Round Economies, Square Nations

by Glen

squarepegCall it economic determinism, if you like – or even economic inevitability.  Either way, Canadians feel as if they are mere passengers on some kind of runaway financial train.  To make us even more anxious is this sense that we’re just like other nations whose financial future seems to be caught up in some kind of maelstrom, making it impossible to tackle significant issues like unemployment or climate change.

All that being said, it is important to remember that Canada and its highly innovative communities never developed quite like any other nation. From the very beginning we were ancillary dreams for someone else’s design – British, French, American.  But our early founders knew that if we wanted to set our own independent path we would have to overcome a set of challenges that would simply overpower us unless we developed a federation that pulled its diverse communities together through government intervention.  For that to happen, a special kind of social contract had to be designed that would offset the overwhelming forces of designing empires.  If we permitted those larger economic magnates to run free we would always be chasing the whirlwind, much as we are doing now.

Those demanding ever greater austerity, the miniaturization of government, increased privatization and the relentless lowering of taxes, overlook the reality that Canada’s historic genius and influence has been its ability to craft its economic outlook to this social compact.

We succeeded in this country against great odds.  A relatively small population hugging its southern border in the midst of a massive land would seemingly be an impossible construct to manage.  And yet we prevailed – not merely through government investments or a robust free market, but by both.  The corporate minded instinctively understood that such a vast landmass, with its untold riches in natural resources, would require infrastructure to move goods to markets.  The national rail system assisted them in seeing what was possible, as numerous spur lines transported ores, labourers, and grains to the main line then on to markets in eastern and western Canada.  Yet the world grew intrigued by this country’s products and so a series of ports, airports (including northern and remote airstrips), ferry systems, and even the remarkable St. Lawrence Seaway were constructed – all with major government investment.  And to move those products, governments invested in research and development that designed the automobiles, ships, locomotives and even components of aircraft.

While the free market and businesses reaped huge dividends from such national infrastructure, they in no way were inclined to come across with all the funds.  To benefit most sectors (not all) of the country, businesses paid their share through corporate taxes as the years progressed and that accommodation created an economy that was not only progressive, lucrative and versatile, but which served as a “gluing agent” that assisted in Canadians discovering each other.

Those days are long past, replaced by a reigning orthodoxy that says our economic troubles and unemployment are due to this country’s inability to get in-sync with the global economic forces.  We accepted it for a time, but we are now aware that, following two decades of that kind of reasoning, we are worse off than at any other time in recent memory.  How can we possibly accept that the answer to our economic woes is just an increased amount of the same?  We would be fools to accept that providing global access to our natural commodities is a replacement for a stable, balanced economy.  We are not the world’s warehouse, but instead a land of rich history, cooperation and mixed economy that didn’t search for social good through a prosperous business sector but the other way around.

This penchant for a universal economic model is actually one of the great deterrents to essential capitalism, starving small and medium-sized business of the attention and investments required to provide for more employment.  A one-size-fits-all model is no more conducive to capitalism than it is to social equilibrium.  Our history shares no resemblance at all to the current economic norm, yet we proceed apace as though there is only one path forward.

Canadians need to come to terms with the counsel of Aldous Huxley: “Facts do not cease to exist because they are ignored.”  Canada’s history is hardly some romantic artifact of the International Monetary Fund, World Bank, World Economic Forum, or even the G8 or G20; it’s clear, accounted, and revealed – warts and all. Its overall success is a matter of public and international record.  The fact that our star has fallen in recent years shouldn’t blind us to the reality that ours is a fate shared by other developed nations – the economic model that doesn’t work here doesn’t work in these regions either.

Monolithic economic structures, packaged in hermetically sealed portions of globalization, are hardly suitable to the human condition, anymore than they are to nations attempting to make room for their citizens.  New ways must be discovered to access the trillions of dollars that flow through our communities and country and yet never seem to land long enough to produce jobs or a sustainable future.  John Lennon used to say “living is easy with eyes closed.”  Actually the opposite is rapidly becoming the reality, not only in Canada, but around the world.