It’s time to deconstruct some of the walls that constrain us
Canada is a vast country – the world’s second largest by land mass. Though sparsely populated, it spans six time zones and is made up of regions that are almost as culturally distinct from one another as separate countries. This shapes our politics – Canadian provinces are among the most powerful sub-national governments on earth, second only to Swiss Cantons in the developed world.
In Canada, provincial capitals have the kind of control over taxation and social policy that, say, the American states could only dream of. On top of this, the federal equalization program is constitutionally enshrined to redistribute revenue from well-off jurisdictions to less wealthy ones. Though it generates its fair share of debate, equalization is not going anywhere. Good luck telling the Governor of Texas that he has to help minimize California’s budget gap. In this country, however, that has become the norm and the power of the provinces has only increased over time.
Auto industry impact
Now let’s look at the automotive industry through this lens. In Saskatchewan, more than two-thirds of passenger vehicles sold in 2009 were light trucks and only 32.6 percent of sales were passenger cars. In Quebec, this ratio is just about the opposite, with 63.1 percent of new sales in 2009 landing in the car column.
Admittedly, this is a crude measure of economic and social distinction between the provinces, but our industry does mirror the regionalism that is a defining characteristic of our country. It is expected that a province that relies heavily on agriculture and natural resource extraction will sell more pickup trucks and fewer small cars, than a province where the bulk of the population lives in large urban centres.
This diversity is part of what makes Canada a great country. No one can deny that Newfoundland is distinct from Manitoba and that this is something to be celebrated. However, celebrating our cultural and regional diversity has led to perverse economic consequences. Just as nationalism builds walls between countries and limits the creation and distribution of wealth by halting the free flow of capital and people, Canadian provincialism has slowly eroded the constitutionally-enshrined federal power over economic policy.
Canada went through a wrenching national debate in the late 1980s over the prospect of free trade with the United States. The normal hysteria over the inevitable cultural assimilation with our southern neighbours was trotted out in an attempt to whip up opposition to the deal. Yet here we are, more than two decades into the North American Free Trade Agreement (NAFTA), and only the most strident extremist would claim it has been anything other than a resounding success for both countries.
Meanwhile, to the surprise of many naysayers, we haven’t become the 51st star on the American flag. If anything, we’ve worked to increase the cultural distinction between Canada and the U.S. while also strengthening economic ties through free trade.
A country constrained
Despite all this, we still haven’t mastered free trade between our provinces – a nurse trained in P.E.I. can’t easily take a job in Alberta due to a lack of standards harmonization; a driver’s licence granted in B.C. is worthless to Ontarians; powerful provincial governments refuse to travel outside their own borders in search of contractors.
On their own, these examples may seem like relatively trivial inconveniences but when added together, we’ve arrived at a point where provincial power has accumulated so greatly that there is a freer movement of labour and capital between countries in the European Union than between our provinces.
No one is advocating cultural assimilation between our infinitely distinct regions. This would be as absurd as it is impossible, but free trade and cultural integration are not one and the same. Canadian trade with the U.S. has increased to a billion dollars a day since the inception of NAFTA, and we haven’t ceded an inch of sovereignty or cultural identity in the process. Our own sector has benefited immensely from this, as have countless others. It’s now time to deconstruct some of the walls that we’ve erected within our own borders for the benefit of all Canadians.
