PEI, a Case Study for Socialism Posted on June 9, 2013 by Marco Lapegna I just recently picked up an interesting book which is fairly popular in some political circles in Canada called The Big Shift. In the book the authors, which consist of a pollster and a columnist attempt to explain how in their view the old elitists in Canada- whom they refer to the “Laurentian consensus”-have failed to realize how Canadian values have changed based on immigration and economic trends. Their failure to understand this “big shift” has allowed the Harper Conservatives to form their first majority government. There is an interesting chapter that pertains to Atlantic Canada where the authors make the case that the old framework of dividing Canada between Quebec and ROC (Rest of Canada) is obsolete. Their belief is that the real divide lies on two regions split between everything East and West of Montreal. Those in the West are the prosperous and thriving economic drivers of the country, while the region in the East is poor and in decline. Being someone that has spent living several years of my life both in Ontario and PEI, I find this framework to be quite accurate. The authors describe the Atlantic Canada region as living under “…the Atlantic Canadian Reality Distortion Field (ACRDF). It’s a place where facts go to die, where the laws of economics are miraculously suspended, and where a universal belief system is founded on the universal denial of reality.” Again even though it’s a harsh statement, I can’t really disagree with this assessment. It’s the main reason why I write this blog, there is nobody else in PEI that I know of writing about free market economics. Everybody in the media, UPEI, and political parties has a heavy bent towards intervention in the economy, hence the existing distortion field, hence the poor economy. Having been lucky enough to travel during my teenage years, I was well aware of the ACRDF, which is why I did my last years of high school and university in Ontario rather than the Atlantic region. I wanted to learn real economics. I would like to add to the author’s arguments though and dig deeper into this phenomenon of the ACRDF. It’s important to make the point and the authors do make it eventually, that Atlantic Canadians and Islanders in general should not be blamed for this distorted perspective. It’s all they get to hear from their politicians, pundits, and commentators. Take transfer payments for instance, since 2007 the core funding from the federal government has increased 11% from 463 million to an estimated 517 million for our current budget. If you hear the current Finance Minister Sheridan tell the story however, you come away thinking that the main reason why the PEI economy is struggling is because the Harper government has put a cap on certain revenues streams like oil in the equalization formula. According to the Finance Minister, the more people work out West, the more money his government is entitled to through the equalization section of the Constitution he enjoys quoting so much from. I think I can actually hear the ACRDF field humming when I hear these types of arguments in the legislature. Sadly, it’s not just Liberals though, the Progressive Conservatives (PC) have also believed in government intervention in the economy and past PC Treasurer Mrs. Mella also believed in equalization and big government transfer because of the weak “fiscal capacity” of the province of PEI. Over and over again Islanders are being told that they are not good enough to make it on their own, that the only way they can have a decent standard of living is if the Federal government shower them with cash. Liberal MP Sean Casey is perhaps the greatest proponent of this flawed argument. In my mind PEI has become a great example for Canada of what happens when socialism becomes the dominant mentality in a society. In PEI the vast majority of the populace seeks to live at the expense of somebody else, examples being an overinflated bureaucracy, government grants for businesses through the numerous government departments (PEILA, Farm Credit, PEIBD,….) , or perhaps the generous EI standards for some industries. When the dominant mentality in a society revolves around what government can do for you, not what you can achieve for yourself, then you know your society is in serious trouble. In my opinion if we are truly to improve out lot here in this Island, we can’t simply look with the green eye of jealousy and envy to the West and ask for more transfers, we must learn to generate our own wealth.We must transform our economy from one resembling the 19th century to one more focused on the 21st century. To do this we have to invite businesses that will teach us the skills and give us the knowledge that will power the economies of the future. This means lower taxes and regulations. I have a belief and a hope that in the future this distortion field will come down and then Islanders can finally realize their true potential.
Posted on: Sun, 14 Jul 2013 13:29:44 +0000
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