Foreign Correspondent: Still More Controls


Toronto. It is a foregone conclusion, in Canada at least, that the increasingly stringent economic controls have some covert political purpose not immediately apparent to the layman. It appears that the Prime Minister's aim is to shackle both business and labour to the direction of an omnipotent central government.

Thus, while the Canadian public remained enthralled by the Olympic Games fiasco in Montreal, the Trudeau government imposed some very strange controls on the manufacturing sector of the economy. Manufacturers must now lower their profit margins from 90 percent of the 1970-1974 average to 85 percent. Already stifling under hardly comprehensible rules, Canadian businessmen must now institute the new rules and revise all of their old estimates. The government calls this "negative growth".

The true tragedy of these most recent developments is not the fact that they were predicted, but that business opposition to the imposition of controls is only now gaining momentum. So, amid the furor of the Olympic headlines, the presidents of two large Canadian corporations (IMASCO and Domtar) voiced their opposition to the governmental decrees through full-page "open letters" purchased in the major dailies. Now, the business community is regretting its earlier support for the spirit and substance of the controls. Says the president of Domtar: "We accepted the restraint as a reasonable contribution to the fight against inflation". Now he finds the restraints "unrealistic," "unfair," and "incredibly complex".

The Supreme Court of Canada found the imposition of economic controls entirely constitutional because the problem relates to a monetary issue, and the government has control of the money supply. Thus, business is stymied at every turn. Businessmen are learning the hard way that after years of conditioning against the "profit motive," the Canadian public is unconcerned about the grave plight of business. As a direct consequence of the controls more and more large corporations are stopping investment in Canada. Productivity is falling as the anti-business climate prevails. The only entity that has not stopped growing, and indeed is thriving, is, of course, the government.

This is precisely the situation which Trudeau has envisioned for a great many years. Trudeau has achieved a foothold towards complete economic control. He has also succeeded in befuddling the Canadian public into believing that inflation is being curtailed only because of government action in "clamping down on the greed of business and labour." Canadians remain ignorant of the fact that 42 percent of their own salaries are confiscated, one way or another, by the various governments.

Trudeau has written many times that his ultimate aim is to create a socialist state in Canada. His are the aims of the classic socialist a la Galbraith—redistribution and complete equalization of everything to the lowest common denominator.

In order to hasten his program, Trudeau is now in the process of patriating the Canadian constitution (which now requires technical assent of the British parliament for change or amendment). Trudeau has stated that he will patriate the constitution unilaterally if the provinces cannot or will not come to an agreement on how patriation is to be done. The implications of unilateral constitutional actions are frightening. Because Trudeau has virtual control of parliament (his cabinet consists of nothing but "yes-men") it would not be very long before he accomplishes this objective.

Judging from the actions of the provinces, though, it may not be necessary to institute any constitutional changes in order to socialize Canada. For example, in British Columbia, the socialist New Democratic Party has been replaced by the Social Credit Party which claims to be more business oriented. The Social Credit government has continued most of the N.D.P.-initiated programs, including mandatory public auto insurance, a government-run investment corporation, mining royalties, and so on. Some business orientation!

Alberta, which has a Progressive Conservative government, has an almost completely nationalized oil and gas industry regulated by the immensely unprofitable provincial/federal oil corporation, PetroCan. Alberta's "conservative" government has also purchased the third largest domestic air carrier in Canada, Pacific Western. How much this venture will lose is anyone's guess.

Saskatchewan's N.D.P. government is in the process of nationalizing everything in sight. The private potash industry, one of the largest in the world, has disappeared. Landlords in Saskatchewan are withholding apartments from the market in a protest against rent controls, but the government is in the process of buying or expropriating empty units, undercutting landlords with their own tax money at government set prices.

In Ontario, which has a Progressive Conservative government, rent control has turned into a bureaucratic nightmare of backlogged claims, requests, and hearings. The construction of new units has plummeted so that Toronto now experiences an incredible one percent vacancy rate. Black markets and key-money are on the horizon.

Looking at these horror stories it is doubtful whether Trudeau will have to take any more action to implement his utopian socialism in Canada. The various provincial governments are doing all of his work for him. All that he will be required to do is to establish a powerful central government.

Although there will be an election in 1978, it is doubtful that anything will change for the better. Governments tend not to give up any powers left to them by previous ones. The federal Progressive Conservative Party is not much different from the reigning Liberal party—their leader, Joe Clark, is a compromise between left and ultra-left leadership candidates.

The shift to the liberal-left is endemic throughout the Western world; It would be a tragedy to let it go unnoticed. Fortunately, the Libertarian Party is active in Canada and could provide a solid national organization for all of the numerous, disparate voices crying warnings about the imminent death of liberty in Canada. The Libertarian Party is presenting a candidate for a federal by-election in Ottawa on October 18. We must hope that this is the beginning of a successful trend.