The Harper-Dion Parliamentary Pillow Fight!

Prime Minister Stephen Harper’s October 16th Throne Speech passed the House of Commons on October 24 by a vote of 126 to 79. Finance Minister Jim Flaherty’s Financial Statement will pass the House in the next couple of days. Harper dared the opposition parties to stop his drive for a Parliamentary majority. Jack Layton of the NDP and Gilles Duceppe of the Bloc voted against the Conservatives and Stephane Dion accepted the advice of the Liberal brain trust and agreed to prop up Harper and allow the Conservatives, not the people, to determine the federal election timetable.
Harper’s throne speech and Flaherty’s economic statement were pitched directly to finance capital to abandon the “big tent” Liberals and support the election of a neo-con Conservative majority in the next federal election. To reassure the corporate sector, Flaherty took a potential $11 billion surplus and gave most of it to the banks and big oil in the form of $10 billion debt reduction and corporate tax relief. Flaherty boasts that in five years corporate taxes will have fallen to 15% from the current 21%, the lowest in the G8. Stephane Dion’s only complaint is that the Flaherty “stole his promise” to do the same. For the people living on wages and salaries, Flaherty gave back a half percent he took from the lowest income bracket of wage earners in 2005, cut the GST by 1% that the provinces will in all likelihood will add to provincial sales tax and cut $700 from basic income tax exemptions retroactive to January 2007. The tax relief that will come next April won’t begin to recover what wage earners and farmers lost this year in rising fuel, housing, user fees, school fees and public transportation costs.
Managing the Economic Crisis – Not Solving It!
What is driving all of this political posturing? Flaherty predicts that the economy will slide in the next six months. The Conservatives aspire to manage the profit system for big business as the country heads into an economic slump created by the US sub-prime melt down, massive consumer, federal and balance of payments deficits all fueled by out of control military spending on Iraqi and Afghanistan wars. Flaherty is deliberately understating the seriousness of the slide.
The Harper-Flaherty plan is to perpetuate massive speculative investor income and shield corporate profits with a promise to smother the inevitable fight back by the people with a “militarize the economy”, “law and order”, “get tough on terrorism”, “get tough on youth”, program that can quickly become “get tough on labour” if the Conservatives win a majority.
Stephane Dion is dead wrong when he asserts Canadians don’t want an election. That states the question incorrectly. What a majority of Canadians don’t want is another four years of the Harper neo-cons and their agenda of war, corporate giveaways and restriction of democratic rights. Instead of confronting the Conservatives “get tough agenda” in Parliament and to find the common ground with the NDP and Bloc to oust the Harper neo-cons, Dion opts to retreat to the back rooms of corporate Canada where his advisors will plead with big business to continue to support the “big tent” Liberals as their best option to protect profits and absorb the growing fight back of the Canadian working people, the first victims of the global made-in-USA economic slump that is coming.
Enacting Policies the People Reject!
The throne speech and Flaherty’s financial statement are not about the needs of the working people of Canada. There is nothing in these documents for workers and farmers. In propping up the minority Conservative Government the Liberals voted to support the arrogant stance of Harper that he will continue to pursue foreign and domestic policies the majority of Canadian’s reject.
Harper speaks to NATO and President Bush that if re-elected he can be relied upon to extend Canada’s combat role in Kandahar, Afghanistan to 2011. He speaks to the big oil investors that he will scuttle Kyoto to keep their profits high and oppose all attempts by the provinces to get an ownership stake in energy development. He plays on fears of faith based supporters about crime to justify legislation to put youth in jail rather than provide them with education and jobs. He speaks to employers that they will get a generous tax cut and workers and farmers will get a pittance. He speaks to agricultural corporations that he will continue to help them destroy the Canadian Wheat Board. He speaks to Quebec Premier Jean Charest and fellow neo-con Mario Dumont that in exchange for their political support, he will continue to deceive the people of Quebec with talk of sovereignty and do nothing about job loss in forestry and manufacturing.
Harper advocates the weakening of federal powers music to the ears of the wealthy and the private health care investors campaigning for two tier U.S. style health care. Mere days after the throne speech the media reported that the UN World Health Organization ranks the U.S. 41st in the world for maternal mortality with one in 4800 American women dying of pregnancy complications compared to Canada where the figure is one in 11,000. Under Harper, public health care has deteriorated and 2 million Canadians failed to find a family doctor last year according to a poll commissioned by the College of Family Physicians of Canada. That is what Harper means when he intones that “the economy is strong, the government is clean and the country is united.”
Why Harper Ignores the Manufacturing Sector!
The day before the Throne speech, Jayson Myers, Chairman of the Canadian Manufacturers Coalition and President of the Canadian Manufacturers and Exporters (CME) called upon Prime Minister Harper to act on a ten point program to halt the decline of the sector. To back up sector demands on the Harper Government Myers asserts that manufacturing accounts for 16% of GDP, generates $3.05 for each $1.00 of manufacturing output, accounts for $600 billion in exports and employs 2.1 million workers. Wages in the sector, where unionization is relatively strong are 22 percent higher than in the rest of the economy and the sector accounts for 66% of private sector research and development. The day of the throne speech the CME group released a survey of its members revealing that one-fifth had shifted production to China that 19% had outsourced production to the USA and 5% said they were shutting operations altogether.
Myers proposals are not primarily aimed to halt job loss they are designed to halt profit loss. Myers demanded the Harper Government provide greater depreciation right offs, lower taxes, greater access to foreign markets, tougher stance in trade disputes, subsidies for skills development, and most revealing of all, “access to reliable and cost competitive energy supplies now and in the future.”
The “Economic Space of North America”
Why didn’t Prime Minister Harper assure the CME that he would act on their proposals and make the decline in manufacturing the top priority for his government and announce he will go to the election with a program to rescue manufacturing? It would be certain to win him votes in Ontario and Quebec. Why does Harper virtually ignore the demands of this key sector of the capitalist economy? Part of the answer came on October 17th the day after the throne speech in a column by Neil Reynolds the Globe and Mail’s designated capitalist cheer leader, reporting on the musings of Peter Harder, an Ottawa mandarin with a long career as key advisor to Prime Minister Mulroney, Prime Minister Paul Martin and Prime Minister Stephen Harper at G8 and other international big business gab fests. What was Peter Harder’s advice to three right-wing P.M.’s from both Liberal and Conservative Parties?
Harder’s advice to the ruling class is; “Canada has every interest in stronger integration with the United States. In our life time we will see the rise of emerging economies - which is a good thing and will alter the economic and geopolitical landscape of the world.” Harder predicts that China will overtake the US economy by 2025 and that Canada’s share of global GDP will decline. “It will be beneficial for us to be part of the economic space of North America.” Harder laments that “we” have been prevented from talking about globalization and integration with the US economy because, “it would look as though we were selling out our sovereignty.”
Peter Harder and Jayson Myer represent contending capitalist interests and are not in total agreement on how to save and develop their system. Capitalists and their advisors can’t agree whether it is the primary role of the capitalist state to promote and support public policies that serve the capitalist system as a whole or whether to abandon whole sectors of the capitalist economy and concentrate in the global market place on key sectors.
State capitalist intervention in the economy that in the post war period was designed to overcome regional disparity and expand the home market by federal transfers and regional development programs has been effectively abandoned. It has been replaced by neo-liberal policies that give free reign to the penetration of transnational finance capital and low priced consumer goods that oust and destroy historically evolved domestic industries dependent on the home market.
Free reign global capitalism has resulted in an onslaught on the historically evolved integrated character of the Canadian capitalist economy. It has meant that the economic sectors that produce products in demand globally survive and those that produce products that are unable to compete with low commodity prices are allowed to die. Compounding the distortions in the Canadian economy is the trend to major decisions affecting economic, fiscal and monetary policy being determined by non-elected corporate elites at meetings of the IMF, at NATO headquarters in Brussels, at the Doha Round and at tri-partite and NAFTA meetings, at the US Department of Trade and Commerce but not in Parliament.
Harper’s Canada: “Energy Superpower” or “Energy Stupid-power”
The governments of Canada, Mexico, and the United States announced in March 2005 the formation of the Security and Prosperity Partnership of North America (SPP) to, "enhance the security of North America while at the same time promote the economic well-being of our citizens and position North America to face and meet future challenges." The SPP has also spun off a North American Competitiveness Council to fully incorporate the private sector into the SPP process. The major concentration of SPP is on the continental management and control of energy.
That is what Harper meant when he told the Canada-UK Chamber of Commerce last July prior to the G8 summit in Russia that Canada is an emerging “energy superpower” – third in the world in gas production, seventh in oil, the largest generator of hydro electric power and marketer of uranium and along with Russia the only net energy exporter in the G8. What Harper failed to explain was that all of this energy production was destined for the U.S. market and is sent there at the expense of the long term energy needs of Canadians.
The economic sector in Canada that produces product in greatest global and North American demand is the energy sector. The mega projects underway in the Alberta tar sands the smaller plays in BC, Saskatchewan and offshore Newfoundland-Labrador is a growth industry, attracting billions in domestic and foreign investment capital labour and materials. In practice this has meant hyper expansion of the oil and gas sector. Hyper growth in the energy sector absorbs the bulk of new capital investment at the same time as those sectors of manufacturing not directly involved as suppliers to the energy mega projects are starved for capital and reeling from market loss, decline. Capital flows to the energy sector where profits are above average to high and trickles to the manufacturing and agriculture sectors where profits are average to low. The result is simultaneous boom and bust capitalism where workers are losers wherever they labour east or west.
The indifference of the Harper Government to the growth of unemployment in manufacturing is because that is what investors in energy want to happen. The unsatisfied demand for labour has become an impediment to the rapid completion of tar sands mega projects and the rail transportation corridors and pipe lines necessary to get the product to US markets for processing. The overriding concern of the energy investors is that labour power be in ample supply, mobile, and its price driven down to the lowest possible point by a large reserve army of unemployed and displaced workers. The capitalist class is using all means to reduce the cost of labour by such schemes as Trade, Income and Labour Mobility (TILMA) style programs that knock out all barriers to reduce wages and force workers to move or die.
The hyper growth in the Alberta tar sands has caused a social crisis of inflated housing costs, faltering health and education, rising demand for recreation facilities, public transportation, expanded and improved bridges and highways, and expanded municipal services and infrastructure of all types. Under extreme political pressure to do something, the Stelmach Government of Alberta has announced revisions to the royalty rates paid by oil investors into the Provincial Treasury. Royalties are expected to increase by $1.4 billion in 2010, a 20-per-cent increase over currently projected revenues for that year. Actual revenues will depend on future prices and production levels in the province. Therefore, the Alberta government’s annual budget development process will not change.
Jim Laxer, director of the Parkland Institute, a left-wing think tank, was quoted in the Edmonton Journal of October 22nd 2007: “that rather than increasing royalties by 20 per cent as headlines tell the public, the panel's recommendations would, if fully implemented, reduce them by 20 per cent by 2016. Alberta would collect only $7.6 billion in 2016, compared to $9.5 billion in royalties in 2006. And that doesn't seem to take inflation into account, meaning that in real dollars the province's royalty revenues would fall more.”
Laxer queried where the promised extra $2 billion from the review panel will come from. Without the panel's recommendations, royalties would drop even further -- to $5.6 billion. The status quo would mean a drop of $4 billion or 42 per cent, whereas the panel's plan means a drop of 20 per cent, he said.
Laxer went on; “Last October, Murray Smith, Alberta's representative to the U.S., told a prestigious oil executive audience in the States, "the royalty structure for oil sands is we 'give it away' at a one-per-cent royalty structure. Roland Priddle, former head of the National Energy Board, based in Calgary, pitched Alberta to Texas oil executives as a place to invest last year by asking "where else can you purchase in-place oil (well, bitumen) for one cent a barrel?"
Laxer charged that big oil portrays the review panel as radical. The language of Bill Hunter, the panel's chair, sounds like he took a tough position: "As Albertans, we own 100 per cent of the resource, and we should expect nothing less than 100 per cent of the rent. It's up to industry to convince us that we should take a decrease."
The Stelmach plan and the feigned horror of the oil investors that the energy sector will collapse is an elaborate charade. Stelmach’s so-called royalty rate increases come at a time when Conservative electoral support has slumped to a 32% approval rating. The Stelmach plan is an elaborate scam to boost his election fortunes as he contemplates a spring election. The day after Stelmach announced royalty rate increases he sent Energy Minister Mel Knight to New York, Washington, Boston and Chicago to calm US investor fears and keep the investment rolling. There was nary a ripple on the stock market, no flight of capital and no interruption in oil deliveries to the US market.
The Harper-Stelmach-Flaherty Vision of Capitulation and Sell Out!
What is the vision of the unholy alliance of finance capital, big oil and militarism that Harper, Stemach and Flaherty represent? It is in this context that we return to Peter Harder’s assertion that “Economic space is greater than political space”…and that “neither Canada nor any other country can stop economic transformation of the world through merely political means. Nor can any country ignore it.”
Consider the assertion, that no country can stop the economic transformation of the world through political means. The economic transformations in the world can’t be stopped because they are objective and driven by the growth of productive forces. Labour is the basis of production. Productive forces are people plus the means of production. The means of production are the instruments of labour (tools) and the objects of labour, (raw materials). In the process of production people enter into economic relations called the relations of production. The relations of production are determined by who owns the means of production, how are the products of production distributed and who appropriates the wealth of production, in other words who receives the wages and who receives the profits from producing the products?
The political conditions arising from definite relations of production vary from one country to another, one economic region to another and from one continent to another. What Harder alludes to when he asserts, “economic space is greater than political space” is the belief among capitalists that the relations of production as they now exist in North America are fixed and cannot be changed they can only be managed and expanded. Harder acknowledges no interest other than the capitalist interest in the growth of capitalist productive forces and that growth is bound to be greater than the political resistance that arises among the people who are the victims of that growth, those who work for wages.
All capitalists believe in the eternal nature of their system. What Harder and those he serves are incapable of understanding is that workers disagree and reject the notion of the eternal nature of their slavery.
The New Vision of Canada In the Making
The vision of a new Canada that Canadians in their majority support is a work in progress. The elements of that vision are already in the making. They arise out of struggle for what the people themselves see as being in their vital common interest and a determination that they will decide for themselves what that common interest is and will not delegate that decision to self serving private corporate and corrupted political elites.
The work in progress is not a vision of the past, of state capitalist management and control that merely kept the disparate regions of the country from flying apart and gave just enough from the capitalist table to the working people to dampen struggle. That is not a vision that is a lament. Nor is it a vision that reduces Canada’s future to a raw material hinterland, a water and energy “stupid power” a cheer leader for US imperialism as Prime Minister Harper wants us to be.
There is a growing resentment at the inadequacy of democracy as it is presently practiced, that reduces the people to spectators of the political process instead of its master. There is contempt for the “poverty of ideas” of the power elites and the media that serves them. There are demands that not only a better economic deal for working people is required, but a place at the table of economic decision making where neo-liberalism, the capitalist justification for destroying whole economic sectors, displacing populations and destroying communities can be openly confronted, challenged and defeated.
Today there is a political trend especially among the youth, around the rejection of subservience to US imperialism, of opposition to Canadian government participation in US fomented wars. Movements have arisen that assert the sovereignty of the peoples over this land and its rich resources that fight to reclaim what has been lost, to repossess what has been stolen and to restore and rebuild what has been destroyed. These movements express the idea that the wealth of the country belongs to the people who create it.
There is an argument that all that is required is to build these movements and the political process will evolve into a popular irresistible force that will compel capitalism to reform itself. The discussion of a people’s vision of Canada has to be more than that, and room must be made for the viewpoint that says, capitalism cannot reform itself, it must be replaced.