rabble blogs are the personal pages of some of Canada's most insightful progressive activists and commentators. All opinions belong to the writer; however, writers are expected to adhere to our guidelines. We welcome new bloggers -- contact us for details.

Canada's economy: A debate fit for a national Parliament

Please chip in to support more articles like this. Support rabble.ca for as little as $5 per month!

Canada's Parliament. Photo: Chris Fane/Flickr

It's membership time. Cultivate Canada's media. Support rabble.ca. Become a member.

We have been doing something unusual in Canada in recent weeks. We've been having a substantive debate about the basic direction of our economy. That's what happens when there are real parties facing each other in Parliament, who have real disagreements about real issues.

In that sense, we can say that the Canadian political system is finally maturing, after a long post-colonial history of elite accommodation. Federal politics used to focus on symbolic issues, and on two legacy parties who alternated in office but shared the same approach to public affairs. Things are different now.

For the time being at least, conservatives have reconsolidated around the Reform Party, currently governing Canada with the former Progressive Conservatives as junior partners. Canada's progressive majority is reconsolidating around the team that Jack Layton led into Official Opposition last May.

If this holds, you'll be able to vote next election to maintain the status quo into a second decade. Or you'll be able to vote to actually change it. Who knew you could do that in a Canadian federal election?

So back to the national debate we've been having about our economy. Check out this interesting report issued by the United Nations in the wake of the collapse of the world economy -- a collapse that shows little sign of ending any time soon.

Paragraphs 7 to 41, starting on page 16, are a crisp, pointed and convincing explanation of how industrial economies got themselves into the trouble we're in. It's all there. The folly of financial deregulation, leading to the mortgage meltdown in the United States. The folly of misplaced faith in unregulated markets to solve overwhelming economic challenges. And, critically, the folly -- and disastrous fiscal, economic and social consequences -- of growing inequality.

"In most advanced industrial economies, median wages stagnated during the last quarter century," the UN report argues, "while income inequalities surged in favour of the upper quintiles of the income distribution. In effect, money was transferred from those who would have spent to meet basic needs to those who had far more than they could easily spend. This created a tendency toward reduced levels of aggregate effective demand."

So then, the report's authors argue, for a time "the negative impact of rising income inequality on aggregate demand was largely offset by increasing indebtedness of households, especially in the United States and some other developed countries such as the United Kingdom. But the high level of indebtedness was not sustainable. ... In advanced countries such as in the European Union social protection systems compensated for stagnating income in a context of high unemployment, but were accompanied by increasing public deficits and public debt."

Just so.

Prime Minister Stephen Harper claims that Canada stands aside from all of this. In truth, income inequality in Canada has returned to its 1920s levels. In consequence, household debt is higher in Canada than in the United States. Our economy is paying the same price other advanced economies are paying for the same folly. But we have developed our own special way of masking the issues, for as long as China is buying. We are selling the world ever more raw unprocessed natural resources -- our rocks, our trees, and our energy (carbon and hydro-electric).

Is this the road we want to stay on? Or do we want to set a different course, towards a greener, more diversified, value-added economy whose benefits are much more widely shared?

There is a debate fit for a national Parliament.

This article was first published in the Globe and Mail.

Thank you for reading this story…

More people are reading rabble.ca than ever and unlike many news organizations, we have never put up a paywall – at rabble we’ve always believed in making our reporting and analysis free to all, while striving to make it sustainable as well. Media isn’t free to produce. rabble’s total budget is likely less than what big corporate media spend on photocopying (we kid you not!) and we do not have any major foundation, sponsor or angel investor. Our main supporters are people and organizations -- like you. This is why we need your help. You are what keep us sustainable.

rabble.ca has staked its existence on you. We live or die on community support -- your support! We get hundreds of thousands of visitors and we believe in them. We believe in you. We believe people will put in what they can for the greater good. We call that sustainable.

So what is the easy answer for us? Depend on a community of visitors who care passionately about media that amplifies the voices of people struggling for change and justice. It really is that simple. When the people who visit rabble care enough to contribute a bit then it works for everyone.

And so we’re asking you if you could make a donation, right now, to help us carry forward on our mission. Make a donation today.

Comments

We welcome your comments! rabble.ca embraces a pro-human rights, pro-feminist, anti-racist, queer-positive, anti-imperialist and pro-labour stance, and encourages discussions which develop progressive thought. Our full comment policy can be found here. Learn more about Disqus on rabble.ca and your privacy here. Please keep in mind:

Do

  • Tell the truth and avoid rumours.
  • Add context and background.
  • Report typos and logical fallacies.
  • Be respectful.
  • Respect copyright - link to articles.
  • Stay focused. Bring in-depth commentary to our discussion forum, babble.

Don't

  • Use oppressive/offensive language.
  • Libel or defame.
  • Bully or troll.
  • Post spam.
  • Engage trolls. Flag suspect activity instead.