You can’t live on nostalgia
Atlantic Canada certainly has got people’s attention up in Ottawa following the federal election. There is no doubt a burning desire there to “do something” following the Liberals’ rout in the region. This should make us all a little nervous.

A government riding off madly in all directions, trying to make nice with the region’s electors, is likely to do a lot more harm than good. It is likely to be guided by the most crass political expediency, and is apt to forget the principles that have guided its policy up till now. If on top of that it proceeds on a flimsy and unsound interpretation of the significance of the region’s vote, the outcome is likely to be tears all around.

The Liberals’ drubbing was a quite reasonable acting-out of the anger and frustration that many people here feel in the face of the changes sweeping this country and the world. We had grown comfortable with the old way of doing things, the old assumptions. A rich natural resource base – fish, timber, coal, etc. – coupled with a generous UI system, for example, created a way of life on which community after community had grown to depend.

But it was, and is, a vicious and destructive system whose ill-effects have to be overcome if our communities are ever to have a sustainable way of life. In those communities most dependent on cod, just to take one example, over fifty percent of fishermen’s income was derived from UI before the moratorium came into effect. UI, not fishing, was their main source of money. To top it all off, if you tried to get back to school to make yourself employable in some other field with a better future, you got cut off. Students aren’t eligible for UI. The knowledge-based economy? What’s that?

Similar patterns have been repeated in industry after industry. Coal mining in both Nova Scotia and New Brunswick is subsidized through the power rates, a hidden tax on both business and consumers. Our competitiveness suffers as a result. Steelmakers in Cape Breton feel that it is their God-given right to make steel that no one wants to buy unless it is subsidized by the uncomplaining taxpayer.

This way of life was not sustainable here, because it encouraged too many people to believe they could live off our limited natural resources, or massive transfer payments from the rest of the country or both. Before the last UI reform, UI paid over $2 billion more into this region than it took out in premiums. On average, over a third of the budgets of the four provincial governments comes from federal transfers.

The cost of keeping going this pale imitation of a sound economy goes up all the time. Our competitors get cleverer and more effective every day at producing more with less. Norwegian fisherman’s catch, on average, is worth twice that of his Canadian counterpart. In the case of his Icelandic opposite number, the value is seven times.

In the case of electricity, competition among utilities is poised to bring power rates down across North America at a time when we still require our utilities to buy uncompetitive local coal.

Yet while the costs of maintaining this region’s way of life have been rising, the willingness of the rest of the country to pay the bills has been declining. About eighty percent of the Canadian electorate has just voted for parties committed either to staying the government’s deficit reduction course, or pursuing that objective more vigorously, accompanied by tax cuts.

No one can or should deny that letting go of a way of life is a painful miserable experience, made worse by the sense that it is being imposed by the outside world. Such wrenching change has always produced outpourings of anger and resentment towards those seen as the agents of change. Kett’s Rebellion in the sixteenth century against the enclosure of agricultural land was an example. So too was the Luddite movement to smash factory machinery in the last century.

Atlantic Canada’s vote is another manifestation of a nostalgic attachment to a way of life that cannot be maintained. Nostalgia, however understandable, is no basis for public policy.

Has government done enough to ease the transition? Certainly not if we judge by the way the TAGS program has been a stunning failure in its attempts to entice people out of the fishery and into other lines of work. Clear deadlines for the reform of social programs, and reasonable transition assistance for those affected, are both necessary and humane.

But no election outcome in Atlantic Canada, no matter how dramatic, can repeal the truths of economics nor reverse trends sweeping the planet. Stubborn attachment to a dying past is this region’s greatest enemy.

c Brian Lee Crowley 5 June 1997

Brian Lee Crowley is the President of the Atlantic Institute for Market Studies (AIMS). His e-mail address is aims@aims.ca