Sunday, June 28, 2009


The recent financial crisis delivered a death blow to the ideology of free market capitalism that reigned for the last 25 years. But are we thinking seriously enough about what dismissing it means? There are wider implications than regulatory reform.

In the Reaganite positioning, big government was bad. Supplying social services was called "tax and spend," which was equated with waste and corruption. That was just spin of course: a major function of government is necessarily the provisioning of social services. On a micro level we could think of a condominium building: if the condo association decided to collect no condo fees and provide no services, then the snow wouldn't be plowed from the driveway and the hallways wouldn't be vacuumed; the leak in the roof wouldn't get fixed; the legal requirements of the association wouldn't be met.

Throughout the last 25 years we have had a trend of government cut-backs that have been not only harmful to our well-being, but also inefficient and costly. We need to rethink government's role in providing services: ideally, we need a new philosophy for the role of the state. It's not a trivial activity and presents some major challenges. I'm not just thinking of the need for prioritizing, but also the need to rethink the government's relationship with civil service unions; devise a public credo that provides for a more equitable sense of government handouts; figure out how to handle the retiring baby boom generation; and so on. We need to change the debate to a more realistic understanding than the old neo-con slash approach: use cost-benefit analysis to show the real cost of not spending money in some cases, such as reducing money for preventative health care or the training of doctors. And so on: I don't think I've probably even skimmed the main issues.

The US has a visionary president now, but Canada can't rely on him to create a conceptual approach to this post-Libertarian era because the US has a much more limited view of social services than Canadians do. Stephen Harper is obviously not going to provide that kind of vision: he's an old-order neo-con. But Michael Ignatieff might be the perfect person for the job, with the intellectual depth and the visionary perspective necessary to forge something new and appropriate for Canada.


No comments: