“From Protest Movement to Neoliberal Management: Canada’s New Democratic Party in the Era of Permanent Austerity / Bryan Evans” in “Social Democracy After the Cold War”
FROM PROTEST MOVEMENT TO NEOLIBERAL MANAGEMENT
Canada’s New Democratic Party in the Era of Permanent Austerity
Over its eight decades of existence, Canadian social democracy, as expressed organizationally in the Co-operative Commonwealth Federation–New Democratic Party (CCF-NDP), has undergone two programmatic and organizational transformations. The first was a planned and formalized refoundation. Born in the heart of the Cold War and its derivative “culture” of anti-communism, the NDP’s emergence in 1961 expressed a declassed and technocratic Keynesianism that signalled a retreat from class as the ideological and organizational centrepiece of its politics. The construction of the NDP was, from its inception, an adaptation to the economic conditions of the golden age of postwar North American capitalism and to the political conditions prevailing through the 1950s and 1960s. The second refoundational episode — an informal, perhaps organic, adaptation in the 1990s to the now-embedded conditions of neoliberalism — strengthened the foundations for a social democracy that went beyond merely consolidating the explicitly “liberal” and post-class political orientation that had shaped the origins of the NDP.
This is not a uniquely Canadian trajectory. As with other members of the Socialist International, New Democrats “began to incorporate neoliberal policies into their programmes and rule as neoliberals in power” (Albo 2009, 119). Andrew Gamble and Tony Wright (1999, 2) contend that “social democracy has always had to change to survive.” It is “not a fixed doctrine but a political movement, as protean as the capitalist economy.” It is also not “a particular historical programme or regime or political party or interest group, or even an unchanging set of values.” Indeed, “its only fixed point is its constant search to build and sustain political majorities.” This propensity of social democracy to transform is a historically well-established practice of adaptation to electoral defeat, which necessitates a reconsideration of program and strategy. The supposed consequences for failing to adapt to changing conditions are dire, for “if socialists do not change they will disappear” (Sassoon 1999, 14). And, of course, each successive adaptation entails a clearer rejection of a class-based politics (a politics that implies a critique of capitalism to a greater or lesser degree) and a firmer embrace of capitalism.
If social democracy is indeed such a plastic political formation, then what is it? What is its political project? The answers have been clear since the First World War. Social democracy does not seek political transformation but rather alignment. It does not seek to ask fundamental questions about the rationality or structures of capitalism but rather to “modernize” these and, where possible (but not necessarily), to create a degree of space for labour, women, and ethno-racial minorities, as well as for the role of the state in addressing political problems. Since the economic crisis of the 1970s, however, the terrain upon which postwar social democracy originally established itself and manoeuvred to implement its redistributive program has been transformed. Indeed, it has been argued that social democracy, from the 1980s and into the 1990s, has undergone “more change than in any decade since World War II” (Kitschelt 1994, 3).
In part, one can explain the ongoing transformation of social democracy by reference to the structural changes within capitalism. The nation state–centred political compromises of the mid-twentieth century gave way to a qualitatively different capitalism. Neoliberalism, which Perry Anderson (2000, 17) characterizes as the “most successful ideology in world history,” has been such a powerful force since the early 1980s that social democracy, ever adaptable and protean, has transformed to accommodate itself to the new conditions created by neoliberalism’s rise. Resistance appeared futile and the limits and outright failures of the Swedish and French social democrats to construct an alternative economic policy appeared to provide additional evidence that, indeed, there was no alternative. And so, as Frances Fox Piven (1992, 18) notes, social democratic parties everywhere are “acknowledging the necessity of adapting to international markets and the austerity policies capital has demanded, arguing mainly their own superior technical capacity to develop and administer the neoliberal policies that will match market imperatives.” In other words, social democrats contend that they can manage neoliberalism better.
Much of the literature examining Canada’s principal social democratic party, the CCF-NDP, is concerned with the “protest movement becalmed” thesis, which argues that the party gradually became much more concerned with electoralism than with achieving social change and transforming class relations. In other words, the prevailing political objective became electing as many representatives as possible with a view to winning government. Consequently the CCF-NDP set upon a trajectory of ever-increasing ideological moderation and internal organizational centralization. It must be recognized, of course, that the CCF-NDP was never anti-capitalist. Although the CCF did, in its formative years, advance a program of significant state intervention into the capitalist economy, Mackenzie King, Canada’s prime minister through part of the Depression and the 1940s, famously characterized the CCF as “Liberals in a hurry.” Michael Cross (1974, 6) confirms King’s description, noting that the CCF-NDP was never “a socialist party in the orthodox sense. … The NDP was created as a liberal party.” Canada’s CCF-NDP, like social democracy everywhere, was and is completely integrated into the capitalist regime of accumulation rather than being a challenge to that regime.
It is not possible to fully understand the New Democratic Party in ideological and political terms without a somewhat broader historical frame of reference, including the party’s founding in 1961 and some examination of its antecedents in the Co-operative Commonwealth Federation. We can think of the creation of the NDP as the first structured refoundation of Canadian social democracy. While there was no comparable and formal second refoundation within the era of neoliberalism, in the wake of the free trade election of 1988, the NDP went through various internal debates, providing evidence that a second refoundation did in fact take place.
The creators of the NDP hoped to reconstruct Canadian social democracy and broaden its electoral appeal by presenting a more moderate and therefore “modern” face. They believed that it was strategically important to leave the Depression behind since an era of seemingly perpetual prosperity and broad-based consumption appeared to be increasingly firmly rooted in the lives of “ordinary” Canadians. This strategy was an explicit adaptation to and acceptance of the mixed market economy, regulated capitalism, and the declassed politics resulting from the conditions of the Cold War and emerging working-class consumerism. In short, social democracy embraced the society of mass consumption. By the 1990s, the NDP had made further accommodations, not with the mixed economy of regulated capitalism but with its neoliberal variant: the party incrementally abandoned its long-standing commitment to public ownership, redistributive social policies, and the right of workers to organize and to have a range of social protections to mitigate the most egregious effects of a market economy.
In addition to the profound effect of neoliberal restructuring, social democracy in Canada has been shaped by certain characteristics of Canadian political arrangements and history. Specifically, the federal structure of the Canadian state created subnational units — provinces — enabled with substantial authority over economic and social policy and program delivery. But although each province presents a distinct political economy, New Democrats in power in different provinces take similar approaches to governing. Second, Canadian social democracy throughout its history has fully accepted the tenets and practices of liberal democracy, along with the concomitant limitations for a more radical theory and practice. This fundamental principle largely restricts NDP strategy to a narrow electoralism and excludes a comprehensive critique of the undemocratic — or at best, rather limited democratic — practices of the institutions composing the Canadian state. Consequently, a critical political program seeking to push this state form to its limits and perhaps beyond is not likely to be entertained. The result is a core narrative running through the entire history of the NDP: integration into liberalism in its first historical episode and into neoliberalism in its second.
A SHORT HISTORY OF CANADIAN POSTWAR SOCIAL DEMOCRACY
Gerassimos Moschonas (2002, 21) writes that in the wake of the Second World War, “social-democratic parties successively embarked on a process of doctrinal and programmatic deradicalization, constituting themselves as parties of ‘all the people.’” The same general process took place in Canada. By 1956 it had become evident that the CCF had stalled electorally and had begun a incremental but continuous decline relative to its peak showing in the 1945 federal vote, when it won 15.6 percent of the popular vote. In each successive election, the CCF vote eroded, reaching a low of 9.5 percent in 1958 (Whitehorn 1992, 2). This limited electoral appeal was understood by the party leadership as reflecting the inability of the CCF to adapt its Depression-era program and organizational structure to the economic and political realities prevailing in the 1950s.
The CCF: From the Regina Manifesto to the Winnipeg Declaration
Programmatically, the CCF was guided from 1933 to 1956 by the Regina Manifesto. While a few of its provisions have given it an exaggerated radical legacy, the Manifesto did nonetheless encapsulate a critique of capitalism. The CCF unequivocally stated the party’s political objective in this document: “We aim to replace the present capitalist system, with its inherent injustice and inhumanity, by a social order from which the domination and exploitation of one class by another will be eliminated, in which economic planning will supersede unregulated private enterprise and competition, and in which genuine democratic self-government, based upon economic equality will be possible” (quoted in Young 1969, 304). The Manifesto proposed reforms that it described as constituting a “far-reaching re-construction of our economic and political institutions” (305) and “moved the fight for immediate demands into a primary rather than a secondary position” (Penner 1977, 196). Specifically, it called for the establishment of various state planning mechanisms within a socialized economic order as the most effective path toward a more equitable distribution of resources. Public ownership of banking, insurance, transportation, communications, and electricity production and distribution were given priority; after those sectors were dealt with, socialization was to be extended to “mining, pulp and paper and the distribution of milk, bread, coal and gasoline” (Regina Manifesto, quoted in Young 1969, 305–6). While the Manifesto famously called for “the eradication of capitalism” (313), it did not articulate a strategy for how this would come about save for an implicit acceptance of the parliamentary route as the only acceptable strategy. Although the document emphasized public ownership, this is not necessarily anti-capitalist, as indicated by government actions in the United States, United Kingdom, and beyond in response to the global financial crisis. As John Smart (1973, 203–4) writes, “The document was based on an assumed rather than stated class analysis. No strategy was enunciated for restructuring society.”
The period from 1942 to 1945 marked a political high point during which the CCF made impressive electoral gains, forming the government in Saskatchewan and becoming the largest opposition party in Ontario, British Columbia, and Alberta. Added to this were four federal by-election victories out of a total of eight. One national opinion poll in 1943 placed the party in the lead. This success brought with it a turn to programmatic moderation and bureaucratization of the party apparatus. Policy positions expressed “a diminishing hostility to the social order, modification in the proposals to change it, and a shift in time perspective” toward more immediate objectives. In addition, the organizational apparatus of the party expanded and its leadership became much more professionalized. The locus of power shifted from the grassroots party clubs to the centre (Zakuta 1964, 70).
The macroeconomic context, in Canada as elsewhere, was also changing. By the mid-1950s, political and economic forces were in the process of transforming Canada into a place rather different from the country that had given birth to the CCF in the years of the Great Depression. Unemployment, at 3.4 percent in 1956, was hardly a crisis; the Keynesian welfare state and the notion of the mixed economy was now orthodoxy for social democrats, liberals, and conservatives alike, and Canada was becoming increasingly urbanized. The occupational mix was changing dramatically as the service sector in both the public and private sectors expanded, and the conditions of the Cold War worked to quash any critique of capitalism, no matter how mild (Whitehorn 1992, 45). The identity of the worker-citizen was being transformed in the context of expanding prosperity to that of consumer-citizen. In addition, for the CCF, the Cold War years contributed to a rethinking of the central role of public ownership and nationalization in constructing an alternative to capitalism. The national chairman, Frank Scott, in his opening address to the party’s 1950 convention, suggested “that for any socialist today to look upon every proposal for nationalization as the acid test of true socialism, an act of faith rather than reason, is to be a little foolish. … While our fundamental purpose of production for use remains, we must keep an open and intelligent mind on the degree and timing of socialization” (quoted in Penner 1992, 87–88). Clearly, the structural, ideological, and demographic terrain that had provided the CCF with its social and political foundation was shifting. Consequently, consistent with Sassoon’s formulation of social democracy’s genetic requirement to “change or disappear,” the CCF set out to reinvent itself just as several of its significant European sister parties had already done or were about to do.
A restatement of program and principles was found to be necessary, and the result was the Winnipeg Declaration. This document expressed a discernible shift in emphasis and tone. Of course, as a product of the Cold War, it took a justifiable swipe at the “new totalitarianism” established by the Stalinist regimes composing the Soviet Bloc. And gone was the critique of capitalism save for a general condemnation of the “immorality” of “a society motivated by the drive for private gain and special privilege” (quoted in Zakuta 1964, 170) and the inequality generated by a “growing concentration of corporate wealth” leading to “a virtual economic dictatorship by a privileged few” (169). The focus was shifted to democracy, peace, support for the United Nations, and the extension of public ownership, but only where necessary. Capitalism was, even rhetorically, no longer at issue. The real political challenge for the CCF was not the eradication of capitalism and the construction of the co-operative commonwealth, as the Regina Manifesto had proclaimed; rather, the party now faced the challenge of replacing this critique with a program of class compromises seeking to make capitalism work in a more democratic and redistributive manner. In this project, Keynesianism became the official orthodoxy. This programmatic development was not unique to the Canadian social democratic experience. In 1958–59, major European social democratic parties, including the Austrian, Swiss, German, and Dutch parties, transitioned officially to Keynesianism, which meant dropping any use of Marxist terms and analysis in their programs. The turn to Keynesianism was more than a perfunctory shift in doctrine; rather, it was indicative of a profound change within social democratic parties, marking their evolution from “reformist workers parties into reform parties with worker support” (Van der Linden 1998, 167).
Canadian social democracy was a multi-class movement from its inception. However, in 1958, to underscore the significance of the turn to Keynesianism, the process of embedding a specifically multi-class — as opposed to working/producer-class — politics was provided further momentum by, of all organizations, the Canadian Labour Congress (CLC). At its 1958 convention, the CLC adopted a resolution calling for the creation of a new political party. The resolution stated: “There is the need for a broadly based people’s political movement, which embraces the CCF, the Labour movement, farm organizations, professional people and other liberally minded persons interested in basic social reform” (quoted in Knowles 1961, 127). A more explicit statement for a pragmatic centrist and multi-class (and hence declassed) refounding of Canadian social democracy is difficult to imagine. With this resolution, and spurred by the near political oblivion delivered to the CCF in the federal election a few months after the CLC convention, the path toward a post-class New Democratic Party was set. The CLC resolution captured the sense that Canadian social democracy was less about transformative change than about achieving electoral success as a means to implement a program of social reform within the context of a market economy. As noted above, the CCF began its turn to centrism in the early 1940s, but with the Winnipeg Declaration, the party set out on its first refoundation as a party seeking to improve the management of capitalism rather than to transform it.
In structural terms, the founding of the New Democratic Party in 1961 sought to more effectively integrate the CCF and CLC into a party that resembled much more closely the electorally successful social democratic parties of Europe, Australia, New Zealand, and Britain in terms of the relationship with the industrial trade unions. The defining feature of the party-union nexus in the British Labour Party was the opportunity for affiliated unions to send blocs of delegates or blocs of votes to party conventions based on the number of members in each local of that union. Indeed, how trade unions and a social democratic party structure their relationship is a politically important matter, but in the case of the CCF, “no formal rules (governing dues payable, representation, or indeed whether union centrals, federations, or locals could affiliate) had been established” (Archer 1990, 15). The height of trade union affiliation with the party was reached in 1944, when a mere one hundred locals holding a combined membership of fifty thousand were officially affiliated. Illustrating the weakness of the union-CCF nexus is the fact that this represented less than 7 percent of Canadian union members (18).
The 1958 electoral disaster provided the impetus for exploring the creation of a new party with strategically closer links to labour. Despite the founding of the NDP in 1961 with the ostensible purpose of strengthening the union-party link, the CCF’s concern with ensuring that the party not become dominated by labour and remain “pluralist” persisted into the formative days of the new party. While both the CCF leadership and organized labour agreed that this new party was to be labour-based, the CCF left was concerned that labour “would move the New Party away from its ‘movement’ roots and into narrow electoral and reformist politics. Moreover, they feared that labor would be a conservative force within the party, diluting the CCF’s prairie socialism, populism and radicalism” (Bernard 1995, 45).
The historical record, however, is clear. Labour would be significant in political and financial terms within the new party but it would not be dominant. And ironically, the tendency toward moderation that more radical elements feared would come to define the party.
The Union-Party Nexus: An Ambiguous Relationship with the Working Class
Given that the very formation of the NDP was intended to “integrate labour and the party more fully” (Archer and Whitehorn 1993, 1), it is necessary to explore the political significance of this relationship to the party. The “privileged” relationship of trade unions is one of the general features of social democratic parties everywhere and is in turn associated with a second characteristic of social democratic parties: their significant electoral base in the working class (Moschonas 2002, 22).
Chris Howell (2001, 7) writes that a “central part of the transformation of European Social Democracy in the period since the end of the 1970s has been a change in the relationship between Left parties and organized labour.” In the case of the NDP, there was, from the very formation of the “new party,” a practice of containing the potential for the trade unions to exert too great an influence over the party. While it is true to say that a “ubiquitous and progressive loosening of the links between socialist parties and trade unions is currently in progress” (Moschonas 2002, 132), in the case of the NDP, the “loosening” began at its inception.
Leading up to the 2001 NDP convention, party leader Alexa McDonough voiced her support for replacing the traditional delegated convention process to select the party leader, including the delegate allocations for affiliated unions based on their total membership, with a “one member, one vote” system (Chase 2001). Ultimately the convention, with a vote of 69 percent, settled on a compromise amendment that accepted the principle of “one member, one vote” but also guaranteed that affiliated unions would hold no more than one-quarter of the votes (Simpson 2001).
Canadian trade unions never did monolithically embrace the NDP despite its founding objective to strengthen the link between party and labour. The number of rank-and-file members of unions affiliated with the NDP reached a high point in 1963 when 14.6 percent of Canadian unionists were members of NDP-affiliated unions; thereafter, this affiliate member “density” consistently declined (Archer 1990, 37; Archer and Whitehorn 1993, 7). This is hardly an image of social democratic penetration of the Canadian unionized working class, especially compared to Britain, where in 1976 more than 89 percent of UK union members were affiliated with the Labour Party via their union (Archer 1990, 47). Hence, the NDP has been characterized less as a “labour party or a party controlled by organized labour” than as a “social democratic party with links of varying strength to the union movement” (39).
This broad indifference toward affiliation is puzzling given that through the 1960s and 1970s, union membership expanded, particularly as public sector employment grew and the rights to organize and bargain were won. In addition, this indifference set up a political conundrum for the NDP. Not only was “membership in an NDP-affiliated local found to be positively related to identification with and vote for the party,” but these individuals were also much more likely than union members whose union was not affiliated to the NDP to view themselves and their politics in explicitly class terms (71). Thus, by extension, the more affiliations, the greater the number of NDP votes. Ironically, given the resistance to a strong trade union presence in the new party, the historic weakness of the union-party nexus for the NDP is a key variable in the general weakness of social democracy in Canada. The reality is that labour, while being a core constituency within the NDP, was never a dominant force: the number of trade union affiliated delegates to party conventions has varied from a high of 32.3 percent of all delegates at the 1971 convention to a low of 17.4 percent in 1981 (Archer and Whitehorn 1993, table 1).
Keynesianism Embraced and Abandoned: New Times, New Social Democracy
The ideological content of the new party expressed a full embrace of Keynesian-managed capitalism and, to underline the point, the new program made no reference to socialism or social democracy (Penner 1992, 93). In this respect, the program was explicitly in favour of a mixed economy; it demarcated a clear role for the Canadian state in economic development and management operationalized through various advisory, planning, and investment agencies. The party declared itself “the party of full employment” and proposed to achieve this goal through a “guaranteed employment act to ensure everyone a job as a ‘social right,’ as well as public funds for houses, schools, hospitals, and roads” (quoted in Whitehorn 1992, 53). This reference to “public funds” expressed a dramatic expansion of the broader public sector, which in fact would take place in the last half of the 1960s. In addition, the public planning and investment agencies envisioned by the NDP at its foundation would “promote steady economic growth and full employment without inflation. A new taxation policy would divert funds from private to public investment, redistribute the national income on a fairer basis and help to regulate the pace of economic activity. Corporation taxes would be increased, while lower income groups were promised tax relief” (Avakumovic 1978, 193, 195). Therefore, the NDP was, in ideological and policy terms, entirely consistent with the classical formulation of postwar social democracy as “political liberalism + mixed economy + welfare state + Keynesian economic policy + commitment to equality” (Moschonas 2002, 15).
The Fordist-Keynesian framework, which had provided the material basis for the social democratic welfare state project, began unravelling in the 1970s under the stress of “economic stagnation, inflation and a looming fiscal crisis of the state” (Carroll 2005, 12). What made this a crisis for social democracy was not only that its raison d’être, the redistributive welfare state, was increasingly unsustainable but also that its theoretical framework, Keynesianism, was increasingly inapplicable to the emerging new economic reality. The end result was that “social democracy [was] not what it once used to be” (Upchurch, Taylor, and Mathers 2009, 1).
Jim Laxer, a former federal NDP research director, criticized the party for being “locked in the 1950s and 1960s” through its adherence to “a Keynesian formula long after it had ceased to be a useful guide to analysis and policy” (1984, 2–5). For Laxer, the problem was that the NDP did not understand how fundamental the changes in the Canadian economy through the 1970s and into the early 1980s were. Laxer (1996, 126–27) argues that NDP policy perspectives “derived from the social democracy of the preceding quarter-century, was that the measures it relied on to achieve economic stimulus … were not workable … in the globalized economy of the 1980s.” The larger backdrop of Laxer’s critique was that from the Winnipeg Declaration of 1956 through to the founding of the NDP in 1961 and into the 1980s, the party’s political program had discernibly evolved away from public ownership as a key means to achieve full employment and replaced this with the technocratic approaches of Keynesian fiscal and monetary policy. Canadian social democracy had not yet come to understand the new politics that was being forged through the process of neoliberal globalization and the resultant social and economic restructuring.
Ideologically and theoretically, the NDP was increasingly confused. With its Keynesian compass growing more unreliable and lacking an alternative understanding of political economy, the party would drift and seek to adapt to, rather than critically assess and challenge, the changing terrain of capitalism.
The Political Economy of the New Social Democracy: The Canadian Terrain
The second postwar refoundation of social democracy has its origins in a structural shift in the political economy that called for a new “social contract.” Social democracy is enabled and sustained by two institutional pillars: “internationally immobile capital in the goods producing sector of the economy and a state with sufficient revenue flows to provide a high social wage. In the 1970s and 1980s both these preconditions … eroded” (Schwartz 1998, 253). A third pillar is a substantial trade union movement, centred on the industrial working class, that has developed organic links to the mass-based social democratic party. The extent to which this third pillar — the central place of the working class as the agent of change — can continue to provide the social base for social deoncracy has been questioned in light of “the declining proportion of manual industrial workers in the labour force” (Panitch 1986b, 3).
What happens to a social democratic party when these prerequisites have been eroded? Leo Panitch (1986b, 2) concludes that “reformism was able to retain popular support and programmatic direction when it appeared the system could support it, but it lost a good deal of both when economic conditions and the bourgeois onslaught against previous reformist gains in these new conditions combined to demonstrate how utterly dependent the system … is on meeting the requirements set by capitalists.” The weakness of social democracy’s three pillars has contributed to the impasse of social democratic politics, which has resulted in declining electoral success. Thus, the project to redefine social democracy is an “attempt to transcend both old-style social democracy and neoliberalism” (Giddens 1998, 26).
The search for a “new social democracy” has long had a Canadian variant, with social democratic intellectuals calling for a “social democracy without illusions” before the Third Way movement had officially declared itself (see Richards, Cairns, and Pratt 1991). This was in large part a response to a decline in state fiscal capacity. Budget deficits and accumulated debt of Canada’s federal and provincial governments began to expand dramatically through the 1980s and onward. The federal government’s gross debt grew from $123.5 billion in 1980–81 to a record $713.6 billion in the fiscal year 1999–2000 (Canada 2008). For the three NDP-governed provinces in the early 1990s — Ontario (1990–95), Saskatchewan (1991–2007), and British Columbia (1991–2001) — the economic context combined with shrinking transfer payments forced them to make revealing choices. In short, rather than engage in activities to mobilize workers, especially the unorganized, and to build the party as a left-reformist alternative to neoliberalism, the NDP chose to adapt to the conditions presented. This included a centrist shift as a means of broadening its electoral coalition not just beyond the industrial working class but instead of it. In policy terms, this was most clearly marked by a sharp turn toward fiscal conservatism and public sector austerity.
The core political base of postwar social democracy was to be found in “an organic relationship between a dominant socialist or social democratic party and the trade unions. … A harmonious and complementary relationship was established based on a division of labour in which the party pursued the politics of state and the unions conducted the politics of civil society” (Upchurch, Taylor, and Mathers 2009, 2). Elsewhere, this arrangement has been aptly termed the “labour-movement party” (Martin 1975).
The problematic of this nexus comes to the fore with the transition to post-Fordist forms of work organization dominated by smaller workplaces and the growth of service employment relative to industrial production. Both of these dimensions are characterized by dramatically lower union membership (Pontusson 1995), and if we accept the political centrality of the trade union link to social democracy’s ideological, organizational, and cultural existence, then such economic structural changes have important implications for social democracy. The problem with the weakening of the union-party nexus is not that there are fewer working-class voters but rather that the efforts to adapt social democracy to the conditions of post-Fordism can be seen as a restating of Adam Przeworski’s “dilemma of class-based parties.” Their electoral success, the argument goes, can only be built through multi-class alliances, which are won at the cost of “diluting its class orientation” (1985, 102). Przeworski’s problematic is something of a misreading of class in that he appears to confine this to the industrial unionized workers. But the problem of declining trade union density is significant given the fairly strong correlation between union membership and votes for social democracy.
The mix of occupations has shifted rather markedly in Canada from the primary and secondary sectors — where the industrial working class is employed in manufacturing, mining, and forestry— and sharply toward the service sector. In 1960 the primary and secondary sectors accounted for 46.7 percent of all employment. By 1999 this had been reduced to 26 percent. In contrast, over the same period, the service sector grew from 53.4 percent to 73.9 percent of the total share of Canadian employment (Roberts et al. 2005, table 2). Trends in unionization have tracked this occupational and sectoral shift as the union-dense industrial sector shrank relative to the union-weak service sector.
Canadian union density reached its historic zenith in 1987 with an overall density of 34.2 percent (Akyeampong 2004, 6). By 2011 this had dropped to 29.7 percent (Uppal 2011, 3). This decline masks more serious changes in the composition of trade union membership. Within the private sector, the density declined from 29.8 percent in 1981 to 17.4 percent in 2011 (Morisette, Schellenberg, and Johnson 2005, table 2; Statistics Canada 2006; Canadian Labour Congress 2012). In certain industries — notably resource extraction (forestry, mining, oil and gas) and manufacturing, the historic bedrock of industrial trade unionism — an even more precipitous decline is evident: union density in these two industrial sectors declined from 46.0 percent and 43.9 percent, respectively, in the late 1980s to 20.2 and 24.1 percent in 2010 (Uppal 2011, 8).
Such declining levels of union density, particularly in the social democratic heartland sectors of the industrial working class, combined with a substantial occupational shift into services, have compelled a rethinking of centre-left political strategy. What has been questioned is the central role of the working class as an agent of political change (Panitch 1986b, 3) or, perhaps more accurately, as the essential electoral base for a party seeking to win government. Ed Broadbent, the longest-serving leader of the federal NDP (1975–1989), contemplated how social democracy might adapt to the shifting socio-economic terrain of post-Fordism: “New approaches must take into account the radical change in the nature of families, the expanding role of women in the economy, and the reduced need for unskilled blue-collar workers. The negative effects of large public and private bureaucracies must also be countered” (1999, 90).
The Problem of Class Identity
Studies of Canadian voting behaviour over the past forty years have consistently demonstrated the low level of class-based voting in comparison to other Western liberal democracies. Indeed, religious and regional cleavages regularly appear to be a more salient factor in voter determinations than class (Alford 1963; Gidengil et al. 2006; Pammett 1987). The lack of class-based voting among the Canadian electorate is particularly pertinent to the NDP, as it is purportedly a political vehicle for the working class. However, even among NDP voters, class has proven to be a marginal concern in determining electoral support for the party. While class is not inconsequential to NDP support, past studies have demonstrated a relatively weak relationship between working-class identification and support for the party (Pammett 1987; Gidengil 1992). Similarly, although union membership does increase the likelihood of voting NDP, Archer (1985) concludes that the overall electoral impact of the union vote is relatively small.
NDP electoral results appear only to confirm such conclusions. Working-class and union members are at least as likely to vote for conservative parties. In the 1997 federal election, the NDP secured the support of only 8 percent of manual workers, while fully 29 percent voted for the populist right-wing Reform Party (Gidengil 2002, 283). Similarly, 20 percent of union members chose Reform in 1997, while only 15 percent opted for the NDP (282). Equally disconcerting for the NDP was the flight of public sector workers — traditionally a bastion of NDP support — toward Reform in the 1997 election (282). These trends appear to have continued into the 2000 election, with Liberals winning 41 percent of union members’ votes; the Canadian Alliance, 27 percent; and the NDP, 12 percent. In other words, 88 percent of union members voted for parties other than the NDP (“Why the NDP” n.d). While the NDP managed to regain a significant amount of union support in the 2004 election, its 28 percent of the union vote still trailed the 30 percent of union members that the Conservative Party garnered (Gidengil et al. 2006, 9). Moreover, manual and non-manual workers voted the same as they had in the past, with income a minor factor for the NDP. While people with low household incomes were more likely to vote NDP than those with high incomes, these effects were offsetting and the net impact on the NDP vote was minimal (9). Thus, while the 2004 election revived the NDP to its traditional level of support (18 percent), it remains without a deep class basis.
In comparison to the social democratic parties in Europe, Australia, and New Zealand, the NDP’s political links to the working class are clearly, in general terms, tenuous. Yet although the party, while significant, is far from hegemonic within the Canadian working class, it cannot be denied that within regional pockets, the NDP is very much the “labour party.” In northern Ontario, Winnipeg and northern Manitoba, Vancouver and Vancouver Island, Hamilton, and Windsor, the NDP is electorally successful. These are also cities and regions with a history of class-based politics marked by significant union membership. The NDP may not be a class party but it is a qualified and uneven party of the class.
The NDP’s heterogeneous class composition has contributed to a characterization that the party is “bifurcated” (Archer and Whitehorn 1997, 52). This refers to a clear socio-economic divide between the party’s union and non-union convention delegates. Surveying 1987 federal convention delegates, Archer and Whitehorn found that 58.4 percent of non-union delegates were professional or “white collar” workers who reported “levels of education far above those of a cross-section of the Canadian public.” In contrast, more than half of union delegates possessed no more than a high school diploma (52). The class identification of these delegates reflected these differences: more than 40 percent of union delegates identified themselves as belonging to the “working class” compared to 21.4 percent of non-union delegates (54). And on the most salient question for any socialist, the question of the centrality of class struggle, 54 percent of delegates agreed that class conflict was the primary basis of political struggle while a full one-third disagreed. This in itself is an interesting indicator of a certain degree of de-classing of Canadian social democratic politics, but it becomes much more pronounced when union and non-union delegates are compared. Of the 54 percent of delegates who agreed that class conflict was central to Canadian politics, almost 61 percent were union delegates while 52.5 percent were non-union delegates (54).
Lynda Erickson and David Laycock’s 1997 Canadian Social Democracy in Transition survey, perhaps the most comprehensive study of the attitudes and opinions of NDP members ever conducted, came to very similar conclusions. In an analysis based on the survey, Erickson and Laycock (2002) described the challenges confronting the Canadian NDP in the 1990s as not fundamentally dissimilar to those of other social democratic parties. For social democrats everywhere, the political environment had been fundamentally altered by two developments. First and foremost was the relative “popularity” of the New Right’s hegemonic orthodoxy, which entailed privatization and deregulation, a reduction in public expenditures and taxes to fund public services, and a reduction in social program entitlements. In response to the shifting political terrain, social democrats elsewhere have reconsidered both the role of the state in economic management and the commitment to egalitarianism. Erickson and Laycock’s survey found that New Democrats resolutely supported egalitarian values and redistributive policies, and showed little interest in reducing the state’s role in social change. However, it is significant that support for expanding public ownership appears to have declined rather dramatically when compared to a survey from 1989, which found that 79.1 percent of delegates supported a policy of expanding public ownership throughout the economy (Archer and Whitehorn 1997, 134). In contrast, the 1997 survey appeared to indicate that support among New Democrats for this policy direction had declined rather substantially to 42 percent (Erickson and Laycock 2002, 310). This apparent decline in support for public ownership among Canadian social democrats may well be indicative of an ideological shift consistent with social democracy more generally.
NEW DEMOCRATS IN POWER: “THERE IS NO ALTERNATIVE”
As of 2011, the CCF-NDP has demonstrated the electoral capacity to form government in five provinces and one territory: Saskatchewan (1944–64, 1971–82, 1991–2007), British Columbia (1972–75, 1991–2001), Manitoba (1969–77, 1981–88, 1999–present), Ontario (1990–95), Nova Scotia (2009–present), and the Yukon Territory (1985–92, 1996–2000). Where New Democrats have been elected to government, especially in the last two decades, they have been hardly distinguishable from other pragmatic centrist governments operating in an age of neoliberalism. Proximity to government power in certain provinces may explain, for example, why “Saskatchewan and British Columbian members appear to be the most consistent anchors for what may count as the political right in the party” (Erickson and Laycock 2002, 316).
In 1990 and 1991, New Democrats were elected to government in Ontario, Saskatchewan, and British Columbia. Leo Panitch and Donald Swartz (2003, 104) asked whether this convergence of electoral victories could “set a new agenda that would make a break with the era of coercion.” But this was not to be. The “tragedy of the NDP,” according to Panitch (1992, 174–75), was that, save for the Saskatchewan wing, the party did not govern during the founding years of the Keynesian welfare state project but instead came into a governing role “at the end of that era.” The previous decade of the 1980s was transformative in that it was witness to the ascent of neoliberalism to hegemonic orthodoxy. Social democratic governments everywhere provide examples of what “modern” social democracy does when in government: welfare state restructuring, including privatization and an abandonment of redistributional social and economic policies, have become part of the policy toolkit of the “new” governing social democracy.
Ontario: Social Democracy’s Conversion to Progressive Competitiveness
The New Democrat government of Bob Rae (1990–95) presents something of a Canadian case study of the ideological confusion within social democracy. After its election victory, the NDP in Ontario initially attempted to apply Keynesian demand stimulus measures, but they moved rapidly toward fiscal conservatism and a program intended to shrink the public sector. And thus the impasse of social democracy found its Ontario expression.
Abandonment of Keynesianism by the Ontario NDP is typically identified with the Social Contract Act of 1993. This legislative intervention rolled back public sector wages and led to a major split between the party and its public sector union allies as well as the Canadian Auto Workers union. However, in historical perspective, this was simply the denouement of a process of ideological rethinking that began before the NDP became the governing party. In 1988 the Ontario NDP’s economics critic in the legislature, Floyd Laughren, initiated an economic policy review by consulting with a group of leftist intellectuals. Their contributions reflected a tension between progressive competitiveness and class perspectives. For the most part, the exercise was not taken seriously (Walkom 1994, 93). However, the lack of consensus with respect to direction was but one problem with the party’s attempts to build robust economic policy. Another was that this rethinking took place in the late 1980s, when the province was in “a relative boom, so that the underlying crisis of permeable Fordism was harder to perceive” (Jenson and Mahon 1995, 160). Riel Miller, who had organized the policy review, wrote a follow-up paper for the Ontario NDP caucus’s Planning and Priorities Economic Subcommittee, wherein he proposed a total break with social democracy’s Keynesian tradition. The redistribution of income and wealth was no longer the role of the state; rather, the state must work to improve “social productivity,” which would be achieved, according to Miller, “by establishing a network of ‘social contracts’ with ‘representative organizations’ such as unions, the women’s movement, environmentalists, and aboriginal groups. These social contracts would not be the European style agreements over wages, employment and inflation. … Rather, the NDP should negotiate specific social contracts about ‘tangible legal rights and economic and social programs.’ Areas to be negotiated would include pension-fund management, labour relations, environmental policy, training and public services” (quoted in Walkom 1994, 95). Two years later, Bob Rae led the Ontario NDP into government as Ontario entered the deepest recession since the 1930s. They soon discovered they had inherited a deficit of $3 billion, which by the time of the NDP’s first budget in 1991, had grown to $9.7 billion (Ontario Ministry of Finance, 1991, 3).
In policy terms, the Ontario NDP maintained the progressive competitiveness approach initiated by the former Liberal government, but with the election of the New Democrats, it was to become much more clearly articulated (Bradford and Stevens 1996, 147). A clear role for the state as a “market reinforcing rather than market replacing” actor is envisioned by progressive competitiveness approaches (Howlett and Ramesh 1993, 172–85). Neocorporatist partnerships are central to a more robust role for the state in “supporting and promoting adjustment to the new realities of a global economic system. … Much of this activity lies in facilitating technological adaptation, promoting human capital development through increased emphasis on training, and orchestrating partnership between business, labour and government to pursue competitiveness” (McBride 1995, 75). Whereas the corporatism of social democratic Keynesianism was designed to negotiate tradeoffs between full employment and inflation through public policy interventions such as negotiated wage controls and expansion of the range of public goods and services, post-Keynesian neocorporatism became a means to enlist the support of key economic actors in the drive to improve competitiveness.
Ontario’s first NDP budget, delivered on 29 April 1991, sent two unequivocal messages regarding economic change and fiscal policy. It looked back toward a Keynesian past and, arguably, forward to a future of progressive competitiveness informed and shaped by human capital theory. Finance Minister Floyd Laughren told the legislature: “We believe that government can and should be active in supporting positive economic change and in ensuring that the costs of adjustment are shared fairly.” He went on to say, “It is important for people to understand that we had a choice to make this year — to fight the deficit or fight the recession. We are proud to be fighting the recession” (Ontario Ministry of Finance, 1991, 1, 3). The progressive competitiveness theme was most clearly expressed in Budget Paper E, in which the government’s economic policy goal was identified broadly: “Ontario must promote equitable structural change through comprehensive economic and social strategy aimed at sustainable prosperity” (86). However, the paper explicitly dismissed more aggressive flexibilization strategies associated with the New Right, saying that “Ontario cannot afford the rigidity induced by policies which focus on cutting wages and eroding public sector contributions to productivity” and that federal government policies of this nature lead “neither to higher incomes nor to an enhanced capacity to adapt” (87). The paper argued for an alternative approach in which “government is to play a role as facilitator of structural change, not only to minimize the costs of transition and distribute them more fairly, but actively to promote the development of high-value added, high-wage jobs through strategic partnerships” (87).
More concretely, this would mean policies that support long-term competitiveness, the key elements of which included “the ability to improve productivity performance, the skills and adaptability of the labour force, the quality of management skills, the capacity for technological innovation, organizational flexibility and a strong foundation of physical and social infrastructure” (87). The Ontario state would perform a central role in facilitating these outcomes by constructing “new institutions for social learning and partnership development” (Bradford and Stevens 1996, 148) such as the Sectoral Partnership Fund and the Ontario Training and Adjustment Board, announced in the 1992 and 1993 budgets, respectively — budgets that both expressed and enabled the new industrial policy regime.
The turn to progressive competitiveness was short-lived since the NDP was unable to withstand pressures to shift its focus toward a policy of public sector austerity. The ensuing Social Contract Act constituted the most abrupt rupture with Ontario’s postwar history. Never before had public expenditures been so deeply cut. Despite the NDP government’s distinctive “mixture of post-Keynesian rhetoric and proposals designed to elicit union consent” (McBride 1995, 78), ultimately it was single-mindedly focused on public expenditure cuts and marked Ontario’s most explicit adaptation to the requirements of neoliberalism. It was, in fact, a turning point in the history of social democracy in Ontario and Canada. On 28 April 1995, Premier Rae called an election for 8 June. The political repercussions for the New Democrats were harsh: they saw their share of the popular vote fall to less than 21 percent and returned only seventeen MPPs. The Progressive Conservatives, campaigning on the themes expressed in their campaign manifesto with the Gramscianesque title of “The Common Sense Revolution,” jumped from 24.7 percent of the vote and sixteen seats to 44.8 percent and eighty-two seats. The logic that the social democrats had put in motion was now about to be played to its conclusion.
Only in the 2011 election did the Ontario NDP recover from the decline in support that followed the Rae government. In the general elections of 1999, 2003, and 2007, the party’s vote trawled historic lows, winning 12.6 percent, 14.7 percent, and 16.8 percent, respectively. The result has been a paucity of legislative seats; winning more than ten seats has proven elusive. This belies a history of healthy third-party status and, on occasion, the possibility of more. In general elections from 1967 to 1987, the Ontario NDP averaged one-quarter of the popular vote and formed the Official Opposition following the elections of 1975 and 1987. What fractured the electoral base of the party was more than the divisions created by the Social Contract Act. Public policy is concerned with decisions to act as well as not to act, and the Ontario NDP made important decisions not to act. The government did not pursue a fundamental overhaul of the Employment Standards Act — the “collective agreement of the unorganized,” as it is known. Expansion of minimum wages, vacation time and hours of work, workplace governance, and enforcement for the unorganized may well have helped build and strengthen a political coalition. In addition, broader-based bargaining — that is, a mechanism whereby the benefits of collective bargaining could be expanded throughout a sector — was not seriously considered. And, of course, the abandonment of the long-standing party commitment to a publicly owned auto insurance system signalled that there was little integrity to Ontario’s social democratic project. The entire NDP episode in Ontario was indeed a case of “giving away a miracle” (Ehring and Roberts 1993).
The general election of 2007, the third post–Rae era campaign led by Howard Hampton, signalled that the political base was drifting given the inability of the party, more than a decade after the end of the Rae government, to reconstruct itself as a viable alternative for voters. The vote increased a mere 2.1 percent over the 2003 total. The party’s empty campaign slogan of “Go Orange” was without content. The party platform did not offer a new vision of how to tackle industrial decline, economic polarization, sustainable development, or an alternative energy policy; instead, it proffered a narrow set of six proposals: a $450 health tax rebate; an immediate increase in the minimum wage to $10 per hour; more stringent environmental regulations; an added $200 per student to the education budget; a tuition fee rollback; and improved home care. All were laudible measures, but they were completely contained and lacked any overarching policy framework. The result was that the Green Party clearly became the party of protest, gaining 3.7 points for a total of 8 percent. More significantly, the re-emergence of a Liberal-Labour alliance that began with the 1999 election and then became sustained and deeper threatened not only the NDP’s political fortunes but also its capacity to put forward any sort of class politics. A coalition of unions under the banner of Working Families Coalition (comprising the Canadian Auto Workers, two teachers’ unions, and the building trades) campaigned on issues that could easily be understood as an endorsement of the Liberal record (Evans and Albo 2007). In fact, between 2000 and 2003, “union donations to the Ontario Liberal party surpassed union donations to the Ontario NDP” (Savage 2008, 178). In programmatic terms, it is unclear whether Ontario’s social democrats are different from the Third Way–informed Liberals in any meaningful way. And it is uncertain if the NDP is even able to rethink itself in such a way as to differentiate itself from “moderate” neoliberalism.
The NDP Western Base: Manitoba, Saskatchewan, and British Columbia
Three of the four provinces west of Ontario have provided the NDP with its greatest electoral success at the provincial level. What makes the western bastions of the NDP particularly interesting is that Canadian social democracy had an opportunity in two distinct historic moments to show what it would do with power in all three provinces: first in the early 1970s, just as the Keynesian era was about to head into crisis, and second in the 1990s, during the high-water mark of neoliberalism. The comparison of the two is instructive as a demonstration of continuity and adaptation of the Canadian social democratic experience to the shifting terrain of liberal capitalism — whether essentially Keynesian or neoliberal.
The three NDP premiers of the early 1970s — Ed Schreyer (Manitoba, 1969–77), Allan Blakeney (Saskatchewan, 1971–82), and Dave Barrett (British Columbia, 1972–75) — shared both a “common indifference to ideology” and a policy agenda focused on “cautious income redistribution, improved public service and a pay-as-you-go fiscal orthodoxy” (Morton 1977, 147, 148). For Canada’s social democratic provincial governments, this was a defining period. The inflation controls proposed in late 1975 by Prime Minister Trudeau, while rejected by the federal New Democrats, were supported by the NDP governments of Manitoba and Saskatchewan. Even the BC NDP, defeated shortly before Trudeau’s announcement, offered contingent support (194). It was this juncture that portended a growing rift between labour and its political arm (Brown, Roberts, and Warnock 1999, 26). The real issue was not simply that the trade unions and the NDP governments had a policy difference. More significantly, it was a policy difference rooted in what was to be fundamental restructuring of state-labour-capital relations that would be played out for decades to come. Leo Panitch and Donald Swartz (2003, 29) frame the era: “The wage controls imposed in 1975 coincided with the inauguration of monetarism as the guiding practice of monetary policy in Canada, while fiscal policy in the last years of the 1970s showed a growing tendency to belt-tightening.”
Saskatchewan’s Transformation: From Agrarian Socialism to Neoliberalism
The experience of NDP governments in Saskatchewan is a study in contrasts as well as an expression of social democratic adaptation to the requirements of capitalism, whether Keynesian or neoliberal. The Blakeney government of the 1970s was the last traditional Keynesian social democratic government in that province. Romanow’s government of the 1990s was a stark rejection of that “old” social democracy. The case of Saskatchewan, where the NDP was the “natural governing party,” is instructive in demonstrating that the Canadian social democratic project has not been an exception to the more general transformation of social democracy.
Warnock (2004, 366) sums up the programmatic and policy content of the Blakeney government as follows: “The NDP government under Allan Blakeney expanded the role of the government in the economy. Resource extraction industries were enhanced, and the government used higher taxation, private-government joint ventures and Crown corporations to significantly increase the share of resource rents going to the provincial government. New social programs were introduced. The minimum wage was set as the highest in Canada. Social assistance rates were raised significantly. Trade union membership increased.” While the “commanding heights” of the economy were never under public ownership in Canada, Blakeney’s government employed public ownership as an economic development instrument in efforts to diversify the province’s economy. A rather dramatic expansion of the public sector took place between 1971 and 1976, with the establishment of six new Crown corporations: FarmStart Corporation, SaskMedia, SaskComp, Saskatchewan Development Fund, Saskatchewan Housing, Potash Corporation of Saskatchewan, Saskatchewan Oil and Gas Corporation, Saskatchewan Trading Corporation, and Saskatchewan Mining Development Corporation (Rediger 2004, 104). And this was in addition to existing Crowns such as SaskTel, SaskPower, Saskatchewan Government Insurance (SGI), and the Saskatchewan Transportation Company (STC).
Still, there were signs even during this golden age of Canadian social democracy of a shift in the class composition and ideological orientation of the party. Through the 1970s, the leadership of the party was drawn increasingly from the ranks of the professional middle classes: “middle level civil servants, lawyers, teachers, credit union and co-op bureaucrats and often professional and middle managers” (Brown, Roberts, and Warnock 1999, 26). In 1975, Blakeney’s support for wage and price controls drew criticism from the trade unions, but the relationship with labour reached a breaking point in 1981, when the NDP government introduced, and later passed, the Labour-Management Dispute (Temporary Provisions) Act. The legislation was a response to a very specific workplace conflict that had led to cancer treatment clinic workers taking legal strike action. While the legislation ended the strike by ordering these workers back, it was drafted in such broad terms that it could be applied to any strike (Leyton-Brown 2006). The Saskatchewan labour movement was outraged by this intervention and vowed not to support the NDP in the impending provincial general election, an important factor in the defeat of the Blakeney government (Brown, Roberts, and Warnock 1999, 26).
In 1991, under the leadership of Roy Romanow, the NDP returned to power, but this was a very different party from that of the 1970s. The Saskatchewan NDP campaign focused on eliminating the $5.2 billion provincial debt and balancing the province’s public finances. The new government’s first budget of 1992 signalled that this would be a different form of social democracy. Rather than rolling back the privatizations and regressive tax policies of the previous Conservative government, the Romanow government pursued the same general approach to public policy, including lowering the taxes and royalties of resource companies. Government revenues therefore proved insufficient to support both the objectives of achieving a balanced budget and supporting social programs. Consequently, the government shrank social programs, resulting in the closing of fifty-two hospitals, a reduced education budget, and the capping of social assistance rates at their 1982 levels. But more than this, and further marking a distinct turn from the reformism marking previous NDP governments, Romanow was not concerned with substantively improving the legislative protections for workers. His government broke public sector worker strikes and allowed what had been one of the highest minimum wage rates in the country to fall to one of the lowest (Warnock 2004, 369–70, 373).
A discernible shift took place in Saskatchewan’s social democracy in the 1990s, marked by the ascent of a much more market-oriented approach to economic policy. As economist Peter Phillips (1998, 46) characterized it, “the approach was broadened from the more traditional industrial development model toward an enabling, climate setting strategy. Instead of programs and investments, successive governments have tried to make the province and its policies more attractive to investors.” Underlining the break with the social democracy of Blakeney’s government, the policy continuity of “successive governments” was that of the Conservative and NDP governments of the 1980s and 1990s.
A significant policy document issued by the Romanow government in 1992 and titled Partnership for Renewal: A Strategy for the Saskatchewan Economy set out the policy framework for the “climate setting” referred to above. It envisioned a path to economic development that differed starkly from the Blakeney government’s deployment of Crown corporations. Instead, economic policy-makers would seek to reduce regulations and taxes to encourage private sector investment; furthermore, there would be no renationalization of the privatized Crown corporations, nor would new ones be created. The minister of Economic Development, who released the report, said: “We will establish a much more focused approach to economic development, where business people are treated a little easier” (quoted in “Saskatchewan Unveils” 1992; see also Yeates 2001, 60). The market, not the provincial state, would lead the province’s development (Fernandes 2003, 6). In 1996–97 the government launched a full-scale review of its five major Crown corporations in addition to other entities in which the government had a significant investment. This substantive review included an academic conference held in Regina in 1996. The process ended with a report, Saskatchewan’s Crown Corporations: A New Era, released in June 1997. It recommended that four of the Crown corporations — those concerned with electricity, auto insurance, telephone communications, and natural gas distribution — remain publicly owned. However, it recommended a policy of commercialization whereby Crown corporate governance and operations would be structured to allow greater management flexibility in strategic and human resources policies in order “to be responsive to shifting market conditions and succeed in an era of increased competition and deregulation” (quoted in McGrane 2006, 7). In practice, this meant that ministers were removed from the governing boards of the Crowns and the Crowns began to operate in other provinces — and, indeed, outside of Canada — providing their services on a for-profit basis (Warnock 2004, 371; McGrane 2006, 7).
A scaled-back privatization agenda continued. The government sold its equity in four companies — the Potash Corporation of Saskatchewan, Sask Oil, Cameco, and the Lloydminister Heavy Oil Upgrader — and Sask Forest Products was sold to MacMillan Bloedel. What’s more, the government removed the limits, imposed by the previous Conservative government, on how much of the privatized Crowns could be bought by foreign investors (Warnock 2004, 371).
In the aftermath of the 2003 general election, in which the NDP won re-election with a larger share of the popular vote than they had had before the election, Erin Weir (2004, 1) questioned whether the returned government would pursue a social democratic agenda, which he defined as creating a policy program of expanded public services and a progressive redistribution of wealth. In a trenchant analysis of the Romanow-Calvert governments, Weir stated that the “government of Saskatchewan has moved in the opposite direction in recent years by cutting income taxes and resource royalties” (3). Under Premier Romanow, resource royalties were lowered from 27 percent, which had been established by the previous Conservative government, to 17 percent; the decrease had the effect of financing private sector expansion “by foregoing millions of dollars of royalty revenues every year” (4–5). The loss of revenue as a result of the cuts to income taxes and resource royalties ensured that the Saskatchewan government did not possess the fiscal capacity to act on the defining features of social democracy — improving and expanding public goods and services as part of a program of resource redistribution (10).
The transition to neoliberalism in Saskatchewan can be seen, in retrospect, in certain actions of the Blakeney government, but this process was consolidated by the NDP governments led by Roy Romanow and his successor, Lorne Calvert (Warnock 2004, 381). In the Canadian context, no other case so vividly presents the neoliberalization of social democracy as does Saskatchewan, given the stark comparison between two governments of the same party representing very different eras in the history of social democratic governance. Perhaps more significantly, the two governments of Blakeney and Romanow-Calvert point to the dependence of social democracy on capitalist economic development. As capitalism transforms, so does social democracy.
Manitoba: From “Old” Social Democracy to “Today’s NDP”
Manitoba was the second province in Canadian history to elect a social democratic government — that led by Ed Schreyer from 1969 to 1977. A certain policy continuity linked the governments led by Schreyer and Howard Pawley (1981–88), who were more traditional Keynesian-era social democrats than Romanow or Calvert, although Pawley clearly governed at a time when neoliberalism was in the ascendant, if not hegemonic. Gary Doer’s government (1998–2009) was much more akin to that of Romanow, providing a second case study in the neoliberalization of Canadian social democracy.
Ed Schreyer’s government introduced several important reforms serving to decommodify certain goods and services. For example, the Manitoba NDP established comprehensive pharmaceutical insurance for seniors as well as universal not-for-profit nursing home care, a minimum income program targeting the working poor, and an unprecedented “equal pay for equal work” provision in labour law to end pay discrimination based on a worker’s sex (Bernard 1991, 145). However, as with Blakeney, Schreyer’s support for Trudeau’s anti-inflation wage-controls program engendered a sharp rebuke from labour. Despite the relative caution of the Schreyer government, eight years of NDP government was enough to galvanize the Manitoba business community behind the Conservative Party led by Sterling Lyon. Lyon was an unrepentant neoconservative and, in Canadian terms, somewhat ahead of his time. In particular, his government reduced spending on popular social programs and, in doing so, engendered a political backlash such that the Conservative government was broadly seen to be “hostile to the aspirations of ordinary people” (Chorney and Hansen 1985, 11). For the NDP, the actions of the Conservative government pushed explicitly class-based issues to the fore in Manitoba. In the ensuing general election of 1981, the NDP, now led by Howard Pawley, modelled its policy agenda on that of Blakeney’s NDP government in neighbouring Saskatchewan. Public ownership was put forward as a means of promoting economic development and to position the provincial government as a “resource entrepreneur” (Netherton 1992, 194). Indeed, upon winning the election and returning to government, the NDP established a new Crown corporation — ManOil, modelled on the Saskatchewan Oil and Gas Corporation — as well as several other resource development corporations mandated to develop the province’s north (Wesley 2006, 10). At the same time, the Pawley government was very explicit in saying that “it would not seek to strike out on radical paths of either nationalization or of large-scale public spending” (Chorney and Hansen 1985, 12).
In addition to employing the power of the provincial state toward economic objectives, the Pawley government brought forward a number of significant reforms in labour law, including new regulations preventing the use of strikebreakers, the establishment of a legal right for striking workers to be reinstated at the conclusion of a strike, a new pay equity act, an amended Employment Standards Act to provide for paternity leave and improved mass layoff notification provisions, and the establishment of final offer selection binding arbitration in the Labour Relations Act (Panitch and Swartz 2003, 115). Still, many of these reforms were rather modest and were already in place in non-NDP provinces such as Ontario.
Despite these nods to more traditional postwar social democratic reforms, the Pawley government “slipped into the crisis of social democracy” as it possessed neither the fiscal resources nor sufficient political conviction to pursue a comprehensive strategy of economic development through public ownership. Perhaps more pointedly, the Pawley government was “cautious and at times fearful of the political consequences of policy innovation” (Netherton 1992, 195). In 1986 the Pawley government was returned, but only barely, as its majority in the legislature was reduced to two seats. The ongoing provincial government deficits and debt became a political issue, and the government turned to a program of public expenditure restraint (198). The NDP’s defeat in the 1988 election arguably marked a historic watershed: the last modestly Keynesian social democratic government in Canada came to an end (Netherton 2001, 222). As in Saskatchewan, a rather different NDP would be constructed in Manitoba over the next decade.
Gary Doer explicitly modelled his politics on that of Tony Blair and the Third Way. In more than twenty years as party leader, and as premier since 1999, he has successfully transformed the party that now describes itself as “today’s NDP” so as to differentiate it from the “old” social democracy linked to public ownership and redistributive policies (Lett 1997, 1998). Leading the NDP in his second election campaign in 1995, Doer’s most significant commitment was that an NDP government “would not raise any of the major personal tax rates.” The election platform proposed that the NDP would seek to make the tax system more “fair,” expand the roles of nurses in delivering health care, and update the Environment Act, but these pragmatic reforms were all predicated on no increase in public expenditures (Carr 1995). Although the NDP did not win the election, it did gain three seats for a total of twenty-three.
Doer led the party back into government in 1999 and further succeeded in winning majority governments in the general elections of 2003 and 2007, placing the Manitoba NDP under Doer among the most electorally successful provincial parties in the history of Canadian social democracy. The three consecutive Doer-led NDP governments led to important but modest changes that in no way sought to challenge the interests of capital. As left-wing critic Cy Gonick (2003, 5) noted, “Even within the limits of a social-democratic framework, the Doer government is hamstrung by its choice to accept the neoliberal economic regime it inherited from the far-right Tory government.” The political strategy of the Doer NDP thus entailed an economic policy that was largely consistent with the interests of Manitoba capital, keeping those interests from mobilizing politically against the NDP. But in addition, to keep the NDP base intact, the Doer government would “do just enough to sustain support from the province’s working class and poor” (Gonick 2007, 12). Reflecting the modest themes of the NDP’s successful election campaigns, the Doer government initiated reforms that are not unimportant, although perhaps uncontroversial. These include:
- regularized increases in the minimum wage
- a long overdue review of the Employment Standards Act, which had not happened since the 1970s
- extension of minimum wage and the Employment Standards Act protections to agricultural workers and a commitment to extend workers’ compensation coverage
- a new minimum wage for construction workers
- the introduction of a province-wide wage scale for all industrial, commercial, and institutional construction projects to mitigate the wage-cost difference between union and non-union contractors
- expansion of the availability of daycare
- reinvestment in health care
- reduced university and community college tuition fees
- a commitment to transferring child welfare responsibilities for Aboriginal peoples to Aboriginal agencies (Chaboyer, Black, and Silver 2008, 2; Gonick 2003, 5)
But a more innovative social democratic agenda was the path not chosen as a result of previous NDP decisions. A very clear continuity with previous Conservative decisions and a general alignment with twenty-first-century neoliberalism were evident in the decisions of the Doer governments.
Leading up to the 2008 budget, critics charged that previous NDP governments had eliminated nearly $1 billion from the Manitoba treasury through tax cuts of various sorts, resulting in an inability to adequately fund public services. It was noted that the rate of child poverty in Manitoba (at 20 percent, the second highest in Canada) had remained unchanged from what it was in 1989, nearly twenty years earlier. Moreover, into its third consecutive majority, the NDP continued the freeze on social assistance rates first initiated by the former Conservative government in 1995. The result was an effective 35 percent reduction in income support for the poorest Manitobans (MacKinnon and Black 2008, 1). Indeed, the 2009 budget offered more of the same, reflecting a “decade long obedience to zero deficits, improved credit access for business and lower taxes” (Webb 2009, 10).
Balanced budget legislation, another legacy of the former Conservative government, was retained. This legislation prohibited running a deficit and required that any increase in taxation must first be approved in a plebiscite. It also required that the government make a $75 million annual “pay down” on the provincial debt. Similarly, labour law changes made under the Conservatives were left largely intact when Manitoba’s business community mobilized against a mere suggestion of a review by the NDP (Gonick 2003, 5; 2007, 12). And, perhaps reflecting a more general international trend of social democracy delinking from labour, in 1999, well ahead of the federal Liberal government’s elections-finance reform of 2003, the Doer government launched a fundamental overhaul of elections financing in Manitoba. This initiative served to minimize the role and position of trade unions as a critical pillar to the financing of the NDP’s political and electoral work. The changes to the Elections Finances Act banned financial contributions from unions (and corporations), restricted election advertising to registered parties and candidates, and limited third-party election spending to five thousand dollars. With this measure, the loosening of the organic link with labour progressed rather significantly.
Cy Gonick (2007, 12) has characterized the NDP under Doer’s leadership as having been transformed into that province’s liberal party. The history of the NDP governments in Saskatchewan and Manitoba closely parallels this expression of the neoliberalization of social democratic governance. In all cases, class politics has been relegated to the margins as much as is politically possible, save for certain actions to sustain the loyalty of the working class. Of course, this is a careful calculation, as the Doer government demonstrated in action: it did not go so far as to undermine the broad (and therefore winning) centre-left electoral coalition that Doer and the Manitoba NDP had constructed. How does the Doer (and Romanow) success square with Harold Chorney and Phillip Hansen’s contention that “a social democratic party is more likely to be successful when class issues are salient than when they are de-emphasized” (1985, 2)? One response may be that a crisis for capital only arises when the working class is sufficiently mobilized and organized to create a crisis. If this element does not exist or is tepid, then even social democrats are compelled to change what they are capable of doing when holding governmental power.
British Columbia: Farewell to Class Politics
British Columbia politics have historically entailed a significant class dimension in that “conflict between the owners of capital … and the workers” has been more consistently and sharply a terrain of struggle than in the other provinces (Penner 1992, 127). This was demonstrated in electoral contests: for example, in 1907 the Socialist Party of Canada, a rather doctrinaire Marxist formation, won nearly 9 percent of the popular vote and elected three members to the BC legislature, and, in the depths of the Depression, the CCF won a third of the BC vote in the federal election of 1935. No other province gave the fledgling CCF such a high proportion of votes (Young 1969, table 1). The response from capital was its own political mobilization to prevent the CCF from winning the BC government. From 1945 onward, BC electoral politics would be polarized as business interests coalesced first into an anti-CCF bloc consisting of a coalition of the historical business parties and, later, into a regroupement under Social Credit from 1952 to 1991 and under the Liberal label from 1991 to the present. Nowhere else in Canada could such a strong business class cohesion be found. That capital and its allies disliked the BC social democrats is not in question. The record of the BC NDP in government does not, for the most part, justify this antipathy, but for BC-based business interests, anything less than complete control over the apparatus of the provincial government is not acceptable.
The 1972 provincial election saw the fracturing of the electoral coalition that had kept Social Credit in power since 1952. The Progressive Conservatives were hastily reassembled as an electoral machine and saw their vote increase from a minuscule 0.1 percent and no seats in the 1969 election to 12.7 percent and two seats in 1972. The result was an NDP majority government, led by Dave Barrett, based on 39.5 percent of the popular vote (Howlett and Brownsey 1992, 279). In the ensuing 1,200 days of NDP government, some 367 bills were passed by the legislature. For BC’s business interests, this agenda went too far and too fast. As in the cases of the Saskatchewan and Manitoba NDP governments, various reforms were introduced in social, labour, and economic policy. Public ownership in certain sectors was expanded: for example, the British Columbia Petroleum Corporation was established as a government monopoly but with a limited responsibility for the marketing of natural gas and oil. This was no effort to nationalize the industry in whole or in part; indeed, it was a tepid intervention into the public ownership of natural resources compared to those that the Blakeney government in Saskatchewan would undertake. In addition, the Insurance Corporation of British Columbia (ICBC) was created, bringing auto insurance into public ownership. In other areas of fiscal and economic policy, the NDP government introduced the Mineral Royalties Act, which sought to bring into the public coffers a larger share of the windfall profits that mining companies were enjoying and to introduce regulations to better manage the extraction of natural resources. However, pressure from the mining industry compelled the government to back away from both the royalty and regulatory aspects of the strategy (Sigurdson 1997, 322).
In terms of redistributive social policy, the NDP established several new programs including Mincome, an income security program for the disabled and seniors, and a Pharmacare program providing a subsidy on prescription drugs. Furthermore, social assistance rates were significantly increased as was support for public housing initiatives and daycare provision (322). All of this contributed to a significant expansion of the public sector in terms of both expenditures and staffing. On the labour relations front, bargaining rights were extended to BC’s government workers for the first time and a new Labour Code was adopted. While the BC trade unions were largely pleased with the policy direction of the government, tensions grew in 1975 as the government intervened in several strikes by ordering workers back to work (Howlett and Brownsey 1992, 280; Sigurdson 1997, 323–24). But the New Democrat vote remained remarkably loyal despite the rifts with the trade union movement that opened up. In the ensuing election, the NDP share of the popular vote dropped by less than 0.5 percent, to 39.16 percent. However, the Liberal and Conservative vote collapsed and coalesced once again around Social Credit to deliver it a majority government. It would take sixteen years and a second fracturing of the anti–social democratic coalition before the NDP would return to government.
In 1991 Mike Harcourt led the BC NDP to a majority government, winning 40.7 percent of the popular vote. The discredited Social Credit fell to 24 percent of the vote and third place, while a resurgent Liberal Party, the new but not yet hegemonic political arm of BC capital, obtained 33.2 percent. Five years later, in 1996, under a new leader, Glen Clark, the NDP won an unprecedented second majority but again as a consequence of a split among right-wing parties and the vagaries of the first-past-the-post electoral system. The New Democrats actually trailed the Liberals by 2.3 percent in the popular vote but still won six more seats than the Liberals, who suffered from a fracturing of the anti-NDP vote: the BC Reform and the Progressive Democrats (a split from the BC Liberals led by the former Liberal leader) together won 15 percent of the vote and three seats. As BC history has demonstrated, when the right unites, the result is invariably electoral victory. In 2001, and led now by the third leader within a decade, Ujjal Dosanjh, the NDP suffered an astonishingly deep defeat. With but one significant party on the right, the BC Liberals won 57.6 percent of the popular vote and all but two seats in the legislature. The fracturing of the vote was now, arguably, on the left, where the NDP contended with the Green Party, which took 12.4 percent of the vote but won no seats. Despite their defeat, their unbroken decade in power gave the BC New Democrats a record to be assessed.
From the very outset, the tenor of the BC NDP under Harcourt was established when the electoral strategy was based on “appeasing the business sector, avoiding radical departures from the status quo and, above all, appearing moderate” (Cohen 1994, 151). The strategy of moderation, intended to broaden the electoral base of the NDP beyond its traditional allies in the labour movement and the popular sectors, included recruiting candidates who did not possess the standard NDP candidate resume, which was typically steeped in labour or social movement struggles. Rather, candidates with “business and management experience were enticed to join the party, attracted both by the prospect of holding office and by the opportunity to work with Harcourt, himself an ideologically moderate and business-friendly NDPer” (Sigurdson 1997, 325–26). From a policy perspective, the party platform, “A Better Way British Columbia,” expressed an explicit pro-market orientation, stating that “a prosperous British Columbia needs a dynamic market economy.” However, this was tempered by the inclusion of commitments to increase the minimum wage, set higher corporate taxes, improve severance and layoff legislation, and increase spending for health and education. But even such modest proposals were qualified by an overarching commitment that public expenditures would be constrained by the central objective of balancing the budget (327).
In government, Harcourt delivered on a number of commitments to the party’s traditional base. A new Labour Code provided an anti-scab provision, a provision allowing for secondary boycotts, and mandatory first contract arbitration, and public sector workers, both in the core public service and in health care, won substantial wage increases, job security, and a role in decision-making. The code thus made a substantive contribution to a limited form of workplace democracy (329). High-income and corporate taxes were increased in the NDP’s first several years of government, but an increasingly ascendant progressive competitiveness orientation, similar to that in Ontario under the Liberals and NDP, was emerging, with the labour and post-secondary education ministries becoming more closely integrated to give institutional and policy focus to human capital development.
Overall, the policy direction of the Harcourt government consisted of a very modest redistributional aspect and an ascendant progressive competitiveness that centred upon skills and knowledge acquisition as a means of transitioning the BC economy at least partially away from resources and toward a new knowledge-based economy. But the priority shaping all other decisions was the focus on fiscal constraint leading toward a balanced budget. Consequently, even though spending on the key social policy areas of health and education increased in absolute terms, this spending, measured on a per capita basis, was actually declining (329). More positively, the Harcourt government created or strengthened new ministries for Women’s Equality and Aboriginal Affairs to give voice at the centre of government to these important constituencies. Even this step, though, can in part be understood as part of the BC NDP’s efforts to consolidate political support for its increasingly centrist program: class-based demands for redistribution were simply too expensive in the context of public austerity and, perhaps as importantly, risked mobilizing capital behind one electoral vehicle.
In 1995 Harcourt was replaced as party leader by Glen Clark, who led the NDP in the successful election of 1996. Journalist Sarah Schmidt (2000, 30) wrote of Clark that he led “the last real NDP government in Canada and certainly the only one that dared flash the class card.” Despite Clark’s style and unabashed working-class roots, however, there is little that distinguishes his three and a half years in the Premier’s Office from Harcourt’s tenure as premier. In this respect, despite seeing Clark’s NDP as the last “real” NDP — a party committed to social and economic equality — Schmidt also noted that “Clark may have talked tough on class, but some of his policies … were hardly radical” (30).
The Clark era began with an income tax cut of 1 percent for all British Columbians in each of the fiscal years 1996 and 1997 and a general freeze on all other taxes through to 2000. In order to protect health and education expenditures, the Clark government reduced expenditures in other parts of the public sector. This included the elimination of 2,200 public service jobs and of three ministries and two Crown corporations, a wage freeze for the public service, a tightening of social assistance eligibility criteria, and a reduction of overall per capita public expenditures by 2.2 percent (British Columbia Ministry of Finance 1996). In the field of social policy, progressive changes, including expanded dental and vision care coverage for children in low-income families, were made to the BC Benefits program, which provided income support and social services to the province’s most vulnerable populations. However, even this effort at redistribution was enabled through greater regulation and cost containment for other poor people, including “cuts to basic rates for employable adults without children by eight to ten percent, reduced earnings exemptions, new time limits on those exemptions, and the elimination of provincial sales tax credits for families with children” (Fairbrother 2003, 315). While certain resources were redirected to poor children, they came at the expense of impoverished adults, a rather perverse form of redistribution by any measure.
An enduring theme through the Clark years — and, for that matter, the brief tenure of Ujjal Dosanjh, Clark’s successor as party leader and premier — was public sector austerity. Elimination of the deficit was a priority, as was a program of deregulation to make “government less burdensome.” Tax reduction was identified as the most effective means of encouraging economic growth. Taken as a package, deregulation, deficit reduction, and tax cuts were seen to be the means for creating a “positive business climate,” thus enhancing British Columbia’s competitiveness (British Columbia Ministry of Finance 1998). The Balanced Budget Act was introduced in 2000 during the brief tenure of Premier Ujjal Dosanjh. This was rather ironic in that Canada’s first example of balanced budget legislation had been introduced by the BC Social Credit government in 1991, only to be repealed when the NDP came back into power that same year (Philipps 1997, 686).
The decade of NDP government through the 1990s in British Columbia was, in policy terms, fundamentally identical to the years of the New Democrat administrations governing Manitoba and Saskatchewan. As in other cases of “new” social democratic governance, the BC NDP effectively aligned its policy program toward the requirements of neoliberalism. While there may not have been a particular moment when the BC NDP officially set out upon a process of “modernization,” shedding any pretense of using the power of the provincial state toward redistributive objectives, its decisions in government speak to a full acceptance of the market. Of course, the BC NDP never set out to challenge capital in any fundamental sense, but as elsewhere, even a modest program of reform based on limited public ownership and a redistribution of resources had been clearly abandoned.
Nova Scotia: Unshackling the NDP from Its Past
The provincial general election held on 9 June 2009 gave Nova Scotia’s NDP 45 percent of the popular vote and an unprecedented majority of seats in the legislature. The party’s election platform, “Better Deal 2009: The NDP Plan to Make Life Better for Today’s Families,” was a sparse two-page document consisting of seven modest and not particularly social democratic commitments. The party’s policy proposals entailed the creation of 2,200 jobs “by rewarding investment in Nova Scotia companies,” a 50 percent rebate on the provincial sales tax on new homes, reduced wait times for medical procedures, a plan to stem the out-migration of young workers and professionals by offering a $15,000 incentive to remain in the province, removal of the 8 percent harmonized sales tax (HST) on electricity consumption, improvement of rural roads, and expansion of home care for seniors — all of this within a broad program of public expenditure constraint. Related to this last point, the platform stated that upon forming government, the NDP would have an independent auditor review and report on the state of the province’s public finances. One columnist wrote of the platform that it was more a “slender leaflet, designed for sales, not debate” and was surprised that nary a word dealt with traditional social democratic concerns about equality and redistribution through progressive taxation (Steele 2009; see also Fodor 2009, 7).
The modesty of the platform compelled the mainstream media to characterize the Nova Scotia NDP not as a party seeking serious reforms but rather as a “party focussed on tweaking government — and pursuing cautious change.” While the caution was welcomed, the same media also noted that this constituted a weakness in that “no big picture really comes into focus” (“NDP Platform” 2009). Political scientist Jim Bickerton consequently characterized the NDP under the leadership of Darrell Dexter as “conservative progressive.” Bickerton situates the electoral success and ideological “modernization” of the Nova Scotia NDP within its incremental shift, beginning in the 1980s, away from a “primarily blue collar, labourite party with its voter base in the steel and coal towns of industrial Cape Breton” and toward “the growing capital district of Halifax, and ideologically … to modern social democracy with its appeal to public sector workers and educated urban professionals” (Strategists Panel 2009). In other words, as noted above, the NDP refounded itself as a broadly centrist political formation in response to the declining, and indeed limited, electoral reach of its historical industrial working-class base. Its electoral success in forming the first NDP government in Atlantic Canada is indisputable, but what this electoral success says about the political content and purpose of Canadian social democracy generally is much more important. Indeed, the transformation of the Nova Scotia NDP leads to the conclusion that the party no longer has very much to do with redistributive social democracy and instead concerns itself largely with efficient public management. This trajectory was already evident in 1999, when the NDP, holding the balance of power, defeated the minority Liberal government of the day because it had failed to balance the budget: the Liberals had chosen to invest in health care rather than focus on deficit reduction. This curious political practice for a social democratic party prompted CAW economist Jim Stanford (2001, 100) to write: “By bringing down a government on the grounds that it failed to balance the budget, and making ‘fiscal prudence’ a centrepiece of its own campaign, the NDP clearly contributed to the emergence of the current regressive trend in Nova Scotia.” Later, in 2003, the NDP supported a tax cut introduced by the Conservative government, a cut that would negatively “affect women, the poor, and regions outside of Halifax” (Haiven 2009, 7). The Nova Scotia NDP had clearly traversed a great distance from its social democratic roots based in equality through the redistribution of resources and power.
Accounting and consulting firm Deloitte and Touche conducted the NDP’s promised financial review. As with other such reviews, it concluded that Nova Scotia’s public finances were far out of balance. In fact, the review projected ongoing deficits into the future, stabilizing at $1.3 billion per year by 2012–13, and intoned grave challenges ahead: “The combination of several events has culminated in the projected trend of future deficits, led primarily by the growth in expenses which is expected to outpace revenue growth … into and past 2012–2013” (Deloitte and Touche LLP 2009, 9). The Deloitte review was compared to a similar exercise undertaken by another newly elected NDP government in 1991, that of Roy Romanow. As analyst Larry Haiven (2009, 6) put it, the purpose of Romanow’s review “was to make the financial situation appear as grave as possible and give the government political room to lower expectations, especially among the NDP’s membership and traditional constituency including the unions.” Dexter’s review served essentially the same purpose.
The title of the 6 April 2010 budget, “Back to Balance,” signalled that deficit busting would be the priority for this government. An unequivocal turn to austerity was announced: $1.1 billion in public expenditures would be cut. Stated differently, this meant that the government had opted to eliminate nearly 80 percent of the projected $1.4 billion deficit through the incremental erosion of public services and programs. Even the government-appointed Economic Advisory Panel recommended that taxes — on both personal income and consumption — be increased in combination with “significant spending cuts” (Nova Scotia 2009, 13–15). A turn to a more broadly progressive income tax was not to be: instead, the Finance minister chose to hike the harmonized sales tax (HST) by two percentage points and to actually cut the income tax on those earning between $93,000 and $150,000 per annum. In addition, the provincial public service would be shrunk by 10 percent. But perhaps the most revealing, though underreported, initiative proposed by the 2010 budget was deindexing the public service defined-benefit pension plan and constraining increases to 1.25 percent per annum for five years (Steele 2010). If the pension fund was not fully funded at the end of that time frame, indexing by any measure would be eliminated. In short, it took an NDP government to declare war on public sector pensions.
There may be an urge to compare the Nova Scotia NDP to Ontario’s Rae-led NDP government, but such a comparison would be facile. The Ontario NDP came into government full of reformist zeal and was quickly overtaken by an unfocused policy agenda, an inability to consider options other than austerity, and a public service that was neutral in some quarters and less so in others. A more apt comparison would be with the reconstruction of the Ontario Progressive Conservative Party through the late 1980s and into the early 1990s, when what had been a pragmatic centrist party for decades was refashioned into a right-wing populist vehicle. With the “red Tories” marginalized, it had become a different party. The Nova Scotia NDP, through the 1990s, had moved through a similar transformative process — in fact, one that was perhaps less grassroots-based than the metamorphosis of the Ontario Conservative party had been. Regardless, the Nova Scotia NDP emerged a party of a different type. The redistributive social democracy that the party had once embodied was incrementally jettisoned and replaced under successive leaders — McDonough, Chisolm, and now Dexter — until what remains is a historical shell whose current leading occupants have only the vaguest resemblance to those who once lived there.
Indeed, the 2009 federal NDP convention, held in Halifax, presented a party that, Janus-like, looked in two different directions. This was personified in the perspectives expressed to the convention by former federal leader Ed Broadbent and the new Nova Scotia premier, Darrell Dexter. Broadbent delivered the convention’s opening keynote speech; it was the first time he had spoken to a party convention since resigning as leader in 1989. Indeed, in historical terms, the convention was taking place at the height of the Great Recession, when there appeared to be a global deathbed conversion to old-style Keynesianism. Broadbent noted that we were living in a “social democratic moment” where “even governments of the right … have now had to adopt the kinds of policies we social democrats have advocated all along” (Broadbent 2009). The theme of his address was the importance of state intervention to stabilize the market economy and to promote greater equality through redistribution of resources and opportunities. Canada’s postwar welfare state had contributed significantly to this goal through concrete policies and programs that Broadbent succinctly summed up as “government pensions, universal health care, trade union rights, comprehensive unemployment insurance, the expectation that every boy and girl with ability could go to university,” all contributing to a state in which, ideally, “all were paid for by adequate levels of progressive taxation.” But he lamented that three decades of neoliberalism (he did not use this term) had effectively eroded this social democracy through tax cuts and an increasingly regressive taxation regime, and the termination of redistributive programs — all of this resulting in expanding inequality. In closing, Broadbent identified his party’s task: “to demonstrate, show and persuade Canadians that with more equality” a more civil, productive, socially cohesive, and healthier Canada was possible. In other words, he exhorted his party to advocate for the social democracy of redistribution, a mixed economy, and an effectively regulated market.
In contrast, the new premier of Nova Scotia, the head of the first New Democratic government in Atlantic Canada, presented a different narrative. The day after Broadbent delivered his impassioned denunication of inequality and market fetishism, Dexter urged the party to “not be shackled by the past” and to “embrace a wider set of values,” adding that the NDP is a “new modern political party” that needs to become a “big tent” (Foot 2009). But the delegates at the convention were not completely convinced to follow Dexter’s advice: resolutions calling for tax credits for small and medium-sized businesses, similar to a Dexter-government policy, and a proposed renaming of the party, met such strong opposition that they did not make it to the convention floor.
CONCLUSION
The content of the social democratic project — the political objective and how this is to be achieved — has obviously been transformed. The politics of the centre-left express nothing more than a more moderate and pragmatic management of neoliberalism. Just as, in the postwar decades, social democracy offered a more redistributive policy and practice in managing capitalism, it now offers a program that assists in the adjustment to the requirements of a globally based hypercompetitive market economy. It is, for now, a program of progressive competitiveness (Albo 1994) whose central political objective is to help workers adapt to neoliberalism through policy focused on skills, training, and knowledge. The politics of class compromise long ago gave way to the politics of class co-optation, which is best captured by the discourse of partnership. Competition between nations and regions requires such a politics. Canada’s New Democratic Party offers no opposition or alternative to this perspective.
The political practice of New Democratic governments through the 1990s to the present demonstrates the unambiguous success of neoliberalism in disorganizing the working class’s unions and political parties (Albo 2009, 121). It is now virtually impossible to discern what sets an NDP government apart from the traditional parties of business. At the convention that saw Bob Rae become leader of the Ontario NDP in 1982, left-wing caucus opponents to Rae circulated a pin that read “Bob Rae — New Liberal.” It was prescient. No one then would have predicted that twenty years later, Canadian social democracy would see not only Rae, but several other prominent New Democrats including one other former premier and several former provincial cabinet ministers, move to federal electoral politics as Liberals. The politics of the centre-left, the politics that gave rise to New Labour in Britain and the amorphous Democratic Party in Italy, had arrived in Canada, though with much less formality.
The overview of New Democrats in power presented here leads to the question of the distinctiveness and relevance of the NDP in the twenty-first century. As workers and popular sector activists in Ontario, British Columbia, Manitoba, Saskatchewan, and, most recently, Nova Scotia have found, the presence of an NDP government is no guarantee that the objectives of economic and social justice will be pursued.
Within the Canadian Marxist Left, there is an ongoing debate about what its relationship to the NDP should be. One argument proposes a practice of “entryism” — that is, becoming active members within the party since it is the only major political party with a significant working-class membership and identification. Another view is that social democracy no longer has any political value save perhaps to slow the erosion of postwar social programs; moreover, the NDP is simply not capable of reinventing itself as an anti-neoliberal political force. The review of the NDP’s history, ideology, and government policy outputs presented here suggests that this latter perspective is a more sensible reading of the possibilities presented by the party. The Great Recession of 2008 has engendered a neoliberal regroupement that has already demonstrated, as in the case of the auto industry, its capacity to use the crisis to pursue and achieve previously unattainable objectives. A union that epitomized the postwar order of class compromise has been smashed. What is assuredly the next phase in the neoliberal project is to use the rapidly emerging fiscal crisis of the state to pursue a more extensive program of public sector austerity and marketization. This has already occurred in social democrat–governed Portugal, Greece, and the United Kingdom. And in Canada, finance ministers of every partisan hue are looking to programs of public sector austerity to deal with the damage left in the wake of the recession of 2008–9. The social democratic politics of adaptation have little to offer in resisting this assault. In fact, social democracy is proving an able partner in facilitating the transition to the next phase of neoliberalism.
POSTSCRIPT: THE 2011 FEDERAL ELECTION AND QUÉBEC’S TURN TO THE NDP
The outcome for the NDP of the 2 May 2011 federal election was indeed astonishing, particularly in Québec. The Québec results require some commentary, given that the NDP, at least federally, is now the key party in that province on the federal stage. What follows is a brief analysis of those results, which may have long-term implications for Canadian politics and the social democratic Left. (For further analysis, see the final chapter in this book, by Roger Rashi.)
The NDP won 103 seats and more than 30 percent of the national popular vote, but it was the party’s victory in Québec that marked a profound shift. There, 42.9 percent of votes were cast for the NDP, resulting in the election of an unprecedented 59 NDP MPs. This remarkable achievement stands in contrast to the previous election, in which the NDP elected only a single MP in Québec and captured a mere 12.2 percent of the popular vote in that province. How can we understand a shift in political fortunes of such magnitude?
Three political factors appear to have given the NDP a strategic advantage in Québec: the exhaustion of the Bloc Québécois (BQ) narrative on sovereignty, a popular desire to defeat the Harper Conservatives, and voters’ perception of the NDP as the best electoral option.
Amir Khadir, co-leader and sole member of the Québec National Assembly for the left-leaning Québec Solidaire, understands the rise of the NDP and demise of the BQ as an expression of “the political exhaustion of a certain sovereigntist orthodoxy” (Fidler 2011b). Khadir explains that the PQ (Parti Québécois)/BQ strategy for independence was based on Québec’s alienation from Canada and was a elite-driven project with no space for popular input into shaping the social project of an independent Québec. Obviously, this strategy had met with little success and progressive opinion began to consider other strategies. Indeed, it was prescient that during the 2008 federal election, a debate had emerged within the pro-independence Left whether to support the BQ or NDP (Fidler 2011a).
When polls in April indicated a growing swell of support for the NDP, the BQ called on PQ notables such as Jacques Parizeau and PQ leader Pauline Marois to speak at campaign events. The result, however, was to remind Québec’s voters that the BQ was part of a failed and tired strategy. Furthermore, in these events, the BQ deployed an “if you are not for us, then you are against Québec” rhetoric, which was seen as excessively dogmatic. This was, however, not a rejection of the BQ and sovereignty per se but rather of the BQ’s discourse. Progressive sovereigntists became more open to alternative strategies. As Amir Khadir noted: “Quebec will have every interest in seeing that a more open Canada emerges, under the leadership of principled, generous and open people — like Jack Layton and the NDP, who have undertaken to respect our right to self-determination” (quoted in Fidler 2011b). The NDP, in short, was not seen by Québec as a threat to the sovereignty project. Except for the BQ, it was the only realistic alternative as a federalist party that was not expressly anti-sovereignty (Tremblay-Pépin 2011).
The second factor contributing to the NDP’s success was tactical. Progressive voters in Québec wished to defeat the Harper Conservatives. The only acceptable party that might do this was the NDP. This, combined with the clear limitations of the BQ, meant that “the mostly anti-Conservative Québecers voted NDP because they were tired of disdainful discourses from the Bloc and the Liberal Party — and because Layton did not seem dangerous” (Tremblay-Pépin 2011). A post-election survey by Leger Marketing (7 May 2011) confirmed this, finding that the key objective of many Québec voters, including BQ voters, was to find a way to defeat the Conservatives.
The third factor, interwoven through the preceding points, was that the NDP was the only real option. The political program and ideology of the NDP was not uncomfortable for most Québecers, to whom its moderate reformism looked very familiar and normal (Tremblay-Pépin 2011). Generally, Québecers are more open to broadly progressive ideas than is the case in the rest of Canada. For example, while not scientific, the CBC’s Vote Compass results demonstrated some fundamental ideological differences. On key left/right questions concerned with taxation, military expenditures, and so on, Québecers tended to be much more progressive than Canadians in general.
As the largest party in Québec at the federal level, the NDP must now advance an authentic program that accepts Québec’s right to self-determination in concrete ways. Perhaps the larger challenge, though, will be to integrate into its electoral strategy the reality of a broadly progressive Québec electorate with a more conservative Canadian electorate.
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