Thursday, July 26, 2012

The Bills Are Due

Or, re-reading Andrew Cohen's While Canada Slept. For those who don't know this book, it was a bit of a hit "back in the day." Released in 2003, it was one of a series of texts that lamented the demise of Canada's standing on the international stage that were published in what we can now recognize as the dying days of perhaps Canada's last Liberal administration. Much of the literature on Canada's international standing was produced -- as Ian McKay's Warrior Nation intimates -- by more extreme elements of the right wing who were overtly militarist. Cohen's text is more nunanced and subtle. He was a firm believer in re-militarization but his position was more mixed and he argued strongly, as well, for anti-poverty untied aid programmes. I don't mean to laud this work. There are problems with it (he clearly romanticizes Canada's Pearsonian "golden age," for instance) but he also harbours no beefs against the liberal welfare state, like so many other critics of Liberal foreign and military policy.

We don't need to go through all the problems with While Canada Slept. Despite the fact that I think this book is the best of the critiques that were written (excepting perhaps Jennifer Welsh's  At Home in the World), it would be a long list. In addition to romancitizing Pearson and his cohort, Cohen stacks the deck in favour of re-militarization in his historical consideration of it. He also focuses a great deal on "will," as if "will" (whatever that might be) were the key to politics. The pros of this book would not be as long but they are considerable as well (his warning against seeing the US as the be-all-and-end-all of Canadian foreign policy is something that others writing in this line might have paid attention to). My goal here is not to re-review this text almost a decade after it was published but instead to consider it from a different perspective. Where did all this concern about Canada's declining status on the world stage come from?

Over and over again in the text, Cohen laments the demise of Canadian spending on foreign affairs (on the diplomatic service, on the military, and on development aid). Fair enough. Like others writing along this line he suggests that this decline was the result of a number of factors but, most importantly, the indifference of governments to things diplomatic and military and the general invisibility of foreign aid for most Canadians (making it an easy target for cost cutting governments). He intimates that, in the context of the first years of the new millenium that Canada did indeed have the money to spend on such things. But, and this is a very important question, did it? At whose feet should we lay the spending cuts of the Martin as finance minister era?

This is a question that is important for two reasons. First, the surpluses -- now exhausted -- of the waning years of the Chretien government and first years of the Martin government -- have caused a great many people to forget what the economy was like before that time. A great many commentators, for instance, seem to have forgotten that when Chretien took office, Canada was running budget deficits in the $ 40 billion/year range. They seem to forget the huge accumulated deficit and the weight of service charges against it that we sucking down the federal budget. Indeed, service charges were one of the largest items on the federal budget and that is simply a dead loss in  terms of government revenue because it is money that is going to produce nothing. It is simply paying interest on an accumulated debt. Service charges build no new hospitals or road or educate no children or provide no health care. Carrying a debt might be needed from time to time. I have one, it is called a mortgage. But, by the early years of the 1990s, the debt was a serious problem that was hampering the federal government's ability to do anything.

What is more, the debt had become intensely politicized. The right wing (in the guise of the Reform Party) made the debt and what to do about it a national political priority. Any political party, in this context, had to address for both economic and political reasons. Canada could not go on accumulating a debt and no party that wanted to stay in power could ignore it. It might have been possible to ignore it a bit more then the Liberals did without the Reform Party but such is life and even if this is doubtful because there were a slew of think-tank reforms and ominous predictions from Canada's business class about the state of the debt and short and long range effects on the ability of Canadians to keep their economy moving.

There is much to debate about the way in which the Liberal regime tackled the debt but, and this is important to note, everyone was tackling the debt. The NDP government in Saskatchewan felt compelled to address it as did the Progressive Conservative government in Alberta. Even sections of the PQ leadership were talking about the need to address the provincial debt in Quebec and, of course, we had the Harris government in Ontario cutting the public service with a chainsaw. In other words, the Liberal government did not act alone. The speed with which they acted, their ruthlessness in cutting social spending, was a product of the politicization of the debt as a result of the Reform activism and the pro-business lobby, but they could not fail to address it and to do so would have been irresponsible.

This context is erased from consideration of Canada's declining military and foreign spending during the Chretien regime. What is more, the books had been tight for some time (back to the Trudeau era). A failure to consider this context means that we don't understand why the Liberal government did a lot of the things they did. Again, I think we can debate -- and constructively -- the details of how things were done but the argument that cutting military and foreign service spending was wrong is actually an effort to re-write history. It is like saying "these branches of government should have been exempt from spending cuts." The bills will have to paid by everyone else (aka taxpayers) but not them.

I will suggest that this approach -- to exempt one section of government from cuts that all other sections had to address -- would have been irresponsible because it would have placed an even greater burden on the social welfare state. It would have forced tax increases -- thus cutting spending in the economy -- and drastically reduced the standard of living of the poorest Canadians through cuts to social welfare services that had already been cut. It would have drastically increased the cost of postsecondary education (and, thus, further hampered Canada's international competitiveness) and reduced the quality of health care available to Canadians even further. In other words, to exempt the military, aid, and foreign service from cuts (or, perhaps to even increase spending on these branches of government) was not just a matter of "will" or poor government choices. Everyone had to pay their share and a failure to recognize this would have reduced the standard of living of Canadians, decreased health care, reduced accessibility to education, and hampered economic growth.

I am not trying to defend Chretien and Martin. I have my beefs with them. What I am trying to say is that much of the "increase spending on the foreign service and military arguments) are predicated on either a lack of historical knowledge or a willful erasure of the past. The bills, as it were, were due. And, those arguing for militarization, in effect, say "yeah, but we won't pay them." In the 1990s, the bills were due; Canada needed to address its deficit and it needed to do so in a way that was fair and that maintained economic and social stability. The military had to take a hit, just like education, health care, etc. A failure to do so would have been irresponsible on the part of any government and a failure to acknowledge this -- as if people just cut the military and foreign service and aid because they didn't like them -- presents Canadians with a false sense of their own history and a false understanding of the choices they have before them today.

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