Why Alberta shouldn’t look to Norway, and why that’s a reason to Leap

One of the clearest memories I have from my only trip to Norway is the repeated failures at hitching a ride. What appeared to be an unbroken string of brand new Audi’s and BMW’s whizzed by my friend and I, dirty and sweaty after a few days hiking and camping in the mountains. “Where am I that the comforts of our rich assholes are the rights of common citizens?”, I remember thinking.

You’ve probably seen at least one article saying that Alberta should be more like Norway. I don’t want to rehash that debate. But I think we’ve gone about it the wrong way and seeing why can tell us a lot about today’s sparring over the Leap Manifesto.

Comparing Alberta unfavourably to Norway for squandering its oil wealth has been a familiar trope of media and progressive organizations, especially since the oil price crash (here’s just the CBCToronto Star and Globe and Mail). The comparison has become so ubiquitous that it has also spawned a cottage industry of counterarguments from the right too. In short, Norway has been putting away the money it gets from oil in a sovereign wealth fund since 1990. The fund is now the world’s largest and worth over $1 trillion. Alberta’s fund, although older and actually the inspiration for Norway’s, is a paltry $15 billion. (Norway and Alberta have similar populations.)

The funny thing, however, is that Norway’s gigantic fund doesn’t pay for much of what the government does. Taxes do that. Take a look at the numbers. Public revenues in Norway at all levels of government are equal to over half of GDP (nearly 55% in 2014). Meanwhile, federal, provincial and local government revenues in Alberta make up somewhere around 30% of provincial GDP. That’s a massive difference. Alberta tax rates are lower: on individuals, on corporations and on consumption. In addition, the Norwegian government not only owns a majority share in its largest oil company, Statoil, but also taxes oil profits at a much higher rate. A special tax on “excess profits” takes the top marginal corporate rate on oil corporations to 78%. (more…)

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Fiscal policy for the left, or Corbyn vs Mulcair on deficits

The question of deficits dominated a lot of the economic debate in Canada during the 2015 federal election and even today. Jeremy Corbyn’s Labour Party introduced a new fiscal policy last week that, on surface, appears to mirror the NDP’s anti-deficit stance from the 2015 campaign. Looking closer, however, Labour’s policy diverges quite substantially and points to more honest and transformative economic policy for the left. (more…)

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Will Sanders’ rise be felt in Canada?

Co-written with Derrick O’Keefe and originally published at Ricochet.

Even if he’s really only offering a pragmatic form of social democracy, Sanders has created a political space in the mainstream left that’s sorely missing in Canada. His insurgent campaign for the Democratic Party nomination has put inequality and systemic injustice front and centre in the United States.

Policy proposals aside, merely having the word “socialism” back on the agenda in the United States signals a massive shift. Compare Sanders’ unabashed use of the term to recent NDP history.

Canada’s traditional social democratic party has spent recent years downplaying and scrubbing away the last vestiges of socialism from its public presentation. Under pressure from party leaders and bureaucrats, the NDP removed all but one reference to it from its constitution in 2013. The s-word is now only mentioned in passing in the party preamble.

It’s useful to take a broader view than just the recent botched campaign and the party itself. For years, the NDP’s leadership and top advisors have taken their cues from their counterparts in control of the Democratic Party — an electoral machine that has been effectively captured by a small coterie of the rich and powerful. (more…)

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Questions for the Canadian left

Harper is gone, but (as a friend only quarter-jokingly said) we got the second worst outcome sold as the best, so now what? That’s the 10 second version of this post. I want to throw up a few questions or, better yet, problems that I think the Canadian left will have to face together over the next few years. There are no easy answers here.

In 2015, the Liberals once again showed that they are masters at campaigning to the left. But as we now wait for them to show how equally apt they are at governing to the right, it’s clear that it won’t simply do to say “told you so!” in four years time. It is not by accident that the Liberals are Canada’s “natural governing party,” for if anything, they know how to govern. They are experts at balancing competing interests or, more accurately, giving the semblance of balancing interests all the while closely aligned with the interests of the elite, and the upper middle class.

Still, we have to recognize that things will be different and that this affects where people are and how they relate to politics. On the one hand, the Liberals do open up some space on the left by making symbolic gestures here and there; at the same time, they close off this space by drawing the limits of respectable progressive politics. They don’t fill the void left by a weak left as do the Conservatives with their exclusionary, pocketbook politics aimed at the working class. In fact, they speak to a broader cross-class progressive segment of the population in a way that can be disorienting. (more…)

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This election, let’s really talk about the economy

The word ‘austerity’ is finally in the mix, but all parties stuck in the right-wing’s frame

Austerity is on the agenda of the Canadian election, as the word was finally uttered — by Justin Trudeau. Bizarrely, this came the same day as the Liberal leader rolled out his economic agenda flanked by Paul Martin, the former finance minister and prime minister who engineered deep austerity measures in the 1990s.

The way austerity has finally made it into the discussion highlights the absurdly limited nature of the economic debate so far. It’s time for a grown-up conversation about the economy in this campaign.

Right-wing frame

Politicians have been falling over each other to make economic promises they cannot keep, all the while firmly stuck in the muck of a right-wing frame. The debate has mostly been limited to whether there will be a deficit and how big, rather than the real questions of who the economy works for and why. (more…)

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The case for a $15 minimum wage the NDP should make

Of all of the NDP’s campaign promises so far, one of the simplest has gotten the most press: the $15 minimum wage for workers in federally regulated sectors. This campaign plank should be an easy sell for the NDP, yet Conservative and Liberal attacks have managed to undermine it. The way it’s been presented has left it open to attack, but this needn’t be so. (more…)

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Where is Canada’s mild Keynesian alternative?

You know something is up when the social democrats are trailing the centrist pundits on the economy. The space for a just a mild Keynesian alternative in Canada is wide open. Such an alternative, however, needs a political rather than merely a technocratic push.

Here is a fragment of a piece that just appeared in Canadian Business magazine and is typical of recent centrist commentary:

No one would counsel a return to unchecked spending. But the magical thinking around balanced budgets should stop. Canada’s debt is a sunk cost, not an anchor. The IMF now advises that countries with enough fiscal room to manoeuvre should think twice about reducing debt for the sake of it. If debt is manageable, economic growth should be the priority. An expanding economy will reduce the debt burden organically.

After establishing centrist credentials via the bogeyman of “unchecked spending”, the author quickly offers an argument to the left of all three major political parties, including the NDP. Debt reduction for its own sake is contrasted with restarting economic growth and there’s even an appearance of the now-common progressive appeal to the IMF as the voice of technocratic reason.

The left counterpart to this centrist line is the “Varoufakiste” argument of trying “to save capitalism from itself…to minimise the unnecessary human toll from crisis.” This argument concedes that today even the meager gains from growth that would go to the many are better than redistributive austerity that encourages stagnation amidst the “creative destruction” of social protections. It is a modest Keynesianism fit for neoliberal times. (more…)

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Looking towards childcare in Canada, with lessons from Sweden

 

This week, the federal NDP reignited a national debate over childcare by proposing a universal $15 per day childcare program. This is the focus of today’s episode, which features two guests. First up, Angela MacEwen. Angella is an economist with the Canadian Labour Congress and has long been a strong advocate for public childcare in Canada. I spoke with her about the economics of universal childcare.

My second guest is Petter Nilssen, who is the press secretary for the Left Party in the Stockholm municipality and is a board member of the Institute for Marxist Social Studies, also in Stockholm. I spoke with him about the recent history of the Swedish model of the welfare state, something he wrote about recently in Jacobin Magazine under the title, “Sweden Without Illusions“.

Remember, you can now also subscribe to the podcast on iTunes, directly via this link.

141016 Childcare poster

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