Prescription for Decline

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While we wait anxiously to see if the United States will launch a “pre-emptive” invasion of Iraq, Canada’s colonial-minded economic elite is aggressively pursuing an initiative called “deep integration” that would see Canada effectively absorbed by our imperial-minded neighbour. For Canada, it’s not so much an invasion as a pre-emptive surrender.

The deep integration plan was launched last spring with an article for the C.D. Howe Institute by economist Wendy Dobson, who presented her blueprint as a “Big Idea.” Not the sort of Big Idea that implies something imaginative or visionary, this Big Idea is designed to get the attention of the Americans, who would otherwise continue to ignore us.

“Canada should anticipate change and initiate a Big Idea that serves the major interests of its partner, while channelling action in ways that best serve its own interests,” writes Ms. Dobson. A key component of the Big Idea should be to hand over our energy resources as a sort of sacrifice. “Instead of waiting to be told what’s expected of us,” says Ms. Dobson, “Canadian governments and industry should prepare for this possibility in a proactive way.”

Other sacrifices include “joint continental defence, closely aligned immigration policies toward third-country migrants, border security. . . .” And, almost as an afterthought, our water: The plan to ensure U.S. energy security “could also provide a model for dealing with demand pressures on other . . . natural resources such as water.” We’d also “modify” our cultural policies, and give up the Wheat Board, and orderly marketing.

What do we get for these sacrifices of our sovereignty? Well, nothing: What the deep integrationists want is a customs union and eventually a common market so Canada can improve its “weak made-in-Canada economic performance and stagnating living standards of the past decade.”

But wasn’t free trade supposed to solve those problems? Isn’t fifteen years enough? Here is what integration has got us. To meet the needs of the free-trade imperative, we have savaged our domestic economy — driving down wages and working conditions, abandoning industrial policies, radically cutting public spending, and handing the rich tens of billions in tax breaks. We lost 276,000 industrial jobs. Ottawa has lost every NAFTA trade-dispute case it has taken; Washington has won every one of its.

We now have a degree of social and economic inequality unmatched since the 1930s. Nearly ninety-five per cent of U.S. direct investment has been used to buy up Canadian assets, consolidating corporate operations in the United States. According to NAFTA’s Commission for Environmental Co-operation, increased trade is accelerating environmental degradation in the NAFTA countries.

But what do our free-trade zealots want? Even more energy sales. By this logic, the United States is to be encouraged to use as much energy as possible so we can sell it to them — Kyoto and our own energy security be damned.

If you are assuming through all this that NAFTA at least increased our trade with the United States, think again. According to a 2001 Industry Canada study, ninety-one per cent of the increase in trade with the United States in the 1990s was the result of the low dollar and the U.S. economic boom.

But never let it be said that mere facts can discourage the true believer. If the medicine doesn’t work, double the dose. The deep integrationists are now sponsoring a sort of private-sector royal commission, called Borderlines — a series of high-profile conferences promoting integration funded by the free enterprise foundations and organized by the major business think tanks.

Not satisfied with economic integration, the Big Idea extends integration into the political realm. One suggestion calls for “four consultative political institutions” to develop a “North American” identity. But Frank Graves of Ekos Associates, which does the most extensive values polling in the country, says there is no sign of, and no support for, such an identity.

According to Ekos, Canadians now demonstrate “a stronger sense of identity and greater national confidence than at any time in the past decade.” But Canada's economic elite is so enamoured of things American, so lacking in imagination and entrepreneurial ability, that the biggest idea it can come up with is to give the United States everything and pray it will be grateful.

A genuinely Canadian reading of the facts suggests that Ottawa should establish an independent public inquiry into the current state and future options regarding Canada-U.S. relations. Surely the real question is: What policy mix would strengthen Canadian society, the domestic economy and our nation-state?

Second, it is so glaringly obvious that free trade has damaged the country, we should immediately declare a moratorium on signing any new agreements. Third, we should begin immediately — in the next federal budget — to restore the social programs we have voluntarily slashed in order to please the United States. The grand experiment has failed. Let’s look for a truly visionary Big Idea and save the country.

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