Posted: Fri Jan 20, 2006 6:50 am
<p>MK writes, "What I can't understand is how this commentator takes issue with Harper's one thing that differentiates him (ideologically) from many others on the right: his opposition to corporatism. We're seeing the effects of rampant corporatism with our neighbour to the south, and enough of it here too with the corruption in the liberal party and increase in government outsourcing."</p>
<p>I agree completely. However, when Harper talks about "corporatism", he's using the term as shorthand for progressive government, government that is in the business of helping people. He considers public investments in public health care, education, and renewable energy, for example, to be forms of "corporatism".</p>
<p>I regard corporatism in the traditional sense: government colluding with business to serve corporate interests. This includes such tactics as no-bid contracts, process- rather than goal-oriented regulations, subsidies, tax incentives, privatization, P3s, crony contracts, and so on.</p>
<p>Corporatism represents the incremental fusion of government and business interests to their mutual benefit. Taken to its logical conclusion, corporatism leads to fascism (a glance across the border will demonstrate this tendency in motion).</p>
<p>So this is where it gets interesting. Harper is a neoliberal economist who has marshalled a coalition between neoliberals, neoconservatives, and the religious right. He claims to believe that government should not help or hurt business, so he claims to oppose both subsidies and regulations.</p>
<p>However, he's being financed by big business, which believes fervently in ensuring that government helps business wherever possible - i.e. corporatism. An actual "free market" wouldn't last five minutes in the real world, because markets on their own are not smoothly self-correcting and do not provide the foundations (rule of law, physical transportation infrastructure, security and reliability of energy supplies, education, public health, civil society, a culture of honesty and trust, and so on) they require to function.</p>
<p>Harper knows this, and he knows further that the corporations who support him expect a government that is very friendly to their interests. It will be interesting to see how long it takes him to weasel out of his opposition to using government to help businesses.</p>
<p>America also claims to oppose corporatism, and it's also nonsense. The US government has long used "defense" and "security" as a back door for its industrial policy, funnelling hundreds of billions of dollars a year into economic development by giving contracts to private corporations that also sell commercial products.</p>
<p>The American economy is also based significantly on its dual public/private health care system, which makes up over 15 percent of the US economy (see <a href="http://www3.sympatico.ca/taylormcgreal/cake.html">this link</a> for more on that). </p>
<p>American corporations also benefit from its massive prison system, which is based significantly on private prisons financed with public money, the owners of which then use some of their profits to lobby for stiffer sentencing and more prisoners. It's no coincidence that America the free has the highest rate of incarcertion on the planet - higher than Russia, higher than China.</p>
<p>Further, the Federal Reserve's policy of extreme liquidity, coupled with Freddie Mac, Fannie Mae, mortgage tax deductibility, and the global use of the US dollar as a reserve currency and the only currency OPEC will trade for oil, has produced a massive American housing bubble, which is responsible for nearly all of America's net economic growth and job creation over the past decade, even as America's real manufacturing base has fleed to third world sweatshops. It's clear this boom would not exist if not for American government policy.</p>
<p>So maybe Harper really believes in the ethos of the free market, but somehow I doubt he'll be able to withstand the demands of the companies who put him into power. Instead, I expect we'll see Harper implement his own preferred form of corporatism, even as he claims to be cutting the waste and cronyism out of government.</p>