On the disappearance of the centre-right in Canada

Jeffrey Simpson wrote a column today on an issue that I think is of a paramount importance in Canadian politics – I’ve often said that the near-total collapse of the centre-right is the most important development in our political system over the past two decades. Unfortunately, the way that Simpson articulated the idea confused many people. First of all, he described it as “The Disappearance of the Moderate Conservative“, and second, he tied it to the unfortunate term “red Tory,” which is a complex political tradition that is not exactly relevant to the current set of issues.

The biggest problem has to do with the term “moderate,” because it suggests a person who takes a position between some set of extremes, and so if you think of the three political parties arranged on a left-to-right spectrum, a moderate conservative is just someone who is more like a liberal. This is not a helpful way of framing the debate (because conservatives just dismiss it, as the sound of a downtown Toronto media elite whining, “why isn’t everyone a liberal like me?”). I use the term “centre-right” because it’s a bit better at allowing me to define the political ideology directly in terms of the issue space (or the set of policy options), thereby providing a referent that is independent of the positions that the various political parties happen to take. I’ll explain how this works in a moment. On my analysis, though, Stephen Harper clearly comes out as an ideological extremist. However, the way that he has governed has been extremely moderate. In other words, despite having extremist views on a variety of questions, he has done very little to impose those views upon the country. This is mainly because he consistently assigns strategic concerns about getting re-elected priority over his political ideology.

You only have to compare the way the Harris government behaved in Ontario (a government that included Tony Clement, Jim Flaherty, John Baird, etc.) to the way the Harper government has behaved in Ottawa to see that they have been pulling their punches, and in this sense, have been moderate. This is in fact why so many Canadian conservatives find the Harper government so baffling (e.g. Andrew Coyne). It’s just not obvious what they’re trying to accomplish, other than getting re-elected forever. This is why Paul Wells could write a 400+ page book trying to unravel the mystery, ascribing to Harper what Coyne called “a vast, if incremental, efficacy: so incremental it eludes the naked eye.”

Let me take just one very specific example. Consider how the Cameron government in the U.K. reacted to the aftermath of the 2008 financial crisis. They decided that this would be a good time to impose an austerity program, in order to achieve a long-term reduction in the size of the British welfare state. In other words, they decided to cut back on spending in the middle of a recession – pretty much the opposite of what textbook economics tells you to do. This was a highly ideological move, in the sense that they achieved their objective, but at enormous cost to the British economy. (They were willing to shrink the pie, just to reduce state spending as a fraction of that pie, which is to say, they assigned their own hostility to the state priority over the welfare of the population.)

What did the Harper government do? Despite all the blather about “austerity” from the left, the fact is that there has been no austerity in Canada. When the recession hit, Harper immediately announced a stimulus package, then proceeded to pump it for all it was worth. This was clearly a “moderate” course of action. An “extreme” course of action would have been to say “party’s over, we all need to tighten our belts” and then cut government spending. In the end, there wasn’t much difference between the way the Obama administration in the U.S. and the Harper government in Canada handled the great recession (even though the case for stimulus was weaker in Canada, since our banks were not compromised!).

This is why claiming that Harper is not “moderate” is more confusing than helpful (one can see some of that confusion playing out here). So let’s talk about what it means to be “centre-right.” In my way of thinking about things, the “centre” in Canadian politics (and in most mature liberal democracies) is defined by the view that the primary economic role of the state is to solve collective action problems, and therefore to increase social welfare in something approximating a win-win fashion. This is accomplished in some cases by regulating marketplace competition, in other cases by providing goods directly (security, infrastructure, insurance, etc.). For those who find this view surprising, I’ve defended it ad nauseum, starting here, here and here. If you look at any major government program and ask, “why is the state doing this?” you can almost always point to a market failure as the explanation. So then if you ask “what else, if anything, should the state be doing?” the answer is to look for other, unresolved market failures, and then think about how the state might act to correct those.

This “centrist” way of thinking is what defines much of the current mainstream policy space: environment and climate change, transportation, pharmaceuticals and childcare – all areas in which markets are currently not delivering great outcomes, and so people feel that social welfare could be enhanced through various forms of government initiative or intervention. What distinguishes centre-left from centre-right then, is that while both want to move into the space of social welfare gains, the left wants to do so in ways that are implicitly redistributive (in the sense that they generate outcomes that are more egalitarian than the pattern that would have resulted from market provision). The centre-right is equally committed to increasing social welfare, but has no objection to the market pattern of distribution, and so doesn’t want the programs to be redistributive, but rather more strictly market-simulating.

Just to make this concrete, consider an issue like urban transportation. Traffic congestion is obviously a collective action problem – access to (most) roads is free, and so there is overconsumption. People ignore the congestion externality they generate when they get into their car. The “centre-right” approach to this problem is to put a price on the use of roads – to impose tolls. The “centre-left” solution instead tends to focus on solutions that are financed out of general taxation, rather than user fees (such a providing subsidized public transportation), because then the state is able to both solve the problem, but do so in such a way that the benefits flow disproportionately to those who are worse off. What makes both of these positions centrist, however, is that 1. they both acknowledge that there is a collective action problem, and 2. they consider it appropriate to use the power of the state to resolve this collective action problem.

The positions that I consider more “ideological” are ones that involve using the power of the state to achieve outcomes that don’t involve solving collective action problems, but instead promoting some other value. The more this involves a sacrifice of social welfare, the more ideologically extreme I consider it to be. (This terminology is a bit tendentious, but bear with me.) So, for example, an ideological left-wing view is one that seeks to achieve pure redistribution – taking from the rich and giving to the poor – without any sort of “value added” beyond the redistribution. (I often use the differences between the Canada Pension Plan and the Old Age Security Plan to illustrate the distinction. The CPP is centrist, in that the government provides a valuable form of insurance in an area where there is significant market failure, and along the way does a bit of redistribution. OAS, by contrast, is left-wing, in that it mainly transfers money to elderly people who are poor, without any sort of insurance function. It is therefore straight-up redistributive.)

On the right wing, the ideological picture is a bit more confusing, because there are lots of different values that are taken to trump social welfare gains. Consider again transportation policy. Here the ideological right-wing position is one that is willing to suffer traffic congestion, in order to achieve some other value. There is, for instance, a libertarian view, which celebrates the freedom that the personal automobile provides, and therefore resists all forms of public transportation, and even road tolls, as limitations of this freedom. Thus the ideological extremist of the right will typically either refuse to acknowledge that there is a collective action problem, or else if he or she does acknowledge it, will say that it is not within the government’s power or mandate to do anything about it. (In the last provincial election campaign in Ontario, the Progressive Conservative Party adopted exactly such a position, which is one of the reasons that they lost.)

(A while back, I drew a little picture to illustrate the way I mentally picture the policy space. Although it’s a bit simplistic, since it only looks at the equality-efficiency dimension, it can be found here.)

With all that out of the way, let me then state my own view – and what Simpson was getting at – which is that the modern conservative movement has almost entirely squeezed out people with centre-right positions. They are not entirely absent. For instance, the current mayor of Toronto, John Tory, is clearly a centre-right politician (as witnessed by the fact that unlike virtually every conservative politician in the province, he is willing to acknowledge that traffic congestion is a serious problem). But if you look at the record of the Harper government in Ottawa, it is difficult to find a single issue on which they have taken a centrist, as opposed to an ideologically extreme, position. Consider the following examples:

1. Criminal justice. In terms of its legislative agenda, the Harper government has treated crime as the single most important issue facing the country. And yet their dominant priority clearly has not been to reduce crime, but rather to increase the retributiveness of the justice system. I’m not saying that in a polemical way – this has obviously been what they are doing. And I’m enough of a Kantian to think that retributiveness is important. But to incur major losses in social welfare (in particular, the costs of new prisons), without any projected benefits (e.g. reduced crime), is either highly ideological, or involves catering to a rather small interest group.

2. Climate change. Not to overstate the obvious here, but Harper has clearly passed on the opportunity to do something about the single greatest collective action problem of our time. The centre-right position on this issue is some sort of carbon-pricing scheme. It is very difficult to figure out what Harper is thinking – many conservatives have pointed out, quite rightly, that by refusing to do anything on this front, he is essentially handing over to the Liberals or the NDP the power to determine national policy, because the Conservatives cannot expect to be in power forever. My own speculation is that Harper still mentally associates control of greenhouse gas emissions with “socialism,” and so is ideologically opposed to any state action aimed at reducing emissions. It’s difficult to know though, since he has never given a forthright explanation of government policy on this question.

3. Tax cuts. Centre-right conservatives approve of efficient taxes like the GST (because they are relatively non-distortionary and have low compliance costs). Ideological conservatives, by contrast, often dislike efficient taxes, because they enhance public-sector efficiency, and thus expand the range of potentially beneficial state interventions in the economy. Let it never be forgotten that Harper cancelled a scheduled income tax cut (from the Martin government) in order to reduce the GST instead. Cynics will say this was all done for campaign purposes. I’m inclined to think that he genuinely wanted to make the tax system more inefficient, in order to make it more difficult for future governments to raise revenue.

4. Tax policy. The overall preference of centre-right conservatives is for the tax system as a whole to be efficient, with a so-called “clean base.” Harper has done more to “dirty” the base of the income tax system than any Prime Minister in recent memory, with all of the boutique deductions that have been introduced, as well as income-splitting. A cynic would say that the goal has been to pander to favoured constituencies. A more charitable interpretation is that they have been trying to tilt the income tax system in order to favour a particular moral ideal of the family, namely, the traditional family, in which the husband works, while the mother stays home, driving the kids to hockey practice. (Underlying it, in other words, is what political philosophers call a “perfectionist commitment” with respect to forms of family organization.)

5. International trade. So far, the government appears willing to scuttle a major international trade agreement (TPP) in order to protect the interests of a favoured constituency – dairy farmers – a position that has no principled basis, and in fact just reinforces a government-induced market failure.

6. Health care. The government appears to have no views at all on the state of the Canadian health care system. Perhaps this is because it is an area of provincial jurisdiction, and they believe in a principled approach to federalism. We have heard more from the Minister of Health about drug policy than we have about the performance of the rest of the health care system.

7. Infrastructure. The government appears to take the cynical view that infrastructure investments are all just “pork,” to be used to appease rent-seeking groups. As a result, there does not seem to be any interest in focusing funds in areas where they will produce significant welfare benefits, or serve to complement markets.

8. The child care benefit. The Harper government has also executed a couple of bizarre ideological inversions, that no one on the right seems to know what to do with. First among them is the decision to champion universal social programs (like the Universal Child Care Benefit) – a position that those of us who are older tend to associate with the government of Pierre Elliot Trudeau – while opposing means-testing (the position being championed by Justin Trudeau). Again, this inversion left people with traditional centre-right views confused, since means-testing is traditionally considered a sort of Thatcherite position. In any case, the child care benefit is exactly the sort of “leaky bucket” redistribution that centre-right economists abhor.

Try as I might, I can’t think of a single policy area in which the government has done anything that would qualify as “centre-right” – and lots of cases where they have passed on the opportunity, or else done things that constitute a rejection of such positions. Which I think is really too bad, because in the end, that’s the only thing that conservative governments are really good for. I mean, I hated Brian Mulroney as much as the next guy, but at the end of his mandate, I had to admit that, even though he had done nothing to improve the fairness of Canadian society, he had increased the efficiency of both the economy (with free trade) and the state (with the GST), creating very tangible benefits for Canadians over the course of subsequent years. With the Harper government, on the other hand, I look for the silver lining, and I find… nothing.

Finally, red Tories. Forget about red Tories. George Grant is dead, and so is the entire political-cultural sensibility that he was channeling. Anyone who is concerned about the rise of ideological extremism on the Canadian right (as I am), should be trying to embolden the centre-right. The mere fact that red Tories are called RED Tories means that they have no chance of being revived. You might as well call them “sell-out Tories” and lament their decline. It’s better just to state clearly what we really need in this country, which is conservatives who are willing to acknowledge the genuine problems that exist in Canada, and to think seriously and creatively about how government actors can use markets, or market-simulating mechanisms, to resolve those problems. This is what has gone missing in recent years.


On the disappearance of the centre-right in Canada — 11 Comments

  1. On the Conservatives’ response to the Great Recession: let’s not forget that, following the election in the fall of 2008, the government first introduced a budget that proposed no marked change in economic course, before launching the “Economic Action Plan” to mollify the opposition. Without those objections, I’m not certain the government would have introduced a stimulus program, at least not to that extent.

  2. “Anyone who is concerned about the rise of ideological extremism on the Canadian right (as I am), should be trying to embolden the centre-right.”

    I think what you’re saying here (and in the post in general) is right as far as it goes, but irrelevant in some sense since the causes for what is driving current trends lies deeper.

    For example, if the internet replacing television as the dominant means of communication is what is driving many of the changes we see, how does ‘trying to embolden the centre-right’ help?

    And if what we’re seeing is just an inevitable moral decay that comes from a long period without any sort of major crisis to bring us together (see Gabriel Kolko, ‘Century of war’, for an idea of what I mean here) then again, how do we embolden the centre-right (without starting a world war, obviously).

    Or what if what we’re seeing is the inevitable result of what happens when we hit the limits to growth, and the focus has to shift from growing the pie to splitting the pie.

    Or what if we’re seeing a general turn (or at least a turn on the fringes that’s spreading inwards) away from the pursuit of welfare gains as the most important goal. What if, after decades in which all the important welfare goals have been solved for most of the population, what people yearn for is something different to work towards.

  3. I think what you are missing is the Conservative view on the effectiveness of government, and the dynamic effects of government intervention. The objection isn’t so much that positive sum market corrections are a bad thing, but that (1) the government will do a horrible job of them so that many of these interventions will turn out negative sum, and (2) allowing the government to get involved in them will result in an arms race of people lobbying the government into all sorts of interventions that are just giveaways. Both of these are absolute commonplaces in both intellectual conservative thought (see e.g. Public Choice), and the worldview of ordinary Conservative voters. So mainstream Conservatives will only support a government intervention if they think it would still be worthwhile if done in a botched and corrupt way – not because they support botching and corruption, but because that’s their view of government effectiveness.

    Take your point (7), infrastructure. The Harper government’s position isn’t that the provision of roads is outside the proper scope of government. But they are (justly!) concerned that when you engage in a big infrastructure project, it will very likely suffer huge cost overruns, be far less valuable than originally promised, and, yes, wind up as just pork. Canada doesn’t have a critical shortage of infrastructure, so why get involved? Conservatives also have a much sharper view of the private sector opportunity cost.

    I’m also flabbergasted by your outrageous analysis of the Cameron government. At what point during his premiership did the “pie” shrink? On the contrary, Britain has easily outperformed its peers over the past 5 years, both in terms of growth and in terms of employment.

      • You present a graph that starts more than 3 years before the Coalition came to power, and ends just 18 months after it came to power. In other words, 70% of it is the record of the last Labour government, and it omits the bulk of the Cameron’s record. How on earth is that fair?

        Wouldn’t it be more intellectually honest to present a graph showing the past 5 years i.e. the time for which Cameron has actually been in power? Such a graph would show UK GDP is up 10%, unemployment down by more than 25%, and employment up by 7% – more than 2 million new jobs. A more appropriate graph would also compare the UK’s performance, not to the US, but to our major trading partners – the Eurozone economies. It is hard for Britain to grow when our major trading partners have such depressed economies, but it is an incredible testament to Cameron and Osborne (and indeed, your compatriot Carney) that they have managed to steward the economy so well in such testing times.

        • The graph shows the UK and US economies moving pretty much in lockstep until 2010 when Cameron comes to power and the two begin to diverge a couple quarters later. In the blog post, I wasn’t discussing the recent record of the Cameron government, I was talking about the key decision that was made, when they came to power, about whether to engage in stimulus or impose cuts — in order to compare their decision to the one made by Harper.

          • No, they are not in lockstep until 2010. Look at the graph – the blue line is already way below the red one. The UK enters a much deeper recession in 2008 Q1, and indeed is recovering more slowly throughout 2009.

            But I take it that, by your silence on the substance of my post and your wish to provide tendentious and misleading analysis of the Cameron government, you implicitly accept my critique that the “centre-right,” by your definition, is alive and well.

  4. I’m confused about why the Universal Child Care Benefit is considered not redistributive. Doesn’t it redistribute money from people who don’t have children to people who do? (Or more broadly from everyone to children, since the children’s parents are already dedicating an enormous portion of their income to their children?)

    Sorry if that’s a very naive position.

    I actually see UCCB as a centrist position in that it solves the collective action problem of too many people deciding not to have children by alleviating some of the economic burden (or removing some of the financial disincentive).

    • Not really. The Conservatives eliminated the child tax benefit, and replaced it with the UCCB, which is taxable. Most of the money gained by the UCCB benefit will be returned as taxes next April. After taxes, parents apparently make something like $7.50 extra per month, per child. UCCB is a vote bribe, pure and simple.

  5. Great post. Two quibbles. Couldn’t OAS be viewed as a form of insurance because people don’t know whether they will be poor when they are old? Some redistributive programs can still have an element of insurance where we don’t know what category we will be in in the future.

    Second is, I am not sure that acknowledging that there is a congestion problem is the same as acknowledging that there is a collective action problem that can be solved by government. In order to do that, you need to recognize that building more roads won’t always solve the congestion problem, because it is a collective action problem and not a capacity problem. Thus, both Ford and Tory acknowledge that there is a congestion problem, but don’t want to do intellectually centre right things to solve that problem (road taxes, congestion fees, tolls). I’m not sure what that makes their response – to increase the size of the state by building more roads and committing public resources to solving car congestion on existing roads (high tech traffic light timing, accelerated transit) – which doesn’t appear to me to either be a centre right or extreme right position on the issue. It seems to me to be almost a poorly thought out populist left position, in which there is no redistribution or increased effectiveness, but there is an increase in the size of the state.

  6. Speaking of collective action problems, it would be nice if politicians would stop pretending to have anything to do with creating jobs. The problem as I see it is that every politician is willing to sell you the ‘jobs plan’ they have, because people will always demand to know how they are going to ‘fix the jobs problem’.

    I believe that politicians can destroy jobs, with this or that policy, but it’s much harder to show that they actually created anything without directly spending tax dollars into the economy or expanding the size of government.