| The following article was written by columnist Mark Steyn in Imprimis Magazine
Is Canada’s Economy a Model for America?
I WAS A bit stunned to be asked to speak on the Canadian economy.
“What happened?” I wondered. “Did the guy who was going to talk about
the Belgian economy cancel?” It is a Saturday night, and the Oak Ridge
Boys are playing the Hillsdale County Fair. Being from Canada myself, I
am, as the President likes to say, one of those immigrants doing the
jobs Americans won’t do. And if giving a talk on the Canadian economy
on a Saturday night when the Oak Ridge Boys are in town isn’t one of
the jobs Americans won’t do, I don’t know what is.
Unlike America, Canada is a resource economy: The U.S. imports
resources, whereas Canada exports them. It has the second largest oil
reserves in the world. People don’t think of Canada like that. The
Premier of Alberta has never been photographed in Crawford, Texas,
holding hands with the President and strolling through the rose bower
as King Abdullah of Saudi Arabia was. But Canada is nonetheless an oil
economy—a resource economy. Traditionally, in America, when the price
of oil goes up, Wall Street goes down. But in Canada, when the price of
oil goes up, the Toronto stock exchange goes up, too. So we are
relatively compatible neighbors whose interests diverge on one of the
key global indicators.
As we know from 9/11, the Wahabbis in Saudi Arabia use their oil
wealth to spread their destructive ideology to every corner of the
world. And so do the Canadians. Consider that in the last 40 years,
fundamental American ideas have made no headway whatsoever in Canada,
whereas fundamental Canadian ideas have made huge advances in America
and the rest of the Western world. To take two big examples,
multiculturalism and socialized health care—both pioneered in
Canada—have made huge strides down here in the U.S., whereas American
concepts—such as non-confiscatory taxation—remain as foreign as ever.
My colleague at National Review, John O’Sullivan, once
observed that post-war Canadian history is summed up by the old Monty
Python song that goes, “I’m a Lumberjack and I’m OK.” If you recall
that song, it begins as a robust paean to the manly virtues of a rugged
life in the north woods. But it ends with the lumberjack having
gradually morphed into a kind of transvestite pickup who likes to wear
high heels and dress in women’s clothing while hanging around in bars.
Of course, John O’Sullivan isn’t saying that Canadian men are literally
cross-dressers—certainly no more than 35-40 percent of us — but rather
that a once manly nation has undergone a remarkable psychological
makeover. If you go back to 1945, the Royal Canadian Navy had the
world’s third largest surface fleet, the Royal Canadian Air Force was
one of the world’s most effective air forces, and Canadian troops got
the toughest beach on D-Day. But in the space of two generations, a
bunch of tough hombres were transformed into a thoroughly feminized
culture that prioritizes all the secondary impulses of society—welfare
entitlements from cradle to grave—over all the primary ones. And in
that, Canada is obviously not alone. If the O’Sullivan thesis is
flawed, it’s only because the lumberjack song could stand as the
post-war history of almost the entire developed world.
Today, the political platforms of at least one party in the United
States and pretty much every party in the rest of the Western world are
nearly exclusively about those secondary impulses—government health
care, government day care, government this, government that. And if you
have government health care, you not only annex a huge chunk of the
economy, you also destroy a huge chunk of individual liberty. You
fundamentally change the relationship between the citizen and the state
into something closer to that of junkie and pusher, and you make it
very difficult ever to change back. Americans don’t always appreciate
how far gone down this path the rest of the developed world is. In
Canadian and Continental cabinets, the defense ministry is now a place
where an ambitious politician passes through on his way up to important
jobs like running the health department. And if you listen to recent
Democratic presidential debates, it is clear that American attitudes
toward economic liberty are being Canadianized.
To some extent, these differences between the two countries were
present at their creations. America’s Founders wrote of “life, liberty
and the pursuit of happiness.” The equivalent phrase at Canada’s
founding was “peace, order and good government” —which words are not
only drier and desiccated and stir the blood less, but they also
presume a degree of statist torpor. Ronald Reagan famously said, “We
are a nation that has a government, not the other way around.” In
Canada it too often seems the other way around.
All that being said, if you remove health care from the equation,
the differences between our two economies become relatively marginal.
The Fraser Institute’s “Economic Freedom of the World 2007 Annual
Report” ranks the U.S. and Canada together, tied in fifth place along
with Britain. And here’s an interesting point: The top ten most free
economies in this report are Hong Kong, Singapore, New Zealand,
Switzerland, United States, United Kingdom, Canada, Estonia, Ireland,
and Australia. With the exception of Switzerland and Estonia, these
systems are all British-derived. They’re what Jacques Chirac
dismissively calls les anglo-saxon. And he and many other
Continentals make it very clear that they regard free market capitalism
as some sort of kinky Anglo-Saxon fetish. On the other hand, Andrew
Roberts, the author of A History of the English-Speaking Peoples since 1900, points out that the two most corrupt jurisdictions in North America are Louisiana and Quebec—both French-derived.
Quebec has a civil service that employs the same number of people as
California’s, even though California has a population nearly five times
the size.
In the province of Quebec, it’s taken more or less for granted by
all political parties that collective rights outweigh individual
rights. For example, if you own a store in Montreal, the French
language signs inside the store are required by law to be at least
twice the size of the English signs. And the government has a fairly
large bureaucratic agency whose job it is to go around measuring signs
and prosecuting offenders. There was even a famous case a few years ago
of a pet store owner who was targeted by the Office De La Langue
Française for selling English-speaking parrots. The language commissar
had gone into the store and heard a bird saying, “Who’s a pretty boy,
then?” and decided to take action. I keep trying to find out what
happened to the parrot. Presumably it was sent to a re-education camp
and emerged years later with a glassy stare saying in a monotone voice,
“Qui est un joli garcon, hein?”
The point to remember about this is that it is consonant with the
broader Canadian disposition. A couple of years ago it emerged that a
few Quebec hospitals in the eastern townships along the Vermont border
were, as a courtesy to their English-speaking patients, putting up
handwritten pieces of paper in the corridor saying “Emergency Room This
Way” or “Obstetrics Department Second on the Left.” But in Quebec,
you’re only permitted to offer health care services in English if the
English population in your town reaches a certain percentage. So these
signs were deemed illegal and had to be taken down. I got a lot of mail
from Canadians who were upset about this, and I responded that if you
accept that the government has a right to make itself the monopoly
provider of health care, it surely has the right to decide the language
in which it’s prepared to provide that care. So my point isn’t just
about Quebec separatism. It’s about a fundamentally different way of
looking at the role of the state.
The Two Economies
So, granted the caveat that the economically freest countries in the
world are the English-speaking democracies, within that family there
are some interesting differences, and I would say between America and
Canada there are five main ones.
First, the Canadian economy is more unionized. According to the
Fraser Institute report, since the beginning of this century, the
unionized proportion of the U.S. work force has averaged 13.9 percent.
In Canada it has averaged 32 percent. That is a huge difference. The
least unionized state in America is North Carolina, at 3.9 percent,
whereas the least unionized province in Canada is Alberta, with 24.2
percent—a higher percentage than any American state except Hawaii,
Alaska, and New York. In Quebec, it’s 40.4 percent. If you regard
unionization as a major obstacle to productivity, investment, and
employment growth, this is a critical difference.
I drive a lot between Quebec and New Hampshire, and you don’t really
need a border post to tell you when you’ve crossed from one country
into another. On one side the hourly update on the radio news lets you
know that Canada’s postal workers are thinking about their traditional
pre-Christmas strike—the Canadians have gotten used to getting their
Christmas cards around Good Friday, and it’s part of the holiday
tradition now—or that employees of the government liquor store are on
strike, nurses are on strike, police are on strike, etc. Whereas you
could listen for years to a New Hampshire radio station and never hear
the word “strike” except for baseball play-by-play.
In a news item from last year, an Ottawa panhandler said that he may
have to abandon his prime panhandling real estate on a downtown street
corner because he is being shaken down by officials from the
panhandlers union. Think about that. There’s a panhandlers union which
exists to protect workers’ rights or—in this case—non-workers’ rights.
If the union-negotiated non-work contracts aren’t honored, the
unionized panhandlers will presumably walk off the job and stand around
on the sidewalk. No, wait...they’ll walk off the sidewalk! Anyway,
that’s Canada: Without a Thatcher or a Reagan, it remains
over-unionized and with a bloated public sector.
Not that long ago, I heard a CBC news anchor announce that Canada
had “created 56,100 new jobs in the previous month.” It sounded like
good news. But looking at the numbers, I found that of those 56,100 new
jobs, 4,200 were self-employed, 8,900 were in private businesses, and
the remaining 43,000 were on the public payroll. In other words, 77
percent of the new jobs were government jobs paid for by the poor slobs
working away in the remaining 23 percent. So it wasn’t good news, it
was bad news about the remorseless transfer of human resources from the
vital dynamic sector to the state.
The second difference between our economies is that Canada’s is more
protected. I was talking once to a guy from the Bay area who ran a gay
bookstore, and he swore to me that he’d had it with President Bush and
that he was going to move to Vancouver and reopen his bookstore there.
I told him that would be illegal in Canada and he got very huffy and
said indignantly, “What do you mean it’s illegal? It’s not illegal for
a gay man to own a bookstore in Canada.” I said, “No, but it’s illegal
for a foreigner to own a bookstore in Canada.” He could move to Canada,
yes, but he’d have to get a government job handing out benefit checks.
His face dropped, and I thought of pitching one of those soft-focus TV
movie-of-the-week ideas to the Lifestyle Channel, telling the
heartwarming story of a Berkeley gay couple who flee Bush’s regime to
live their dream of running a gay bookstore in Vancouver, only to find
that Canada has ways of discriminating against them that the homophobic
fascists in the United States haven’t even begun to consider.
The third difference is that Canada’s economy is more subsidized.
Almost every activity amounts to taking government money in some form
or other. I was at the Summit of the Americas held in Canada in the
summer of 2001, with President Bush and the presidents and prime
ministers from Latin America and the Caribbean. And, naturally, it
attracted the usual anti-globalization anarchists who wandered through
town lobbing bricks at any McDonald’s or Nike outlet that hadn’t taken
the precaution of boarding up its windows. At one point I was standing
inside the perimeter fence sniffing tear gas and enjoying the mob
chanting against the government from the other side of the wire, when a
riot cop suddenly grabbed me and yanked me backwards, and a nanosecond
later a chunk of concrete landed precisely where I had been standing. I
bleated the usual “Oh my God, I could have been killed” for a few
minutes and then I went to have a café au lait. And while reading the
paper over my coffee, I learned that not only had Canadian colleges
given their students time off to come to the Summit to riot, but that
the Canadian government had given them $300,000 to pay for their travel
and expenses. It was a government-funded anti-government riot! At that
point I started bleating “Oh my God, I could have been killed at
taxpayer expense.” Say what you like about the American trust-fund
babies who had swarmed in to demonstrate from Boston and New York, but
at least they were there on their own dime. Canada will and does
subsidize anything.
Fourth point: The Canadian economy is significantly more dirigiste
(i.e., centrally planned). A couple of years ago it was revealed that
the government had introduced a fast-track immigration program for
exotic dancers (otherwise known as strippers). Now as a general rule,
one of the easiest things to leave for the free market to determine is
the number of strippers a society needs. But for some reason, the
government concluded that the market wasn’t generating the supply
required and introduced a special immigration visa. To go back to
President Bush’s line, maybe this is one of those jobs that Canadians
won’t do, so we need to get some Ukrainians in to do it. Naturally, the
exotic dancers are unionized, so it’s only a matter of time before the
last viable industry in Quebec grinds to a halt and American tourists
in Montreal find themselves stuck in traffic because of huge numbers of
striking strippers. What governmental mind would think of an exotic
dancer immigration category?
Fifth and obviously, the Canadian economy is more heavily taxed:
Total revenue for every level of government in the U.S. is
approximately 27 percent of GDP, while in Canada it’s 37 percent. And
yes, that 37 percent includes health care—but you would have to be
having an awful lot of terminal illnesses each year to be getting your
money’s worth from what you’re giving to the treasury for that.
Canadian Dependence on the U.S.
Yet, having criticized Canada’s economy in various features, let me
say something good about it: It doesn’t have the insanely wasteful
federal agricultural subsidies that America has. In fact, if a Canadian
wants to get big-time agriculture subsidies, he’s more likely to get
them from the U.S. government. I’m sure most people here know that very
few actual farmers—that’s to say, guys in denim overalls and plaid
shirts and John Deere caps with straws in the stumps of their teeth—get
any benefit from U.S. agricultural subsidies. Almost three-quarters of
these subsidies go to 20,000 multi-millionaire play farmers and blue
chip corporations. Farm subsidies are supposed to help the farm belt.
But there’s a map of where the farm subsidies go that you can find on
the Internet. And judging from the beneficiaries, the farm belt runs
from Park Avenue down Wall Street, out to the Hamptons, and then by
yacht over to Martha’s Vineyard, which they really ought to rename
Martha’s Barnyard. Among the farmers piling up the dollar bills under
the mattress are Ted Turner, Sam Donaldson, the oil company Chevron,
and that dirt-poor, hardscrabble sharecropper David Rockefeller. But
what you may not know is that also among their number is Edgar
Bronfman, Sr., who isn’t just any old billionaire, he’s the patriarch
of Montreal’s wealthiest family, owner of Seagram’s Whiskey, which
subsequently bought Universal Pictures. So the U.S. taxpayer, in his
boundless generosity, is subsidizing the small family farms of Canadian
billionaires. As a Canadian and a broken-down New Hampshire tree farmer
myself, I wondered whether I could get in on the U.S. farm program, but
as I understand it, it would only pay me for a helicopter pad on top of
my barn and a marble bathroom in my grain silo.
Edgar Bronfman’s dependence on U.S. taxpayers is symbolic of more
than just the stupidity of federal agriculture subsidies. In the end,
there’s no such thing as an independent Canadian economy. It remains a
branch plant for the U.S. Over 80 percent of Canadian exports come to
America. From time to time, nationalist politicians pledge to change
that and start shipping goods elsewhere. But they never do because they
don’t have to—they’ve got the world’s greatest market right next door.
So when people talk about the Canadian model as something that should
be emulated, they forget that it only works because it’s next to the
American model. The guy who invented the Blackberry email device is
Canadian, but it’s not been a gold mine for him because he’s selling a
lot of them in Labrador or Prince Edward Island. It’s been a gold mine
because he’s selling a lot of them in New York and California and in
between.
Canadian dependence on the United States is particularly true in
health care, the most eminent Canadian idea looming in the American
context. That is, public health care in Canada depends on private
health care in the U.S. A small news story from last month illustrates
this:
A Canadian woman has given birth to extremely rare identical
quadruplets. The four girls were born at a U.S. hospital because there
was no space available at Canadian neonatal intensive care units.
Autumn, Brook, Calissa, and Dahlia are in good condition at Benefice
Hospital in Great Falls, Montana. Health officials said they checked
every other neonatal intensive care unit in Canada, but none had space.
The Jepps, a nurse and a respiratory technician were flown 500
kilometers to the Montana hospital, the closest in the U.S., where the
quadruplets were born on Sunday.
There you have Canadian health care in a nutshell. After all, you
can’t expect a G-7 economy of only 30 million people to be able to
offer the same level of neonatal intensive care coverage as a town of
50,000 in remote, rural Montana. And let’s face it, there’s nothing an
expectant mom likes more on the day of delivery than 300 miles in a
bumpy twin prop over the Rockies. Everyone knows that socialized health
care means you wait and wait and wait—six months for an MRI, a year for
a hip replacement, and so on. But here is the absolute logical reductio of a government monopoly in health care: the ten month waiting list for the maternity ward.
In conclusion, I’m not optimistic about Canada for various
reasons—from the recent Chinese enthusiasm for buying up the country’s
resources to the ongoing brain drain—but also for a reason more
profound. The biggest difference between Canada and the U.S. is not
that you crazy, violent, psycho Yanks have guns and we caring,
progressive Canucks have socialized health care, but that America has a
healthy fertility rate and we don’t. Americans have 2.1 children per
couple, which is enough to maintain a stable population, whereas
according to the latest official figures, Canadian couples have only
1.5. This puts us on the brink of steep demographic decline. Consider
the math: 10 million parents have 7.5 million children, 5.6 million
grandchildren, and 4.2 million great-grandchildren. You can imagine
what shape those lavish Canadian social programs will be in under that
scenario, and that’s before your average teenage burger-flipper gets
tired of supporting entire gated communities and decides he’d rather
head south than pay 70 percent tax rates.
So, to produce the children we couldn’t be bothered having
ourselves, we use the developing world as our maternity ward. Between
2001 and 2006, Canada’s population increased by 1.6 million. 400,000
came from natural population growth kids, while 1.2 million came from
immigration. Thus native Canadians—already only amounting to 25 percent
of the country’s population growth—will become an ever smaller minority
in the Canada of the future. It’s like a company in which you hold an
ever diminishing percentage of the stock. It might still be a great,
successful company in the years ahead, but if it is, it won’t have
much—if anything—to do with you.
In that most basic sense, American progressives who look to Canada
are wrong. Not only is Canada’s path not a model for America, it’s not
a viable model for Canada. As Canadians are about to discover, the
future belongs to those who show up for it. |
