- Michal Rozworski reminds us that austerity in Canada is nothing new under Con or Lib governments, while pointing out what the public needs to do to repel it:
The campaigning Stephen Harper boasts that his tough austerity policies saved the Canadian economy. Lost in the rhetoric are two important facts. As most economists will tell you today, austerity measures are lousy ways to expand jobs and investment. And Harper's Conservatives were just carrying on the work of their austerity embracing Liberal predecessors.- And Bruce Wark follows up by challenging the media's failure to recognize what's already been lost to past cuts.
The first round of Liberal cutbacks were quick and deep. A greater share of government expenditures redirected towards debt repayment created additional false scarcity of funds for direct spending. Spending on federal government programs and transfers to provinces, cities, and individuals fell by over five per cent of GDP from 1993 to the turn of the millennium. Spending growth did not just slow: absolute expenditures decreased.
Reduced fiscal transfers to provinces put the squeeze on local governments. Since the 1990s, Canada has seen provincial governments -- not just governed by Liberals and Conservatives, but also by New Democrats -- impose austerity further down the line. Since provinces are responsible for many basics like health, education, and welfare benefits, shrinking transfers have further eroded the working class's social wage. Privatizations, workfare schemes, tuition increases -- all were applied (unevenly) across the country.
Overall, the sharp turn to austerity created a more punitive welfare state. While Canada's economic growth in the mid to late '90s fed off that in the U.S., the character of its reforms was also in line with the Clintonite agenda. There was a similar push to create conditions for business expansion even less encumbered by working class demands. A major strategy was an attack on the social wage -- public spending on goods, services and income supports for people in Canada.
There is now more than one generation that has grown up with austerity and little else. Despite, or perhaps because of this, the youngest generation today is more inclined towards left politics than any other. Yet the space for even modest social-democratic politics has rarely been narrower. This opening and closure exist side-by-side in contradiction. To make the contradiction a productive one, we need an honest appraisal of political forces and how power operates: a political economy of the present.
Upon this foundation, we can create a political space that rekindles the imagination -- one that has less risk of falling into a mythologized, and wholly false, vision of the 1990s. Going back further, we also need to come up with more than simple nostalgia for the postwar prosperity, whose contradictions created the lumbering monster that still chews at our horizons.
Stopping and reversing austerity in Canada, as anywhere, requires an honest assessment of the forces allied in its favour. A consensus that has emerged over decades will not be broken easily. While putting a single man's face to it may be useful to start the conversation, we will need to go further, examining the systemic challenges that prevent a parting with austerity -- whether the slow-simmering kind Canadians are now experiencing, or sharper variants.
- Kevin Campbell argues that the success of progressive parties and voters will depend on our ability to highlight their ability to do more for citizens' economic security. And Kevin Lynch points out that plenty of economists are on board to work on economic growth through fiscal rather than monetary policy.
- Sara Mojtehedzadeh reports on a new study from the Atkinson Foundation and Mowat Centre discussing the need for community institutions such as universities, hospitals and municipalities to foster local development rather than needlessly sending money elsewhere.
- Finally, Dan Leger notes that the Cons and their supporters are thoroughly in denial over the facts about the Duffy scandal - though it's hard to see where else they could go without abandoning the party under Stephen Harper. And Chantal Hebert sees the combined scandal and cover-up as reflecting the Harper Cons' core character.