Oops…what if the Alberta forensic audit into foreign-funded activism doesn’t have enough documents to audit?

How will Allan conduct a forensic-style investigation when neither the US funders nor the Canadian recipients will cooperate with the inquiry?

Pity Steve Allan. The Calgary forensic accountant has put his reputation on the line by agreeing to head up the Kenney government’s public inquiry into foreign-funded anti-pipeline activism. He is tasked with investigating a “wicked problem” where the field has already been ploughed by an incompetent researcher whose work has been weaponized by the UCP and the oil and gas industry to serve highly partisan purposes. This way be dragons, Mr. Allan.

Steve Allan.

The researcher is Vivian Krause. For a decade she has been combing US government databases looking for evidence of American foundations funding Canadian environmental non-government organizations (ENGOs) working to shut down the Alberta oil sands and stop projects like the Trans Mountain Expansion pipeline. Her work was thoroughly debunked by Energi Media with a deep dive published in May.

Since then, Energi Media has begun interviews with a variety of experts about Krause’s additional claims that foreign-funded was behind the Great Bear Rainforest, which she claims was funded to act as a “green trade barrier” to Alberta oil exports, and her accusations before a Senate committee that political interference by the Trudeau government into Canada Revenue Agency investigations into Canadian ENGOs receiving money from US charities amounts to “corruption.” That investigative reporting lays bare just how shoddy Krause’s research really is.

Unfortunately for the Commissioner, he has a bigger issue.

The inquiry website, launched Monday, says that Allan “will be examining and exploring a variety of sources to gather relevant information and evidence, and the prior work of Vivian Krause is one such potential source.” The website also promises that Allan will conduct his duties with an “entirely open mind” subject all “available information and evidence gathered to objective and impartial scrutiny.”

Vivian Krause.

Right there is the inquiry’s wicked problem.

Wicked problems are issues that can’t be solved or properly understood. The problem may be too complex, like poverty. In this case, there will not be enough information available to the Commissioner.

The inquiry can compel Alberta individuals and organizations to answer questions, but most of the ENGOs are located in BC or Ontario and they will be very reluctant to participate in what they consider to be a witch hunt. Energi Media interviewed 15 ENGOs for its deep dive and all expressed frustration with Krause’s misrepresentation – deliberate, in their view – of their work.

Why would they subject their organization to an investigation that was justified by Kenney and the United Conservative Party using Krause’s blog posts and newspaper op-eds?

The only ENGO eager to provide information, or testify if Allan decides to hold public meetings, is the centrist Pembina Institute, which has said publicly that it will avail itself of all opportunities to refute Premier Kenney’s allegations that it is a “radical” environmental group hell bent on destroying the oil and gas sector. Giving Pembina a public platform to proffer abundant evidence that it advocates for environmentally responsible oil and gas development could be a real black eye for the government.

The American foundations almost never publicly discuss their contributions to Canadian ENGOs. None replied to Energi Media’s request for interviews for the deep dive. Why would they make an exception for the inquiry?

That leaves Allan in exactly the same position as Krause, with only IRS tax data to review. He and his researchers will be able to tell how much was transferred to Canada, but not how ENGOs spent the money. Some returns will include a cover letter describing the general intent of the grant, including opposing the oil sands and pipelines, but that isn’t much without confirmation on the Canadian end of exactly how those monies were spent.

Joanna Kerr, CEO, Tides Canada.

For example, Krause often vilifies Tides Canada as a funder of anti-pipeline activism. CEO Joanna Kerr told Energi Media that her charity only supports pipeline-related activities, like helping First Nations adapt to oil and gas development on their traditional territories, not activism.

One of the basic functions of a forensic audit is to verify the paper trail. How will the inquiry do that when both the American funders and the Canadian recipients refuse to cooperate?

Another thorny aspect of the wicked problem will be showing cause and effect. Just because US foundations funded Canadian ENGOs to undertake anti-pipeline activism doesn’t mean that the activism actually caused pipeline projects to be cancelled or delayed. In fact, for every pipeline project that has run into trouble since 2008 – for example, Northern Gateway and Energy East – when foundation money began pouring across the border, a good argument can be made that business or regulatory factors were far more important than activism.

Krause supporters like to claim that the effect of US funding is self-evident, that it doesn’t have to be proved. That case may be sufficient on Twitter, but not for a forensic auditor like Allan, for whom the bar is set much higher. In this case, the available data and documentation don’t appear to fit well with forensic audit methodology.

It will be very interesting to see how Allan stickhandles this issue when his interim report is issued in January, which leaves just four months to resolve his wicked problem.

How will the inquiry address the issue of Canadians’ right to dissent, their right to protest against projects they believe represent the potential for great harm to the environment? Albertans may view ENGO activism through the lens of economic activity and jobs, but plenty of Canadian and international citizens see it differently, worrying about pipeline spills, contributions to climate change, and damage to sensitive marine ecosystems.

Some of those citizens live in the United States. On the West Coast, for example, Washington residents are concerned that an oil tanker spill could do irrevocable harm to their coastline. Other Americans don’t like heavy crude oil with a high carbon-intensity – so-called “dirty oil” – being imported into their country.

Are the concerns of those citizens somehow illegitimate? Of course not. And their contributions to US foundations that send money to Canadians ENGOs is perfectly legal and always has been.

Protester John George at anti-Trans Mountain Expansion rally on March 10, 2018.

Lastly, how will the inquiry treat BC First Nations, many of which have received US foundation funding for activities related to oil, gas, and pipelines?

Industry boosters sometimes claim indigenous opponents wouldn’t be able to challenge government approvals in court without that American money. Leaving aside the implied desire to deprive First Nations’ exercise of their legitimate constitutional rights, ENGOS told Energi Media that most of the contributions to support applications to the Federal Court of Appeal came from Canadians, not US foundations.

If not handled diplomatically, this could be a political landmine for both the Premier and Allan that includes allegations of bias and racism.

One wonders if Allan really understood what he was getting into when he agreed to head up this inquiry, dubbed by wags as the Un-Alberta Activities Committee, a play on the House Un-American Activities Committee of anti-communist Senator Joe McCarthy during the 1950s. By all accounts, Allan is a well-respected professional who can be expected to colour within the lines and perform at a high level.

The wicked problem of foreign-funded activism, however, may be more than even he can manage. Data and documentation is a huge issue and it’s hard to see how he can resolve it.

If he fails to do so and delivers an inconclusive report, or one that contradicts the Krause conspiracy narrative, then Kenney and his industry supporters suffer a huge political black eye. If Allan delivers the report Kenney anticipates but has to fudge his methodology or the numbers in the process, then his hard-earned reputation will lay in tatters and his report will be a highly publicized sham.

Problems are wicked when they can’t be solved. Like this one.

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