By Ed Finn, rabble.ca, June 5, 2018
The people in Canada who are intelligent, open-minded, and not ideologically conservative would probably number at least a million. But if only one in 20 of them — 50,000 — were to read Joyce Nelson’s latest book, Bypassing Dystopia: Hope-filled challenges to corporate rule — the outcome could be a grassroots uprising that would free Canada from the corrosive clutches of neoliberalism.
Canada would become the idyllic country of economic, social, and environmental well-being that our corporate and political leaders hypocritically boast it already is.
For anyone who hasn’t read this book and doesn’t intend to do so, my prediction of its revolutionary effects may seem impossibly grandiose. Most of those who do read it, however, will almost certainly share my enthusiasm. Its stunning exposure of how neoliberalism has worsened poverty and inequality, while supplanting democracy with plutocracy, will both infuriate and motivate readers not yet aware of these and many other “free market” iniquities.
A brief review, no matter how descriptive, can never do justice to the substance of so influential a book. So, I’ll just touch on a few of the highlights — especially the forgotten vital role of the Bank of Canada — if only to whet your appetite for the complete tome.
Bypassing Dystopia is the sequel to Nelson’s previous book, Beyond Banksters: Resisting the New Feudalism, published in 2016. It would be beneficial to have read that book, but by no means essential, since Nelson provides a helpful summary in her introduction to the sequel.
To give you some idea of the book’s scope, I’ll list the 12 harmful aspects of neoliberalism that it succinctly lists. Nelson appropriately calls them “the Dirty Dozen.”
- Unlimited economic growth
- Privatization of public assets
- Deregulation
- Free trade (corporate rights deals)
- Smaller government
- Tax cuts for multinational corporations
- Austerity budgets
- Union-busting
- Open borders for capital
- Tax havens
- Privatization of the money-creating function
- Central bank “independence”
One by one, Nelson methodically exposes the baneful effects of these infamous neoliberal policies, as well as a few others not specifically on the Dirty Dozen list, such as the housing crisis and threats to Canada’s water and farmland.
Lacking space to delve into Nelson’s meticulous analysis of all these neoliberal atrocities, I’ll focus on examples of the surprising optimism she expresses in her chosen subtitle: Hope-filled challenges to corporate rule. Although I’m not putting quotation marks around the following extracts, all but the bracketed words are based on the book’s text.
Divestment from Fossil Fuels
[While Canada’s federal and most provincial governments continue to push for more pipelines], the rest of the world seems poised to move away from tar sands investment. Norway’s central bank, which runs that country’s $1 trillion sovereign wealth fund, has recommended that the Norwegian government fully divest from oil and gas companies and sell off some US$35 billion of shares in that sector.
Last year, 83 economists released an open letter, “Declaration on Climate Finance,” which called on “global economic actors to fully embrace safe and renewable energies and phase out fossil fuels “by no longer investing in them.” The Guardian later reported that, across the planet, more than 800 institutions, with total investments valued at $6 trillion, have committed to divest from fossil fuels.
Opposition to ISDS
The investor-state dispute settlement (ISDS) clause in NAFTA, and other trade deals such as CETA that Canada has signed, allows foreign companies to challenge domestic laws that threaten their profitability. (Since 2010, according to the CCPA, Canada has been sued under NAFTA twice as often as the US and Mexico combined, with claims from corporations often targeting environmental protection, public health, and resource management decisions by Canadian governments. On top of the $219 million Ottawa has paid out in awards and settlements, it has also spent more than $95 million in legal fees defending these lawsuits.)
In a scathing editorial titled “The Arbitration Game,” The Economist noted: “If you want to convince the public that international trade agreements are a way to let multinational companies get rich at the expense of ordinary people, this is what you would do: give foreign firms a special right to apply to a secretive tribunal of highly paid corporate lawyers for compensation whenever a government passes a law to, say, discourage smoking, protect the environment, or prevent a nuclear catastrophe. Yet that is precisely what trade and investment treaties have done, through a process known as ‘investor-state dispute settlement,’ or ISDS.”
(US President Trump has proposed scrapping the ISDS clause in NAFTA, and Canadian negotiators reportedly were will- Dystopia from page 1 ing to follow suit.) But Prime Minister Justin Trudeau stubbornly insists that ISDS be maintained in both NAFTA and the CETA, despite Canada’s poor track record and the costly, unreasonable threat ISDS poses to democratic policy-making.
An ongoing and robust public opposition to ISDS has grown massively since 2012 (especially in Europe and Central and South America). But in Canada, the Trudeau government is a notable exception to the anti- ISDS movement. When asked to explain this anomaly, Celia Olivet, head of the Economic Justice Program at the Netherlandsbased Transnational Institute, responded: “In my view, the only way to explain the Canadian government pushing for ISDS is because it is defending the privileges and interests of Canadian multinational corporations that could benefit from the system.”
Tax Havens
After the release of the informative Paradise Papers in 2017, the NGO Canadians for Tax Fairness (CTF) estimated that between $10 billion and $15 billion in taxes were not being collected annually from the massive amounts being stashed in tax havens by big corporations and wealthy individuals. The Conference Board of Canada’s estimate is even higher: a whopping $47 billion a year lost to overseas tax evasion.
The CTF stated that this forgone tax revenue would be enough to fund Pharmacare, universal child care, free university tuition, and infrastructure improvements in First Nations communities, all at the same time.
The corporate sector overlords have been hiding trillions in tax havens to “starve the beast” of governments worldwide, forcing austerity measures, deregulation, privatizations, and further tax cuts for the rich.
The Toronto Star pointed out that “the Paradise Papers are doing nothing to soothe those who worry about the unseemly intertwining of money and power in politics, or about the extent to which the economy is being rigged by the few against the many. The government can do something about this. It can, for instance, close unfair loopholes and collect what’s owed.”
Both these changes, however, would need a loud, concerted, and immediate push from the Canadian public. In other words, this is no time for either apathy or cynicism.
The Bank of Canada — For 35 years the “People’s Bank”
The Bank of Canada Act gives our publicly- owned central bank the power to make near-zero interest loans to our federal, provincial, (and potentially, municipal) governments for infrastructure and health care spending. The BoC successfully did this for 35 years, from 1938 to 1973 [funding the St. Lawrence Seaway, the Trans-Canada Highway, construction of coastal ports and airports, and many other public building ventures] and without incurring debts to private lenders and without creating inflation problems.
In 1974, however, the Bank for International Settlements, the World Bank, the International Monetary Fund, and a variety of corporate think-tanks persuaded most countries, including Canada, to stop their central banks from making interest-free loans (and have governments do most of their borrowing from the private banks instead). Since then, the neoliberal economic agenda has created environmental destruction and massive wealth inequality across the planet. Canada’s federal debt has skyrocketed, and we have paid about $1.5 trillion in interest to the private banks (most of which could have been saved if our federal government had continued to borrow from the Bank of Canada).
For the past seven years, the Torontobased Committee on Monetary and Economic Reform (COMER) has been pursuing a lawsuit against the federal government’s refusal to reactivate the Bank of Canada’s original mandate of funding public projects. In May of 2017, however, the Supreme Court of Canada refused to hear COMER’s lawsuit. The Court never gives a reason for refusing a case, but the government’s lawyers contended that the Bank of Canada issue is “not for the courts, but for the electorate” to decide.
[Given Trudeau’s decision to bypass the Bank of Canada and set up a Canada Infrastructure Bank that intends to spend $180 billion over the next decade — derived mostly from private sector investors who will be paid millions in interest — it’s obvious he will never voluntarily resume borrowing from the Bank of Canada.]
Last year, while Trudeau was speaking to a town hall meeting in Peterborough, Ont., on the country’s economic problems, COMER’s Herb Wiseman shouted out: “Use your central bank!” To which Trudeau promptly responded: “That doesn’t work.” It was a stunning remark, blithely ignoring and denying 35 years of Canadian history. Moreover, Ecuador has proven over the last several years that using the central bank actually does work to put money into the real economy without taking on expensive debt to private banksters or causing an inflationary spiral.
[Another country that has continued major borrowing from its central bank is Japan.] As Ellen Brown has pointed out, “While the US government (along with Canada’s government) has been driving up its ‘sovereign’ debt and the interest owed on it, Japan has been cancelling its debt at the rate of $720 billion per year. How? By selling its debt to its own central bank, which returns the interest to the government. An interest-free debt owed to oneself that is rolled over from year to year is effectively void.”
That strategy by Japan’s central bank sounds very familiar to what COMER has been advocating for Canada.
COMER has not been discouraged by the Bank of Canada’s refusal to hear its case. Its leaders and supporters have decided to increase their educational outreach to the public. Their goal is to make the restoration of the Bank of Canada’s role as the main funder of government projects a key issue in the next federal election.
I estimated at the start of this review that Bypassing Dystopia could have as many as 50,000 intelligent and open-minded readers. Since Watershed Sentinel Books is a relatively small publisher, however, without the financial means to widely promote their books, that estimate may be overly optimistic.
But maybe not. If every reader becomes as impressed and enthused by Bypassing Dystopia as I am, and if each of them commits to persuading 10 or more of their relatives, friends and co-workers to read it as well, that 50,000 readership level might actually be reached.
And then, if these many thousands of readers become politically active during next year’s election campaign, the Bank of Canada’s “resurrection” as the prime funder of public projects could indeed win overwhelming voter support.
Edward (Ed) Finn, Jr. is a Canadian trade unionist and journalist, editor, author and former Newfoundland politician. He was the leader of the Newfoundland Democratic Party and the first leader of the Newfoundland New Democratic Party. Finn also wrote a weekly labour column for the Toronto Star from 1968- 1982 and has also contributed articles to various publications. Now retired, he worked for the Canadian Centre for Policy Alternatives beginning 1993 as editor of its monthly journal, The CCPA Monitor. The CCPA has published several collections of Finn’s essays in three books, The Right is Wrong and the Left is Right, Cutting through the Neoliberal Bafflegab, Under Corporate Rule and Who Do We Try to Rescue Today?
Bypassing Dystopia: Hope-Filled Challenges to Corporate Rule
By Joyce Nelson
Watershed Sentinel Books
www.watershedsentinel.ca/bypassingdystopia
ISBN: 978-0-9953286-3-1
Order directly by phone at 250-333- 6117 or online at www.watershedsentinel.ca/bypassing-dystopia.
Our Comment
I’m always moved, on Canada Day, to see such great numbers of Canadians sporting flags and singing, “Oh Canada!,” in joyous celebration of all they believe their country to be — expressing their confidence in it, and their heartfelt allegiance to it.
I’m moved by the unrealized human potential it reflects and the promise for a better future that it holds — and I’m moved to deep resentment of the politicians to whom Canadians have entrusted all of that, and who have betrayed that trust through policies dictated by Neoliberalism’s “Dirty Dozen.”
ER subscribers will not be unacquainted with information about “the Dirty Dozen.” But however well informed one may be, Nelson’s “meticulous analysis” is certain to evoke fresh insights and to sharpen one’s indignation. This is balanced with “Hopefilled challenges to corporate rule” in a way that is indicative of the negative and positive forces — presently at work — that define the critical moment of our time.
The examples addressed clearly identify those whose government the Trudeau government really is. They support Michael Hudson’s contentions (Finance Capitalism and Its Discontents, Interviews and Speeches, 2003-2012) that, “Governments henceforth are to serve high finance, not labour and industry” (page 41), and that, “The reality is a new epoch of class warfare” (page 64). “The banks’ plan is to get public bailouts for themselves but not for the rest of the economy. This has become today’s financialized mode of class warfare” (page 56).
Clearly, electoral reform is a fundamental step forward. The great ‘democratic’ choice has come to be the ‘lesser evil’ resulting in a tweedle-dum-tweedle-dee alternation between two strings of the same team.
In an article “Challenging the Common Sense of Neoliberalism,” Ian McKay, Chair of the Wilson Institute for Canadian History at McMaster University in Hamilton Ontario, argues that “The term ‘neoliberalism’… in many ways misleads us” — that it might more accurately be called ‘authoritarian liberalism.’
“In essence, such authoritarian liberals, now hegemonic throughout much of the West, though stoutly affirming their loyalty to conventional liberal values and practices, consistently defend an implicit theory of politics that radically departs from them. Aware that a kind of grassroots liberalism — a belief in fairness, honesty, and accountability — has deep roots in the populace, such authoritarians continue to pay lip service to compassion, equality, and democracy while blatantly contravening any such commitment. (Rethinking Democracy, by Leo Panitch and Greg Albo, Socialist Register, 2018)
This hypocrisy is evident in the “Dirty Dozen” neoliberal credo, and in the “foregone tax revenue” that hardly reflects such traditional liberal values as “fairness, honesty, and accountability…equality and democracy”!
As the Toronto Star pointed out, time is of the essence. We are living through a critical moment. Dealing with the problems of money and power in politics, and of an economy that favours the many, will take more than “a loud, concerted and immediate push” from the Canadian public! It will require electoral reform, and public education.
Surely those of us who have been so affected by the consequences of these policies as to find our way to reliable information like that delivered by Joyce Nelson, can find a way to get that 50,000 Canadians to read the “stunning exposure of how liberalism has worsened poverty and inequality, while supplanting democracy with plutocracy.”
Among other things, we should insist that glib answers like, “that doesn’t work,” be backed up with the reason why!
Speed up the process of change!
Get a group together — share responsibility for reading sections of Bypassing Dystopia — organize public forums to inform and inspire your neighbours at the local level!
Cheers!
Élan
Further Comment
“In Beyond Banksters, Nelson laid out key forms of financial and trade practices that enrich the very wealthy, and obstruct the rights, security and opportunities of ordinary citizens. Now, in this sequel, she details further initiatives that enrich the vastly rich, but she also lays out a brace of key examples of successful pushback from those same ordinary citizens, aided by courageous industry whistle-blowers and bold and prescient political leaders. The outline of a new social contract — where people always count more than profit — is present in this work, and it will undoubtedly stir readers to apply new and constructive ideas in their own lives.” — R. Warren Bell, Past Founding President, CAPE (Canadian Association of Physicians for the Environment)
“Given an economy rigged against us, Nelson’s book provides examples of citizens acting together, affecting fundamental and structural change.” — Judy Kennedy, activist and long-time COMER member
“Joyce Nelson’s incisive sequel to Beyond Banksters is, like the predecessor, required reading to understand the deep structural evils of neoliberal capitalism. Again and again, Bypassing Dystopia exposes how vile greed is institutionalized to economically and ecologically rape our planet and its people, the vast majority who are propagandized to believe in the latest versions of progress, packed and sold by corporations, banks, their political servants and PR flacks. The author points to beacons of light in the darkness of corporate control, such as the regenerative organic agricultural revolution, but she makes it clear that without a grassroots revolution of informed and organized citizens, the seductions of neoliberalism doom us to serfdom and ecological destruction.” — John Stauber, author and activist
