OTTAWA — When a deal to protect B.C.'s Great Bear Rainforest was brokered in January 2007, one of Prime Minister Stephen Harper's most trusted lieutenants singled out the environmental and social justice organization Tides Canada as being crucial in Ottawa's decision to contribute $30 million to the plan. John Baird, then Harper's new environment minister and now head of foreign affairs, said the Harper government acted due to fear that the unprecedented $60-million contribution raised by Vancouver-based Tides - the vast majority from U.S. foundations - was in jeopardy of being lost to the total $120-million fund. "I was tremendously concerned . . . that we could lose that, particularly the money coming from abroad, so we didn't want to have that happen," Baird said at a Vancouver event where he shared the stage with first nations leaders, and Tides chief executive Ross McMillan. Baird spoke emphatically in Vancouver about the importance of habitat to 355 species in the 6.4 million-hectare rainforest. He also stressed his commitment to keep working with environmentalists and first nations. "I hope that this is a beginning, not an end." Flash-forward to late 2011 and the world has turned upside-down. Harper warned last November that "significant American interests" are funnelling money through "environmental groups and others" - presumably first nations - to stop Enbridge Inc.'s $5.5 billion Northern Gateway oilsands pipeline from Alberta to the B.C. coast, where huge tankers will cruise the waters near the Great Bear Rainforest. Natural Resources Minister Joe Oliver followed a few weeks later with an open letter denouncing environmental groups as foreign-funded "radical" organizations determined to "hijack" Canada's need to develop natural resources. Tides was the only organization Oliver named in interviews. The letter was like an aerial bombardment to soften up the enemy before a ground assault - a March federal budget which gave $8 million to the Canada Revenue Agency to step up audits and enact other compliance measures targeting groups that accept foreign funding for alleged political activities. The budget also included the promise of significant amendments to major federal environmental protection tools, notably the Fisheries Act and the Canadian Environmental Assessment Act. The government says it is simply eliminating red tape that upset landowners and stood in the way of billions in economic development. But critics said the moves - in a 425-page omnibus bill being rushed through the House of Commons with the goal of getting it passed by mid-June - will turn the clock back a half-century on Canada's environmental laws. Meanwhile, accusations continued that environmentalists are laundering money and even bribing aboriginal leaders. What triggered Harper's dramatic shift from a government anxious to be seen with green credentials to an unabashed adversary of the environmental movement? Interviews with government insiders and environmental groups, as well as an analysis of internal documents and lobbyist records, suggest a confluence of factors are behind the dramatic evolution since Harper's first election win in 2006. An overarching dynamic was the global economic crisis of 2008 that pummeled the U.S. economy and convinced many Canadian political and business leaders to view Asia's hunger for natural resources as Canada's economic linchpin.

Another factor was the emergence starting in late 2010 of Vancouver researcher Vivian Krause (see sidebar), whose theory that Canadian environmentalists are pawns in a U.S.-funded conspiracy was soon echoed by Harper and Enbridge chief executive Pat Daniel. And politics, naturally, played a role. Harper, who remembers slights and attacks like a hockey enforcer who's just been levelled by a cheap shot, had some score-settling to do after environmentalists tried to derail his campaigns in the 2006, 2008 and 2011 elections. But the turning point was another bitter environmental battle playing out in the U.S. President Barack Obama capitulated to massive protests in Washington by announcing last November a delay of at least two years in approving TransCanada Corp.'s Keystone XL oilsands pipeline to the U.S. Gulf Coast. After that decision all eyes in Ottawa turned to Enbridge's Northern Gateway pipeline which faces considerable opposition on the West Coast, particularly from environmental groups and first nations. Government and energy industry leaders recognized the downside of oil producers being tied to a single U.S. market and saw opportunity for higher profits if China could became a major buyer and bid up the price for oilsands production that was selling at a discount. After Obama's decision, many in Harper's cabinet started to view pipeline projects as the 21st Century equivalent of building the Canadian Pacific Railway to the West Coast in the 1880s. "It had a very profound impact," Environment Minister Peter Kent said in an interview. "It drove home the fact we have stranded resources with great potential for jobs and a contribution to GDP that require alternate routes to a more diverse marketplace. "And I think that has certainly given added momentum to changes that were already being considered." Government officials play down the argument that the attack on environmentalists, and C-38's legislative amendments to streamline the environmental assessment process and water down the Fisheries Act, are intended to help Enbridge's Northern Gateway project overcome hurdles. Instead, Fisheries Minister Keith Ashfield has focused on how landowners and especially farmers have been hassled by fisheries officers who refuse to allow alteration of drainage ditches even if they aren't fish-bearing. Former federal fisheries biologist Otto Langer, one of the government's most vehement critics, has acknowledged that bureaucratic overzealousness is a problem. But he blames "unwarranted" ditch-protection measures by federal fisheries officers on bad management rather than bad legislation. "That is now coming back to haunt us big-time in that Ashfield loves to use that farmer ditch example to gut habitat protection," Langer said in an email. But the government has also acknowledged that C-38's environmental provisions will very much impact Northern Gateway. The provisions to streamline environmental reviews will be retroactive, likely limiting who can testify in the remaining hearings being run jointly by the National Energy Board and the Canadian Environmental Assessment Agency. And Ashfield has acknowledged that the Fisheries Act amendments could help Enbridge by potentially reducing the number of streams traversed by the pipeline that will be subject to departmental review.

"It could be determined that some of these waterways may not necessarily be vital waterways," Ashfield told The Vancouver Sun. Enbridge has indeed complained about the "onerous" demands from fisheries bureaucrats regarding the pipeline's impact on the 1,000 streams and rivers it would cross, according to internal government documents obtained through the Access to Information Act. And a group of biologists who flew over the proposed route with Enbridge officials wrote in a February 14, 2011, email: "There were many crossings that [we] intuitively had concerns with, but that the proponent seemed to brush off as low issue." The government's suggestion that pressure to change the Fisheries Act came mainly from farmers and other landowners isn't reflected in the federal lobbyist registry. The vast majority of lobbyists on fisheries issues are from the mining, energy and aquaculture industries, and not farming. Records shows that Enbridge and two of the oilpatch's dominant industry associations, the Canadian Association of Petroleum Producers (CAPP), and the Canadian Energy Pipeline Association (CEPA), have all frequently lobbied senior bureaucrats, senior political officials, ministers and MPs. Enbridge, for instance, lobbied in December in favour of "regulatory streamlining - seeking improved efficiencies in the government secondary permitting processes for department of fisheries and oceans permits," according to the registry. A CAPP lobbyist met with the natural resources minister in March to discuss the "repeal" the Fisheries Act and the planned creation of new fisheries legislation. And CEPA, according to the registry, sought a "discussion in respect to ensuring that large linear infrastructure projects of national importance and significance are completed in a timely fashion while respecting fish habitat." Conservatives say it would be selling Harper short to assume he's only bowing to industry lobbyists, and point to the politics behind the dramatic shift. In January of 2007, around the time when the dynamic Baird was moved into the environment portfolio, polls suggested the Liberals had momentum and that environmental issues championed by new Liberal leader Stephane Dion were popular with Canadians. So with Baird taking the lead the Harper Conservatives scrambled to build a green crusader image with a flurry of announcements, most in B.C., to try to cut Dion's momentum and discredit the Liberal record. Harper was also vocal, suggesting a few weeks before the Great Bear Rainforest agreement that he inherited a mess from the Dion Liberals. "Canada's environmental performance is, by most measures, the worst in the developed world. We've got big problems," Harper said. But by late 2008 Harper learned he didn't need to pander to the green vote. Dion flopped in the 2008 election campaign, and Green Party leader Elizabeth May, who made clear she was a big admirer of Dion, failed in her bid to take a seat from cabinet minister Peter MacKay in Nova Scotia. More importantly, that autumn the bottom fell out of the global economy. Suddenly jobs, not greenhouse gas emissions, became the public preoccupation, according to veteran Tory strategist and lobbyist Tim Powers. "And this results in a great opportunity for Harper," says Powers, noting that the prime minister's true passion was to follow through on his 2006 foreign policy speech in Britain that declared Canada an "emerging energy superpower."