Spinning past thinking on the Canada-US Border

Growing threats to both economies argue for boldness in Canada’s relationship with the United States. That’s the last thing we're going to get from the anything-but-Beyond-the-Border-initiative.  

This Wednesday in Washington, Stephen Harper and Barack Obama will sign off on measures to improve border operations, hopefully without stirring paranoids in either country. The deal, however, will camouflage a failure—especially of the Canadian government that must always take the lead in the relationship—to think in fresh, ever so slightly radical terms about their two changing economies and their common destiny.

Harper shouldn’t be attacked for taking too many risks; rather, he should be called for taking too few.

For weeks, the only real drama about the pending signing ceremony was whether Obama would make it news by even participating.  

Last Friday, Harper, along with an anodyne statement from Perrin Beatty and Thomas J. Donohue, the CEOs of the Canadian and US Chambers of Commerce, set the stage.

Harper played the vigilant nationalist, circa the 80s:

“We are seeking ways of ensuring security in North America while at the same time making sure that we continue strong Canadian access to the American market,” Mr. Harper said. But the Prime Minister had a different message when asked about plans for a pipeline to Canada’s Pacific Coast.

“Diversifying our markets for those products is not just essential to our economic prosperity but to our economic security,” he said. “It is not in our country’s interest that we are a captive supplier of the United States of energy products, especially when we see some of the politics that are going on south of the border.”

Click on: www.theglobeandmail.com/news/politics/harper-stresses-need-for-open-markets-before-us-trip/article2259075/

The Chambers’ review of the expected deal relied on the timeless language of standing committees. Benefits will be enhanced, hassles will be eliminated, procedures will be aligned and simplified, standards will be modernized, and search and seizure capabilities will be improved.

“This agreement gives us the chance to fix what’s broken. With the commitment from both sides, the Beyond the Border initiative can strengthen the security and the efficiency of our borders.”

Click on: www.nationalpost.com/opinion/border+that+works/5806772/story.html

These are the kinds of statements that statesmen in France and Belgium were making two generations ago.

We deserve, especially from market liberals like Stephen Harper, more than past platitudes about better access and shimmering visions of a border that works. Rather than telling their officials to meet, leaders should be challenging their populations to think about dismantling the border all together.

Better access for business executives, widgets, and resources is just fine-tuning the agreements of an earlier time. In 1988, it appeared that essentially all we had to do was secure access to each other’s markets. The dynamism of North America’s economy today, however, won’t be sustained by just-in-time delivery and just-visiting professionals.  

Beyond free access for finished products and finished ideas, our cosmopolitan information economies need free access for workers, their skills, and their half-baked as well as their most promising ideas. True labor mobility—one labor market for the two most advanced large economies in the world—would bolster every significant commercial center on the continent.

Market reformers shouldn’t be satisfied with a state-of-the-art border. No one in a line-up or on the other side of the best border in the world can breathe as easily—and work as productively—as one can within one common labor market, if not one federation.

Of course, professional border watchers are right—in the short-run, US politics is turning inward for the 2012 elections. Still, Canada should prepare for better times. On Wednesday, Harper ought to acknowledge the limitations of what has been accomplished and offer something more to think about.

Why not, for starters, propose that both countries look at scraping their lists of preferred trades and professions and open each other’s job markets to each other’s high skilled workers and post-secondary graduates?

Canada’s new nationalists: GNP Conservatives

Historically, Conservatives didn’t boast much about Canada.

Indeed, being less dynamic and less obsessed with material success than Americans was one of the cornerstones of Canada’s identity. They were British loyalists—living alongside a larger, rapidly growing federation. They were in the resistance business, fending off a glamorous liberal civilization to the south.

Today, America doesn’t run as fast as it used to. But its earliest liberal ways have prevailed at home and have captured the Conservative imagination in Canada. Today, Canadian Conservatives label the past “royal” and measure their country’s worth in terms of future economic growth—once America’s most recognizable, albeit philistine, virtue.

Commodity markets, futurists, and statistics now support a new patriotism that thrives on numbers.

The latest send up is by Scott Martin, a post-graduate at LSE and former aid to Canada’s minister of foreign affairs and minister of finance. Using a forecast by HSBC Global Research, he exclaims in “Bigger than France?”:

“When you modestly adjust for HSBC's conservative projection for Canada's population growth, it is not inconceivable that our country might reach 2050 with a larger economy than that of La République. And on that path, we would be well placed to even approach Britain in economic weight by the time Canada celebrates its bicentennial.”

Click on: www.nationalpost.com/news/Bigger+than+Britain/5631301/story.html

Staying number ten in the world, with one percent of the population of the world—and, conceivably, passing France and Great Britain economically—Canada’s economy will stamp out any remaining questions about the logic of living in a separate northern country. Canada needn’t feel left out for not being American; now, it can also be great. Martin prods us forward.

“Are Canadians even prepared to outshine France? Are we really ready to be bigger than Britain? Very few of us have started to think in these terms, but we are not without some good reasons to. Our world mid-century will be very different place than it is today, that is certain, but there are promising indications that Canada's influence in it can increase dramatically. The sooner we begin to work towards much more ambitious goals than we are used to setting, the more successful we will become at transforming ourselves in order to fulfill this country's limitless potential.”

There’s something sad and funny about this scenario.

Martin could have been an Anglican seminarian in the summer of 2007, deciding to go into high finance and study how to bundle and re-sell mortgages.

Tories used to explain that sticking with Canada was the only way to preserve conservative virtues in this vulgar world. The chance of being richer than France and Britain is a philistine argument and as elusive as being a good Tory.

All projections about Canada’s future economic success rest critically on the continuing economic vitality of the United States and its continuing inclination to champion and protect open and orderly international trade. No long-term forecast makes Canada a great exporter without a robust North American home market. No forecast of Canada as an energy and resource export super-power allows Canada to be great without a US market and, as important, continuing support for open trade—American-style—in China, India and other young capitalist economies.

Even if the present world order purrs along for another forty years and Canada’s GNP catches up with several former European giants, Canadians will not “outshine” the French or the Italians or the British as citizens of the world—as people with political power able significantly influence regional and global events.

Those Europeans will be citizens of a decentralized Europe Union. They will have political sway within a one of the world’s great civilizations and economic machines.

Canada’s new nationalists seem content to win at statistics and live politically outside of North America’s political drama.

Politics of hard choices making democracy in US look bad

American federal government may have a basic management problem—its leaders today don’t seem to know how to make painful decisions. This has driven Fareed Zakaria to wonder whether American style democracy is the problem.

“It's not that our democracy doesn't work; it's that it works only too well. American politics is now hyper responsive to constituents' interests. And all those interests are dedicated to preserving the past rather than investing for the future. There are no lobbying groups for the next generation of industries, only for those companies that are here now with cash to spend. There are no special-interest groups for our children's economic well-being, only for people who get government benefits right now. The whole system is geared to preserve current subsidies, tax breaks and loopholes. That is why the federal government spends $4 on elderly people for every $1 it spends on those under 18. And when the time comes to make cuts, guess whose programs are first on the chopping board. That is a terrible sign of a society's priorities and outlook.”

—Fareed Zakaria, “Are America’s best days behind us?” Time U.S., March 2, 2011

Read more: http://www.time.com/time/nation/article/0,8599,2056610,00.html#ixzz1FYhWaotV

This may accurately capture how Washington has drifted into a crisis but, thankfully, doesn’t explain how it usually gets out of trouble. Historically, danger has been met by leadership. Leaders—not great teachers, but great doers—have assumed their responsibilities. That is still possible today.

In quiet times, Zakaria has it right: politicians deliver what they’re told their people want—and the wants of the richest, most diverse democracy on earth are daunting. However, the vast majority of people still elect their leaders to decide—to know better what’s got to be done and to consider wider interests.

In fact, people do expect their representatives to respect the interests of children and future generations, not just vested interests and likely voters.  If this was not so, budgets would never be balanced, taxes would never be raised  and child labour and slavery would still exist in North America.

There is no question about our politicians—including Washington’s—having a mandate to do adult things to entitlements and taxes. There is nothing in the polls to suggest that American democracy—and civil order—can’t sustain tax reform or an extension of the retirement age.

The underlying problem is very unflattering: too many Democrats and Republicans are not yet willing to stop using the big budget items against each other.

However, if they don’t settle down and lead, there will be consequences. France’s 4th Republic from 1946 to 1958 thought it would last forever. It was also full of intellectuals, amateurs, cynics and zealots. It played politics day and night, but couldn’t tackle France’s untenable colonial policy. In short order, it was replaced by President Charles de Gaulle. He once said: “When I want to know what France thinks, I ask myself.”