Monday, 20 February 2017

How Did We Get Those Free Trade Agreements?

In 2016 “free trade” once again made the headlines. There was the Trans Pacific Partnership (TPP)  and  the Trans Atlantic Trade and Investment Partnership (TTIP).  In the United States, both Bernie Sanders and Donald Trump insisted that the North American Free Trade Agreement (NAFTA) had been good for Mexico but had greatly damaged the US manufacturing economy. Now President, Donald Trump is insisting that NAFTA has to be renegotiated.

The standard line from big business, the mass media and mainstream academics is that everyone benefits from free trade.  Consumers profit from lower prices for all goods and services. So Canadians are waiting to see how the proposed new NAFTA negotiations will go. It might useful to remember the major political battle that transpired as the Canada-US Free Trade Agreement (CUSFTA) and NAFTA were created.

The Push from the United States

At the beginning, a free trade agreement between the United States and Canada was proposed by Ronald Reagan in his 1980 Presidential campaign. In 1983 Paul Robinson, the U..S. ambassador to Canada, began talks with Sam Hughes, President of the Canadian Chamber of Commerce. The US insisted that the official request for negotiations had to come from Canada in order to try to contain nationalist political opposition.

The US administration had goals: the elimination of the Foreign Investment Review Agency,  the National Energy Program and the Canada-US Auto Pact.  They wanted the agreement to include services, agriculture and culture. All federal and provincial government subsidies should be eliminated and “national treatment” guaranteed for American investments. The big surprise was that the final draft of CUSFTA also included a continental energy agreement that gave US investors a preferred status and guaranteed access.

The US government initiative had strong support among the American corporate sector. In 1987 over 400 large corporations created the American Coalition for Trade Expansion with Canada. They spent heavily on advertisements and began a major lobbying campaign in Washington.

Canadian Business Support for the Agreement

In Canada the Chamber of Commerce led the campaign. They were joined by the powerful Business Council on National Issues, the Canadian Manufacturers Association, the Canadian Bankers Association, the Canadian Federation of Independent Business, and many other business organizations. They achieved support from the Royal Commission on the Economic Union and Development Prospects, headed by Donald Macdonald. After Brian Mulroney and the Conservatives were elected in 1984, the Canadian government pushed hard for a bilateral free trade agreement.

There was strong opposition to the agreement in Canada. It was led by the Action Canada Network, anchored by the Canadian Labour Congress and the Quebec trade union federations. The coalition included teachers organizations, most farm organizations, the major women’s organizations, the Assembly of First Nations, the Canadian Environmental Network, and the Canadian Conference of the Arts. Public opinion polls revealed strong majority opposition to any agreement.

The Canadian business alliance played a key propaganda role in the federal election in the fall of 1988, known as the “free trade election” because of the strong opposition taken by John Turner, the leader of the Liberal Party. The New Democratic Party also opposed the agreement, but its leader, Ed Broadbent, played down the issue in his campaign.

The Conservatives won a majority of the seats in the House of Commons, but the Liberals and the NDP together took 56 percent of the popular vote. This explains why big business in Canada is so committed to keeping the British first-past-the-post electoral system. Ronald Reagan declared CUSFTA “the new economic constitution for North America.”

Negotiating NAFTA

Historically, Mexican business organizations had not opposed the Keynsian “populist” agenda. They had clearly benefited from one policy in particular: when a foreign-owned corporation sought permission to build a plant in Mexico, they were required by law to find a Mexican partner and give them 51% of the voting stock. This had resulted in strong business organizations. As they said in Mexico, “300 businessmen run the country.”

This was quite a contrast to Canada which put up tariffs under the National Policy to try to force American corporations to manufacture in Canada. The result was the “miniature replica” problem: high foreign ownership, very inefficient Canadian branch plants, and a relatively weak capitalist class.

This changed in Mexico with a new political leadership that had largely been trained at elite American universities. They absorbed the neoliberal agenda advanced by Margaret Thatcher and Ronald Reagan: free trade, the free market, government deregulation, the privatization of profitable state-owned enterprises, including public utilities, and a broad attack on labour unions and the welfare state.

The media emphasized the benefits to consumers of the removal of tariffs. But tariffs in general were below the 10% level. Big business, with excess capital, wanted the right to invest anywhere, sell their products and services anywhere, and repatriate their profits without government interference. Corporate taxes would be reduced and tax havens expanded.

The Alternative Agenda  
Manuel Lopez Obrador at Mexico City Rally

The Canadian and American anti-free trade coalitions were still in place. In Mexico, a similar coalition was formed, the Mexican Network on Free Trade (RMALC). Their goal, supported by their American and Canadian counterparts, was to raise Mexican wages and standards of work up to the highest levels in the northern states. This included human rights protections as found in the European Union, rules of the International Labour Organization on labour rights, and health and safety rules. The coalitions also argued that corporations should not be permitted to move to Mexico to avoid environmental regulations.

Of course, when the final draft of NAFTA was released none of these objectives were included. Corporations were moving to Mexico to maximized profits by specifically taking advantage of much lower wages, lower taxes and weaker regulations.

For many years public opinion polls in Mexico have shown majority opposition to NAFTA. Economic growth and job creation was much higher during the `populist” period. That opposition has been enhanced by the politics of Donald Trump. This is reflected in the rise of support for Manuel Lopez Obrador in recent public opinion polls. .
John W. Warnock is retired from teaching political economy and sociology at the University of Regina. He is author of Free Trade and the New Right Agenda (1988) and The Other Mexico: The North American Triangle Completed (1995).               

Monday, 13 February 2017

On Re-negotiating NAFTA

Most people who are following the Trump phenomenon know that big business is worried that the new Republican President will carry through on his pledges to pull the USA out of the various “free trade” agreements and put forth alternatives which will “bring the good jobs back to America.” The Globe and Mail reflects this concern through its editorials and its stable of men committed to the neoliberal program, enhanced in recent years by opinion pieces contributed by propagandists from the many right wing “Think Tanks” based at Canada’s universities.

A recent piece by Ian McGugan is typical. “ is a mutual exchange in which countries buy from one another and invest in one another...this back-and-forth usually works to both parties’ benefit because it allows each country to specialize in what it does most profitably.” Oh?

Who does the trading and why.

Historically, trade began as a democratic process in horticultural societies. People came together to exchange their surplus goods for goods that were in short supply. I was fortunate to observe one of these markets in rural Chiapas one day while travelling in Mexico. Once a week there was a community market where individuals (usually women) came, spread a blanket on the ground and laid out their agricultural products and crafts. They bargained with buyers on a price, usually based on labour time. The products had a use value for buyers.

I also saw this in a public market in San Cristobal which I visited with local friends. On several tables a woman from an indigenous community had stacked the clothes that she had created. The needlework was amazing. Her daughter, around 10 years old, was explaining how a price was set for the various items. It was based on the labour time needed by her mother to create the individual item. The labour theory of value.

The mercantile system.

This democratic trade was replaced in Europe during the feudal era by professional merchants who had a different value system: maximizing profit by buying cheap and selling dear. Slowly this form of trade came to challenge the feudal system.

Merchant trade was radically changed by the creation of the territorial states with absolute monarchs and a class system founded on a landed aristocracy. Trade was controlled by the ruling classes and state-created monopoly corporations like the Hudson Bay Company. State military power became an important factor in this new system of trade. Historians hold that the mercantile system lasted from around 1500 to 1750.

A key factor was the development of European imperialism and colonialism. “Trade” under this structure was more like military pillage. Slavery was introduced on a large scale. Europeans began moving to areas of the world where the indigenous peoples had been forcibly removed from their land and resources.

The new liberal political economy. 

A new class with wealth was developing under mercantilism, a capitalist class which demanded the end to the old order and the freedom to invest and trade anywhere in the world. John Locke is often cited as the founder of liberalism. But what he did was put together a unified political position based on demands by the new capitalist class.

Locke was primarily concerned with justifying the seizure of land and resources from indigenous communities. He supported slavery, was a partner in the New Royal African Company, which was engaged in the slave trade, and invested in sugar plantations in Barbados, which depended on slavery for productive labour.

The early liberals like Locke argued that the only reason for government to exist was to defend private property rights. Citizenship and any role in parliament should be limited to men who owned private productive property. 

When the new ruling class of capitalists took power, they fiercely supported colonialism and imperialism through the 19th century and the first half of the 20th century. Trade under such a system could not be anything but unequal.

The orthodox view of trade today continues to follow the model set forth by David Ricardo in his Principles of Political Economy (1817). Free trade benefits all. Every country has a relative comparative advantage. Great Britain should emphasize manufacturing. Portugal should give up on manufacturing and concentrate on making wine. How did that turn out? 

Karl Marx once asked: Cuba today is a sugar plantation. When did the Cubans decide that this was their international comparative advantage? In fact, the Cuban indigenous populations were all killed or fled to other areas around the Caribbean. They were replaced by Spanish immigrants and African slaves.

The real world of trade is quite different from that described in the current economics text books.  Governments establish policies to try to regulate trade. But it is the large corporations and the major financial interests who direct the policies and who do the trade in goods, services and control the capital flows. Different social and economic classes have different political views on trade and trade policy. This all became very evident in the debate surrounding the Canada-US Free Trade Agreement and the North American Free Trade Agreement.

John W. Warnock is retired from teaching political economy and sociology at the University of Regina. He is author of Free Trade and the New Right Agenda (1988) and The Other Mexico: The North American Triangle Completed (1995).

Wednesday, 16 March 2016

U.S. Presidential Election: Trump v. Clinton?

There were five important primary elections in the United States yesterday, and the results seem to suggest that the candidate for the Republican Party will be Donald Trump and the candidate for the Democratic Party will be Hillary Clinton.

Donald Trump now has around 674 delegates of the 1237 that he needs for the nomination. Ted Cruz, the right-wing Christian fundamentalist from Texas, born in Canada, trails behind with 396. John Karich, the “moderate” from Ohio, has only 142. The proposal of the Republican establishment to mobilize around Karich will not work, as the rules for the Republication convention require that a candidate have won in at least eight states, and he has won only Ohio.  On average, Trump has been winning 37% of the votes cast in the Republican primaries, but most of the states remaining have a “winner take all” delegate system which will greatly aid him.

Hillary Clinton won all five of the contests yesterday for the Democratic nomination. She is slowly adding to her delegate lead over Bernie Sanders: it presently stands at 1132 to 818, with 2383 delegates needed to win the nomination. Clinton swept the solid south, and this has given her the lead, but these are states where the Democrats rarely win. Sanders will have to win many of the big states by a good margin to catch up with her.

Clinton as the Democratic candidate
There are a number of significant obstacles to Hillary Clinton winning the Presidential election in November 2016. They are as follows:

(1) In the primaries there has been a significantly greater turnout of voters for the Republicans. For example, in the five primaries on March 15 the Republicans received 54% of the total votes and the Democrats 46%. If this trend holds, Clinton will have to move to the right to attract Republican voters. No doubt this is part of her strategy to defeat Trump.

(2) 43% of potential voters are identified as independents. Only 19 states have open primaries where independents can vote. But public opinion polls showed that 70% of independents have preferred Sanders over Clinton. What can Clinton do to change this situation?

(3) Young people have turned out in mass to support Sanders. Clinton is part of the political and corporate establishment that they oppose. Sanders was winning 80% of the vote of those under 30 years of age. Will they vote for Clinton? One poll reported that 33% would not, and a second poll put this at 20%.

(4) In the CNN/ORC poll released on March 1, 55% of those surveyed had an unfavourable view of Clinton. Only Trump was higher at 60%. Sanders was at 33% and was the only candidate which had a favourable rating over 50%. Can Clinton change this situation?

I can see a possible scenario developing. Clinton could enter the convention with a majority of the elected delegates, but less than a margin of 493, the number of super delegates who will vote without being elected. If the public opinion polls show that Sanders would win in a contest with Trump and Clinton would not, would they break with tradition and not back the candidate with the most elected delegates?

Monday, 29 February 2016

For Canadians: A Heads Up on Elections in the USA

Here are a few things to keep in mind while watching the news from south of the border on this year's federal elections. That's right, I was once a U.S. citizen, at university I had a major in political science/political economy, and while living in Washington D.C. I was close to the John F. Kennedy camp. Long ago.  

(1) Voter turnout in the USA is quite low by the norms of modern liberal democracies. In non-Presidential federal elections, it tends to be near 35%. In Presidential elections it is around 50%.

(2) In recent elections, the trend has been for a drop in voter support for the Democrats and an increase in support for the Republicans. In the 2014 off year (non- Presidential) federal election, the Republicans won 51% of the vote for members of the House of Representatives and the Democrats won 45%.

(3) The Republicans have a firm control on the House of Representatives, 247 to 188 seats. They also control the Senate, 54 seats to 46. They now appear to be the majority party.

(4) In the four state primary elections prior to Super Tuesday (March 1), there has been a significant increase in voter participation in the Republican primaries and a decline in participation in the Democratic primaries.There are nineteen states which have "open primaries" where a person can vote for a party without being a member. In 2015 26% of American voters registered Republican, 30% Democrat and 43% declared that they were Independent. Bernie Sanders is the most popular candidate among Independents, who won't vote in the major primaries, like California and New York.

(5) Hillary Clinton is expected to do well in the primaries in the Southern states, which the Democrats do not normally win in the general elections. A good example is South Carolina, where blacks are in the Democratic party as the Republican Party, which completely dominates the state, is seen as the White Man's Party.

(6) As of this date, it looks like Donald Trump will most likely be the Republican candidate for President. There is no moderate alternative. Ideologically, Ted Cruz and Marco Rubio are not that different. Trump's stand against undocumented immigrants from Latin America is popular as is his stand against Muslim immigrants. He has also taken a strong stand against the free trade agreements and the loss of good jobs to Asian countries, and this is also a very popular position.

(7) The powers that be in the United States are united in their opposition to Bernie Sanders, even though several polls show he would be the best bet to defeat Trump in the federal election. Polls indicate that many people do not like or trust Hillary Clinton. Check out the results posted on Huffington Post.

(8) There is a movement among the younger Bernie Sanders supporters to pledge that they will not vote for Clinton. For good reason, they are angry at the way the Democratic Party structure is backing Clinton.

(9) In a contest between Trump and Clinton, I would not be at all surprised to see Trump the winner.

Wednesday, 10 February 2016

Leamington, Ontario: Growing Tomatoes in the Era of Free Trade

H. J. Heinz plant in Leamington

Southwestern Ontario is the historic home of Canadian tomato growers. The bulk of the crop goes to processing, and since 1909 the dominant corporation had been H. J. Heinz, a food giant based in Pittsburgh. But in 2013 the Heinz Corporation was bought by Warren Buffett’s Berkshire Hathaway (26%) and 3G Capital (51%), based in Brazil. It was soon announced that they were planning to close their plant in Leamington. The story has been a snapshot of what has happened to the manufacturing industry in Ontario following the free trade agreements with the United States.

The free trade economy
In 1988 Canadians were informed that their government, headed by Brian Mulroney, had been negotiating a free trade agreement with the U.S. government. The push for this had come from organizations representing big business and finance on both sides of the border. The Action Canada Network was formed, representing many democratic organizations who opposed the free trade agreement with the United States. Along with many Canadian political economists, they warned that given the reality of Canada’s branch-plant economy, any free trade agreement would likely lead to many plants closing and their operations moved back to the United States. But Canada’s political leadership pushed through the “New Economic Constitution of North America,” as U.S. President Ronald Reagan termed it.  Over the next 25 years Ontario communities saw factory after factory shut down. The food industry was not immune to this development.

The “free trade agenda” is part of the new political economy commonly known as neoliberalism, a return to the open free market system that existed before the Great Depression and the social democratic governments that dominated the political agenda for thirty years following World War II. The liberal package included the repeal of `populist`national policies which were aimed at promoting domestic manufacturing, the privatization of state owned enterprises, deregulation of the economy, reversing legislation which protected workers`rights and trade unions, cuts to social programs and the repeal of progressive tax systems designed to promote greater equality. 

The goal of the organizations representing the corporate sector was to increase their rate of profit. They wanted the right to produce anywhere in the world, sell their products anywhere, and not be subject to any government controls on the movement of their products or capital. In more recent years, with the world economy characterized by overproduction, excess capacity and limited profitable investment opportunities, the corporate sector has sought to open investment opportunities in all areas of the public sector, including health, education, social services, social housing and government services.

Free trade comes to Leamington
Tomato harvest near Leamington
  In 2013 the new owners of Heinz announced that they were going to shut down the plant in Leamington. 3G Capital had a reputation for taking over companies, laying off many workers, and putting top priority on raising the profit ratio. Warren Buffett, the other major partner in the new ownership, said that the Canadian plant was `not efficient`: it relied on fresh tomatoes grown in Canada, bypassing cheaper tomato paste that could be imported from producers in Mexico and elsewhere.

Was there an alternative? Sam Diab, the plant manager at the Leamington operation, found several investors in the Toronto area and put forth a plan to keep the plant open and operating.  Changes had to be made to continue production under the free trade model.

(1) There would be a major downsizing in the plant`s operation. The regular work force would be initially reduced from 740 to 250. The workers, primarily women, were represented by a trade union, United Food and Commercial Workers. Production workers who kept their jobs would see their hourly wages reduced from $25 to $16. The union accepted the changes as there was no alternative.

(2) The business in its new form survived because of a regulation under the Canadian Agricultural Products Act. This specified that tomato juice sold in Canada must be made from fresh tomatoes and not paste. Heinz had 50% of the Canadian tomato juice market and did not want to give this up. They negotiated a five year contract with the new owners, now known as Highbury Canco. Business interests complained that this type of “trade distorting regulation” was supposed to be eliminated under the terms of the existing free trade agreements. Such regulations will likely be eliminated if the Trans-Pacific Partnership (TPP) free trade agreement is ratified.

(3) The number of tomato growers has declined since the plant changed ownership. In 2013 Heinz had contracts with 119 tomato growers; that was down to only 10 in 2015. The tonnage of tomatoes grown in this area of Ontario declined from 555,092 in 2012 to 432,175 in 2015. There remain two other tomato and vegetable processor in the region, ConAgra Foods, a U.S. food giant  in Dresden, and Canadian-owned Sun-Brite Foods which is located near Leamington. Vegetables are also processed in Quebec by Bonduelle North America, a French corporation.

(4) Highbury Canco wants to expand the company`s production by introducing a new class of tomatoes, to be called “industrial paste.” They argue that this could add an additional 250,000 tons of tomatoes and 25 - 30 more growers. Farmers who lost their contracts have had to switch to corn-soybean production, with lower returns. Of course, tomatoes in this new fourth class would bring farmers less money, as the industrial paste would be sold bulk to other processors at a discount. Regular tomato paste in 2014 brought farmers $110 per ton. The company argues that the new class would bring farmers at least $95 per ton, the paste price in 2013.

(5) Standing in the way of total free trade in this case would be the Ontario marketing boards. The Ontario Farm Products Marketing Commission has not approved the introduction of a new fourth class of industrial paste tomatoes. Neither has the Ontario Processing Vegetable Growers. They do not have the economic power of the supply management marketing boards (like milk, poultry and eggs), but as marketing agents they do have considerable influence. They are there to provide some power for farmers when negotiating with agribusiness. Corporate interests, and their liberal academic supporters, expect that the Trans-Pacific Partnership agreement will eventually put an end to the influence of farmer-controlled marketing boards.

(6) In order to try to keep businesses in Canada, governments have increasingly offered them subsidies. Leamington granted Highbury Canco subsidized municipal water and re-assessed the value of the plant, cutting their property taxes in half. The city council abolished all development charges for building construction. The provincial government “invested” $2.5 million in Highbury Canco to help it expand production lines. Such practices have become a normal part of business under free trade. Most people are aware of the huge subsidies that are given to automobile corporations.

What is it like to work in a manufacturing corporation operating under the new free trade, free market regime? Of course workers were not happy when their wages were cut as at Leamington. But they lined up to work at the new plant as there were very limited alternatives.

We can get an idea by looking at the comments posted by workers at the Kraft Heinz plant, as reported at “Previous company was good to work for but not 3G.” “Deep cost cutting.” “New 3G culture . . . very focused on the bottom line.” “Was great place to work . . . until 3G/Heinz merger.” “Daily grind, week after week.” “Great people and horrible Senior Management.” “Go back to Brazil, please.”

The experience of the tomato industry in Southwest Ontario is a case study of manufacturing in Canada under the new free trade regime. As the democratic opposition warned, the free trade regime has resulted in a major loss of manufacturing plants and good jobs in Canada. It is widely expected that the new Trans-Pacific Partnership will only make matters worse.

There is also a new factor on the horizon: climate change. As weather systems become more unstable and destructive, a crisis is expected to develop in the production and distribution of food. There will be greater pressure on Canada to expand our own production of food, especially fruits and vegetables. It is likely that we will need to move to a production system similar to that used during World War II, with significant government intervention. This would be the opposite of the free trade model. A growing crisis will provoke a new political struggle.

Tuesday, 15 December 2015

Keynes is Back!

On Monday I tuned in to the CBC to listen to the first public speech by Bill Morneau, the new Minister of Finance in Justin Trudeau’s Liberal government. The speech was given to the Toronto Region Board of Trade for the benefit of the Bay Street crowd. I have to admit, that I was favourably impressed.
Bill Morneau and Justin Trudeau

Morneau is a very successful Toronto businessman with a very good academic background in economics. Of all Trudeau’s cabinet appointments, this was the one which concerned me the most. Morneau had also been chairman of the C. D. Howe Institute, a right wing pro-business “think tank” that is firmly committed to the agenda of free trade and the free market economy.

Morneau remarked that at his first meeting with a group of government economists he sat alone across a long table facing a dozen of them. When he stated that the new Liberal government would not put a high priority on balancing the budget, he reported that smiles broke out among those across the table. They knew full well that the Canadian economy is going through a very rough period, and with the collapse of the markets for oil and minerals, the immediate future was not all that great. As a result, the weakened economy was providing all governments with less revenues.

The Bay Street crowd heard Morneau report that there will be a string of budget deficits, and they were starting with a $3 billion deficit left by the Conservative government of Stephen Harper. But the goals of the new government started with restoring economic growth. The Liberals would proceed with their promise of major government spending on infrastructure, a pledge of $125 billion over a decade. The tax cut for the middle class would also boost spending and help create jobs.

Despite their campaign promise, an annual federal government deficit could possibly exceed $10 billion. The plan was to revive the economy so that the debt-to-gross-domestic-product ratio would be reduced. The hope was to be able to balance the federal government’s budget by 2019, the year of the next election.

There would be no structural adjustment policies. Instead, the economic policies identified with John Maynard Keynes would drive the agenda. The Liberals could see the complete failure of the alternative, the structural adjustment programs pursued by European governments.

To top it off, Morneau’s presentation was outstanding. He was very clear in both English and French. He gave a well organized speech without consulting notes or reading a text. He looked straight at the audience and spoke with conviction.

What happened to the New Democrats?
Thomas Mulcair and the NDP

In contrast, there is the disaster of Thomas Mulcair and the New Democratic Party. What happened? At the beginning of the 2015 election campaign, the polls showed support for the NDP was slightly ahead of the other two parties. An NDP-led government seemed possible.

In his first speech to the Bay Street crowd, given at the Economic Club of Canada on June 16, 2015, Mulcair made it very clear that his social democratic party stands strongly for balanced budgets. This was the tradition of NDP provincial governments in Canada, he argued. Special praise was given to the Saskatchewan NDP  government of Roy Romanow, who came to office in 1991, balanced the budget and paid down the provincial debt. No mention was made of the fact that this was done by slashing health and social programs and raising consumption taxes which fell heaviest on those with low incomes.

Mulcair noted that there was one exception to this tradition: the Ontario NDP government headed by Bob Rae, who, he noted, had turned out to be a Liberal. Bob Rae’s NDP government confronted an economic recession in 1990-1 by cutting taxes on low income earners, raising taxes on those with higher incomes, and expanding a range of social programs designed to assist the weaker members of society. His government and its policies were praised by a long list of Keynesian economists.

Then came the shock from Quebec. In June 2015, in the middle of the election campaign, journalists in Quebec posted a video clip from the Quebec legislature, a speech Thomas Mulcair made in 2001, when he was a member of the provincial Liberal government. Mulcair praised the free market policies of Margaret Thatcher, criticized the Labour governments in Great Britain for “putting their nose in everything” while declaring that “government interventionism is a failure.” He declared: “let the free market thrive and get off the backs of businessmen and women.”  He was also very critical of the trade union federations in Quebec for their politics of the left, backing the Parti Quebecois. Mulcair brushed this off. He refused to say he had been wrong. 

Looking to the Saskatchewan NDP
Mulcair’s NDP was determined on this issue. In August 2015 he chose Andrew Thomson, former NDP finance minister in Saskatchewan, to be a star candidate in the Ontario riding of Eglington-Lawrence. Thomson had been elected to the Saskatchewan legislature in 1995 while Roy Romanow was premier. When Lorne Calvert became NDP premier Thomson joined the cabinet, serving as finance minister in 2006 and 2007.

Thomson is best known for his determination to reduce the province’s royalties on the oil and gas industry. He also cut corporate taxes and corporate capital gains. He took substantial amounts from the Financial Stabilization Fund – a pool of revenues held in the bank by the government, termed “a rainy day fund” – in order to balance the provincial budget. Thomson was used by Mulcair to stress the NDP’s commitment to their primary election promise, to run four straight balanced budgets. They would do what Stephen Harper’s government could not.

Recent public opinion polls show that Canadian support for the Trudeau Liberals stands at 52%. Support for the NDP stands at just 14%. It appears that Mulcair is in full control of the party, as he has announced that he expects to lead the NDP in the next federal election. So far there is no indication that there is any opposition to Mulcair within the federal NDP caucus or party.

It seems to me that the Canadian electorate made the right choice in the recent federal election. The Harper gang is gone, and the large majority of Canadians are happy with that. But it also appears that they made the right decision when they shifted their support from Thomas Mulcair to Justin Trudeau. With the world experiencing economic stagnation, Keynes is the correct road to take, not structural adjustment.

Monday, 14 December 2015

I Am Not Dead Yet

Our farm at Bulyea.
What happened? I have not posted on my blog since last June. That would seem to suggest that I am no longer around. But I am still here. However, I have been negligent in letting my readers know what is happening. I do have some excuses, but they may seem a bit lame.

The Farm
At the farm this summer, I once again had to face the problem of flooding and my inability to win the war with the beavers. We would take the major dam down, and they would just build it up overnight. There were too many beavers around, and the eradication process was unsuccessful. We made some tries.

The beavers have built a huge lodge in the lake which has formed in our back yard. Beaver experts (trappers) who have seen it say it is the largest they have ever seen. You cannot use dynamite any more since the events of September 2001. Then there once was the old tried and true farmer explosives made from ammonia nitrate and diesel fuel. Again, it is not a good idea to use this method for it will likely bring down the forces of law and order on your head.

So we went to the local gun shop and bought the latest explosives for destroying beaver dams and lodges. It is a chemical mix which comes in a relatively small plastic jar. The ingredients are carefully mixed simply by rotating the jar which is then placed on the dam or lodge. At a distance of more than 100 yards you shoot the jar with a 22 rifle. I checked it out on the Internet, and videos show that it is supposed to work. The experts do get impressive results.

Not having a good 22 rifle, I asked a farmer I know who does a lot of hunting to help me out. He obliged. We launched his fishing boat in our back yard and paddled out to the beaver lodge. The new lake at this point is about six feet deep. We set the plastic jar with the explosives, paddled back to shore, and my friend got out his 22 rifle with long rifle shells and a scope. A few shots that he took hit the jar, it jumped up, but did not explode.

So we went back in the boat to see what happened. One shell went right through the jar and out the back, but no explosion. We agreed that it probably did not go off because there was not enough force behind the shell. My friend went home and got his deer rifle and we tried that with a new jar of supposedly explosive materials. However, his scope was off and at that distance he failed to hit the jar after about 10 rounds. So we put off further action until next spring.

In addition
In any case, day to day coping with the flooding, and work finishing off the bathroom in the renovated residence,  took a great deal of my time over the summer and fall. I have also been doing research on my new project, the impact of climate change on agriculture and food. I have done quite a lot research and written drafts, but to date I have not published any of it.

I returned at the end of October to Peterborough, Ontario where I will be spending the winter; I will return to Saskatchewan and the farm in early April 2016. Right now I am reconstructing my web page, and the new program I am using is much more complicated that the one I originally used, and it is taking me a lot longer to learn how to do the work. But I will be done soon, and in early January I will once again be posting on my blog. If you are on Facebook, you will see that I am still commenting on the world of war and political economy.

The big change                                                                                             
Saskatchewan Wheat Pool No. 1, Bulyea

Stephen Harper and his gang of mean spirited conservatives are gone. He told an American right wing group one time that “you will not recognize Canada when I am finished.”  He tried his best to move Canada into the right wing conservative camp. But Canadians are basically middle of the road liberals who are not really interested in making the rich richer and getting tough with the poor. While the large majority of Canadians come from a Christian background, most want to have a generally secular society. The mainstream is not interested in fundamentalist religions and their politics. It seems to me that the majority of Canadians are satisfied to just follow along with the Americans as long as the Democrats are in office.

I am one of the solid majority of Canadians who are quite happy that Stephen Harper and his gang are gone and has been replaced with a modern liberal. Right now I am enjoying the Justin Trudeau honeymoon. I am actually quite pleased with the people he has put in the cabinet, especially the women. They are such a contrast and improvement over what we just experienced. .It is going to be a pleasant Christmas this year. The new Trudeau seems to be ready to lead and has indicated that his government is going to do what it pledged in the election campaign. His government will find the money to provide adequate support for the 25,000 political refugees from Syria. As he has said, “Canada is back!”

This is all bad news for the New Democratic Party which is stuck with Thomas Mulcair as leader. He is too much of a neoliberal. They are now down to 14% in the polls. The only way they are going to recover is to get rid of Mulcair and move back to being a traditional democratic socialist party. It wouldn’t hurt if they shifted to being an anti-war party.

In Saskatchewan there will be a provincial election in April 2016. The NDP has a very weak,  neoliberal leader, who follows the precedent set by Roy Romanow, Lorne Calvert and Dwaine Lingenfelter. All across the advanced capitalist world, electors are turning against the social democrats for moving to the right to embrace the neoliberal agenda, including structural adjustment policies. Until the Saskatchewan NDP faces up to this reality, they will be a weak opposition. They are down to 30% in the polls and are currently looking at another major defeat in April.