Harper, Bush, and Calderon: The Men Behind the Barbed-Wire Fence

The men who met behind the barbed-wire fence at the Chateau Montebello on the Ottawa River have been promising to enhance the prosperity and security of their fellow citizens.

They are not the sort of men who gladden the hearts of democrats. At their summit at the Chateau, they met with the CEO’s of some of the world’s most powerful corporations. Others---labour leaders, environmentalists, writers, students, aboriginals, humanity in general---were only allowed to stand on the other side of the fences and to be sprayed with tear gas and pelted with rubber bullets.

One thing the three men share in common is that they are not trusted by millions of their compatriots. In recent polls, 31 per cent of voters say they would back Stephen Harper in an election. In the U.S., the approval ratings of George W. Bush are stuck at around 29 or 30 per cent and many Americans are counting down the days to January 20, 2009, the day W. leaves the White House. Anyone who thinks this man will strengthen their security only has to think of the two failing wars he launched and the freedoms he took away from his fellow citizens with the powers Washington seized under the Patriot Act. And amigos visiting from Canada or Mexico should keep in mind that the US government has assumed the right to lock up any foreigner deemed a security risk for an indefinite period. Watch out, you could be the next Maher Arar. Arar was a victim of a previous border security deal between Canada and the US. If W. has done little for security, he has not raised the tone of democracy either. His friends in Florida and the US Supreme Court stole the 2000 election for him, and historians have not yet made up their minds whether the funny business in Ohio in 2004 amounted to another theft. Felipe Calderon, Mexico’s president, holds his office following elections in 2006 that were riddled with irregularities.

As for prosperity, the three men share views that inclined them to believe they would be most likely to enjoy their meals at the Chateau in the company of multi-millionaires. All three are devoted to the cause of tax cuts for the rich. Bush’s tax cuts, along with his wars, have driven the US into record indebtedness. Calderon, who opposes contraception, abortion and gay marriage, is a proponent of flat taxes, free trade and lower taxes for his corporate friends. Harper is an opponent of public childcare, a fair deal for first nations, and he dreams of the day when he has a majority government that can deliver steep tax cuts to Big Oil and the rest of his pals. No wonder that under the rule of the three partners, Mexicans, Americans and Canadians are watching the income and wealth gaps widen between the rich and the rest.

From a Canadian perspective, here are some issues that ought to be on the table in any meeting with a US president:

· Ottawa ought to insist the NAFTA be amended to end the deal that commits Canada to providing oil and natural gas to the US even in the event of shortages for Canadians. That deal, along with a ban on Canada’s right to sell petroleum to the US for a higher price than the Canadian domestic price, infringes on our security and our prosperity.
· No discussion with the US is complete without bringing the unwillingness of Washington to recognize Canadian sovereignty in the North-West Passage to the attention of the public in both countries.
· Ottawa ought to make it clear that it has no intention of sharing security information with a government that has yet to publicly apologize for the treatment of Maher Arar.
· No summit should be held with a US president that does not feature the grave concerns of Canadians about the prevalent use of guns smuggled in from south of the border in the commission of violent crimes in Canada. The risk of someone being killed in a Canadian city by a gun of American origin is far greater than that of dying in an assault by Al Qaeda. The American gun culture and its consequences belongs on our security agenda.

When Big Money is in Trouble, the State Rides to the Rescue

The turbulence in global financial markets, sparked by the crisis in the US “subprime” mortgage market, has shown, for those who needed the evidence, who matters and who doesn’t under capitalism.

As stock markets plunged in Toronto, New York, Asia and Europe, the media focused vast attention on the plight of investors. Last week, on the four to six show on CBC radio in Toronto, an expert from the Bank of Montreal came on to put the crisis in perspective and the host thanked him for offering comfort. On Friday, the Federal Reserve in the US rushed to rescue investors by cutting the discount rate charged on loans directly to banks by a half a percent in a bid to calm financial markets.

Why the crisis and why the rescue? The crisis is the direct consequence of the speculative bubble that has developed in real estate markets in the US, the UK, parts of Canada and other regions of the world. In our era, capitalism has shown itself highly prone to speculative bubbles. A speculative bubble comes into existence when investors rush into a particular sector, not on the strength of the economic fundamentals in the sector, but because prices in it have been appreciating rapidly and institutional and individual investors want to get in on the action. They buy because they are sure the price will keeping on rocketing upward.

In the late 1990s, investors raced to tech stocks, buying into companies that had never made a profit, or whose price to earnings ratios made no sense in traditional terms. The flames were fanned by media and market hucksters who assured investors that there was a “new economy” and the old rules no longer applied. In 2000, the tech market crashed and a lot of high rollers, day traders, derivatives junkies and suckers were wiped out.

We’ve seen it all before, in the gold market, the silver market, and in the great oil price crash of the early 1980s. The sure sign that a speculative bubble market has developed is that a huge number of people simply won’t believe that their special market will ever go anywhere but up. The psychology of a bubble involves a ferocious disregard of reality.

A previous speculative real estate market, centred on Tokyo, burst in 1990, provoking related crashes all over the world. The epicenter of the present real estate bubble is in various regions of the US and in the UK, particularly in London. The correction (or crash) is coming, because there no longer is a viable relationship between the price of housing and other real estate and what buyers can afford. When housing prices get so high that the properties cannot generate rents that bear a normal relation to the value of the property or when it takes too many years of a potential buyer’s income to purchase a property, a speculative bubble is developing. True believers in the idea that real estate prices in hot markets will go on soaring, when confronted by these arguments, fall back on the idea that there is something “special” about a particular market. Certain regions of the US or London can go on defying the laws of economic gravity forever, they say. That’s what they said about Tokyo, gold, silver and oil. And they were wrong every time.

Bubbles burst as this one now is. From the subprime mortgage market, the problem is spreading to other financial institutions all over the world. As this happens, mortgage rates will rise, and property values will plummet, especially in the regions where the speculative fever has been hottest. Bankruptcies will be declared and financial institutions will shudder.

When investors get into trouble because they are greedy or stupid, central banks, finance ministers and the national media rush to help them or at least to offer them a sedative over the airwaves.

This is in sharp contrast to what happens when working people lose their jobs through no fault of their own. When thirty thousand people marched through the streets of Windsor, Ontario a few months ago to protest that manufacturing jobs were in peril because the Canadian dollar had been appreciating against the US dollar too quickly, the national media took little notice. When workers lose their jobs in regions that are dependent on a few key industries, that’s tough. Central bankers and finance ministers don’t ride to the rescue. Such job losses are treated by the national media as the necessary restructuring that companies have to make in a dynamic, global economy. And the corporate executives who decide to cut jobs or shift them to places where wages are lower, are hailed as far-sighted leaders. In the pages of the financial press, their praises are sung.

As the market turmoil continues in the weeks to come, watch how the central bankers and politicians behave, and ponder what happens when it’s wage and salary earners whose lives are torn apart.

Michael Ignatieff: Putting Iraq Behind Him

Canadian politicians are very mulish when it comes to admitting that they have ever been wrong about anything. That’s why when Michael Ignatieff proclaimed that he had been wrong about the invasion of Iraq, in an article in the New York Times Magazine, it mattered.

In his article, while Ignatieff says much and leaves much unsaid, he is clear in stating that his judgment had been wrong about the Iraq invasion.

Ignatieff attributes US failure in Iraq to the fact that it was a country “of which most Americans knew little”, and that those supporting the invasion were wrong in supposing that “a free state could arise on the foundations of 35 years of police terror.” He adds that those such as himself who championed the US mission were wrong in believing that “because America defended human rights and freedom in Bosnia and Kosovo it had to be doing so in Iraq.” He says that people such as himself did not grapple sufficiently with the hard questions like: “Can Kurds, Sunnis and Shiites hold together in peace what Saddam Hussein held together by terror?” On the subject of leadership, he says this of George W. Bush: “It was not merely that the president did not take the care to understand Iraq. He also did not take the care to understand himself. The sense of reality that might have saved him from catastrophe would have taken the form of some warning bell sounding inside, alerting him that he did not know what he was doing.”

Ignatieff dismisses the warnings of those he says predicted catastrophe in Iraq in advance for ideological reasons, those he says are always disposed to think the Americans are in the wrong. It is not surprising that Ignatieff has little time for those who opposed him from the beginning on Iraq. He sees them as having been right, but for the wrong reasons.

What Ignatieff does not tell us in the article is whether he has re-thought his position on the American Empire in light of Iraq. This is no small matter. Ignatieff framed his support for the invasion of Iraq as a telling case in which the American Empire was needed to act on behalf of those who had nowhere else to turn if they desired human rights and the rule of law. “The case for empire is that it has become, in a place like Iraq, the last hope for democracy and stability alike,” Ignatieff wrote in the New York Times Magazine in January 2003 two months before the invasion, noting that critics “have not factored in what tyranny or chaos can do to vital American interests.”

Has Ignatieff now changed his mind about the utility of empire, empire lite, the American Empire? He doesn’t tell us.

Perhaps we should not make too much of this. At length in the article, Ignatieff discusses the differences between a theorist on the one hand and a practicing politician on the other. He is at pains to tell us that while he was the former in the past, he is now the latter.

Throughout the course of Canadian history, ambiguity on the question of empire has been a hallmark of our most distinguished Liberal prime ministers.

Liberal prime ministers have always been well-disposed to the United States when they have come to office. But they have learned on the job how difficult the Canadian relationship with the empire can be.

Wilfrid Laurier received his education in office in the days when it was the British, not the Americans, who dominated our lives. Leading a country torn between pro-imperialists (mostly Anglo-Canadians) and anti-imperialists (mostly French Canadians), he once proclaimed: “I am neither imperialist, nor anti-imperialist. I am Canadian.”

When Lester Pearson came to office in 1963, he was regarded as a great friend of America, and was welcomed on board by President John F. Kennedy, who had detested Pearson’s Tory predecessor, John Diefenbaker. Pearson learned how short the leash for a Canadian prime minister can be when he was summoned to Camp David by JFK’s successor, Lyndon Johnson. Johnson was furious because Pearson had called on the White House, in a speech delivered in the US, to order a pause in the bombing of North Vietnam. At their meeting, Johnson seized Pearson by the lapels and pulled him to his feet. After leaving office, Pearson described his meeting with LBJ as “my trip to Berchdesgaden” (a reference to Hitler’s Bavarian retreat).

Today people forget that when Pierre Trudeau came to power, he was notably pro-American, once proclaiming that after he retired he might choose to live in New York. Trudeau abominated nationalism, not just Quebec nationalism, but Canadian nationalism as well. During his days at 24 Sussex Drive, Trudeau dealt with five US presidents, but his views of America were mostly shaped by Richard Nixon and Ronald Reagan. When Nixon proclaimed his New Economic Policy in the summer of 1971, he delivered a severe blow to Canada. Trudeau learned the lesson that Canada ought to care about Canadian ownership of major economic sectors, particularly the energy sector. Nixon helped push Trudeau down the road to the creation of Petro-Canada as a publicly owned corporation, and later to launch the National Energy Program, whose central goal was fifty per cent Canadian ownership of the petroleum industry.

The members of the Reagan administration detested Trudeau, regarding him as an untrustworthy ally, who could not be brought into the loop on matters such as the US occupation of Grenada in 1983. The Reagan White House joined forces with the oil companies and the multinationals in their assault on Trudeau’s economic nationalism. By the time he left office, Trudeau was seen in Washington as an anti-American pinko.

If ambiguity on empire and learning on the job have turned up on the CVs of former Liberal prime ministers, including Jean Chretien and Paul Martin, what are we to make of Michael Ignatieff, who while not the leader is one of his party’s brightest lights?

Ignatieff returned to Canada to pursue the leadership of the Liberal Party with two strikes against him. The first, his decades-long absence from the country, is quickly fading with the passage of time. Ignatieff got himself elected to parliament, made a strong run for the leadership of his party and has performed effectively as the Liberals’ deputy leader. Those who thought he was just a Harvard intello have been proven wrong by Ignatieff’s stellar performance during Question Period. By far the most effective opposition politician in the House, Ignatieff has savaged the Tory front bench, regularly getting the better of Stephen Harper.

The second strike against Ignatieff was that he returned to Canada as an apologist for George W. Bush, and an advocate of empire and the invasion of Iraq. He appeared in the guise of a would-be Tony Blair. While Canadians have bred their own poodles for Reagan, Bush I and Bush II---their names are Brian Mulroney and Stephen Harper---Liberal voters are not looking for a poodle.

For Ignatieff to realize his full potential in Canadian politics, he had to put his support for the invasion of Iraq behind him. He has now done that.

And although he voted in the House of Commons to extend the Canadian mission in Afghanistan to February 2009, he has become one of the most effective critics of the shortcomings of the mission.

Ignatieff’s major impact on our politics to date has been to force federal politicians to recognize Quebec as a nation within Canada---a step long overdue.

He has now cleared the debris aside so he can demonstrate just how much political talent he has.

Barack Obama: A Knee-Jerk Imperialist When it Counts

In the hunt for the 2008 Democratic Party nomination, Barack Obama told an audience last week that as president he would launch an air strike against top leaders of Al Qaeda in Pakistan even if the government refused permission.

It’s easy to see that the Junior Senator from Illinois was trying to regain ground he had lost a couple of weeks ago when he said that within the first year of his administration he would be prepared to meet with America’s foes, the leaders of Cuba, Iran and North Korea among others. Hillary Clinton successfully chided Obama for putting this not very radical proposition on the table.

Obama’s pledge to violate Pakistani sovereignty should a plum target present itself revealed more than the knee-jerk tendency of Democrats to act like tough guys when they are under pressure. It demonstrates that the habits of empire run very deep in US political culture, and are by no means limited to Republicans.

One would have hoped that the disasters that have befallen America as a consequence of the Bush doctrine of pre-emptive war would have taught American “progressives” that violating international law by invading and bombing sovereign states has weakened the global standing of the US. And Obama is supposed to be a progressive.

What the American political leadership, in both parties, has failed to learn is that Osama bin Laden and his cronies can only threaten America effectively if Americans are dumb enough to play his game by launching unilateral attacks on Muslim countries. End that hopeless strategy and the political oxygen would be sucked out of Al Qaeda.

For Obama, though, that is not the issue. Winning a minor tactical skirmish with Hillary Clinton is what matters and that tells us how deeply the imperial reflex is embedded in the sub-cortex of members of the American political class.

Stop Harper From Winning a Majority: The Focus should be on “Big Oil”

For the next couple of days, members of the Conservative caucus will be meeting in Charlottetown to plot strategy for the fall session of parliament. What is really on their minds is how to win a majority of seats in the next election.

For Harper and Company, who have big plans to remake Canada as their kind of neo-conservative paradise, the last few months has been a frustrating time. On Afghanistan, the environment, aboriginal issues, child care, and fiscal arrangements with the Atlantic provinces, the government has rubbed Canadians the wrong way. According to the polls, Harper is further from his holy grail----a majority next time---than he was the day after winning power in the election of January 2006.

While the Conservatives plot strategy, those who want to ensure that there never is a Harper majority ought to be doing the same. This is a theme to which I plan to devote a lot of attention in coming months.

I am starting here by putting one broad proposition on the table. A key to beating Harper next time is to focus on the fact that the prime minister and his party are above all else, the mouthpiece of “Big Oil” in Canada. Yes, the Conservatives are militarists who want to shift Canada from peacekeeping to war making. And they want to block public daycare, shoot holes in medicare, lower taxes for the wealthy, and avoid the expense of an historic deal with the country’s First Nations. But more than all of that, the Harper Conservatives are there to act for Big Oil.

The Harper government is determined to:

• Prevent the adoption of environmental measures that would slow the rate of development of the Alberta oil sands. Without such measures, Canada will increase greenhouse gas emissions and compound its record as one of the world’s most flagrant polluters on a per capital basis.
• Keep the door wide open to rising exports of petroleum to the US, whatever the implications in the future for the security of energy supplies for Canadians.
• Work with provincial governments to stand in the way of the imposition of higher taxes and royalties on petroleum companies. Harper and the Conservatives want to maintain Canada’s status as the bargain basement place to do business in contrast to countries like Norway that collect serious revenues from the petroleum industry to plan for their future beyond oil. Oil patch reporters have been rubbing their hands with glee this year as profits soar. For instance, Petro-Canada, Imperial Oil Ltd. and Suncor Energy Inc. - earned $481-million from petroleum products in the first quarter of 2007, up from $285-million in the first three months of 2006.
• Oppose any proposals to bring the petroleum industry under public control or public ownership. As the global energy and environmental crises worsen, there are bound to be voices in Alberta and the other petroleum producing provinces for royalties that reflect the true value of the resource. And across Canada, there will be voices insisting that energy is too important to be left in the private sector and that it ought to be developed under provincial and federal public ownership, as public utilities.

What I can’t understand is why the major opposition parties, the New Democrats, Liberals, the Bloc, and yes the Greens, utterly fail to make the case that the Harper government is the voice of Big Oil. Here is an industry and a government that is worsening the environment and that is deepening the income divide between the rich and the rest of Canadians, and the opposition parties tip toe around the subject in timorous politeness. A little populism wouldn’t hurt.