Monday, January 25, 2010

Corporate Shills

Last week, the United States Supreme Court gutted campaign finance legislation with a decision rooted in the legal fiction that corporations are people. In abolishing the distinction between the two, the court effectively gave corporations much more political leverage; and it declared that corporatism was a sacred cow in a country which likes to call itself "the world's greatest democracy."

In that same week, voters in Massachusetts voted for a candidate who is the antithesis of the man who held the seat for 46 years. Bob Herbert, in The New York Times, claimed that the vote did not represent a vote for corporatism: "In 2008," he wrote, "a startling 91.6 million people -- more than 30 percent of the entire U.S. population -- fell below 200 percent of the federal poverty line, which is a meager $21,834 for a family of four." This, while the barons of Wall Street were taking home six and seven figure salaries. The result in Massachusetts was an angry rejection of the notion that corporations are people.

And in Canada this weekend, Canadians took to the streets to protest the proroguing of Parliament by a Prime Minister who claims that things run more smoothly -- at least for the markets -- when Parliament is closed. When the people's representatives return, he said, "there will be votes of confidence and election speculation for every single week after that for the rest of the year. That's the kind of instability I think that markets are actually worried about."

The statement is stunning in its utter disregard for the public good. Government's primary task is to insure market stability. This from an angry man and an angry party who lust for a majority government, and who -- time and time again -- manage to trip over themselves. In his book, The Unconcious Civilization, John Ralston Saul saw through the ruse:
The neo-conservatives, who are closely linked to the neo-corporatists, are rather different. They claim to be conservatives, when everything they stand for is a rejection of conservatism. They claim to present an alternate social model, when they are little more than courtiers of the corporatist movement. Their agitation is filled with the bitterness and cynicism typical of courtiers who scramble for the crumbs at the banquet tables of real power but are always denied a proper chair.

It has begun to dawn on a growing segment of the population that North America's elites -- legal and political -- are little more than corporate shills. The Supreme Court and Mr. Harper have each had their Marie Antoinette moments, notifying the public that they can eat cake. It would be in their own self interest to remember the lady's fate.

Monday, January 18, 2010

Micawber's Progeny

Last week, Parliamentary Budget Officer Kevin Page released a report, estimating that the Conservative government of Stephen Harper -- a man who prides himself on his economic expertise -- faced a structural deficit of $18.9 billion. "The decline in the government's structural balance relative to potential income over this period," Page wrote, "is largely due to lower revenues."

Others have noted that the Harper government's two point reduction in the GST accounts for $12 billion of that negative number. Add to that the government's reduction of the corporate income tax rate from 22.12% to 15%, and the reason for the hole in the government's finances becomes pretty clear, The Great Recession notwithstanding.

The Finance Minister was unimpressed by Page's report. "I see speculation. I don't see a lot of evidence." he said. "I'm comfortable with the fact that if we have reasonable economic growth and we, if necessary, restrain the rate of economic growth of government program spending, then we will get to a balanced budget in the medium term."

Conservatives like to talk restraint. But they never seem to practise it. The across the board tax cuts which Mr. Harper and Mr. Flaherty initiated were followed by unparallelled growth in government spending. They are Wilkins Micawber's progeny. Some of the most famous words Dickens wrote came from the mouth of Micawber: "Annual income twenty pounds, annual expenditure nineteen nineteen six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery." The man became a literary joke simply because he did not practise what he preached.

The truth is that Mr. Harper and Mr. Flaherty have been mesmerised by what has become an economic joke, the appropriately titled Laffer Curve. In the 1970's, the American economist, Arthur Laffer, floated the theory that the tax rate that maximized government revenue was a rate that (at the time) was much lower than previously believed. Or, as Mr. Flaherty puts it, "Tax reductions are stimulus. The more money we leave in the hands of Canadian individuals and families, the more they have available to spend and help the economy expand and create jobs." That idea has become standard conservative boilerplate.

But, as economist James Tobin wrote, "the 'Laffer Curve' idea that tax cuts would actually increase tax revenues turned out to deserve the ridicule with which sober economists had greeted it in 1981." Despite that experience, the second Bush administration made the Laffer Curve the cornerstone of its economic policy, just as Mr. Harper and Mr. Flaherty have made it the cornerstone of their economic policy.

It's not as though Mr. Harper and Mr. Flaherty have no track record. Fifteen months ago, they insisted that Canada was going to skirt the recession and even run a small surplus. And those of us in Ontario remember the $5.5 billion deficit Mr. Flaherty bequeathed to those who succeeded him.

Einstein defined insanity as doing the same thing over and over again and expecting a different result. The patients are in charge of the asylum.

Monday, January 11, 2010

Playing for Time

Jeffrey Simpson claimed, in last Saturday's Globe and Mail, that the Prime Minister's suspension of Parliament would not loosen his grip on that body. "Canadians didn't make him suffer the last two times he adjusted the parliamentary timetable to suit his partisan purposes." Simpson wrote. "Why would they respond any differently now?"

And, earlier in the same week, Tom Flanagan -- Harper's original eminence gris -- offered an analysis which was as remarkably straightforward as it was cynical. Harper's political success, Flanagan claimed, was based on a mixture of "polarization, ad hoc alliances" and the "fear of an election."

This prime minister plays for time. From a year ago, when he almost sabotaged his newly elected government with his clumsy attempt to hamstring his opponents, to this year's attempt to avoid accountability for what is happening -- or, more precisely, what is not happening in Afghanistan and the environment -- Mr. Harper has retreated to what he claims should be any prime minister's fall back position, prorogation.

His hope is that Canadians, bored with the processes of government, will overlook the fact that nothing is happening. And, if they do begin to notice, he can blame the situation on the opposition parties. He fought the last election on the notion that parliament was dysfunctional, neglecting to mention that each of his party's MP's had been given a manual on how to make sure that it didn't function. He claimed that Canada was going to skirt a recession. When that rosy prediction proved to be completely at odds with the facts, he said he needed time to recalibrate. When Canadian automobile manufacturers were heading into oblivion, he said that he needed time for the Americans to figure out what they were going to do before he acted. He uses the same argument when it comes to environmental policy. Until the Americans come up with one, Mr. Harper asserts, we can only bide our time. If the government had taken that position in the 1960's, we would still be waiting for medicare.

On the other hand, the prime minister has given the opposition parties the gift of time. "Harper's Given Them Two Free Months of Target Practice," was the headline to Lawrence Martin's column in The Globe. Perhaps. But -- while the break gives the opposition plenty of time to keep the prime minister in their cross hairs, and they will find lots of ammunition in his past statements -- if that's all they do, they will prove Mr. Simpson right. They should use this time to fill the policy vacuum which Mr. Harper has left in his wake. What should Canadian policy be on the environment? What, as we face at least two years of anemic economic growth, should Canadian policy be on unemployment? What should Canadian policy be on the detention of Afghan prisoners? And what happens when our troops leave that country?

For, the simple truth is that Mr. Harper is prime minister by default. He came to politics as an angry young man, who had a much better idea of what he was against than what he was for. Rocked in the cradle of Western alienation, he came to Ottawa to get even. And that's the reason he is still there. A party which knows more about what it is against than what it is for will never achieve a majority. Paul Martin tried the same tactic; and he, too, presided over a minority parliament.

The opposition parties -- particularly Mr. Ignatieff -- need to give Canadians policies to vote for. Their job is not to make Parliament work. Mr. Harper has devoted a lot of energy to ensuring that it doesn't. Now is the time for both Mr. Ignatieff and Mr. Layton to tell us what they stand for.

Monday, January 04, 2010

The Northern Magus?

We have reached one of those standoffs and somebody has to blink. The opposition has asserted the supremacy of Parliament, by demanding uncensored copies of documents in the Afghan detainee file. The Prime Minister has refused to cooperate. Instead, he has declared that Parliament sits at his convenience; and he can make it go away when he chooses.

When commentators on the right -- like Andrew Coyne -- declare that, "What the government has done is not illegal. It is merely wrong: an abuse of process, an insult to Parliament, another step on Parliament's long slide into irrelevance," it should be obvious that this is no minor bump in the road. Mr. Harper's gambit should come as no surprise. When the Conservatives threatened to go over Michaelle Jean's head a year ago -- if they did not get the answer they wanted -- the stage was set for what has now happened.

The problem is that there is a general perception -- at least among some members of the press and the public -- which has no basis in fact. Tim Powers declared in The Globe and Mail last week that "what few appreciate is that the guy likes to govern and arguably does it well." When 32 of the government's 60 odd bills die on the order paper, that's not governing. This standoff is not about governing; it is about control. A democracy --a real democracy -- spreads control around. For Mr. Harper, democracy is a constant annoyance.

Perhaps when he was in high school, the Prime Minister read Richard Gwyn's book on Pierre Trudeau, The Northern Magus. Gwyn concluded that Trudeau was an excellent showman, but not really a magician. The image of the prime minister as a magician would have appealed to a bright, awkward kid who felt his talents were unappreciated. Whatever the source of Harper's hunger for power, the fact is that magicians don't really make things disappear. It's all about sleight of hand and distraction.

That is why the opposition can't blink. They must not disappear. They must continue to meet -- in another place, as Mr. Coyne suggests. They should continue their investigation into prisoner abuse; and, as Mr. Harper seeks to pack the senate, they should repeat all the nasty things he has said in the past about that chamber being a resting place for party hacks. In fact, there is a great deal of damning evidence to be found in the Prime Minister's own words.

If necessary, the opposition should continue to meet during the Olympics. It would be a national embarrassment. But Mr. Harper has already been a national embarrassment in Copenhagen, where -- in an attempt to be seen as a magus -- he made himself disappear. In the end, the voters will have to show him to the stage door.