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  June 5, 2011

Canadian Gov. Plans Austerity and North American Security Perimeter


Canadian government throne speech plans to eliminate deficit by 2014 and move closer to US rules and regulations
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biography

David Macdonald is a Research Associate with the Canadian Centre for Policy Alternatives where he heads the Centre's Alternative Federal Budget project that takes a fresh look at how the federal government could build a better Canada. David is a frequent media commentator on national and local public policy issues.


transcript

PAUL JAY, SENIOR EDITOR, TRNN: Welcome to The Real News Network. I'm Paul Jay in Washington. And in Ottawa, Canada, on Friday, the governor general, David Johnston, delivered the speech from the throne. Of course, one of the things that happened during the speech was not normal pomp and ceremony. A young page named Brigette DePape broke with the somber ceremony, and displaying a stop sign saying "stop Harper", and then was ushered out rather quickly from the chambers. But the speech from the throne laid out what the new Harper majority government plans to do. Now joining us to help deconstruct this speech is David Macdonald. He's a research associate at the Canadian Centre for Policy Alternatives, and he joins us from Ottawa. Thanks for joining us, David.

DAVID MACDONALD, RESEARCH ASSOCIATE, CCPA: Thanks for having me.

JAY: Here's a little clip from the speech.

~~~

DAVID JOHNSTON, GOVERNOR GENERAL OF CANADA: The United States is our most important trading partner, ally, and friend. Our government will work with President Obama and his administration to deliver on the shared vision for perimeter security and economic competitiveness.

~~~

JAY: David, that language has often been code word for a kind of North American integration. Is this--this in itself is not new that they're carrying on these talks. The Liberals before them, in fact, apparently, had a secret committee working on projecting how this all might look. But the fact that it shows up in the throne speech again, does this show that during Harper's majority government they might actually try to get this done?

MACDONALD: Yeah. And there's various degrees of this. You know, the long-term problem with Canada is that our major trading partner is the US. And the fact is, despite agreements like the Free Trade Agreement, NAFTA, and so on, if the US doesn't want our softwood lumber, they will continue to obfuscate the process and not allow, you know, access to our goods to the US market. And so, you know, the endless compromise from Canadian politicians is that, you know, if we integrate slightly further with the US, we'll finally get access to these markets. The fact is, if American politicians are not interested in us having access to those markets, it doesn't matter what a free trade deal says or what sort of a security perimeter says; we aren't going to get access to those markets. But in the meantime what we've done is we've traded away our own independence in terms of deciding what should our refugee policy be, what should our regulation policy be, and so on, and we become much more tied to accepting whatever the American policies are, which may not be in keeping with what Canadian values are.

JAY: Well, it also--if you really have an integration on security issues, it starts to suggest: how could you have a Patriot Act operated on one side of the border and not something similar on the other side of the border, especially if they want to get to this state, which has been the dream of at least a section of the Canadian business elite, to have no borders at all, have a European style, just free flow back and forth between the two countries, which means you're going to have to have similar mirrored security legislation in both countries?

MACDONALD: Yeah. And, again, I don't think a lot of Canadians are particularly interested in that kind of regulatory harmonization, quote-unquote, where, you know, their personal information's now accessible to the CIA and the FBI, more so than it is today--and in some cases it is. And so we can continue to want more open borders for trade, but the problem is is that to get those, we always have to put up our independence in trade. And the fact is is that when push comes to shove, the US will invoke protectionism on key industries, and there's very little that we can do to stop it, irrespective of whether we have a common perimeter or whether we have a Free Trade Agreement or NAFTA or whatnot.

JAY: Now, the other thing I think is important in this economic competitiveness concept actually showed up in the NDP platform, where the NDP, in their election platform, when it came to climate change issues, said they would work with the Obama administration to make sure that there was a coordination or harmonization in a cap-and-trade program on both sides of the border, which means, number one, that the NDP was willing to accept an American-style cap-and-trade program and, number two, given that even the cap-and-trade program, which many environmentalists have been very critical of because many people don't think it actually leads to real controls on carbon emissions, but the NDP itself committed to not doing something that would make Canadian businesses, quote, uncompetitive. So you have the NDP and the conservatives kind of on the same path when it comes to this kind of issue.

MACDONALD: Well, I'm not against, particularly, working with the US on issues that make sense for us to work together on. [crosstalk]

JAY: Well, what I'm saying is that nothing's going to get done in the US. So if you use that as the bar, the bar is zero.

MACDONALD: Fair enough [crosstalk]

JAY: It's completely paralyzed here, cap-and-trade and climate change. The words climate change did not--not did it not only cross Prime Minister Harper's lips; it has not crossed President Obama's lips in months and months.

MACDONALD: Fair enough, fair enough. And maybe that's it, placing so much emphasis on waiting for the US to take action, although it would certainly make sense for us to coordinate as a recipe for endless [incompr.] I mean, the fact is is that in Canada there has been movement on carbon taxes. There's a carbon tax in BC. There's the start of a carbon tax in Quebec, and some pushes as well in Ontario. I mean, there are movements in Canada on the environmental front. I mean, it also makes sense to note that in the throne speech, for instance, there was no mention whatsoever of climate change, very little mention whatsoever of the environment. This is clearly not a priority for the Harper government.

JAY: Okay. Well, let's talk about the bigger issue of all of them, I suppose, and that is Prime Minister Harper's pledge to balance the budget, pay off the deficit by 2014. How's he going to do that?

MACDONALD: Yeah. You know, the throne speech was really interesting in that the Harper government--or the throne speech acknowledged that stimulus spending in 2009 and '10 did create jobs and did drive economic growth. And, in fact, they were positive means of doing so. So we know how to create jobs. The Harper government knows how to create jobs. It's engaging, you know, employing Canadians to fix infrastructure, or, you know, employing Canadians to work in hospitals, or so on. And so what's interesting is that we've got this mechanism to create jobs. Now, unemployment isn't dramatically lower today than it was in 2009, when the financial crisis hit Canada, in terms of the unemployment numbers. So I think what's interesting is that despite that working as a prescription in 2009, it's no longer applicable today. And so the question, despite the fact that jobs and growth were mentioned, you know, 100 times or many times, anyway, in the throne speech, unemployment was not mentioned once. And so the actual measure of how many jobs you're creating was not mentioned.

JAY: You know, I think it's important if for--I mean, for Canadians, but also for our American viewers, you know, the unemployment rate in the US is about 9.9. The national average in Canada is lower than 9. But if you actually go into various provinces, like Ontario, if I--last numbers I looked at, it was 9.1 percent unemployment in Ontario, in the Maritimes it's somewhere between 12, 13, 14 percent, British Columbia hovers around 9, which are not that far from the American numbers. And in the US, people are up in arms about unemployment, and in Canada, for some reason, it doesn't get talked about very much.

MACDONALD: Yeah, and it actually received very little attention from the opposition party as well. I mean, I'm from Windsor originally. And people who know the area, Windsor's right across the river from Detroit. Detroit's gone through a real tough time, and so has Windsor, which is one of those places that have been hard hit by the collapse of manufacturing in the US and in Canada in that whole area. And the fact is unemployment is much higher in Windsor, as it is in many areas in Canada. And so, while I think the Harper government realizes that talking about jobs and talking about growth is what concerns Canadians, and so they mention it and it's part of the rhetoric, the fact is is that actively committing to creating jobs through government spending is just not on the agenda. And so I think [crosstalk]

JAY: Yeah, so he's not going to create jobs through government spending, but he's going to cut the deficit. So you've been predicting what that means now is a massive cut in jobs in the federal civil service. So you're actually not creating jobs over here, but you're actually creating less jobs over there. But what do you make of what he's going to do to the civil service?

MACDONALD: Yeah. And so this was amusing, if you will, in the March 22 budget that didn't pass, that failed. And so the idea was is that, well, we could balance the budget one year earlier if we engage in $11 billion in cuts. The president of the Treasury Board at the time, John Baird, said that instead of cutting transfer payments to people or transfer payments to provinces, they would cut staff positions and they'd cut 80,000 staff positions, which represent about a third of the entire public service, federal public service in Canada. And so that's how they would balance the books a year early. And there's actually no--I mean, you know, your American viewers should understand that there's--in contrast to the US, the debt levels, the federal debt level in Canada is dramatically lower. We're actually the lowest in the G8 by a long shot. And so there's actually no pressing need to balance the deficit a year earlier. In fact, we could continue to let it run. We could run up, actually, $500 billion in additional debt--this is the actual number, $500 billion, half a trillion dollars in additional debt--and we'd still be tied for first place with Germany in terms of the debt ratio. So, I mean, there's no pressing need to balance the deficit right now. There is a pressing need to reduce unemployment. But the move to deficit reduction instead of job creation, which is signaled through this throne speech, means that we'll actually cut about 80,000 positions over the next four years. And we'll see more detail, I think, with this in the budget on Monday.

JAY: And we saw a little bit. These were layoffs, I guess, that were already planned before this. But we just saw, I think, 50 people laid off from Environment Canada. There was, I think--what is it?--half a dozen people laid off at the National Archives. And people are suggesting this is just the beginning.

MACDONALD: Well, I mean, there were actually--I mean, one of the big figures was there's 2,000 people being laid off at DND, and so--Department of National Defence, rather. But this doesn't include the 80,000 positions. I mean, this is already budgets that have already been passed. These are cuts that have already been passed in budgets. What I'm talking about here is future cuts [crosstalk]

JAY: But Harper campaigned in the recent election saying that cuts in the civil service would only take place through retirement and attrition. Could he get--if the number's 80,000, can he get there through that process?

MACDONALD: Oh, that's a total fantasy. I mean, they're living in total fantasy land if they think they're going to get to 80,000 positions through attrition alone. Currently in the civil service, about 6,000 people are retiring a year. That's definitely going to go up. But you might get to 40,000, might get to 40,000, if you had an aggressive buyout package, which again is going to cost money. The other 40,000's going to be in layoffs. But, I mean, the fact remains that even if you weren't going to lay those people [off], even if you were going to have 80,000 people retire in the next four years, a cut of a third in terms of civil service staffing levels simply means that, I mean, you have to see an effect on service levels. I mean, there's no way to avoid that. So if you've got a problem with your tax form, you're trying to get your EI check, your grandmother's trying to get her CPP, her pension check, or some of the income support programs for older seniors there's a problem with it. The mantra of the next four years is going to be get in line, because there's not enough people to actually deal with your issue.

JAY: [inaudible] joining us, David.

MACDONALD: Thanks for having me.

JAY: And thank you for joining us on The Real News Network. And if you want to see more coverage about Canada on The Real News--and we would like to have a full-time person in Ottawa, coming in the fall--we need you to click the donate button, 'cause if you don't do that, we can't do this.

End of Transcript

DISCLAIMER: Please note that transcripts for The Real News Network are typed from a recording of the program. TRNN cannot guarantee their complete accuracy.



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