relatively cooperative, with the important exception of two brief periods of heightened salience of environmental issues, during which both levels of government were more inclined to adopt a broad view of their jurisdiction. A case study of federal and provincial regulation of pulp mill effluents offers considerable evidence of provincial reluctance to strengthen environmental standards for fear of placing local industry at a competitive disadvantage. Scholars troubled by the environmental implications of interprovincial economic competition typically look to the federal government to establish national standards. However, it is argued that many have underestimated the political obstacles to such a federal response.  iii  Table of Contents Abstract Table of Contents^ List of Tables^  iv viii  List of Figures Acknowledgements^  xi  Chapter 1 - Federalism and Environmental Policy^ 1 Introduction^ 1 Federalism and Public Policy^ 7 Assigning Jurisdiction for the Environment^ 9 Overlapping Jurisdiction: Problem or Panacea? 14 Research Methodology^ 22 Outline of the Thesis^ 23 Chapter 2 - Policies and Intergovernmental Politics^26 Introduction^ 26 The Politics of Environmental Protection^ 27 Evolving Federal and Provincial Roles in Environmental Protection^ 37 Policy vs. Jurisdiction^ 37 Evolving Roles in Environmental Protection ^ 40 Implications for Federal-Provincial Relations^ 41 Policymaking Amid Provincial Interdependence^ 44 Interprovincial Competition: Healthy or Destructive? ^52 Game Theory and the Real World of Provincial Policymaking 56 The Federal Response^ 58 Federalism and Blame Avoidance ^ 61 Political Decisionmaking in Context^ 63 "Politicians have Personal and Institutional Objectives" 64 "Governments are not Monolithic"^ 65 "Governments Influence Public Opinion"^ 67 "Political and Constitutional Context Matters" ^69 Summary^ 71 Chapter 3 - The Constitutional Framework: Constraints and Opportunities^ Introduction^ Sources of Provincial Authority^ Provincial Proprietary Powers ^ Provincial Legislative Powers ^ Limitations of Provincial Powers ^  iv  74 74 77 78 81 82  Sources of Federal Authority^ 85 Federal Proprietary Powers^ 85 Federal Legislative Powers^ 87 Limitations of Federal Jurisdiction over the Environment 118 Conclusion^ 120 Chapter 4 - The Emergence of Federal Involvement, 1969-1972 ^123 Introduction^ 123 The First Wave of Public Concern ^ 124 Attitudes Toward Federal Jurisdiction ^ 132 Testing Federal Jurisdiction at the Legislative Level ^136 The Canada Water Act^ 136 The Fisheries Act^ 142 The Creation of Environment Canada ^ 147 The Clean Air Act^ 148 Federal-Provincial Relations Concerning the Environment^151 The Site of Intergovernmental Negotiation: The Canadian Council of Resource Ministers^ 152 Diversity of Provincial Perspectives ^ 153 Provincial Responses to the Canada Water Act ^156 Provincial Responses to Other Federal Legislation^161 The Constitutional Negotiations ^ 162 The Federal Position ^ 163 Federal-Provincial Negotations on the Constitution^165 Public Hearings on the Constitution ^ 168 Summary^ 170 Chapter 5 - The Federal Retreat: 1972-1985 ^176 Introduction^ 176 The Decline in Salience^ 178 Attitudes Toward Federal Jurisdiction^ 185 The Federal Government Perspective^ 185 The Opposition Perspective^ 195 The Constitutional Function^ 196 The Legislative Function^ 198 The Ocean Dumping Control Act^ 199 The Environmental Contaminants Act^ 200 1977 Amendments to the Fisheries Act ^ 202 The Canada Environment Act^ 209 Amendments to the Clean Air Act^ 211 The Regulatory Function^ 212 Implementation of Regulatory Statutes^ 216 The Enforcement Function^ 222 Delegation of Enforcement^ 225 The Federal-Provincial Accords^ 229 The "One Window" Approach^ 231 Unconditional Surrender?^ 235 Federal-Provincial Relations ^ 236 Federal-Provincial Relations in International Affairs ^238 Evaluation of CCREM^ 243 Conclusion^ 246  Chapter 6 - The Second Wave: The Reemergence of the Federal Role, 1985-1992^ 253 Introduction^ 253 The Resurgence of Public Opinion ^ 255 Attitudes Toward Federal Jurisdiction ^ 259 The Government Perspective^ 259 Other Perspectives on Federal Jurisdiction ^268 The Constitutional Function^ 271 The Legislative Function^ 274 The Canadian Environmental Protection Act ^275 The Canadian Environmental Assessment Act ^287 The Regulatory and Enforcement Functions ^ 299 Implementation of CEPA^ 301 Federal-Provincial Relations ^ 304 The Canadian Council of Ministers of the Environment^305 The Statement on Interjurisdictional Cooperation: Partnership or Obstruction?^ 306 Federal-Provincial Relations in Environmental Assessment 309 Conclusions^ 326 Whither -- or Wither -- the Federal Role? ^ 331 Chapter 7 The Regulator's Dilemma: Federal and Provincial Regulation of Pulp Mill Effluents^ 333 Introduction^ 333 The Political Economy of the Pulp and Paper Industry^337 Analysis of Actors' Incentives^ 341 Environmental Groups^ 341 The Pulp and Paper Industry ^ 342 The Provinces^ 345 The Federal Government ^ 351 Round 1 - Negotiating the 1971 Federal Effluent Regulations 351 The Industry Position^ 355 The Provincial Position^ 356 The Federal Response^ 359 Round 2 - Provincial Resistance^ 361 The Industry Position^ 361 The Provincial Position^ 363 The Federal Response^ 364 Round 3 - Industry Resistance^ 366 The Industry Position^ 367 The Provincial Position^ 368 The Federal Response^ 369 Comparison of Provincial Standards^ 371 Regulating the Industry in Ontario^ 372 Regulating the Industry in British Columbia^373 Regulating the Industry in Quebec^ 374 Regulating the Industry in New Brunwick and Alberta^376 Comparison of Provincial Standards ^ 376  vi  Round 4 - Public Pressure^ 382 The Industry Position ^ 388 Environmentalists' Position ^ 393 Provincial Perspectives^ 395 Multilateral Federal-Provincial Negotiations ^398 The Federal Response ^ 411 Summary^ 417 Conclusions^ 419 Chapter 8 - Regulatory Enforcement in a Federal System^427 Introduction^ 427 The Cooperative Canadian Approach to Enforcement ^429 Trends in Discharges from the Canadian Pulp and Paper Industry^ 434 Responding to Chronic Noncompliance^ 438 The Sulphite Crackdown ^ 439 Substituting the Carrot for the Stick ^ 442 Determinants of Regulatory Effectiveness ^ 446 Dependent Variables^ 448 Independent Variables^ 453 Results^ 458 Summary^ 468 Conclusions^ 470 Government-Industry Cooperation Revisited ^ 470 Intergovernmental Cooperation Revisited ^ 477 Chapter 9 - Conclusions^ 491 Introduction^ 491 Assertion of Jurisdiction^ 493 Provincial Policymaking Amid Economic Interdependence^498 Federalism and Blame Avoidance^ 502 Federal-Provincial Relations and the Environment^505 Competition and Cooperation Revisited ^ 508 Institutions and Public Policy^ 510 Institutional Objectives^ 512 Politicans' Personal Objectives ^ 514 Governmental Influence on Public Opinion ^ 517 Political Context^ 518 Governments as Complex Organizations ^ 520 Whither Canadian Environmental Policy?^ 523 Bibliography^  527  Appendix A - Comparison of Federal and Provincial Regulatory Requirements^  545  Appendix B - Discharge Trends by Regions and 1987 Discharge Data for Individual Mills^ 557  vi i  List of Tables  Table 7-1^Predominance of "Company Towns"  425  Table 7-2^Average Provincial Permit Requirements  425  Table 7-3^Comparison of Provincial and Federal Standards  426  Table 8-1^1987 BOD and Suspended Solids Discharges by Province  483  Table 8-2^1987 Average Discharges from Different Mill Types  483  Table 8-3^Analysis of BOD Discharges  484  Table 8-4^Analysis of TSS Discharges  484  Table 8-5^Analysis of Toxicity Compliance  485  Table 8-6^Effect of Grants on Compliance in Eastern Canada  485  Table A-1^Federal vs Provincial TSS Requirements, 1987: British Columbia  546  Table A-2^Federal vs Provincial BOD Requirements, 1987: British Columbia  547  Table A-3^Federal vs Provincial TSS Requirements, 1987: Alberta  548  Table A-4^Federal vs Provincial BOD Requirements, 1987: Alberta  548  Table A-5^Federal vs Provincial TSS Requirements, 1987: Ontario  549  Table A-6^Federal vs Provincial BOD Requirements, 1987: Ontario  550  Table A-7^Federal vs Provincial TSS Requirements, 1987: Quebec  551  Table A-8^Federal vs Provincial BOD Requirements, 1987: Quebec  553  Table A-9^Federal vs Provincial TSS Requirements, New Brunswick  1987:  555  Table A-10 Federal vs Provincial BOD Requirements, New Brunswick  1987:  viii  556  List of Figures Figure 4-1 Trends in Public Concern  173  Figure 4-2 Trends in Salience  174  Figure 4-3 Rank of Pollution Among Most Important Problems  175  Figure 8-1 Trends in National BOD Discharges  486  Figure 8-2 Trends in National TSS Discharges  487  Figure 8-3 Trends in National BOD Compliance  488  Figure 8-4 Trends in National TSS Compliance  489  Figure 8-5 Actual and Projected Discharges for TSS  490  x  Acknowledgements This dissertation could not have been completed without assistance from a great many sources. A graduate fellowship from the Social Sciences and Humanities Research Council of Canada provided financial support during four years of graduate studies. In addition, a research grant from the Science Council of British Columbia was invaluable for the pulp and paper case study. I am indebted to Don Munton for facilitating my involvement in that project. Sincere thanks are owed to Andrew Fabro, the librarian in Environment Canada's Pacific and Yukon Region, who cheerfully tracked down my innumerable requests for documents, and to Trevor Ruthman, from Environment Canada's Industrial Programs Branch, who responded to my frequent calls to ask "just one last question" concerning the Canadian pulp and paper industry. I am particularly indebted to several dozen federal and provincial officials, pulp and paper industry representatives, and members of environmental groups who generously gave their time for interviews. While their names are not listed in order to maintain confidentiality, their anonymity in no way reflects the extent of my appreciation of their contribution. Kent Weaver's bitnet messages have been a source of insightful and challenging questions. I am especially grateful to the three members of my dissertation committee. Peter Nemetz encouraged me to pursue a PhD some five years ago, and since then has provided thoughtful comments on many papers, in addition to this dissertation. As my professor, Richard Johnston offered valuable assistance, particularly with the pulp and paper case study. And as a friend, he has been a source of trusted counsel as I went through the traumas of academic job-hunting. My thesis supervisor, Alan Cairns, always managed to strike just the right balance between leaving me on my own, and offering timely and extensive feedback whenever I sought it. My work has been strengthened not only by Professor Cairn's challenging questions, but by the inspiring example of his own scholarship, which served as the basis for an ongoing, often lively, hypothetical conversation with him as I wrote. My friends Lynda and Gaalen Erickson have cheerfully entertained frequent digressions onto the subject of pulp mill pollution in unlikely settings, like ski lifts and mountain cabins. They also have provided a much appreciated home away from home for my frequent trips back to Vancouver this year. My parents have been a constant source of support from my first day of school through what must have seemed like a never-ending formal education. It's impossible to say just how much that has meant to me. Finally, my most profound debt is to my husband and colleague, George Hoberg, who has been a sounding board for my ideas, a willing reader of chapters even longer than they are now, a last-minute graphics consultant, and a source of encouragement whenever my confidence or enthusiasm flagged. This thesis is dedicated to him. xi  Chapter 1 Federalism and Environmental Policy Introduction Within Canada, the renewed salience of environmental issues in recent years has given rise to legislative and regulatory initiatives by both the federal and provincial governments and, not coincidentally, to increased intergovernmental conflict. Jurisdictional disputes have emerged over the Quebec government's James Bay hydro development, the Al-Pac pulp mill and the Oldman River Dam in Alberta, and the Rafferty-Alameda dam in Saskatchewan, to name but a few. As a result, questions concerning the appropriate balance of federal and provincial roles in environmental policy have assumed increasing prominence. This thesis will consider how the current division of federal and provincial responsibilities for environmental policy evolved, and the implications of that arrangement for protection of the environment. The case of environmental policy also will be used to explore the relationship between federalism and public policy more generally. As virtually all human activity has some impact on the environment, it was necessary to narrow the focus somewhat. Thus, the primary concern of this thesis will be environmental protection, that is, policies to maintain or enhance the quality of environment. Policies to conserve or allocate the quantity of natural resources will not generally be addressed. In light of recent developments, it is striking that there 1  actually were remarkably few intergovernmental disputes over environmental matters until recently. As late as 1989, scholarly publications praised the cooperative atmosphere of federalprovincial relations in the environmental field.' The degree of cooperation achieved in environmental protection between the early 1970s and the late 1980s was particularly noteworthy in contrast to the often hostile climate of federal-provincial relations in other fields during the same period, including energy policy and constitutional reform. In order to understand why conflicts emerged in the late 1980s, one first must understand why cooperative federalprovincial relations prevailed in earlier years. It will be argued that the low level of federal-provincial conflict concerning the environment between the early 1970s and the late 1980s reflected the fact that the federal government did not challenge provincial dominance in the field. In 1980, Thompson concluded that "a summary of federal/provincial regulations shows provincial control over environmental matters being exercised against a background of minimum federal interference."  2  Until  recently, the federal government played a largely supporting role  1 O.P. Dwivedi, R. Brian Woodrow, "Environmental PolicyMaking and Administration in a Federal States: The Impact of Overlapping Jurisdiction in Canada," in William M. Chandler, Christian W. Zollner, Challenges to Federalism: Policy-making in Canada and the Federal Republic of Germany, (Kingston: Institute of Intergovernmental Relations, Queen's University, 1989). 2 Andrew R. Thompson, Environmental Regulation in Canada: An Assessment of the Regulatory Process, (Vancouver: Westwater Research Centre, 1980), 25.  2  of conducting research, offering technical expertise, regulating mobile source emissions, and encouraging the provinces to adopt consistent national standards. In contrast, provincial governments assumed the role of "front line" protectors of the environment -- setting standards for environmental and effluent quality, issuing permits for individual sources, and enforcing both provincial and federal standards. Two explanations for the historically weak federal role have been offered: constitutional constraints and provincial resistance. A number of authors have suggested that the federal government was constrained by limited constitutional authority.  3  There is little disagreement that the provinces have strong claims to jurisdiction over the environment within their borders. They have considerable authority both by virtue of their legislative jurisdiction over "property and civil rights" and their ownership of Crown resources. In contrast, federal jurisdiction over the environment is both indirect and uncertain. 3 Lennart J. Lundqvist, Environmental Policies in Canada, Sweden, and the United States: A Comparative Overview, (Beverly Hills: Sage, 1974); O.P. Dwivedi, "Environmental Administration in Canada," International Review of Administrative Sciences, 39 (1973): 149-157, 156; O.P. Dwivedi, "The Canadian Government Response to Environmental Concerns", in O.P. Dwivedi, ed., Protecting the Environment: Issues and Choices -- Canadian Perspectives, (Vancouver: Copp Clark, 1974), 180; L.J. Lundqvist, "Do Political Structures Matter in Environmental Politics? The Case of Air Pollution Control in Canada, Sweden, and the United States," Canadian Public Administration, 17 (1974): 119-142, 135; Dominique Alheritiêre, "Les problêmes constitutionnel de la lutte contre la pollution de l'espace atmospherique au Canada," La Revue du Barreau Canadien 50 (1972): 561-579, 571; Kernaghan R. Webb, Industrial Water Pollution Control and the EPS, unpublished background study prepared for the Law Reform Commission of Canada, May 1983, 1-4.  3  Although most legal scholars believe that the federal government has at least some authority concerning environmental problems that cross international and interprovincial borders or that threaten public health, the limits of that authority are unclear. The problem with the constitutional constraint argument, however, is that uncertain authority has not always stopped the federal government before. Why would the federal government display such self-restraint with respect to the environment, when it did not do so with respect to health care, post-secondary education, or oil-pricing? In fact, legal scholars have been inclined to argue that the federal government has taken a limited view of its environmental powers. 4 Federal authority concerning the environment remains unclear twenty years after the passage of first wave of environmental statutes largely because successive federal governments have declined to test the limits of that authority. Franson and Lucas have suggested that "the excuse of constitutional difficulties is used as a smokescreen to hide a basic unwillingness on the part of those involved to take the  4 J. Owen Saunders, Interjurisdictional Issues in Canadian Water Management, (Calgary: Canadian Institute of Resources Law, 1988), 28-9; D.R. Percy, "Federal/Provincial Jurisdictional Issues," in Harriet Rueggeberg, A.R. Thompson, eds., Water Law and Policy Issues in Canada, (Vancouver: Westwater Research Centre, 1984), 86; Paul Muldoon, Marcia Valiante, Toxic Water Pollution in Canada, (Calgary: Canadian Institute of Resources Law, 1988), 26; Donna Tingley, "Conflict and Cooperation on the Environment," in Douglas Brown, ed., Canada: The State of the Federation 1991, (Kingston: Institute of Intergovernmental Relations, 1991), 132.  4  actions that are necessary." 5 Along with other legal scholars, they have attributed federal timidity to an unwillingness to confront the provinces, which are highly protective of their jurisdiction over natural resources.  6  Again, however, it is  noteworthy that the federal government has not been so reluctant to provoke the provinces in other fields. For instance, when questions arose about which level of government could tax windfall profits from the oil industry, the federal government did not hesitate to challenge provincial authority with respect to natural resources. One is left to wonder why provincial resistance in the environmental field was so successful. While not denying the existence of either constitutional limitations or resistance from at least some of the provinces, this thesis will argue that an explanation for federal and provincial roles in environmental protection is not complete without considering governments' incentives to extend or defend their jurisdiction over the environment in the first place.  5 Robert Franson, Alastair Lucas, "Legal Control of Hazardous Products in Canada," in Science Council of Canada, Canadian Law and the Control of Exposure to Hazards, (Ottawa: Science Council of Canada, 1977), 25. See also H. Scott Fairley, "The Constitutional Conundrum of Jurisdiction over the Environment," in Canadian Bar Association, Canada's Environmental Laws, (Toronto: Canadian Bar Association, 1990), 1. 6 Alastair R. Lucas, "Harmonization of Federal and Provincial Environmental Policies: The Changing Legal and Policy Framework", in J. Owen Saunders, Managing Natural Resources in a Federal State, (Toronto: Carswell, 1986), 39; Thompson, Environmental Regulation, 22; Saunders, Interjurisdictional Issues, 21; Muldoon and Valiante, 27; Barry G. Rabe, "Cross-Media Environmental Regulatory Integration: The Case of Canada," American Review of Canadian Studies 19 (1989), 261-273, 262.  5  Environmental protection typically involves diffuse benefits and concentrated costs, and thus offers few political benefits but significant political costs.' The absence of electoral incentives, rather than constitutional constraints or provincial opposition per se, may explain why the federal government did not pursue a larger role in environmental protection throughout the 1970s and early 1980s. The federal government's resulting reluctance to challenge provincial control of natural resources could also stem from fear of electoral "fed bashing" by provincial governments. Thus, the reality may be closer to a federal surrender than the provincial victory implied by many authors. Why then have provincial governments been so eager to defend their environmental jurisdiction? An argument that will be developed in the following chapter is that a crucial difference between the federal and provincial perspectives is that the provinces are the owners of virtually all Crown resources. Although both orders of government would be expected to respond preferentially to the concentrated interests of resource development industries rather than the diffuse interests of the beneficiaries of resource conservation and protection, in the provinces' case, their ability to do so is inextricably tied to their authority to control the rate and terms of resource exploitation. Thus, the provinces can be expected to defend 7 James Q. Wilson, "The Politics of Regulation," in James McKie, ed., Social Responsibility and the Business Predicament, (Washington: Brookings Institution, 1975).  6  their jurisdiction over natural resources, not so much to protect them, as to manage their exploitation. Public opinion, and thus electoral incentives, are not static, however. During periods in which environmental issues enjoyed a high level of public salience, in the early 1970s and again in the late 1980s, the federal government did in fact adopt a more expansive view of its environmental jurisdiction, despite constitutional uncertainty and despite objections from a number of provinces. Analysis of the subsequent withering of federal environmental programs as the first wave of public attention to the environment declined over the course of the 1970s may offer important lessons as the second wave ebbs in the early 1990s. Federalism and Public policy In recent years, there has been renewed interest in how institutions affect public policy by shaping the opportunities and incentives available to different political actors.  8  It is  argued that it is not only the strength of the players, but also the "rules of the game" that determine policy outcomes. One of the most fundamental rules of the game in Canadian politics is federalism and the associated division of powers between federal and provincial governments. Indeed, long before the movement to "bring the state back in" to studies of politics, there was an extensive literature on the implications of federalism for public  8 For instance, see Theda Skocpol, "Bringing the State Back In: Strategies of Analysis in Current Research," in Peter Evans, Dietrich Rueschemeyer, Theda Skocpol, eds., Bringing the State Back In, (Cambridge: Cambridge University Press, 1985).  7  policy in Canada. Although the state arguably has been well-entrenched in Canadian political science all along, the literature is far from consensus on the relationship between federalism and public policy. 9 Many of the theories that have been offered are in direct conflict. For instance, Professor Cairns' imagery of dirigiste governments competing to expand their jurisdiction 10 contrasts with other authors' arguments that the vetoes and obstruction in the federal system constrain the scope of public policy." There is disagreement between scholars like Trudeau, who argue that federalism promotes diversity and innovation," and those who see interprovincial competition for investment inevitably leading to conservative policy outcomes." And, there is debate over whether federalism promotes intergovernmental turf  Frederick J. Fletcher, Donald C. Wallace, "FederalProvincial Relations and the Making of Public Policy in Canada: A Review of Case Studies," in Richard Simeon, ed., Division of Powers and Public Policy, (Toronto: University of Toronto Press, 1985). 9  m Alan C. Cairns, "The other crisis of Canadian federalism," Canadian Public Administration, 22 (1979): 175-195.  11 ^Banting, The Welfare State and Canadian Federalism, (Kingston: McGill-Queen's University Press, 1987); David R. Cameron, "The Expansion of the Public Economy: A Comparative Analysis," American Political Science Review, 72 (1978): 12431261; Fletcher and Wallace, "Federal-Provincial Relations." 12 P.E. Trudeau, "The Practice and Theory of Federalism," in Michael Oliver, ed., Social Purpose for Canada, (Toronto: University of Toronto Press, 1961). 13 Frank R. Scott, "Centralization and Decentralization in Canadian Federalism," in Essays on the Constitution, (Toronto: University of Toronto Press, 1977).  8  wars, or is instead the stuff of backroom deals." Part of the diversity of the literature lies in the fact that different authors have been asking different questions. Two of those questions, which level of government should be assigned responsibility for a particular problem, and what are the implications of overlapping jurisdiction for public policy, will be considered in turn. Assigning Jurisdiction for the Environment In considering which level of government should be assigned responsibility for a particular policy problem, the dilemma is that both levels of government offer characteristic strengths and weaknesses. With respect to environmental protection, arguably the strongest point in favour of federal authority is the existence of interjurisdictional spillovers. When pollutants cross provincial boundaries, the downstream province can do little to control sources of pollution located outside the province, while the upstream province has little incentive to accept the costs of regulating polluters in its own province in order to deliver environmental benefits to another province. Like physical spillovers, economic spillovers also can create problems. Elliott et al. have noted the propensity of U.S. state governments to shift the costs of air pollution control out of state by regulating products that originate elsewhere, such as 14 ^Breton, "Supplementary Statement," Report of the Royal Commission on the Economic Union and Development Prospects for Canada, (Ottawa: Minister of Supply and Services Canada, 1985), Vol. 3, 493. 9  automobiles and coal, rather than controlling discharges from sources within their own borders.  15  The federal government is less likely to face geographic constraints or related perverse incentives given its larger physical jurisdiction. However, as awareness of transboundary environmental problems has evolved from discrete instances of contamination of interprovincial rivers to global environmental problems, such as climate change and depletion of the ozone layer, it is increasingly clear that even federal jurisdiction may not be large enough. Nonetheless, it is often argued that federal authority is preferable to provincial, since international negotiations normally take place between national, rather than subnational, governments. A second argument in favour of federal jurisdiction is that the federal government is less vulnerable to prisoners' dilemmas. Since individual provinces compete to attract investment and to maintain existing industries, they may be reluctant to impose stringent environmental standards for fear of placing local industry at a disadvantage relative to competitors in other provinces. 16 As a result, each province could end up adopting 15 E. Donald Elliott, Bruce A. Ackerman, John C. Millian, "Toward a Theory of Statutory Evolution: The Federalization of Environmental Law," Journal of Law, Economics, and Organization, 1 (1985):^313-340, 329. 16 A critical underpinning of this argument is the assumption that regulated industries in general enjoy greater political influence than voters at large, by virtue of their greater mobility. See Susan Rose-Ackerman, "Does Federalism Matter? Political Choice in a Federal Republic," Journal of Political Economy, 89 (1981): 152-165.  10  standards that are lower than they would have chosen had they been acting independently of the others. At the limit, provinces that are particularly vulnerable to threats of job losses, whether by virtue of high unemployment or non-unique resource assets, might offer particularly generous concessions to industry, effectively creating "pollution havens." The third argument in favour of federal responsibility is that the federal government can capture economies of scale in administration. As Mashaw and Rose-Ackerman have noted, "Some information relevant to the entire country can be most efficiently created by the federal government."" It may be more efficient for the federal government to review available control technologies, devise effluent standards, and take the various procedural steps necessary to promulgate a single regulation, than for ten provincial governments to replicate each of those activities. The fourth argument in favour of federal jurisdiction concerns the possibility that the extent of influence of different interest groups may be different at the federal and provincial levels. Stewart has argued that economies of scale in political organization allow environmental groups to have the  17 Jerry L. Mashaw and Susan Rose-Ackerman, "Federalism and Regulation," in George C. Eads and Michael Fix, eds., The Reagan Regulatory Strategy, (Washington: Urban Institute Press, 1984), 118. 11  greatest impact at the national level." Environmental groups can exercise greater leverage by organizing once on a national scale, than by attempting to fight the same battles in each and every province. Although similar economies of scale also are available to regulated industries, they are likely to be more meaningful to groups with limited resources inasmuch as they allow them to achieve a "critical mass" at the national level. Provincial control of environmental policy also offers important advantages. First, administrative diseconomies of scale may outweigh national economies of scale. Local officials are likely to be more familiar with local problems and also in a better position to devise solutions tailored to the circumstances of a particular community. Second, it is often argued that smaller scale governments are "closer to the people" and thus, better able to discern citizen preferences. Although it may be more resource-efficient for environmental groups to fight a battle once at the national level than to wage war on ten different fronts, they may nonetheless be more effective closer to home if it is easier for them to organize and to be heard among their neighbours. Proponents of provincial jurisdiction argue that the problem is  n Richard B. Stewart, "Pyramids of Sacrifice? Problems of Federalism in Mandating State Implementation of National Environmental Policy," Yale Law Journal, 86 (1977): 1196-1272, 1213-4. See also Anthony Scott, "Piecemeal Decentralization: The Environment," in Robin Boadway, Thomas Courchene, Douglas Purvis, eds., Economic Dimensions of Constitutional Change, (Kingston: John Deutsch Institute for the Study of Economic Policy, 1991). 12  not that local governments are too sympathetic to powerful minorities, but that national governments are insufficiently responsive to local majorities. 19 Third, to the extent that the public's preferences are geographically diverse, they can be satisfied more fully by geographically diverse policies. When national governments impose uniform standards, as they are wont to do," they force residents of some provinces to pay for more environmental protection than they want, and others to settle for less. A closely related argument is that multiple jurisdictions tend to better satisfy voter preferences, since citizens retain the option of "voting with their feet" by moving to a jurisdiction that offers a more favourable package of environmental and  19 ^classic statement of this argument can be found in James Madison's "Federalist Paper No. 10," reprinted in James Q. Wilson, American Government, 3rd ed., (Toronto: D.C. Heath, 1986). It should be noted, however, that Madison offered the argument in favour of national jurisdiction, since he was motivated to overcome the "tyranny" of local majorities. Although the quite different argument, presented above, that diffuse interests can be better represented at the national level is often attributed to Madison (see, for instance, Mashaw and Rose-Ackerman, "Federalism and Regulation," 121), in fact, Madison was concerned exclusively with shifting majorities, rather than Olsonian notions of obstacles to collective action. Theoretically, the federal government could adopt regionally tailored standards that would mimic those that would be adopted by individual provinces. However, as Breton and Scott have argued, using an analysis of governments' and citizens' transaction costs, that is unlikely to occur. (The Economic Constitution of Federal States, (Toronto: University of Toronto Press, 1978.)) Richard O. Zerbe offered a similar argument, with particular emphasis on administrative costs, in "Optimal Environmental Jurisdictions," Ecology Law Quarterly, 4 (1974): 193-245. 20  13  economic services." The fourth argument in favour of provincial jurisdiction is essentially that ten heads are better than one -- with diversity comes innovation." Studies in both Canada and the United states have shown that new ideas that emerge in one state or province often diffuse to other states and provinces." A related final argument is that interprovincial competition is healthy in a democratic society. Short of "voting with their feet," voters can compare their own government's performance with that of neighbouring jurisdictions and, if it is found wanting, vote for another party come election-time. Overlapping Jurisdiction: Problem or Panacea? More recently, scholars in both political science and economics have acknowledged that we seldom face an either/or proposition between provincial and federal government. A constitution written more than a century ago simply cannot allocate responsibility for contemporary policy problems exclusively to one level of government or the other. More often than not, today both federal and provincial governments are 21 ^Tiebout, "A Pure Theory of Local Expenditures," Journal of Political Economy, 64 (1956): 416-424. 22 ^"The Practice and Theory of Federalism." The classic statement of this argument in the U.S. is Louis Brandeis' depiction of the States as "little laboratories of democracy." 23 ^L. Walker, "The Diffusion of Innovations Among the American States," American Political Science Review, LXIII (1969): 880-899; Dale H. Poel, "The Diffusion of Legislation among the Canadian Provinces: A Statistical Analysis," Canadian Journal of Political Science, 9 (1976): 605-26. 14  involved in a given policy field, a phenomenon Leslie has referred to as "entanglement.  X24  However, just as scholars have offered competing theories of the implications of federal vs. provincial jurisdiction, they also disagree about the implications of overlapping jurisdiction. Norrie, Simeon, and Krasnick have summarized the literature in terms of two distinct models of intergovernmental relations: competition and collaboration.  25  As depicted in the matrix  below, advocates of the collaborative model stress the advantages of joint federal-provincial action and the disadvantages of unilateralism, while advocates of competition stress the advantages of independent action and disadvantages of joint decisionmaking. 26  Advantages^Disadvantages Collaboration Complementarity^Collusion Vetoes Unilateralism Diversity^Duplication "Backup"^Obstruction Healthy Competition Unhealthy Conflict  24 ^Leslie, Federal state, national economy, (Toronto: University of Toronto Press, 1987). 25 Kenneth Norrie, Richard Simeon, Mark Krasnick, Federalism and Economic Union in Canada, (Toronto: University of Toronto Press, 1986), 129.  26 ^matrix is similar to one offered by Martin Painter, in "Intergovernmental Relations in Canada: An Institutional Analysis," Canadian Journal of Political Science, 24 (1991): 269-288. 15  Proponents of collaboration have argued that the greatest asset of federalism is its flexibility, which facilitates intergovernmental arrangements that capture the strengths of both levels of government.  27  In the field of environmental policy, it  is often suggested that the federal government can capture economies of scale by developing national effluent standards, while provincial officials can take advantage of their familiarity with local sources by taking the lead role in enforcement. Alternatively, the federal government could elect to play a stronger role in provinces with limited resources, while leaving more capable provinces to their own devices. Proponents of coordination stress the wasteful duplication and conflict that can result from unilateralism.  28  Duplication  is not only costly for taxpayers, but also for regulated firms that must satisfy often-inconsistent federal and provincial requirements. Moreover, independent action could lead to obstruction. Conflicting federal and provincial environmental regulations may well constrain the effectiveness of either one. Along a similar vein, Alan Cairns has argued that government leaders within the federal system tend to be preoccupied with the  27 See, for instance, Mark Sproule-Jones, Public Choice and Federalism in Australia and Canada, (Canberra: Australian National University, 1975), 30. 28 Richard J. Schultz, "Federalism and Telecommunications: Multiplication, Division and Sharing," Osgoode Hall Law Journal, 20 (1982): 745-761, 754; Steven Alexander Kennett, "Interjurisdictional Water Resource Management in Canada: A Constitutional Analysis," L.L.M. Thesis, Queen's University, 1989, 99.  16  extent of their own jurisdiction, rather than their voters' preferences, leading to wasteful "turf wars" and unwarranted expansion of the scope of activities of both levels of government. 29 In contrast, proponents of competitive federalism have argued that "Constitutional 'messiness' may be the servant, not the enemy of political responsiveness." 30 They favour the diversity that results from independent federal and provincial policies. In the environmental field, it often is asserted that an important advantage of overlapping jurisdiction is that with two levels of government in the business of pollution control, there is a greater chance that at least one of them will do the job. 31 Independence could be particularly important when it comes to governments regulating each others' activities. Albert Breton has taken the argument a step further in asserting that federal-provincial competition is actually quite healthy. Because both levels of government have to appeal to the same voters, they have incentives to respond to each others' 29  Cairns, "The other crisis of Canadian federalism."  30 ^Simeon, and Krasnick, Federalism and Economic Union in Canada, 317. 31 See, for instance, Thompson, Environmental Regulation in Canada; Peter Nemetz, "The Fisheries Act and federal-provincial environmental regulation: duplication or complementarity," Canadian Public Administration 29 (1986): 401-424; Webb, Industrial Water Pollution Control and the EPS; Dale Gibson, "Environmental Protection and Enhancement under a New Canadian Constitution," in Stanley M. Beck, Ivan Bernier, eds., Canada and the New Constitution, Vol. 2, (Montreal: Institute for Research on Public Policy, 1983); Franson and Lucas, "Legal Control of Hazardous Products," 48.  17  initiatives, thus strengthening their own proposals. Breton draws an analogy  between  political and economic markets, and  asserts that competition between suppliers leads to greater satisfaction of consumers preferences in both types of market. In the environmental field, Ilgen has offered the analogous argument that federal-provincial competition extends the scope of conflict and thus opens up otherwise closed and consensual policymaking. 32 Where proponents of collaboration see opportunities for efficient joint administration, advocates of competitive federalism see collusion." Simeon has expressed concern about the lack of public accountability that attends secretive "federal-provincial diplomacy," and argued that in the absence of public scrutiny, governments' own interests become paramount.  m  Others focus on what kind of decisions are likely to emerge from behind closed doors. Involvement of multiple governments may create a "joint decision trap" that allows any one government to veto a decision, and thus to block new policies or to resist policy change when social conditions or public preferences  32 ^Ilgen, "Between Europe and America, Ottawa and the Provinces: Regulating Toxic Substances in Canada," Canadian Public Policy, 11 (1985): 578-590, 588. " Breton, "Supplementary Statement." m Richard Simeon, Federal-Provincial Diplomacy, (Toronto: University of Toronto Press, 1972).  18  change. 35 In environmental standard-setting, joint decisionmaking could deliver the lowest common denominator, rather than the "best of both worlds." Scholars who study Canadian federalism disagree over whether intergovernmental competition or collaboration is likely to prevail, and over which outcome is to be preferred. However, one common assumption implicit in much of the literature is that both levels of government invariably seek to expand or at least fully exploit their available jurisdiction. 36 Norrie, Simeon, and Krasnick have asserted that "Responding to new citizen needs, governments expanded to occupy the full 'jurisdictional potential' allocated to them under the Constitution, and indeed sought to extend their reach beyond it." 37 Similarly, Alan Cairns has portrayed federal and provincial governments as "pyramids of bureaucratic power and ambition" capped by "protectionist and expansionist" political authorities, "steadily extending their 35 Fritz Scharpf, "The Joint-Decision Trap: Lessons from West German Federalism and European Integration," Public Administration, 66 (1988): 239-278. A similar argument is offered in Banting, The Welfare State and Canadian Federalism.  36 An important exception is R.A. Young, Philippe Faucher, Andre Blais, "The Concept of Province-Building: A Critique," Canadian Journal of Political Science, 17 (1984): 783-818. Their paper argues that not all provinces have attempted to extend their jurisdiction. This thesis takes a similar approach in arguing that not all types of jurisdiction provoke either province- or nation-building. Norrie, Simeon, and Krasnick, Federalism and Economic Union in Canada, 123. It is noteworthy that in devising their typology, the authors as well as Painter ("Intergovernmental Relations in Canada") assume that the reverse of "collaboration" is "competition," rather than merely independence or unilateralism. 19  tentacles of control, regulation, and manipulation into society." u While there is no denying the dramatic growth of the scope of government activity in recent decades, the question remains whether that growth has been indiscriminate, or whether one or both levels of government have declined to act in certain fields even while seeking to extend their jurisdiction in others. It is accepted wisdom that governments within the federal system seek both to claim credit and to avoid blame.  39  However,  to date students of Canadian federalism have been more attentive to opportunities for credit claiming than to blame avoidance. It is true that some authors in passing have noted opportunities for governments to shirk responsibility within the federal system.  °  Certainly, environmentalists long have complained of "jurisdictional buck passing" in the environmental field.  41  38 ^C. Cairns, "The Governments and Societies of Canadian Federalism," in Douglas E. Williams, ed., Constitution, Government, and Society in Canada: Selected Essays by Alan C. Cairns, (Toronto: McClelland and Stewart, 1988), 150-151. 39  For instance, see Richard Simeon, Federal-Provincial Diplomacy, (Toronto: University of Toronto Press, 1977), 185. 40 ^Skogstad, "Federalism and Agricultural Policy," in Herman Bakvis, William M. Chandler, eds., Federalism and the Role of the State, (Toronto: University of Toronto Press, 1987); D.V. Smiley, The Federal Condition in Canada, (Toronto: McGraw-Hill Ryerson, 1987), 21; Garth Stevenson, "The Division of Powers," in Richard Simeon, Division of Powers and Public Policy, (Toronto: University of Toronto Press, 1985), 113. An exception which places greater emphasis on "buck passing" strategies is James Struthers, No Fault of Their Own: Unemployment and the Canadian Welfare State 1914-1941, (Toronto: University of Toronto Press, 1983). 41 See Tingley, "Conflict and Cooperation," 132; Canadian Environmental Law Association, cited in Colin P. Stevenson, "A New Perspective on Environmental Rights After the Charter,"  20  However, the intergovernmental dynamics evoked by less desirable policy fields have received relatively little scholarly attention. A central argument of this thesis is that the implications of federalism for public policy are very different when both levels of government are eager to pursue their own programs than when one or both is content to vacate the field. To a large degree, government attitudes toward their available jurisdiction, and the type of intergovernmental dynamics that emerge in a given policy field, will depend on the political costs and benefits of the policy in question. In effect, there is less need to "bring the state back in" to Canadian scholarship on federalism and public policy than to bring society back in, to reconsider societal influences on governmental strategies of action and of inaction within the federal system. The argument here is not that institutions do not matter. Indeed, the dissertation is preoccupied with the impact of one particular institution -federalism. Rather, it is that institutional analysis cannot proceed independently of social analysis.  Oscroode Hall Law Journal 21 (1983): 390-421, 412; David Estrin, J. Swaigen, Environment on Trial: A Handbook of Ontario Environmental Law, (Toronto: Canadian Environmental Law Research Foundation, 1978), 13; Barbara Rutherford, Paul Muldoon, "Designing an Environmentally Responsible Constitution," Alternatives, 18 (1992): 26-33, 30; Ian Jackson, in House of Commons, Standing Committee on the Environment, Minutes of Proceedings and Evidence, October 23 1991, 12:26. Although these authors have expressed concern about "buck-passing," they have not offered a theory for when and why governments seek to avoid responsibility for environmental protection. 21  Research Methodology Various documentary sources were used in the research, including secondary literature, case law, newspapers, federal and provincial government reports, and legislative debates. However, a critical source of information, particularly concerning federal-provincial relations, was unstructured interviews conducted with 76 individuals. As summarized below, within government, they ranged from former Ministers of the Environment to technical specialists. In addition, representatives of the pulp and paper industry and environmental groups across the country were interviewed for a case study of federal and provincial regulation of the pulp and paper industry. Subjects were guaranteed confidentiality, with the exception of several politicians who agreed to be interviewed "on the record."  Federal^Provincial^Other Former Ministers^2  3  5  Departments/Ministries of the Environment Senior Executives^3 4 Federal-Provincial Relations Specialists ^5 8 Technical Specialists^19 9 Other Departments^6 e.g., Fisheries Intergovernmental Affairs  Total^  7 13 28  4  Pulp and Paper Industry Provincially-Based Environmental Groups 35  28  22  Total  10  8 5  8 5  13  76  Both because the theoretical argument of the thesis concerns environmental policymaking in the context of overlapping jurisdiction, and because the bulk of the population and associated environmental problems are concentrated in Southern Canada, the research focused on the federal government's role within "federal Canada," that is, within the provinces. No effort has been made to investigate federal environmental protection efforts offshore or in the Northern territories in any depth. Interviews were conducted in Ottawa and five provinces: British Columbia, Alberta, Ontario, Quebec, and New Brunswick. Each of the provinces chosen brings unique characteristics to the study. Ontario is the largest and, historically, wealthiest province, which one would expect to be least affected by resource and scale limitations. Quebec was included because governments of that province historically have been defensive of their jurisdiction in order to promote the province's distinct francophone identity. Both Alberta and British Columbia have natural resource-based economies, and their provincial governments often have been aggressive in defending provincial jurisdiction over natural resources. Finally, New Brunswick was included as a representative of the smaller and more economically vulnerable provinces. Outline of the Thesis This thesis uses the case of environmental protection to explore the phenomenon of policy inaction within Canadian 23  federalism. The questions addressed by the thesis -- why has the division of federal and provincial responsibilities for environmental protection evolved as it has, and what are the implications of different federal-provincial arrangements for protection of the environment -- are primarily empirical, rather than normative. Although those seeking discrete policy prescriptions thus will be disappointed, I believe that empirical research need not be detached from normative analysis. We will have greater success in reforming public policy if we begin from an empirically-grounded understanding of the factors that influence existing current policies and institutional arrangements. The theoretical chapter which follows discusses in greater depth the implications of policy type for federal-provincial relations and policy outcomes. The empirical component of the dissertation then is divided into two parts. The first traces the evolution of federal and provincial roles in environmental protection over a twenty-three year period from 1969 to 1992. To limit the scope of the study, those chapters focus primarily on the evolution of the federal role as public attention to the environment waxed and waned over time. However, close attention is paid to provincial reactions to federal initiatives and to federal-provincial relations concerning the environment. Chapter 3 reviews federal and provincial governments' sources of constitutional authority with respect to the environment, while Chapters 4 to 6 trace federal environmental policy and federal24  provincial relations over three periods corresponding to the emergence of federal involvement (1969-1972), the federal retreat (1972-1985), and the resurgence of the federal role (1985-1992). In the second part, Chapters 7 and 8 present a case study of federal and provincial regulation of effluents from the pulp and paper industry. In contrast to the preceding chapters, which consider relatively broad questions of jurisdiction, the case study is more focused on policy outcomes. What actually happens when both levels of government regulate a given industry? Since federal powers over the environment are strongest in the area of water pollution, the pulp and paper industry provides a critical test of the federal government's willingness to exercise its environmental jurisdiction. Finally, concluding remarks are offered in Chapter 9.  25  Chapter 2 Policies and Intergovernmental Politics Introduction Wilson has offered the important observation that policies characterized by different distributions of costs and benefits tend to evoke different types of politics. 1 Policies with diffuse beneficiaries and concentrated victims are likely to elicit very different politics than those where, for instance, both "winners" and "losers" are concentrated. The critical concept underlying Wilson's argument is Olson's insight that organizations to pursue collective goods and information about public goods are themselves public goods.  2  Thus, individuals who  are diffusely affected, whether winners or losers, are unlikely to organize to pursue their shared political goals, or even to inform themselves about the nature of the costs and benefits they bear. It follows that democratic governments, motivated to claim credit and avoid blame from voters, would be inclined to pursue policies with concentrated benefits and to resist policies with concentrated costs. This chapter represents an attempt to extend those insights to the study of federalism and public policy, with particular 1 James Q. Wilson, "The Politics of Regulation," in James McKie, ed., Social Responsibility and the Business Predicament, (Washington: Brookings Institution, 1975). A similar point was made in an earlier article by Theodore Lowi ("American Business, Public Policy, Case-Studies, and Political Theory," World Politics, 16 (1964): 677). 2 Mancur Olson, The Logic of Collective Action, (Cambridge: Harvard University Press, 1965).  26  attention to the concentrated costs and diffuse benefits of environmental protection. Following Wilson's example, it is argued that policies with different distributions of costs and benefits are likely to provoke different intergovernmental politics. Moreover, the ways in which the institution of federalism affects policy outcomes are likely to depend on the characteristics of the policy at issue. The chapter is organized in six sections. The first applies Wilson's insights to the field of environmental policy. Thereafter, the next four sections examine different aspects of the relationship between federalism and public policy: the shifting balance of federal and provincial roles in the environmental field, federal-provincial relations, the impact of federalism on provincial environmental policymaking, and the impact of federalism on federal environmental policymaking. The theoretical focus in each of those sections is on the implications of the distribution of costs and benefits of environmental policy. The final section considers the influence of other factors on federal and provincial policymaking. The Politics of Environmental Protection Before going further, it is useful to distinguish between three government functions: taxation, spending, and regulation. 3 The typology is similar to Stevenson's four-fold classification of constitutional powers of taxation, spending, regulation, and service provision. I have treated service provision as a special case of spending. (Garth Stevenson, "The Division of Powers," in Richard Simeon, ed., Division of Powers and Public Policy, (Toronto: University of Toronto Press, Toronto, 1985.)  27  3  Taxation and spending are familiar and require no explanation. Regulation will be defined broadly as rules of behaviour backed up by the legitimate sanctions of the state. 4 In effect, rather than providing a public service itself, in choosing regulation, the government exercises its coercive powers to force someone else to provide the service and to pay for it. Thus, an important characteristic of regulation is that the government's administrative costs are small, at least relative to the costs borne by the private sector. Regulation typically is perceived as imposing concentrated costs on regulated industries in order to confer diffuse benefits on the public. As such, one would not expect governments to pursue regulatory policies aggressively, since diffuse beneficiaries generally would be uninformed, unorganized, and thus, unappreciative, while regulated interests would be wellorganized and unyielding in their opposition. However, regulation also can be used to deliver concentrated benefits at diffuse cost. Regulations such as those establishing agricultural marketing boards are actively sought by those who would be regulated. 5 In such cases, the diffuse victims of regulation are unorganized and uninformed, allowing government to  4 G. Bruce Doern, "Introduction: The Regulatory Process in Canada," in G. Bruce Doern, ed., The Regulatory Process in Canada, (Toronto: Macmillan, 1978), 14. 5 George J. Stigler, "The Theory of Economic Regulation," Bell Journal of Economics and Management, 2 (1971): 3-21.  28  purchase beneficiaries' support with consumers' dollars.  6  All else being equal, one would expect governments to prefer diffusely applied taxes, spending programs that deliver concentrated benefits, and regulations that impose diffuse costs to achieve concentrated benefits. ? The absolute magnitude of costs and benefits can also come into play, however. Even diffuse costs can add up and cause taxpayers to revolt, if only at the ballot box. In addition, the particular identity of winners and losers may be relevant. Policies that appear to reward undeserving interests may provoke opposition, even if the costs are widely diffused. 8 How does environmental policy fit within the preceding discussion? A government seeking to protect the environment can choose among the governing instruments described above. An analogy commonly offered is that of motivating a donkey to pull a cart with either a stick or a carrot. The "stick" corresponds to the use of regulation, encompassing both the traditional "command and control" form of regulation and incentive-based approaches, such as marketable permits and discharge fees.  9  The "carrot"  6 Douglas G. Hartle, Public Policy Decision Making and Regulation, (Toronto: Institute for Research on Public Policy, 1979), 91. 7 M. J. Trebilcock et al., The Choice of Governing Instrument, (Ottawa: Economic Council of Canada, 1982). 8  Hartle, Public Policy Decision Making, 87.  9 Although discharge fees could be considered a tax, they have been considered a form of regulation here since their intent is to promote regulatory objectives, rather than merely to raise money.  29  corresponds to government spending to subsidize pollution abatement costs. However, spending is best seen as a supplement rather than an alternative to regulation, since subsidies alone cannot eliminate regulated interests' economic incentive to pollute. m Governments also can choose to pull the hypothetical cart themselves, by relying on public enterprise. However, given the ubiquity of activities that affect the environment, this approach would entail an implausible degree of public ownership. In the end, some form of regulation, possibly supplemented by subsidies or public enterprise, is necessary to overcome economically rational polluting behaviour. Environmental regulation presents a classic case of diffuse benefits and concentrated costs. In general, the public at large benefits from improvements in environmental quality, but the costs are borne by a smaller number of regulated firms or individuals. An Olsonian analysis suggests that the opponents of environmental protection would be better organized and better informed than the beneficiaries. Moreover, those most directly harmed by environmental regulation tend to hold privileged positions in society. Regulated industries can offer politicians more than just votes or even campaign contributions. Most importantly, they create jobs, and thus offer extremely valuable indirect benefits. As a result, one would expect governments normally to be more responsive to the concentrated interests, 10 William J. Baumol, Wallace E. Oates, The Theory of Environmental Policy, 2d ed., (New York: Cambridge University Press, 1988), Chapter 14. 30  that is, to the polluters. The logic of collective action is heavily weighted against strong environmental policy. As Farber has noted, "The Olson paradigm appears to have a straightforward implication for environmental legislation: there should not be any." n If that is the case, then why do governments ever adopt environmental policies? A number of explanations have been offered. First, however improbable it might seem to Olson, numerous environmental groups have emerged since the 1960s to pursue policies that involve diffuse benefits. 0 The presence of "policy entrepreneurs," who derive personal satisfaction from pursuing collective benefits, clearly is a critical factor in the emergence of such groups. Although only a minority of those who would benefit from environmental protection are persuaded by policy entrepreneurs to actually join environmental groups, the substantial number that do join nonetheless provide an important voice for the interests of an otherwise silent constituency. Moreover, environmental groups provide information that "rational" individuals diffusely affected by environmental regulation would not take the trouble to seek, and thus stimulate greater attentiveness to environmental issues even among non-members. The presence of an active environmental community effectively serves to concentrate 11  ^A. Farber, "Politics and Procedure in Environmental Law," Journal of Law, Economics, and Organization, 8 (1992): 5981, 60. 12 ^response, see Mancur Olson, The Rise and Decline of Nations, (New Haven: Yale University Press, 1982), 34-5. 31  the interests of those diffusely affected by environmental policy. Although more sophisticated interest group theory can account for the emergence of interest groups representing diffuse interests, 13 it nonetheless predicts that such groups will remain weak relative to those representing concentrated interests, a proposition for which there is considerable empirical support.  m  Moreover, in Canada, the first generation of environmental statutes passed in the early 1970s coincided with, rather than followed, the emergence of organized environmental groups, and thus cannot be attributed to their influence.  15  In sum, interest  group politics offers at best an incomplete explanation for the emergence of environmental protection policies. Others have argued that governments adopt environmental policies primarily in response to rent-seeking industries. Elliott, Ackerman, and Millian have asserted that the U.S. federal government involvement in air pollution control was a response to lobbying by the coal and auto industries for  13 On why people join public interest groups despite collective action problems, see Jack Walker, "The Origins and Maintenance of Interest Groups in America," American Political Science Review, 77 (1983): 390-406.  14  ^"Politics and Procedure," 61.  15 R. Brian Woodrow, "The Development and Implementation of Federal Pollution Control Policy," unpublished Ph.D. thesis, University of Toronto, 1977, 124.  32  consistent national standards.  16  Along a similar vein, Canadian  authors have argued that the earliest provincial environmental statutes were passed to protect polluters from private litigation under common law. 17 Although this argument often is persuasive in the case of discrete regulated industries, it fails to account for the breadth of environmental statutes or the very real costs that have been imposed on many sectors of industry that not only did not pursue environmental regulation, but actively opposed it. Still others have implied that environmental statutes are all "smoke and mirrors." The incentives of those diffusely affected by regulations to remain ill-informed create ample opportunities for symbolic politics. Governments can claim credit for protecting the environment while at same time avoiding blame from regulated interests either by offering subsidies to cover the costs of regulation, or by simply neglecting to enforce regulations after exalting their stringency. There is considerable evidence that governments do both. Hartle for one has argued that in practice, most regulated interests have been  16 E. Donald Elliott, Bruce A. Ackerman, John C. Millian, "Toward a Theory of Statutory Evolution: The Federalization of Environmental Law," Journal of Law, Economics, and Organization, 1 (1985):^313-340. 17 See, for instance, D.P. Emond, "Environmental Law and Policy: A Retrospective Examination of the Canadian Experience," in Ivan Bernier, Andr6e Lajoie, eds., Consumer Protection, Environmental Law, and Corporate Power, (Toronto: University of Toronto Press, 1985), 134.  33  "gummed rather than bitten" by ostensibly strict regulations." The question remains, however, whether subsidies and weak enforcement reflect conscious strategies adopted by governments at the outset, or merely after-the-fact responses to persistent political opposition. The latter is more plausible, particularly with respect to the strategy of nonenforcement. If weak enforcement were planned from the outset, governments either would have to bear the brunt of industry wrath anyway until the laxity of enforcement became apparent, or alternatively, risk letting regulated interests in on the plan from the start. Even if there were sufficient trust between government and business to keep such a conspiracy quiet -- a very big "if" -- it is far from obvious that regulated industries would welcome the prospect of being "gummed" even if not "bitten." Despite receiving reassurances from the current government, regulated industries would be expected to fear that once legislation or regulations were in place, a future government might be more inclined to enforce them. The most compelling explanation for environmental policy is that public opinion occasionally overcomes the obstacles to collective action, thus transforming politicians' incentives. Although the odds are weighted against public attention to environmental issues, a rare combination of effective political entrepreneurship and unusual events that capture the media's I8 ^Public Policy Decision Making, 17; also, Donald N. Dewees, Evaluation of Policies for Regulating Environmental Pollution, (Ottawa: Economic Council of Canada, 1980), 24. 34  attention can cause even those diffusely affected to sit up and take notice, and that leads electorally-minded politicians to do the same. Although poorly informed, the beneficiaries of environmental regulation nonetheless substantially outnumber the victims. Thus, relatively small changes in levels of public awareness can quite dramatically transform the balance of political costs and benefits. 19 Farber has argued that: [P]olitics alternates between normal periods, in which public attention to an issue is weak, and extraordinary periods, in which the issue has high salience for the public. In those extraordinary periods when broad segments of the public are intensely involved with an issue, legislators find themselves in the spotlight, and their positions shift closer to those of the public at large." To date, there have been two such waves when the North American public turned its attention to the environment, the first around 1970 and the second around 1990. However, given the diffuseness of the benefits of environmental protection, such high levels of salience are difficult to sustain. It is not  19 A simple model offered by Peltzman is illustrative. (Sam Peltzman, "Towards a More General Theory of Regulation," Journal of Law and Economics, 19 (1976): 211-241.) He posited that politicians would seek to maximize political support, M, such that M = abs[(n x f) - (N - n) x h],^where n = number of voters in the regulated group; f = probability that regulated interests will oppose; N = total number of voters; h = probability that diffuse beneficiaries will support. Because n is small, f normally will be much larger than h, reflecting the logic of collective action. However, since (N n) is much larger than n, M would be very sensitive to changes in h.  20 Farber, "Politics and Procedure," 66. 35  sufficient for members of the public merely to prefer a cleaner environment; they must also be familiar with government policies and willing to weigh the government's performance on environmental issues heavily at election-time. Whatever the origins of these unusual periods of public interest (a complex question that will not be examined here), the logic of collective action suggests that they will be shortlived and relatively rare. In fact, like its predecessor in 1970, the most recent green wave crested with the onset of economic problems, as public attention returned to "bread and butter" issues like unemployment and inflation, 21 a trend consistent with Peltzman's argument that "[r]egulation will tend to be more heavily weighted toward 'producer protection' in depressions and toward 'consumer protection' in expansions.  "22  In summary, one would expect that most of the time, when environmental issues do not capture public attention, governments will decline to impose environmental regulations. However, during periods of high salience of environmental problems, they are more likely to respond to public opinion by passing new laws and regulations. It is during those periods that symbolic statutes might be expected to emerge, since regulated industries would be more willing to accept the risk of future enforcement when the alternatives seem worse. However, during normal periods 21  Hugh Winsor, "Canadians have turned a lighter shade of green," Globe and Mail, April 24 1991, A6. 22  227.  Peltzman, "Towards a More General Theory of Regulation," 36  of public inattention, symbolic statutes represent an unnecessary risk for government and industry alike. Evolving Federal and Provincial Roles in Environmental Protection The preceding section was concerned exclusively with governments' own policy objectives in light of their relationships with their own constituents. This section considers how those objectives affect federal and provincial governments' attitudes toward their constitutional jurisdiction, and thus shape the division of federal and provincial responsibilities that emerges in the environmental field. Just as some policies are more politically appealing than others, some fields of jurisdiction are worth fighting for, while others are willingly vacated. It is argued that the distribution of costs and benefits inherent in different poli