Canada: Conservatives hold on to power amidst capitalist crisis

Build a real alternative

On October 14th a second consecutive minority Conservative federal government was elected in Canada. The voter turnout hit a record low with just 59.1% of Canadians casting a vote. The lack of an alternative to the Tories, in the midst of the world economic crisis left many working class people angry, frustrated and unconvinced that any of the main parties could offer a real answer and alternative to the status quo.

The Liberals lost 18 seats and now hold 77 seats in the House of Commons with the Conservatives taking 143 (twelve short of a majority). The Liberals won only 26% of the vote, their worst popular vote result since 1867. The loss has ignited the third Liberal leadership race in five years with the announced resignation of current leader Stephan Dion.

In third place is the Bloc Quebecois, which advocates Quebec independence, winning 49 seats – a drop of two seats from 2006, followed by the social democrat New Democratic Party (NDP) with 37 – a gain of 8 seats from 2006 based on 17.5% of the vote.

The Greens, despite gaining a large amount of press coverage after leader Elizabeth May was allowed to take part in the party leader debates, failed to win a seat in parliament. May was unable to win her own seat despite an arrangement with the Liberal Party which did not run a candidate against her in her constituency.

The Conservatives were hoping to win a majority government by rebuilding the coalition of the 1980s era Progressive Conservative government of Brian Mulroney which won back to back majorities on the strength of support from Quebec nationalists, Ontario based finance capital, the oil industry in Alberta and social and populist conservatives. In order to complete the puzzle Harper’s Tories needed to gain seats in Quebec and Ontario. While they were able to make gains in Ontario, mostly in rural and suburban areas, despite being shut out of major cities their Quebec strategy failed with their percentage of the vote declining from 24 to 21% and their seat total remaining stagnant at 10 (out of a possible 75). While neo-liberal policies have been implemented by provincial governments throughout English Canada in Quebec, which has a higher rate of unionization than English Canada and more militant unions, the right wing Liberal government of Jean Charest has been unable to have the same success in rolling back social programs. For instance, Quebec remains the only province with a comprehensive subsidized day-care program for toddlers which charges parents $7 a day. This higher level of resistance to neo-liberalism hurt the Tories in Quebec as did the government’s cuts to cultural programs (designed to appeal to social conservatives in English Canada who see the arts as liberal which incited a firestorm of opposition from Quebecois artists and cultural nationalists. A brutal socially conservative "law and order" proposal that would jail 14 year olds who ran afoul of the law also proved unpopular in Quebec which has a rehabilitation-oriented youth justice system and the lowest rate of youth crime in Canada.

No answers for economic crisis

The snap election was called by Tory Prime Minister Stephen Harper in hopes of securing a majority in parliament before a widely expected recession. However, events caught up when stock market collapse occurred mid-campaign. As a result, the world economy dominated public attention in the last weeks before the election. In every debate, each leader was trying to say a lot on what was happening with the economy; but at the same time were actually saying nothing – as they could not provide an explanation or alternative to the developing crisis inherent to the capitalist system they all try to find their answers within.

This was just as true for the NDP – who were faced with a perfect opportunity to put forward an alternative to the crisis in the economy – yet failed to do so. During their campaign, headed by their leader Jack Layton, some left-wing rhetoric was used particularly aimed at working class people. Several of their ads claimed an NDP government would emphasize issues important to the "kitchen table" rather than the "board room table", such as fighting job losses in manufacturing and tackling the problem of a lack of family doctors in many communities. Although this was a step up from previous elections where they were almost indistinguishable from the Liberals; they did not go anywhere near far enough in offering a real alternative to the other main parties. According to some polls, the NDP came within striking distance to the liberals during the campaign – yet failed to bring this to a reality as they were not seen as different enough in most constituencies. They failed to offer a socialist alternative to the deep economic crisis inherent to the capitalist system and lacked substance on much of their program and therefore on election day, were not able to offer an real alternative to workers.

Harper showed that his heart was with the investor class rather than with workers by committing a serious gaffe during a national television interview saying "there would be good bargains to be had on the stock market out of the crisis!". Comments such as this showed how out of touch he is to ordinary people who are losing savings and pensions and scared about their jobs and futures.

The Conservatives throughout and since the election campaign have been sounding very calm and somewhat arrogant over the possible effects of the world economic crisis in Canada. Jim Flaherty, the finance minister, recently said "We’re not through this crisis," but "there’s good reason for confidence in the Canadian economy" because there was no housing bubble like in the United States, and the Canadian banks are solid.

But this has little effect to calm many peoples’ nerves with falling house prices, job losses in the manufacturing industries and the value of many resource industry companies dropping – not to mention the TSX (Toronto Stock Exchange) coming only moments from being temporally closed earlier last month due to plummeting figures.

Crisis looms

The Canadian dollar has hit a three year low against the US dollar and has, in recent weeks, dipped below 80 cents. This is in stark contrast to the end of 2007 where driven by an overheated natural resources based economy, it hit parity with the US dollar for the first time in three decades. Some economists are claiming that this decline is a good thing as exports from Canada – which are mainly raw materials – are now cheaper for the US and other countries to buy. This effect is being claimed as possibly being able to cushion the economy during a recession. However, the dollar’s fall is a result of a dramatic drop in demand for natural resources by global industry entering a worldwide recession. The decline in the value of raw materials is hitting the natural resource sector very hard and workers are seeing falling income or are losing their jobs altogether. The dropping value of the Canadian dollar is also causing rising prices of imports from the US and the world which will hit working class people the hardest when buying anything from food to electrical items.

Avery Shenfeld, a senior economist with CIBC World Markets was recently quoted; "In the near term, the continuing turmoil on financial markets is going to put some downward pressure on the Canadian dollar, but we likely have room for a substantial recovery when the global economy is back on its feet," he said. "I wouldn’t expect this to last that long."

This attempt to convince working class people not to worry is insincere as the world economy continues to nose-dive and recession hits working class people worldwide. It is the case that Canada has not yet suffered quite the depth or breadth of the crisis as many other countries have already faced. But as the economic crisis deepens internationally it is impossible for any country to shield itself from the effects of this.

Already many workers have lost jobs and savings – many more are scared at what will happen next.

For years working class people have been told ’no’ to demands of more pay, better education, health care and housing – being told by governments and big business that there is no money to provide these basics of life. Yet when their financial system is in crisis hundreds of billions of dollars are found within a matter of days to bail out banks and companies with bad loans and debts. This is the reality of capitalism – and there is no ’fair-share’ for the majority of the world’s population.

Here in Canada the one thing the recent election and the impact of the world economic crisis has made clear – is how there is a desperate need for a new mass workers party which can build a socialist alternative to this capitalist crisis – where the needs of all can be met.

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November 2008