The Parallel Parliament

by Glen Pearson

Tag: globalization

Budget 2016: A First Step

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IN ONE OF THE FUNNIER EPISODES OF THIS MANIC BUDGET WEEK, host Ellen DeGeneres aired a segment showing Canada’s response to the threat of Americans moving up here to escape Donald Trump, titled, “We’re nice, but we’re not that nice.” You can view it here.

The reality is that we might be even nicer at the moment. During an American election season revealing far deeper divisions in the electorate than many realized, this week’s federal budget couldn’t set a more different tone. It was breathtaking in its own way, covering everything from deep investment in Indigenous Peoples to seasonal Employment Insurance programs, from tackling nagging infrastructure shortfalls to invigorating benefits for children and seniors, from beginning to make right the abiding gaps in veteran’s care to opening a new front on fighting climate change. Yes, it has its detractors, but even they were energized by its comprehensiveness.

It’s scope was made possible by the government’s willingness to go into deficit by almost $30 billion to pay for it (almost three times more than the Liberals campaigned on). Many voiced alarm at such a significant dip into the red, but, as this graph points out, we have been in worse situations before. CeMDjJGUYAA3AdK

Following a decade of austerity, many Canadians are hoping for more investment in our social way of life. While both the Conservatives and NDP ran on balanced budget platforms in the last election, Trudeau’s Liberals put it out there that they believed the time had come for some deficit spending in significant proportions. Those who didn’t take to that outlook nevertheless had to come to terms with a Liberal win, empowered by over two million more voters who agreed with the approach.

Just as our neighbours to the south flirted with a less tolerant future, Canada was banking on more inclusiveness. It’s not the first time we showed a certain economic defiance. When in the 1950s we refused to link our currency with the U.S. dollar, as other nations were doing, alarms bells sounded across the nation as we permitted our currency to float independently. We not only survived; we thrived. And when the great rush to deregulate banks helped to drive forward the global austerity agenda, Canada refused and was able to escape the worst of the Great Recession as a consequence.

Whatever opinion one might have of this budget, there is no question that it represents a clear departure from the same old, same old economic policies of recent years – policies that implied we couldn’t afford to strive for our greatest ideals. It was a rationale used by both previous Liberal and Conservative governments to rationalize some of our greatest social and economic ills like lackadaisical environmental reforms, growing poverty, high unemployment, and deep infrastructure decline. Trudeau didn’t just reason that Canadians were tired of underperforming; he ran on that hunch in his election platform, receiving a clear mandate in the process. Rather ironically, it was the very kind of investment plan that even the once draconian International Monetary Fund (IMF) has been supporting.

In many ways were are staking a claim, investing in ourselves and some of our deeper instincts of fairness and equity. The government believed we were ready for it and presented a budget largely to match.

There is just one problem. The budget is one country’s attempt to somewhat swim against the current of a greatly dysfunctional global financial system. All that was wrong with global inequities still remains in place both before and after the Canada’s recent budget. Trudeau is banking on growth to eventually pay back our deficits, but it will take more – much more. Canada must assist the rest of the world, not by mere example, but by articulate and dynamic financial leadership to reverse decades of elitism and the kind of globalization the placed the free market system and not democratic citizenry at the helm of human advancement.

A number of years ago, then Senator Joe Biden made a revealing observation: “Don’t tell me what you value; show me your budget and I’ll tell you what you value.” This week the Trudeau government did exactly that. But it’s only the beginning. Changing the very nature of our global economies is now the next great step.

Is Reducing Financial Inequality Really Possible?

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WE’VE TALKED ABOUT IT, ADVOCATED AGAINST IT, lived with it, and continually felt defeated by it. Despite the best efforts of millions of individuals and groups to tackle the glaring presence of financial inequality in our community, country, and the world, we can be forgiven for feeling no closer to solving it.

We understand about the advances in technology, the challenges to employment, corporations that can shift their operations where they please, and the sheer magnitude of the capitalistic behemoth that stands astride the world appearing unshakable and unremorseful. We have emerged from the last economic recession (the worst since the Depression) and seemed to have learned little from its negative causes. Wealth continues to be moved upwards, to a few people who now control the major share of the world’s finances.

Alexis de Tocqueville is a name hardly mentioned anymore but his observations are as keen today as they were during the 18th century in America. In a piece he later published, titled How an Aristocracy May Be Created by Industry, he made a startling observation:

I think that, generally speaking, the manufacturing aristocracy which we see rising before our eyes is one of the hardest that have appeared on earth … The friends of democracy should keep their eyes anxiously fixed in that direction. For if ever again permanent inequality of conditions and aristocracy make their way into the world, it will have been by that door that they entered.

Keep in mind, he wrote these observations in 1835, but we can’t help acknowledging that the “door” he referred to has been wide open for some time. He premised that, in a free society, based upon the tenuous balance between free markets, social cohesion, and democratic participation, any monopoly, especially over money, would spell ruin to the democratic experiment and the hopes of millions, not just a few.

There’s lot of places where blame can be put – corporations, global financial bodies, a distracted citizenry – but ultimately it all comes to rest on just plain bad politics. When they were lobbied by financial groups to forego urging businesses to invest in new sectors by training future workers and paying them accordingly, political leaders readily replied, leaving millions out of work around the world. Politics oversaw a restructuring that deregulated many of those financial protocols that once used to protect communities. At the same time as they permitted significant corporate tax breaks, governments also failed to invest in the kind of physical infrastructure that connected communities and assisted with the flow of goods and people.

The list of such actions is far more extensive than any of us realized. But we have felt it, and that sense of foreboding has not left us. But here’s the point: each one was a political choice, and the damage from each could have been better minimized if our politics hadn’t been sick and ailing. Different political choices would have resulted in less inequality today. One gets the sense that, following every economic downturn in recent decades, that more of the legislative restraints were taken off the free market in hopes of recapturing past glory. It worked, in that fabulous wealth was generated. Unfortunately, that wealth placed such a huge wedge in society, rewarding those above and pressing down on those beneath the cut, that inequality now characterizes our age more than any in recent decades. All this wealth. All this money. All this inequality. These realities are all linked by the prevalence of poorly aimed political choices.

But there is a glimmer of hope: if the fault lies in our politics, then the solution lies in our democratic instincts. For these to function more effectively, it will take citizens and not a detached elite to correct them, for democracy is based on our ability to correct a system by applying ourselves to the problem. Governments grew lax because we grew distracted, and when numerous capitalist leaders spotted that, they rushed through that door de Tocqueville talked about and occupied the positions of dominance.

Those in control of power and wealth, in most cases, won’t relinquish such amenities freely. It will take citizens, responsible businesses, and democratic organizations coming together and actually selecting people for politics who know where their grounding is – family, community, meaningful work, a more peaceful world, a sense of inner accountability and humility.

Can we reduce financial inequality in our time? Absolutely, but only when we increase our sense of citizen responsibility. There’s the rub.

Homo Economicus

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EARLIER THIS MONTH, THE WORLD’S financial leaders met in Washington D.C. at the World Bank and International Monetary Fund (IMF) to discuss what they were going to do about a struggling world economy. Observers were surprised to hear the acknowledgement that capitalism isn’t producing the results many had hoped for following the financial crisis of only a few years ago. Just exactly how they will tackle the growing inequality and poverty wasn’t forthcoming, but still the admission of failure was perhaps a positive step as the world attempts to make sense of what went wrong.

There was the open admission from two major plenary panels that we are rapidly becoming a world of extremes  They also conceded that with 67 people now owning half of the world’s wealth that there’s clearly a problem. In an environment when the financial rules are rigged in favour of the fabulously wealthy, there was hope that those with the resources would apply themselves to humankind’s great challenges. Alas, there was another admission that this hadn’t transpired. This isn’t fully so in regards to capitalism, as we shall note in the next few blogs. Some corporate leaders are steering a new course that brings community value back into circulation, but they are few and the prognosis for the failure of capitalism and democracy isn’t good.

We sometimes forget just how wildly things have fluctuated. Only 300-400 years ago, the average Chinese family was better off than those in Europe. But when the emerging West utilized its advantages of more open politics, enhanced institutions, trade, free enterprise, scientific invention, and growing public education, things began to change, and rapidly. By 1978, the average North American was 22 times better off than their Chinese counterparts economically. Today that number has switched again and we find that we are only 5 times better off.

And yet China is heading down the road of similar mistakes as we have made. Presently there are 800,000 millionaires and 65 billionaires in China. While many struggling families in that great country have emerged from dire poverty, they are also watching the gap between the rich and poor inevitably widen.

Most of us understand why China is doing better, but are experiencing great confusion as to why the great capitalist engine of the West has faltered badly enough to assist in the widening gap between the rich and the poor, flattened communities, increasing environmental degradation, and a growing animosity between average citizens and corporations in general. When World Bank president, Jim Kim, suggested that more “pinstriped suits” get involved in finding ways to get trillions of dollars from corporate wealth into struggling economies for “moral” reasons, there was no backlash or rebellion. The world’s financial elite are getting closer to realizing they have played a hand in the great decline. What is yet unknown is how they will respond to that culpability. Just as they have replaced the idea of individual citizens with consumers, so they have reduced communities to market bases or employment pools.

Where we were once known as homo sapiens – from the Latin homo (meaning “human”) and sapiens (meaning “wise” or “rational”), we have been reduced by the modern financial order to homo economicus – “economic humans.” We have become one-dimensional creatures in the eyes of modern finance and in the process our local communities have been reduced in the same manner.

Yet, for reasons which largely remain a mystery, some corporate leaders have moved out ahead of the World Bank and IMF and are attempting to bring human value and dimension into their business and corporate models. We shouldn’t be fooled into becoming maudlin and wishful about their motives. They understand that they are businesses and that by appealing more to social good they are merely opening up their business to a larger pool of customers. 

Nevertheless, when we have reached the point where international monetary leaders are confronting their illegitimate offspring – jobless, environmental degradation, declining communities, inequality, corporate dysfunction and corruption, and lack of public trust – and at least by acknowledging the results of their decades of excess, we might at least have a starting point in which to discuss saving our communities from eventual ruin.

The word “capitalist” now resides in the cellar, along with “politician” – both the object of public disdain. Significant efforts must be made by the leaders of both finance and democracy to not only restore their reputations, but to bring our communities back to a place of economic and social health. Somehow the counsel of Thomas Jefferson doesn’t seem too dated anymore: “The end of democracy and the defeat of the American revolution will occur when government falls into the hands of lending institutions and moneyed interest.”

There is only one way back, although the various motives will vary. The change must come from communities fighting for the lives they want and from businesses and corporations who realize that their days are numbered if they continue to isolate themselves from the effects of their policies.

High Noon

MPW-17611I was fortunate enough this past week to have received numerous emails from Kellogg’s employees, thanking me for some recent posts.  A theme from these messages began to emerge.  People wanted to explore some of the ideas about how our current economic/political/social system is no longer sustainable.  I think they hit on the crowning struggle and question of our age.

Things are coming to a head – perhaps not this year or next, but soon.  It’s like the Gary Cooper movie High Noon, when the solitary figure of a man determined to do right and protect his community goes up against a number of individuals determined to undo his value system.  Today, democracy is squaring off against the forces of a capitalism that has, perhaps besides its best intentions, begun to undo the very human capital it once so much depended upon.  To date, it has had its way in many of our communities, but as its deteriorating effects become more obvious, as with a situation like the Kellogg’s plant, a democratic backlash is emerging.

A modern state cannot exist merely made up of politics and private enterprise.  Any good society must offer citizens a vast array of ways to get involved in developing various levels of co-existence, solidarity, and participation.  Politics and capitalism will dominate any space where a robust civil society is struggling.  Worse still, political ideologies and the free market will become increasingly dysfunctional the more humanity is stripped from their workings.  In a democracy, this element of civil society, and the ability to determine collective well-being, must be predominant or else we will enter the stage we are presently enduring – power without accountability, wealth without responsibility, and citizenship without community.

In any good society, the greatest interactions are played out by non-profit organizations, neighbourhoods, civic celebrations, citizen encounters, houses of worship, local coffee shops, clubs, groups and a myriad of places where traction is gained for the broader community.  These are the things that provide those places where we live with their life-giving energies.  Vaclav Havel might as well have been talking about London, Ontario:

After all our upheavals, it is time for goodwill, tolerance, decency, interest in others, faith in the good in humanity, respect for our neighbor, natural responsibility, modesty, and an amicable view of the world to return to our social climate.  The more successfully this is done, the better we will all live.”

In so many of our communities these are the very things that are under threat, as neither politics nor capitalism can produce them.  In reality, together they are resulting in the opposite.  Only a rediscovered civil society can save us.

But those attempting to build that society have some sincere questions that, while many will question their validity, are rising to the forefront in citizen consciousness.  In their way, the questions are simple.  The importance right now is not the answer, but the very fact they are increasingly being raised.

  • Why can’t communities recall their political representatives who behave badly or put the party before their constituents?
  • If capitalist elites are stripping wealth from our communities while still using our roads, banks, universities, airports, security measures, and natural wonders, should they be brought back into the social compact that worked for decades?
  • If corporate taxes continue to decline, how can our communities possibly maintain the living style they took years to establish?
  • Why are politicians permitted to govern when they have already confessed to crimes?

What is interesting about questions like these is that they are being asked everywhere around the globe – the supposed capitalist domain.  Everywhere it has ventured and enriched itself, questions such as these are being left in its wake.  And from them have come certain theories that are gaining increasing traction.  Why can’t a global tax be placed on those global transactions that remove wealth from one country to another that will help to reimburse the communities they have left somehow depreciated?  What if citizens practiced civil disobedience to reveal their displeasure with a political class that seems as inept and it is remote?  If large businesses get public funds to expand their efforts, why not charge them a service fee for using a community’s infrastructure?

Look, these are questions that many will object to and attempt to refute, but the reality is that citizens and communities are asking them increasingly – Kellogg’s employees are asking them everyday.  Such queries are being brought forth because of the very inability of politics or commerce to reverse our slide.  Corporate barons and economists alike might belittle them, but such challenges are beginning to keep pace with corporate profits.

If the economic reforms of the past three decades are not matched by the increasing capacities of civil society, our lives will inevitably become one-dimensional, caricatures of themselves, and will result in an apathy towards public affairs – much like we have now.

We must rebuild a system in which words, kind deeds, responsible business, and responsive politics can shake the very structure of the elites and where words themselves can become more powerful and transcendent than capitalism’s call to our baser selves and the penchant for politics to turn us away from the public space. 

What took place at Kellogg’s this past week is just another step bringing our communities into a showdown with capitalist forces gone astray.  And such power will not prevail as long as citizens openly ask such questions.

Kellogg’s – We’re Not Done Yet

Screen Shot 2013-05-02 at 6.14.36 PMI LOOKED UP SO SEE FOUR PEOPLE coming down our driveway.  They introduced themselves, but it’s what they said next that set the tone: “We’re from Kellogg’s.”

They were insecure but had lots to say about wanting me back in politics, about the corporate agenda, about what this community has meant to them.  And then, sadly: “Glen, how do we get help from the food bank when the time comes?”

This is rapidly becoming the state of modern community life – people who helped arrange food drives at Kellogg’s were now going to require some of that very food themselves.  This is no way to run a society, and nor is it any way to treat people who built our cities and regions.  Sadly, my morning wasn’t done.

I headed to a local coffee shop and encountered another Kellogg’s employee who wanted to thank me for my blog post the day before and to say how much it meant to the workers.  Yet the sadness on his face said it all.  At that moment, a former Conservative MP – a good friend – walked in the door with his wife.  He reminded us that in 1984, the Mulroney government had granted $223 million to Kellogg’s in London for an expansion project that would make the local plant one of the most technologically advanced manufacturing facilities in the entire company – 1,140,000 square feet. 

“Glen, I was there when the Prime Minister came to down to announce the funds and we were assured by the company that this would make for a prosperous future. What happened?” he asked. 

Simple math would tell us that the our funds were used to assist a company to build a more solid future in London not quite 30 years ago.  Now that company is leaving, having used our investment to make their fortune, and leaving hundreds of devastated families in their wake.  What happened indeed!  We feel like a community undone.

Work seemed to really matter in our community.  But that was before the evolution of the new economy, where elites could move anywhere around the globe in search of cheaper labour; where they would press governments, foreign and domestic, for ever lower taxes and the diminishing of labour and environmental standards, and where the ultimate goal was treating labour as a commodity rather than a standard of dignity or a necessity to community.  Only a generation ago we believed that wealth would increase in dramatic terms and that jobs would be available for everybody.  The first part has become the reality while the second lies in ruins.  In a period of a generation, work has gone from edifying the soul by giving it value to undermining it by forcing it into banality.  Where we once hoped for a better world, driven by equity and progress, we now face the real chance of massive global unemployment and the spread of poverty.  We are entering an era of cheap people and very expensive machines.  As the world hurtles along this path, directed by a global financial juggernaut of the few, the link between labour and prosperity will be a part of our past, not our future.

We must find a way to dignify work once more and enable wealth to work for the many. A bleak future is never inevitable in a world where citizens still possess the opportunity to turn their countries around.

So let’s start with some easy steps.  Here are two ideas.

This morning I spoke with my friend, Andrew Lockie, director of the United Way in London, and proposed that our two organizations hold a community reception for Kellogg’s employees in the spring.  Both the United Way and the London Food Bank have been huge beneficiaries of funds and food from these employees.  And that is just what we will do, drawing in other community partners like labour groups, businesses, civil society groups, and citizens aplenty.  We will celebrate and honour those among us who didn’t just live here, but actually built our community.  We are in the process of putting that event together and we trust everyone will be there.

And, then, let’s begin a larger conversation on the future of work.  It was in the 1930s that things seemed so inevitable and that the capitalist barons owned not only their companies and wealth, but the future.  But at some point, citizens and their politicians came together and reversed a trend that seemed inevitable.  The boom that resulted for those moments of daring created the great middle-class.  Of course, we live in a globalized world now and bringing companies back to the community table won’t prove easy.  But if a global consensus can be reached, it can be done.  Capitalism will hang itself if it proceeds down this course. Let’s think of ways we can further that conversation and start talking about the new and valuable work of tomorrow, a more ethical capitalism, living wages, and the important and dignity of work for all of us.

The employees of Kellogg’s, and even the company itself for a time, remind us what is possible when investment in a community matters.  London has some remarkable citizens from Kellogg’s to celebrate, and then we must turn our attention to a future where citizenship – corporate and individual – begins the process of building renewed communities.  We’re not done yet.

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