Separating from Canada Would Be an Economic Disaster for Alberta

Stacey Innes, who lives in Spruce Grove, an Edmonton bedroom community, has struggled to find work since she lost her job at Walmart as an overnight shelf stocker. Although she’s since landed a construction job with the company her son works for, she was forced to rely on support from her son and seventy-three-year-old mother to get by between jobs. For her, separation is a no-brainer.

A sovereign Alberta, she’s certain, will benefit people like her. When she looks at her paycheque, she sees all the taxes that are taken off. In an independent Alberta, she thinks she’d keep more of her money.

“Honestly, I hate this country right now. If I could leave, I would.”

The motivations that have contributed to the separatist movement and Alberta’s sense of grievance in recent years are not especially discrete; it’s more like a nebulous Venn diagram. Simple politics have pushed some people toward separatism. Indeed, the paucity of separatist talk during the time when Stephen Harper was prime minister suggests there’s a significant political component to the idea; when Liberals are in power, people feel more inclined to talk about leaving. Culture also plays a role. When Angus Reid pollsters talked to separatists in February 2026, 86.5 percent said they thought Canada forced Alberta to take in too many immigrants, and 96 percent believed that an independent Alberta would better protect personal freedoms.

But, as with Innes, separatists tend to find the economic arguments particularly seductive. Angus Reid polling shows 96 percent of respondents who want an independent Alberta believe they would be free from economically damaging federal government policies. Separatist leaders promise the elimination of the personal income tax while creating a new provincial sales tax of 5 percent. They also claim Alberta would save $75 billion from no longer paying federal taxes.

Not all separatists promise immediate prosperity, but the argument remains persuasive. Cameron Davies is the leader of the Republican Party of Alberta. “I don’t paint an immediate rosy, utopian picture of what independence looks like,” he says. “Will it be difficult? Yes. Will it be immediate sunshine and rainbows? Probably not. But will it be worth it? Five, ten, fifteen years down the road for your kids and your grandkids? One hundred percent yes.”

Separatists often focus on the idea that Alberta would be far wealthier if Albertans weren’t handing over wads of cash each year to the federal taxman to be disbursed to less well-to-do provinces. This is the anti-equalization argument. Eighty-eight percent of Alberta separatists cite the desire to exit equalization as a reason for their support of separatism, according to Wesley’s polling. Canada’s Constitution Act commits Parliament to ensuring that provinces can provide reasonably comparable public services at reasonably comparable levels of taxation. So Ottawa shuffles money from “have” provinces to “have-not” provinces.

In 2025, only three provinces did not receive equalization payments: British Columbia, Alberta, and Saskatchewan. The program is now worth around $26 billion annually. Albertans, who represent about 11.5 percent of the population, contribute around one-sixth of all federal revenues. Its share of the money paid into the equalization program has been estimated at $4.2 billion. In 2021, the Canadian Taxpayers Federation pegged Albertans’ contribution to equalization as $650 per capita.

The Fraser Institute, a free-market think tank, estimates that, between 2007 and 2022, Albertans’ net contribution to federal finances was $244.6 billion—that’s federal taxes and payments paid by Albertans minus the money spent on Albertans by the federal government. It’s a large number. On the equalization program specifically, Alberta has not received equalization payments since 1964–65. The Canadian Taxpayers Federation estimates that the province has received 0.02 percent of the equalization program’s overall spending since it was created in 1957.

“The fact that Alberta has not received equalization payments is not itself a problem,” the Fraser Institute says, “however, it illustrates Alberta’s outsized contribution to the funding of national programs.”

The basic contention made by both separatists and non-separatists who express frustration with Ottawa is that money is flowing out of Alberta to finance other provinces, while Alberta’s main industry, oil and gas, has been hamstrung by punitive federal policies. At the same time, equalization payments, critics argue, keep provinces from developing their own economies and industries because to do so could imperil their receipt of equalization by making the province wealthier. There have long been debates over the way the equalization formula works in Canada. A particular concern has to do with the way resource revenues are calculated.

In addition to the argument over equalization, the Alberta separatists have attempted to argue that as an independent country, the province could deliver government services more cheaply—and that Albertans’ taxes could be lowered substantially. The Value of Freedom, a document from the Alberta Prosperity Project (APP), deals with the dollars and cents of separation. While its figures and conclusions are debatable, it’s notable that they’ve bothered to do such an analysis. The APP has worked hard to give their movement some intellectual heft.

Still, the promises in the document are practically unbelievable—spending on all sorts of services, coupled with deep tax cuts given to the Alberta population, is hard to reconcile with a balanced budget. The plan forecasts that a barrel of oil would sell for $85, roughly the 2024 average. But it sold for less for much of 2025 and has sold for as little as $5 per barrel as recently as 2020. That matters because Alberta’s revenue is tightly intertwined with the price of oil. And, with demand for oil set to peak in the next few decades, there’s no way to gauge how much money Alberta will continue to make from the energy sector.

Beyond the number crunching and concerns over equalization, there’s an argument within separatist circles that an independent Alberta would be economically so well-off that other problems would practically cease to exist. In an early November 2025 episode of the Unacceptable Fringe podcast, Keith Wilson argued that the massive teachers’ strike that kept students out of classrooms for several weeks last fall simply wouldn’t have happened, because higher wages for teachers in an independent Alberta would be a given, considering how wealthy the province would be.

“All the teachers should be behind independence,” said Wilson, “because if Alberta’s independent, the wealth creation that’s going to occur in this province is going to be unleashed.”

Federalists tend to argue this optimism is misplaced. An independent Alberta would be landlocked, so negotiating corridors through foreign lands in order to get goods to market would be a must. Trevor Tombe, a University of Calgary economist, has estimated that an independent Alberta would actually see the economy contract by about 4 percent—amounting to around $3,900 annually in lost wealth per person. “A separate Alberta would be a poorer Alberta,” Tombe concludes.

Economists and business leaders have warned that even the talk of separatism—let alone actually leaving—will have deleterious effects on the investment climate in Alberta. The province might be rich, but as a country, it could be rather broke if nobody wants to invest, products can’t get to tidewater, and coffers are drained funding a military and a health care system with no support from Ottawa. Quebec’s economy was harmed by the two referendums it held in 1980 and 1995. Thomas Lukaszuk, the man behind the pro-Canada petition, argues that the entire debate is harmful, regardless of outcome. “We saw what happened to Quebec,” Lukaszuk said. “Hundreds of thousands of Quebecers left Quebec, packed their bags, sold their houses and moved. Large corporations left Quebec. Investment dried up.”

The polling bears that out. Angus Reid polling says that 77 percent of Albertans say they would leave an independent Alberta, either for other Canadian territories or another country.

Davies agrees that will happen but doesn’t see it as a downside. “I can guarantee you that when Alberta votes for independence, there will be . . . an exodus from people who want to stay in Canada,” he said. “But I can guarantee you that you’ll have an equal, if not greater, number of freedom-minded individuals across Canada who see Alberta as a beacon of prosperity and freedom, and so we will have an influx of those freedom-minded people from across Canada who will want to move to Alberta.”

If separation does indeed happen, Canada has a roadmap for what could happen next, and that’s thanks to Quebec’s prior attempts to leave the country. In 1995, Quebec voted on whether to separate from Canada. The “remain” side won with just 50.58 percent of the vote, a bare majority that startled many inside and outside la belle province.

In the aftermath, the government of then prime minister Jean Chrétien moved to clarify the rules. In 1996, the federal government asked the Supreme Court of Canada to explain the circumstances of how a province might secede from Canada. The court said, in brief, that a province could not unilaterally secede, but if a referendum delivered a mandate, the other provinces and the federal government would have to negotiate the terms of disengagement. In response to that ruling, the federal government crafted the Clarity Act, which codifies how that would actually happen.

The Clarity Act sets out a handful of basic principles. The first requires the question asked on the referendum to be “free of ambiguity”; a clear question, in other words, on leaving Canada. The House of Commons also has the power to declare the question itself unclear in the first place by determining “whether the question would result in a clear expression of the will of the population.” Notably, it specifies that a question that “merely focuses on a mandate to negotiate” or “envisages other possibilities in addition to the secession of the province from Canada, such as economic or political arrangements with Canada” is enough to make the question too unclear to proceed.

Second, the Clarity Act says there must be a “clear majority in favour of secession,” which would then “create an obligation to negotiate secession” on the part of the rest of the country. As others have noted, ironically, the Clarity Act is unclear in setting a specific percentage that counts as a “clear majority.”

Third, secession requires negotiations between all the provinces and an amendment to Canada’s Constitution.

So, in order for Alberta to secede, it would need to ask a clear question with the intention of leaving Canada; Albertans would have to vote in a “clear majority” to leave; and there would then be negotiations concerning Alberta leaving Canada. At least, that’s the theory. We don’t know exactly how it would all play out, says Eric Adams, a constitutional law professor at the University of Alberta. “We have no set of precedents about how this works in practice.”

The reality is that the Clarity Act and a supreme court reference wouldn’t necessarily stop a province from seceding if its people were hell-bent on getting out of Canada. Separatists have made this argument: Davies says that, as far as he’s concerned, Alberta would simply need a clear vote determining that the province wishes to be independent of Canada and then recognition by another country. Often, separatists look to Kosovo for inspiration. The Balkan country declared independence from Serbia unilaterally in 2008 and secured international recognition. In the case of Alberta, the United States would be the obvious country separatists hope would recognize an independent Alberta.

On that point, the separatists are probably correct. “There are other radical ways in which independence can be declared and which the international community might recognize the sovereign statehood of an independent province,” said Adams. “I don’t think Canadians can simply say, ‘Oh, well, you violated the Clarity Act. Separation is off the table.’”

Other separatists, including Cory Morgan, who helped found the Alberta Independence Party two-and-a-half decades ago, have argued that, in addition to satisfying the rules of the Clarity Act, a referendum would have the most democratic legitimacy. “Over the years, I’ve heard countless theories pushed about how the West can bypass democratic means and secede from Confederation . . . All these theories are pure bunk,” Morgan wrote in his book The Sovereigntist’s Handbook. “There are no substitutes for a democratic and fair referendum.”

There are many unknowns in the process. In addition to just how a Clarity Act process would play out, there is one massive wild card to consider: Indigenous rights. Indigenous communities have made it clear that the treaties they signed are with the Crown, not with Alberta. In May 2025, two First Nations chiefs wrote to Premier Danielle Smith reminding her of that plain fact. “If you or any Canadians are not happy living on Treaty lands, they are free to apply for citizenship elsewhere,” the letter said.

Indigenous groups have not been idle during the burgeoning debates over separation. They have argued separation would impede their mobility rights since their lands may, post-separation, be bisected by international borders.

Separatists counter that there are already Indigenous lands in Canada that straddle the Canada–US border and that the treaty obligations that currently sit with Canada could be taken over by an independent Alberta. Either way, Justice Colin Feasby did conclude that the question of separating from Canada would contravene treaty rights.

In January 2026, once Stay Free Alberta began collecting signatures for a citizen-initiative petition to trigger a referendum on Alberta independence, the Sturgeon Lake Cree Nation launched a lawsuit against the provincial government over its changes to the Citizen Initiative Act, made via Bill 14, that allowed the petition to get going. It argued that the Alberta government, by allowing the petition to go ahead, had breached its agreements under Treaty 8 between First Nations and the Crown in Alberta. The lawsuit seeks a declaration from the court that any proposed secession referendum cannot go ahead since it “requires First Nation involvement and consent from its inception.” The Siksika Nation, Piikani Nation, and Blood tribes have filed a separate lawsuit calling for judicial review of petition drive.

Separately, at a news conference in late January, Sturgeon Lake Cree Nation chief Sheldon Sunshine said, “we’re here to be clear with the province of Alberta: We strongly oppose any petition calling for a separation referendum. Letting this move risks opening the door to Alberta becoming the fifty-first state, something that we will not allow.”

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But let’s say it happens. Alberta holds a referendum, and Albertans vote to leave the country. Clarity Act negotiations ensue, or perhaps recognition by another country spawns a newly formed nation-state. Then what? The logistical task is enormous: international treaties to be signed, a police force to be stood up, the writing of a criminal code and a constitution. Decisions on the style of government and its formation.

The APP argues that an independent Alberta would become a constitutional republic, “because a republic is the safest, freest, strongest, and best way to protect the Albertan’s rights, freedoms, dignities, and home.” Davies argues that an independent Alberta could perhaps take inspiration from Barbados, which officially ditched the British Crown and became a republic in 2021. “We have a number of republics around the world that we can take the best parts of,” Davies said. “Let’s make a twenty-first-century made-in-Alberta constitution and bill of rights that puts the people back in power.”

There are other nations and models that could be an inspiration too. Morgan, in The Sovereigntist’s Handbook, points out that Switzerland, with its decentralized cantons, could be an inspiration for the governance structure of a newly independent Alberta.

Mike Lorusso and the Alberta 51 Project believe that an independent Alberta should join up with the United States. While a critic might argue that’s just swapping one federal government for another, Lorusso argues that’s not the case in the US, where states have powers that Canadian provinces do not. “So they look at statehood . . . in a flawed way, going from being controlled by one government to being controlled by another government,” said Lorusso. “The difference is, the way Canada’s founding documents were always set out is to always give that essence of power to the federal government, where in the United States constitution, that power originally has always been given back to the people.”

Indeed, an infinite number of questions would be spawned by a successful referendum to leave Canada. And for many of them, there are, so far, no answers. There are some proto-constitutional documents that have been drawn up by academics and writers, but nothing “official.” Nobody has really talked about what an independent Alberta’s food inspection or agricultural safety system might look like. It’s unclear what currency an independent Alberta might use, though there’s some suggestion that the province would adopt the US dollar. The APP has suggested a dollar figure for military spending, but that raises questions about what military alliances, if any, Alberta would be in. What about free trade agreements? Extradition treaties? An independent Alberta could have an elected judiciary, for example, or different criminal law provisions, such as the death penalty.

There are, in short, far more questions than answers, even as the province lurches closer to actually having a referendum.

In the more likely case that a referendum fails, there could still be serious consequences for the province. Already, some business leaders have warned that talk of secession is having an impact on the business climate in the province. The Edmonton Journal has reported that Heather Thomson, vice president of the Edmonton Chamber of Commerce, said investments have already been halted because of separatism talk and the instability that could ensue.

“This is really bad for the economy,” Thomson said. “Any time people are looking to make a large investment, they want to make sure that money is going to grow. Investors want to see stability; they want to see collaboration.”

There could also be consequences politically, including for the United Conservative Party. It represents the union of two very different political traditions—the Progressive Conservatives and the Wildrose Party. A divisive debate over separation could fracture the party and swing electoral power back toward the New Democrats.

More generally, Alberta’s relationship with other governments in Canada could change. Alberta could, like Quebec, adopt a “knife-to-the-throat” posture toward the rest of the country—do what we want or we’ll leave—leading to a permanent souring of relations.

Some within the conservative movement have a different fear. If a referendum fails, Ottawa could have licence to completely ignore Alberta’s concerns.

Neither circumstance is a sure thing, but it’s not hard to imagine other Canadians will become less willing to tolerate Alberta’s grievances, given Albertans’ professed reluctance to make good on the threat to separate.

On top of all of that, talk of separatism could damage relationships between Albertans themselves, warns Jason Kenney. “These things can take on a kind of non-violent civil war dynamic, by which I mean families being divided, local communities, people who you know will feel very passionate about this,” said Kenney. “It will rupture relationships.”

Adapted from The Republic of Alberta. Copyright © 2026 Tyler Dawson. Reprinted by permission of Sutherland House Books.