|Liberals prefer to freeload instead of lead
September 13, 1998
Braveheart, which won best-picture Oscar a couple of years ago, was notable for its scenes of unsparing violence. Yet for all of the portrayals of physical brutality, the most disturbing was the political violence the Scottish aristocracy perpetrated against its own people.
While William Wallace rallied the Scottish to rebel against the repressive English, noblemen like Robert the Bruce and his father were selling them out to King Edward I for titles and prestige. In the end, Wallace was betrayed and the uprising failed. It might have failed in any event, but what chance did the Scottish have when their leaders put self-interest ahead of duty?
Canadians face a similar dilemma—how to protect their country’s political independence when their elected leaders surreptitiously persist in policy contrary to the national interest. I refer, of course, to the Multilateral Agreement on Investment.
In late April, the 29 member nations of the Organization for Economic Co-operation and Development tried and failed again to negotiate an agreement.
Many of us celebrated, yet the project is far from dead, thanks largely to our elected leaders who somehow think that pandering to American business is in Canada’s best interest. We all know the standard line: unfettered cross-border flow of investment capital will benefit Canadian businesses because it will improve access to the American and European markets, which in turn will lead to greater profits and a higher standard of living at home.
The sheer inanity of this argument is breathtaking. Anybody with a modicum of intelligence knows that this right-wing boilerplate is a thinly veiled apology for economic determinism. In the world of MAI, governmental leadership becomes virtually irrelevant because policies like environmental standards, labour laws and cultural matters are economically inefficient. They detract from profit maximization and are therefore legislated into impotence. Yet the MAI begs the question: Is economic determinism desirable?
In one sense, the Liberals’ attitude is typically Canadian: Why should we do for ourselves when we can rely on other countries to prop us up? That’s the real message of the loonie’s collapse. Even though Canada has always exported much of what it produces, its economy is so underdeveloped that it’s inordinately dependent on other countries to maintain our standard of living.
The collapsing Asian economies contributed to the run on the loonie largely because Canada is heavily dependent on Asians to buy our raw materials. B.C., especially, has basked in the wealth of the Chinese and Japanese. So long as tourists kept coming and real estate values rose, nobody thought much about the future. After all, B.C. didn’t have a recession in the early 1990s. Now B.C.’s economy has gone from first to worst.
In MAI—The Multilateral Agreement on Investment and the Threat to Canadian Sovereignty, Maude Barlow and Tony Clarke note that the total value of foreign direct investment in Canada in 1997 was about $180 billion—six times the per capita rate of the U.S. With that amount of foreign control, the idea of a Canadian economic policy becomes almost moot. How effective can any policy be if so much of the economy, and hence power, is in foreign hands?
The federal government’s first obligation should be to build up a national economy to insulate Canada—to some degree at least—from the vagaries of international trade, and to shore up the currency.
The collapse of the loonie made me realize how much Canada has freeloaded off the Americans since Trudeau inflicted himself on us in 1968. Every drop in the relative value of our dollar was a sign that Canada was becoming less efficient. I had come to accept a cheaper Canadian dollar as a matter of course, but now the old rationalizations seem ridiculous and forced, especially the one about how a low dollar benefits exporters and hospitality industries. So what? A high dollar benefits importers. What’s your point?
The last thing Canada needs is the MAI, which will only serve to exacerbate our foreign exposure and undermine what little political sovereignty we have. Canada desperately needs a political leader who will use this economic setback to create economic reform, not make feeble rationalizations. It doesn’t make sense to sell goods and services to other countries when those countries already own you.
Ironically, both Chrétien and Mulroney were staunch opponents of free trade when they were in opposition. Like the Tories, the Liberals are willing to sell out their own people.