State visit won't enhance Harper's image

They didn't hear a speech Obama gave on Jan. 30. One of his highest priorities is an Employee Free Choice Act strengthening the bargaining power of U.S. trade unions, a power that has been gutted over the last three decades.

"We need to level the playing field for workers and the unions that represent their interests, because we know that you cannot have a strong middle class without a strong labour movement," Obama said.

They didn't notice the new president's aggressive clean energy program is, per capita, four times larger and much tougher than Harper's feeble "intensity based" initiative. Nor did they read his Nov. 18 Los Angeles speech on climate change.

"Once I take office, you can be sure that the U.S. will once again engage vigorously in (climate) negotiations and help lead the world toward a new era of global co-operation on climate change," Obama said. "Now is the time to confront this challenge once and for all. Delay is no longer an option. Denial is no longer an acceptable response. The stakes are too high. The consequences are too serious."

They are left simply crossing their fingers that he won't, as he pledged during the Democratic primaries, renegotiate NAFTA to raise and enforce labour and environmental standards, end the right of foreign investors to sue governments and open up continental integration initiatives like the Security and Prosperity Partnership to public scrutiny and more stakeholders than just corporate CEOs. Significantly, Obama reiterated his intention to renegotiate NAFTA at a Jan. 12 meeting with Mexico's president. Filipe Calderon grudgingly agreed.

And they will have to explain to Canadians why Harper's so-called "stimulus" budget not only falls far short of the International Monetary Fund's two per cent of GDP goal, but the Parliamentary Budget Office reports it to be a miniscule 0.7 per cent -- just one quarter of Obama's 2.7 per cent of GDP package.

Canadian progressives like Bruce Campbell, executive director of the Canadian Centre for Policy Alternatives, hope the combination of the global economic crisis and Obama's election marks a paradigm shift, not just for Canada, but the world, spelling an end to three decades of neo-conservatism and its tenets of deregulation, globalization and untrammelled corporate dominance combined with unprecedented attacks on public and social institutions.

The huge power imbalance that has always defined Canada-U.S. relations could finally work in favour of the interests of individual Canadians as much as Americans, Campbell predicts, although he warns "the worst conservative excesses of the Harper government" may only have been reined in temporarily.

In a paper titled The Obama Effect: Canada-U.S. Relations in a Time of Economic Crisis, released Tuesday, Campbell not only highlights the polar-opposite approaches of Obama and Harper to NAFTA, the economy and the environment, but charts neo-conservatism's destructive impact on Canadians.

"Since the last recession, Canada's laissez-faire policies have dramatically widened the gap between the rich and the rest of us, deepened poverty, and intensified insecurity among middle-class families whose incomes have either stagnated or declined even as they work harder to hang on to their standard of living," Campbell writes. "Income gains since the early 1990s have gone disproportionately to Canadians in the top 10 per cent of the income scale, and predominantly to the richest one per cent... This same group had appropriated the lion's share of the benefits from tax cuts..."

Simultaneously, Ottawa's national role and fiscal capacity have been eviscerated. Since 1994, federal spending as a portion of GDP has dropped 15 percentage points and is now virtually tied with the U.S. One consequence is the shredding of Ottawa's main automatic stabilizer, unemployment insurance. Eighty per cent of Canadian workers were covered in the last recession; today, only 39 per cent are. Yet Canada's job loss already is proportionately higher than America's.

The downward pressures of globalization and free trade on jobs and incomes have returned Canada to its colonial status of resource hinterland -- "hewers of wood and... cookers of tar," Campbell says.

"The Canadian economy has become structurally unbalanced... The rapid escalation of commodity prices led by oil and gas, magnified by unbridled speculation, the investment boom in the Alberta tar sands and the unprecedented wave of foreign takeovers" caused a 65 per cent run-up in the value of the Canadian dollar, ravaging Canada's manufacturing sector.

"The Conservative government did nothing to curb any of these bubbles," Campbell continues. "On the contrary, it encouraged them and boasted that they were a source of economic strength."

Rather than burnishing Harper's image, the stark contrasts in style and ideology highlighted by Obama's presence here are likely to tarnish it further.

Republished from the Winnipeg Free Press print edition February 18, 2009 A9