The Lost Massey Lectures (39 page)

This raises the problem of the survival of the individual in a growing bureaucratic society. If power is centralized, the individual loses the protection and security of his community, those who know him and those whom he knows. He is isolated and vulnerable, and the community that once provided the base from which he could develop and make a contribution itself declines in authority and the capacity to support him.

Mill had hoped for the day when “minds ceased to be engrossed by the art of getting on.” He wrote that in a stationary state “There would be as much scope as ever for all kinds of mental culture, and moral and social progress; as much room for improving the Art of Living, and much more likelihood of its being improved.” His philosophy and sociology were correct, at least in my view, but few economists agreed with him. The historical context, the height of the Industrial Revolution, was not sympathetic.

Similarly, those who speak out against centralization and concentration of power, political or economic, feel instinctively
that they are whistling against the wind. Centralization, however, is not a new evil. As Sir Halford Mackinder, famed British geographer, reminded critics of his balanced-economy concept: “You tell me that centralization is the ‘tendency' of the age: I reply to you that it is the blind tendency of every age—was it not said nineteen hundred years ago that ‘to him that hath shall be given'?”

Centralization, concentration, the accumulation of power and property may well be the tendencies of the age, but they may also be blind tendencies wherein communities are ignored and individuals lose their identity. The governed no longer know their governors.

Nationalist- or provincial-rights movements do not begin with power-mad Politicians bent on Balkanizing or “Iranizing” a country. They arise out of dispositions and sentiments that already exist, most often among young people anxious to live a life of challenge and achievement at home. They know that the world moves on, that communities form regional groups which grow into provinces, and the provinces unite to form the federal state. The anxiety centres on the costs of regionalism, nation-hood, and now globalism. How much control over their lives and freedom is lost along the way? The land may be strong, but if this foundation of economic independence and personal freedom is owned abroad, what remains of effective, political freedom and the community's capacity to solve problems and to satisfy needs? It is through politics that the spirit of the times is captured, reflected in the polling booths, but then ignored by the elected and the servants of the state.

If I were a political leader, I would find it increasingly difficult to accept the doctrine that Canada, with its distinct economic regions and cultures, should be a strong, centralized country—a heartland centred on Ottawa, Montreal, and Toronto and with all the rest a periphery. In effect, I would be telling the best young
people of my province, the educated and the intelligent, to go away. There is no room for you at home.

To make provinces and communities more important is to insist that they strive for more balance in their economies. An economic heartland, the metropolitan centre of colonial days, organizes an economy from the core outward and assigns specialized roles to the outlying regions, which lose their balance and sovereignty and become dependent, lopsided, and vulnerable to change. If you wreck the economic balance of a community or region, can social frustration, cultural poverty, and political ineptness be far behind?

If the roots of a community are its people and its land, then the primary factors of production must also be the people and the land. Capital, then, is a secondary affair derived from the surpluses arising from the utilization of land and labour. Capital is not an original factor of production, however useful and necessary it may be in accelerating the pace of growth and development.

Growth begins with the land and the services of people. If the land is attractive and the yields are good, many will come and stay. If the yields are retained, the community will grow and prosper. If, however, the surpluses are drained away, the community will stagnate and decline in an increasing dependence.

Land and labour are indispensably bound together as the basis of society. Isolating land and forming markets out of it is as great a crime against community as slavery is against humanity. Land is not a product for sale but part of a life-support system which, with labour, precedes the market economy just as it exists prior to the formation of the institutions, laws, and norms of the society. From the point of view of the community, the land and resources must be considered as inalienable, one of the reasons for coming and one of the reasons for staying, the root of sovereignty and the foundation of policies which determine future directions as well as current standards of living.

When we debate the question “should the nation-state survive,” the discussion centres around growth, efficiency, the benefits of an international assignment of the factors of production; that discussion is carried on in chambers of commerce, at conferences of economists and bureaucrats both public and private. We seem to forget that economics has to take into account social attitudes, the quality of politics, traditions, language, and human endowments. Above everything else the participation should include people under thirty who will be the more affected than aging corporate executives.

The young are also the ones most likely to have something new to say for, as Keynes remarked, “in the field of economic and political philosophy there are not many who are influenced by new theories after they are twenty-five or thirty years of age, so that the ideas which civil servants and politicians and even agitators apply to current events are not likely to be the newest.”

A half-century ago, Berle and Means wrote in their seminal book
The Modern Corporation and Private Property
:

The rise of the modern corporation has brought a concentration of economic power which can compete on equal terms with the modern state . . . where its own interests are concerned, it even attempts to dominate the state. . . . The law of corporations, accordingly, might well be considered as a potential constitutional law for the new economic state, while business practice is increasingly assuming the aspect of economic statesmanship. . . .

In 1975, discussing the power of large corporate groups and their control of markets, Prime Minister Trudeau was an eloquent witness to the truth of the Berle and Means prophecies—“People are wondering who is in charge of the economy, who's in charge of
the society, and they're concerned, they're worried. And they have cause to be.”

In a similar vein, President Eisenhower, in his farewell address to the nation, “Liberty Is at Stake,” had warned of the dangers to the very structure of American society in the growth of “the total influence—economic, political, even spiritual—” inherent in the size of the military and industrial corporate establishments.

In the councils of Government, we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military industrial complex. The potential for the disastrous rise of misplaced power exists and will persist. We must never let the weight of this combination endanger our liberties or our democratic processes. We should take nothing for granted.

Size of firm, economies of scale, efficiencies of concentration, multinational corporations, all are justified by the more productive possibilities assumed to exist in global markets. This conception of the
economic
unification of the world has been justified by George W. Ball, former undersecretary of state in the Kennedy administration, in the following terms:

In order to survive, man must use the world's resources in the most efficient manner. This can be achieved only when all the factors necessary for the production and use of goods—capital, labor, raw materials, plant facilities and distribution are freely mobilized and deployed according to the most efficient pattern. And this in turn will be possible only when national boundaries no longer play a critical role in defining economic horizons.

And again in the same article:

Conflict will increase between the world corporation, which is a modern concept evolved to meet the requirements of the modern age, and the nation-state, which is still rooted in archaic concepts unsympathetic to the needs of our modern world.

So there we have it—the modern era has witnessed the progress of civilization from feudal manor to nation-state. It is now, in 1983, time to move on to the emergent world economy, i.e., a unified commercial and corporate view of the world, the organization of production on an international scale.

Economics has as its object the most efficient use of resources at the disposal of a decision-making unit, whether that unit is Aristotle's household, the classical firm, or the corporation or the nation-state. When the world itself is taken as the basic economic unit, the assumption must be that the world is a great anonymous pool of resources both human and physical, yielding goods and services in accordance with their most efficient allocation and without regard to nation-states concerned with their own problems, priorities, and even prejudices. That is the death of the nation-state.

The “archaic” concepts of which Ball speaks are only as “archaic” as the last century. The difference between the 1983 theory of international production and the nineteenth-century theory of international trade is the profound respect that classical economists held for people and for community. A political philosophy is embedded in classical trade theory, for our predecessors were not merely economists but were possessed of a political philosophy as well. Men and women were citizens, the foundation and source of national strength, custodians of the traditions,
beliefs, language, laws, and customs of the nation. They were the substance of the state, not mere instruments and factors of production to be transferred to foreign lands at the dictate of capital flows and feedback systems.

No one knew better than David Ricardo the extent of capital exports and emigration from England, but this was not the national purpose. He wrote approvingly of the “natural disinclination which every man has to quit the country of his birth and connexions, and intrust himself with all habits fixed, to a strange government and new laws . . .” The theory of free trade, so suitable for that period of England's hegemony, was designed to build financial power, employment, and industrial strength at home.

In a similar vein, Germany under the influence of the doctrines of Friedrich List and Chancellor Bismarck adopted the opposite policy of protectionism in intense efforts to keep her manpower from emigrating by providing employment at home. Limiting imports to materials containing little labour and few skills, and promoting exports with high wage content soon provided the employment that caused net emigration from Germany to disappear.

Trade in goods, unlike trade in persons, adds to the level of real income in a nation, which leads in turn to an increase in the standard of living and wealth. Nations gained from trading the goods and services in the production of which they had a natural or comparative advantage. They did not gain from draining each other. It would not have occurred to Ricardo, for example, when he spoke of trading English bolts of cloth for Portuguese pipes of wine, that England would be even better off if English capital bought out the vineyards of Portugal and managed their production. Such actions would have invaded a neighbour's sovereignty and reduced its economic independence and, in the long run, was bound to be counterproductive. Such, at least, was the nineteenth-century
view. Sovereignty depended not only on a strong citizenry proud of their rights, it also depended on the control of all one's resources. Unlike our political leaders and the current network of civil servants and economic advisers, classical economists believed that the citizenship of those who owned and controlled the land and its natural resources was fundamental to a strong society. A state that is not the master of its own environment can hardly aspire to great status and importance in the assembly of nations. Classical economists incorporated into their principles the society's institutions (private property), national aspirations and objectives, human motivations, drives, and needs, and looked upon the national economy as an ongoing process.

In 1983 the logicians of the world enterprises refuse to recognize that nations are autonomous entities. The world is one, a global system in which each area interacts with the others, and behaviour in any region has repercussions throughout the world economy. Those who refuse to accept the new model of ordering economic activity are labelled nationalists, xenophobes, parochial monopolists, socialists, protectionists, and anti-American.

No one, to my knowledge, of those concerned with the problems of retaining independence in decision making and control over their own choices and value systems has ever held that anyone or any nation can exist apart, or that there would be great value in such isolation if it did exist. Progress is only possible through interaction and interdependence; the diversification that exists between communities adds to the vitality and quality of each.

This acceptance of the worth of other cultures, outlooks, value systems, and social structures leads to an interdependence that is profitable in more than the material sense. Something new is added to one's culture which conserves as it broadens and is subtly changed. There is no dependence in this effect, for nothing is
imposed. As Bernard Lonergan has written, “If one is to communicate with persons of another culture, one must use the resources of their culture. To use simply the resources of one's own culture is not to communicate with the other but to remain locked up in one's own.” There is no one culture, as anyone from Quebec understands full well; just as there are differences within Canada, so we are entitled to believe in and support a Canada that has a set and shape of values that is distinct from other systems and nations. This does not mean that we would refuse, in the name of independence, to subscribe to a set of moral principles that would serve as the basis for international relations and international law, but it does mean that we contribute what we can of our own values without surrendering our sovereignty, objectives, and policies.