Читать книгу Fearful Symmetry - the Fall and Rise of Canada's Founding Values - Brian Lee Crowley - Страница 7

A review of the profound changes in public policy over the sixties and seventies is like a pleasant stroll down memory lane for most Boomers, but we forget just how different the New Canada that was emerging was from its predecessor, where smaller government, fiscal rectitude, suspicion of dependence on government or charity, and a ferocious work ethic were the norm.

The minister responsible, Bryce Mackasey, and his colleagues in Pierre Trudeau’s first government, liberalized unemployment insurance in 1971,11 overnight creating the “UIC ski team,” as it was affectionately known, a brilliant shorthand for a system that essentially paid people an income for most of the year in exchange for a token work effort—in fact, a very thinly disguised form of workfare. Economists widely credited the UI reform with an increase in difference between the unemployment rates in Canada and the United States of around two percentage points. This system was made especially vicious because it gave to thousands of seasonal workers the illusion of paying their own way by charging them a token “premium” and calling their welfare entitlement an “insurance benefit.” But the intellectual dishonesty of this position is belied by these beneficiaries’ outrage at any suggestion that the benefits they receive and the premiums they pay should bear any serious economic relationship to one another.

Other social welfare programs were liberally enriched as well. John Richards12 and Ken Boessenkool,13 for example, have both shown that the purchasing power of social welfare in much of the country rose significantly between the mid-1960s and the mid-1980s. Contrary to what one would normally expect, while numbers of people on welfare rose during economic downturns, there was no corresponding decline in welfare numbers when the economy started growing again. Welfare dependency was an up escalator, not a roller coaster, at least until the provinces, largely due to cuts to federal transfers, got serious about welfare reform in the mid-1990s.

Many of my friends in those heady early days of the expansion of the state benefited from programs we all remember fondly, such as Opportunities for Youth (OFY), Local Initiatives Program (LIP), Katimavik, and so forth, programs that paid young people for being, well, young.

Soon our spending outstripped politicians’ willingness to raise taxes, and we entered a long period of deficit financing. Then-finance minister Edgar Benson tabled a balanced budget in 1969. There would not be another until Paul Martin’s fifth in 1997–98. In between, we ran up an impressive national debt at both the federal and provincial levels, to the point that the Wall Street Journal in 1995 said that the state of our public finances qualified us as an honorary Third World country.14 Yet in earlier post-war years, thanks to controlled spending and many budget surpluses, we had retired a huge amount of debt acquired to prosecute the war.

Net federal debt in fiscal 1968, just before Trudeau became Prime Minister, was about $18-billion, or 26 per cent of gross domestic product; by his final year in office, it had ballooned to $206-billion—at 46 per cent of GDP, nearly twice as large relative to the economy.... Only in Trudeau’s first full year in power, 1969–70, was the budget actually in balance.

Andrew Coyne, Trudeau’s Shadow

There was a massive ramping up of our universities, not only in the number of institutions (callow universities with no tradition behind them and an entire faculty recruited during the radicalized Vietnam era, such as Simon Fraser, York, and UQAM [Université du Québec à Montréal], were bywords for chaos, protest, and disaffection), but also in student numbers and dumbing down of standards. The vocation of the cultivation of the mind was quickly overwhelmed by that of entertainment provider to, and warehouser of, young people we scarcely knew what to do with.

Expectations of when and how one might hope to retire were pushed sky-high as we practically begged older workers to get out of the way and let the rising generation take their place, even though there is little evidence that older workers block the rise of younger ones, given the very different economic and other roles they play. One financial institution’s brilliant advertising slogan, “Freedom 55,” came to denote a widespread expectation of early retirement. Moreover, it was widely regarded as code for “Freeing Slots for Workers Who Are 25.” As a former member of the national political panel on Morningside, I well remember host Peter Gzowski’s chat one day with demographer David Foot. Foot had just been expounding on some of the economic consequences of the Boomer generation, and Gzowski suddenly sat up and said, more or less, “Wait a minute. You’ve just made me understand something. The reason that I could be the editor of Maclean’s magazine in my late twenties wasn’t because I was brilliant, but because I had the good fortune to be born at a time when not many other babies were being born. I didn’t have much competition. Now my children are lucky if, at the same age, they can be the obit editor on the paper in Swift Current, because there is a million of these kids.” Compulsory retirement became official government policy, and buy-out packages a major topic of conversation in the company cafeteria. The Canada Pension Plan (CPP) gave the first generation of its beneficiaries benefits disproportionate to premiums they had paid.

It wasn’t just spending programs that changed, of course. Immigration changed too, for example. I was a university student when the requirement became widespread that employers had to prove there was not a qualified Canadian available to fill a job before they would be permitted to fill it with an immigrant. This was a huge sea change compared to the comparatively liberal open-door policy we had operated for years. We also made it much harder to bring in temporary workers.

Laws affecting the workplace changed as well. Surprisingly, this was an era of trade union influence. Normally, unemployment weakens workers relative to employers. But the trade unions saw an opportunity, in a political climate of anxiety about unemployment, to get gains for their members through political action rather than collective bargaining. Minimum wages were driven up, labour standards legislation gnawed away at employer prerogatives while strengthening the hand of unions, and protections against firing became more stringent. To protect existing members’ wages and existing retirees’ benefits, unions threw up barriers to entry to their guilds.

In this same atmosphere, barriers to trade between Canadians and with the outside world, already significant, rose anew. Protectionism is a natural, if wrong-headed, response to growing unemployment, as those with a job organize to protect themselves from outsiders who might be able to do the same work more efficiently and less expensively. When I was young, doctors, engineers, and tradesmen from the United Kingdom, for example, were plentiful and found it easy to enter Canada and exercise their profession.

Today medical graduates from the University of Edinburgh are treated on an equal footing with those from Lower Elbonia when they try to immigrate to Canada, and engineers from India and Iran find the path to exercising their profession in this country blocked at every turn. Manufacturers of yellow margarine in provinces like Ontario or New Brunswick have only very recently earned the “right” to sell that margarine in the province of Quebec, and we finally have at least embryonic trade in electricity across provincial boundaries only because the Americans required reciprocal market access if we wanted to sell electricity to them. And let us not forget that the rise of the Boomers in the workforce coincided with the emergence of anti-free trade sentiment embodied in measures like foreign investment restrictions and government requirements that broadcasters use Canadian songs and programming on radio and TV, while barriers were thrown up to foreign (and especially American) cultural products.

Nor should we in our inventory of responses to the confluence of Quebec nationalism and the baby boom generation neglect the creation of a lot of public sector “employment” whose principal function was to give a salary to the incumbent rather than to provide any useful and productive service to the public or the economy. These were jobs in government departments, Crown corporations, and subsidized private companies, jobs that had little economic rationale but plenty of political payoff. To this phenomenon I have attached the name “pseudo-work,” but the more traditional “make-work” or “featherbedding” would do just as well.

Lester Pearson, Pierre Trudeau, and their successors created whole new departments with no known function, such as the ministries of state for urban affairs, multiculturalism, science and technology; ministers were created for consumer affairs, international trade, financial institutions, sport, and other things already perfectly well looked after by existing departments.15 Direct and indirect public employment skyrocketed.

Transfers to the provinces shot up and had the desired effect, especially in low-growth provinces: today Ontario has 67 municipal and provincial employees per thousand residents, while Newfoundland has 89 and Manitoba 105.16

To prevent workers from areas with few jobs from moving to areas of economic growth, and possibly undermining wage growth there through their willingness to accept jobs at lower pay, unemployment insurance and regional development policy were given starring roles. They muted the signals that the job market was trying to send to workers in economically underdeveloped parts of the country to the effect that their current industry and work could not, in the long run, provide them with a sustainable standard of living. Regional development policy came along and subsidized weak natural resource industries with low levels of investment and poor productivity, to keep jobs going long after their economic rationale had ceased to exist. The wholly predictable result was that movement of people around the country to seek out new opportunities took a nosedive. One of the traditional motors of Canadian economic growth stalled, and for decades the trend was down, down, down, until about 2003–04.

Despite (or, as some of us think, because of ) all this massive effort, unemployment marched inexorably higher and rose to be the number one political preoccupation of Canadians for many years.

Our work ethic, regarded by our forefathers as one of the most ennobling distinguishing characteristics of Canadian society, was thus put under severe pressure by a state suddenly offering enticing alternatives that hadn’t existed before on anything like the same scale. The pressure spread to the other institution that had been traditionally regarded as the cornerstone of Canadian life—not government but the family. Divorce and abortion rates rose, marriage and fertility rates plummeted, helped along, as I will show later, by a state that took over many traditional functions of the family but didn’t perform them nearly as well.

Again because it helps us to put the change in perspective and to see how much we were changing and how quickly, the comparison with the United States is instructive. According to a recent Hoover Institution study comparing marriage and family between our two countries, from similar starting points almost thirty years ago (i.e., in 1980) our two societies’ behaviour where family is concerned has diverged markedly. Whereas Canadians had 25 per cent more children than Americans, the reverse is now true; our fertility level is a quarter below that of Americans. In 1975, our marriage rate of 9 per 1,000 population was just below the U.S. rate of 10 per 1,000. Today the Canadian marriage rate is only 60 per cent of the U.S. rate, although both have declined.17

Speaking of divergences with the United States, the economic one was becoming increasingly troubling. And yet in 1960, the respective standards of living of our two countries had been almost indistinguishable. Since then our productivity and our standard of living have both been in long-term decline relative to our neighbour. Americans, too, allowed some growth in the size of government, but the scale and speed of their increases were dwarfed by the changes in Canada, and they recoiled before the consequences of large-scale redistribution and welfare dependence as the manifest failings of Lyndon Johnson’s Great Society and its progeny came into clear focus.18 Our unemployment, our standard of living, our productivity, all had been highly competitive with the United States, but the gap has widened in favour of our neighbours over the ensuing decades. In 1960, a difference of just 8.1 per cent in favour of the Americans separated real per capita income in the United States and Canada.19 But by 1999 the real per capita income gap was on the order of 22 per cent in favour of the United States.20 And while the current economic downturn has cast a temporary pall over America’s economic portrait, the foundations of its better long-term performance remain intact: its entrepreneurial energy, its inventiveness, its technological prowess and its deeply ingrained work ethic, for example, have not gone away.

This account of the history of the last fifty years will seem unbelievable and even offensive to those raised with the official version of our recent history, namely that we had always been a kinder, gentler society than those laissez-faire Americans; that French-speaking Quebeckers had been discriminated against and we had to put right the historical wrongs that had been done to them; that we had to expand government because the private sector could never have absorbed all those workers flooding into the labour market. Such a use of government was merely an extension of our long-standing propensity to use the state for grand public purposes, a kind of natural deduction from Peace, Order, and Good Government.

This account, however, will not stand up under examination—it is wrong on almost every point. Only by setting the record straight will we come to have an appreciation of the real causes of many of the ills that assail us: hostility between Quebec and the rest of the country; transfer dependency by individuals and governments; the decline of both fertility and the family; and government that has become a powerful brake on our economic and social progress.