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Reviews/Comptes rendus
John B. Burbidge, James Cutt, Paul Dickinson,
Newman Lam, Michael J. Prince, Christopher
Ragan and William B.P. Robson When We’re 65:
Reforming Canada’s Retirement Income System reviewed by Ellen M. Gee 466
Wallace Clement (ed.) Understanding Canada:
Building on the New Canadian Political Economy
reviewed by Barry Cooper 469
Michael Dorland (ed.) The Cultural Industries in
Canada: Problems, Policies and Prospects reviewed
by John D. Jackson 462
Richard G. Lipsey Economic Growth, Technological Change, and Canadian Economic Policy reviewed by Peter Howitt 467
Christopher McKee Treaty Talks in British Columbia: Negotiating a Mutually Beneficial Future reviewed by Gurston Dacks 460
Alex C. Michalos Good Taxes: The Case for Taxing Foreign Currency Exchange and Other Financial Transactions reviewed by Patrick Grady 461
C. Paraskevopoulos, R. Grinspun and T.
Georgakopoulos (eds.) Economic Integration and
Public Policy in the European Union reviewed by
Thanasis Stengos 461
George Selgin Less Than Zero: The Case for a Falling Price Level in a Growing Economy reviewed by
Ralph Kolinski 467
Carolyn Strange (ed.) Qualities of Mercy: Justice,
Punishment, and Discretion reviewed by Vladislav
(Victor) A. Tomovich 465
Peter Warrian Hard Bargain: Transforming
Public Sector Labour-Management Relations
reviewed by Greg McElligott 468
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460 Reviews/Comptes rendus
Treaty Talks in British Columbia: Negotiating a
Mutually Beneficial Future
by Christopher McKee. Vancouver: University of
British Columbia Press, 1996. Pp. xvi, 126.
Treaty Talks in British Columbia should be required
reading for anyone interested in the process by
which aboriginal rights in the province may well
transform the relationship between its non-Native
and Native inhabitants. Moreover, there should be a
great many interested readers because this issue stirs
powerful emotions, colours the province’s political
process, carries with it hugh financial implications,
raises profound issues of morality and justice, and
promises to define relations between Natives and
non-Natives for generations to come.
Christopher McKee has achieved his goal of providing a lucid account of this process for lay readers. He begins by explaining the context of the BC
treaty process — basic legal concepts and the history of Native-government relations in the province.
The treatment of the latter topic is particularly important for readers sceptical of the claims process
because it demonstrates that contemporary Native
claims are far from a recent, groundless, and selfserving fabrication. Rather they reflect a history of
governmental injustice that British Columbia’s First
Nations have actively protested for more than a century.
After laying the groundwork, McKee summarizes
the treaty-making process that has been under way
since 1993, focusing on the British Columbia Treaty
Commission and the six stages of its negotiating
process. He then outlines the major issues under
negotiation and their politics. Because the BC claims
process has provoked substantial opposition, McKee
comments on some of its most contentious aspects.
In particular, he correctly rejects the argument that
total extinguishment of Aboriginal rights should
accompany the settlement of Aboriginal claims. In
his view, to do so would be to extinguish
aboriginality, exactly the opposite of the purpose of
the treaty process, which is to pave the way for an
enduring future of respect and mutual recognition
between non-Aboriginal Canadians and First
Treaty Talks in British Columbia closes by looking to the future of the treaty-making process and
arguing forcefully about the behavioural and policy
changes to which the participants must commit
themselves if the process is to succeed. It is here
that Treaty Talks in British Columbia makes its greatest contribution. McKee spares none of the participants. He argues that the provincial government
must develop a more coherent policy process and
involve third parties more meaningfully in the treaty
process if they are to accept it as fair and legitimate.
In his judgement, the Government of Canada should
move more vigourously away from the band council provisions of the Indian Act in favour of more
legitimate and effective forms of governance. At the
same time, the Aboriginal leadership empowered by
the Indian Act provisions must reform its often selfserving and elitist ways. Also, non-Aboriginal interests, such as the Council of Forest Industries, must
accept both the morality and the cost effectiveness
of the treaty process, particularly as compared to
the unsatisfactory alternatives.
The argument falters when it advocates turning over
the implementation of the treaties, once they are ratified, to the federal Indian Claims Commission. Somebody must implement the treaties and help manage the
resulting relationship between the First Nations and
the federal and territorial governments. However, the
lack of success that the Indian Claims Commission
has enjoyed suggests looking elsewhere.
This is a modest problem compared to the overall
strength of this book. McKee deserves great credit for
distilling the historical, legal, and political complexities of the treaty process into such a brief and readable
work, and for demonstrating so persuasively the interest that all British Columbians — indeed all Canadians — have in the success of this process.
GURSTON DACKS, Department of Political Science,
University of Alberta
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Economic Integration and Public Policy in the
European Union
edited by C. Paraskevopoulos, R. Grinspun and T.
Georgakopoulos. Brookfield: Edward Elgar Publishers, 1996. Pp. xvii, 310.
This volume brings together a number of papers that
try to shed some light on the basic issues surrounding the economic integration drive in the European
Union under the Maastricht treaty. This debate is
especially relevant after the recent French election
results which brought to the forefront serious questions about the feasibility as well as the desirability
of the monetary union. It has become quite clear
that problems of convergence of domestic inflation
rates come with a price of relatively high unemployment, and the sacrifice of domestic monetary policy
is recently receiving more skeptical scrutiny in member countries than it did earlier.
The volume covers a number of important aspects
in the area of economic integration that do not feature prominently in the current debate as it takes
place in the media but are as important and perhaps
more so if the experiment of the EU Maastricht
treaty is to be successful. These include the politics
of union, implications for national fiscal policies and
associated social and labour policies as well. Since
some of the most difficult problems of integration
are sectoral, questions of agricultural policy and the
conflicts among member states as well as foreign
investment and technological guidelines are among
the most prominent issues that need to be addressed.
Many of the general issues of convergence mentioned above are investigated in the context of
Greece, the focus of most papers in the volume.
The first of six parts considers a number of general issues of European integration, including recent
challenges to the convergence criteria. The second
part presents certain empirical and theoretical aspects of the monetary union. Part III deals with social policy reform and the structuring of a social
union. Part IV deals with fiscal policy and public
finance issues. Part V presents an analysis of such
European Union policies as agriculture, foreign investment, and technology. Finally, the last part looks
at Greece as it tries to meet the convergence criteria. It is in this context that the volume adds to the
debate about European integration in that it considers a process of integrating unequal partners and
looks at the issues that arise from the point of view
of one of the members least prepared to satisfy these
convergence criteria. To that end, the set of articles
presented here constitutes an interesting and valuable collection of papers that shed considerable light
on the complex phenomenon of European integration as it unfolds.
THANASIS STENGOS, Department of Economics, University of Guelph
Good Taxes: The Case for Taxing Foreign
Currency Exchange and Other Financial
by Alex C. Michalos. Toronto: Dundurn Press, Science for Peace Series, 1997. Pp. viii, 87.
This book is called Good Taxes because its author
strongly believes that financial taxes in general and
the Tobin tax in particular are good taxes. By this
he means they generate enough revenue to pay for
public goods including the social safety net, they
are levied in proportion to ability to pay, and they
are administratively manageable and cost effective.
The author claims to construct a reasonable sort of
benefit-cost analysis of financial transaction taxes,
but his analysis is literary not quantitative.
The meat of this book is contained in two chapters: the first presents 19 arguments in favour of financial transactions taxes and the second offers rebuttals for 20 arguments against financial transaction taxes. While the underlying literature review is
thorough, the point of view is, not surprisingly, relatively one-sided. The book does, however, present a
handy survey of the estimates of the amount of revenue that might be raised by a Tobin tax.
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A drawback of the book is its very academic style;
it is filled with many long quotes that make for
choppy reading.
a coherent primer on financial transaction taxes, you
might not find this book very enlightening.
PATRICK GRADY, Global Economics Ltd.
Strangely, the book does not systematically offer the author’s own argument in favour of a Tobin
tax. Instead, the reader is left to infer this from the
views the author expresses about the arguments of
others. Consequently, readers looking for a strong
coherent case for a Tobin tax are likely to be disappointed. Rather all they will find is a smorgasbord
of supporting arguments.
The author never clearly reveals if he prefers a
Tobin tax or would settle for any kind of financial
transaction tax. The answer to this question of course
depends on what you want the tax to do, and the
author is not very clear on this. His fondness for
financial transaction taxes appears to stem from his
belief that any type of financial transaction tax is
good because it takes money from the rich to spend
on the poor. In other words, he believes that financial transactions constitute a good proxy for ability
to pay. Unfortunately, no empirical analysis is presented in the book to demonstrate that this is indeed
the case. The reader is left with nothing more than
the author’s assertion.
The author also never really satisfactorily addresses
the efficiency arguments against the taxation of financial transactions. The theory of optimal taxation suggests that from the point of view of allocative efficiency
it is best to tax transactions where supply and/or demand are most inelastic, thereby approximating the
impact of a lump sum tax and minimizing distortions.
On this criterion, financial transactions are not the
obvious candidates for excise taxation.
If you are already familiar with the pros and cons
of financial transaction taxes and want a convenient
list of all the arguments on both sides or alternatively if you wish to see how one knowledgeable
supporter of the concept deals with the arguments,
this book might be for you. On the other hand, if
you are not already familiar with the issue and want
The Cultural Industries in Canada: Problems,
Policies and Prospects
edited by Michael Dorland. Toronto: James Lorimer
& Company, Publishers, 1996. Pp. xiii, 376. $24.95.
There is no shortage of published collections in the
culture and communications field. There is a shortage of solid analytical reports or monographs on the
issues and debates facing policymakers. Nevertheless, some collections are superior to others and
some do make a contribution. This collection has a
certain uniqueness. All essays are original, there are
no reprints. There is a very high level of topical integration (many collections do not quite make it in
this respect). The essays address the private as well
as the public sector and they (at last!) go beyond a
preoccupation with content, thus probing marketing issues in addition to the more commonly
analyzed industrial structures. The Cultural Industries in Canada is a collection of 13 essays by recognized scholars and consultants, many of whom
readers will have met before in other collections and
research monographs and in the press.
According to Michael Dorland the “essays ...
trace out what the effect of state policy has been,
evaluate its often ambiguous legacy, and examine
the implications for the future in an increasing global market ...” According to Dorland, the text as a
whole revolves around the argument “that the way
one approaches the cultural industries and policies
affecting them, as well as the language one uses, is
as important as the reality one imagines one is talking about, or making policy for.” Although this implies an analysis of the language (or discourse) of
policy statements, such is not the case. The essays
which, for the most part, are of good quality and
evenly balanced throughout the text, are descriptive
and historical. The focus is on specific industries
and the consequences of policies implemented.
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The selections are grouped into the following
production domains: Print (books, periodicals, and
newspapers); Sound (recording and radio); Image/
data (film and video, public and private television,
cable, home video and DBS); and Policy. In turn,
each writer deals with the assigned topic by describing its background, analyzing the market accompanied with production statistics, describing the related industrial structure, and considering related
policy formulation and implementation. It is much
to the credit of the editor that the writers were held
to a common framework, thereby giving the collection the quality of a single monograph (not an easy
task as those who have edited collections well
Though evenly balanced, readers will undoubtedly dwell more on essays related to their specific
interests and quibbles. The fact that I too have selected certain articles over others for comment in
no way reflects negatively on those passed by.
Rowland Lorimer’s extensive research on books and
reading makes him an excellent choice to write on
book publishing history. How many of us are aware
that the “book publishing industry ... generates
yearly sales of over $1.5 billion in publisher’s
receipts and $3 billion in retail sales.” This is the
lead essay; if the value of production and sales for
each industry in the business of producing and
reproducing representations were calculated and
added for the field as a whole, the amount would be
very impressive indeed. Not surprising then that the
federal ministries of Canadian Heritage and Industry find themselves frequently at odds and frequently
cooperating. This common distinction between the
“symbolic environment” and the “industry environment,” as Professor Dorland puts it, seems to present
the writers and, perhaps, the readers, with a conundrum. Lorimer chooses to introduce the distinction
as one between certain markets (trade books and,
“in a more limited fashion,” mass-market paperbacks
and textbooks), “if the focus is on ... culture” and a
broader market, “if the focus is on industrial development.” There is too a hint here that mass-market
paperbacks are not quite “culture.” The riddle is, how
does one conceptually distinguish between industry and culture as separate objects of discourse? I
will return to this issue, one which pervades the
Both Lorimer and Lon Dubinsky, in his article
on periodical publishing, note that their discussions
are limited, in the main, to English Canada, a point
that is all too often missed in analyses of and presentations on “Canadian Culture.” Dubinsky specifies that his material focusses on English Canada.
Having made this distinction, these and other essays give very little attention to the presence of
strong regional cultures (although Dubinsky does
point to the development of regional periodicals) and
the fact that the Canadian cultural enterprise is and
has been principally devoted to the creation of a
national culture, in some cases undermining local
or regional cultures. (This can certainly be demonstrated in the broadcasting field). In contrast, the
cultural enterprise in Quebec has been and is devoted to the preservation of a national culture.
Christopher Doran and Will Straws’ articles introduce the reader to two areas infrequently addressed
in the field, namely, the press and the recording industry, both doing quite well as “Canadian cultural
industries.” It is of some significance that Straw asks
the reader to seriously consider the contradictions
and paradoxes inherent in the recording industry,
significant because all commercial and public enterprises in the business of representation contain
contradictions and paradoxes and it is only through
a recognition of these that public policy has a chance
of meeting reality halfway.
Michel Filion’s essay on radio concludes the section on the “Sound Industries.” Interestingly enough,
of all the essayists, Filion discusses the interests
differentially attached to public and private
broadcasting as nationalism versus commerce rather
than in terms of the more usual culture versus economics dichotomy: “... national radio, from its very
beginning was a compromise between nationalism
and commerce.” I have often puzzled over the fact
that most writers in the culture and communications
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464 Reviews/Comptes rendus
field resist acknowledging that the discourse of
Canadian “culturists” carries English-Canadian nationalism as a sub-text. Good for Filion! Though I
would argue that he neglects to come to terms with
the regionalization/centralization axis in broadcasting. The fate of CKUA, Edmonton at the hands of
the CRBC during its earlier years and the forced
closing of CKY, Winnipeg (the first commercial
public radio station in Canada) during the 1940s are
two examples of this process. Marc Raboy picks up
the case of public television. Quite rightly, and again
not too often referred to in the field, Professor Raboy
points out that no broadcaster is void of public purpose nor of regulation. The difference between the
CBC and private television is a matter of degree,
with the former becoming more and more like a private broadcaster combined with a kind of
“publicization” of the private sector. This is a provocative analysis, all the more so because Raboy,
like Filion is not taken in by the “culturists.” Public
broadcasting, as we have it, emerged as the instrument of a particular vision of the state.
There are four essays on policy, all interesting in
their historical coverage of policy formulation and
implementation, but not overly productive in debating the key problems facing politicians and bureaucrats who must make policy within the context of a
political-economy where very little consensus is to
be found. Robert Babe’s contribution does present
a useful conceptual framework for the evaluation of
policy in his use of the categories of technical, functional, and corporate convergence and the historical emergence of divergence in the communication
To return to the distinction between culture and
economy, a comment, directed more to the field in
general, than to the authors of this book in particular: culture may be taken to refer to dominant, traditional, or emerging systems of meaning; the latter
two challenging the dominant. If one adopts this
manner of conceptualizing culture, one cannot op-
pose culture to marketplace economics; or keep culture out of or put culture into trade negotiations; or
have cultural and non-cultural industries. Marketplace economics is a culture — a set of meanings
and prescriptions for action — as are anti-market
public policy objectives. Culture can only be “put
into” or “taken out” of trade agreements or industry
if one specifies just what cultural configuration is
at issue. In Canadian/US trade negotiations and in
the split between culture and economy adopted in
this book, the references are not to culture tout court
but specifically to industrial complexes (public and
private) producing and distributing particular types
of discourse. An important point if one is to address
public policy regarding instruments of communication. We cannot oppose cultural development per se
to marketplace thinking or to technology for that
matter; we can oppose only a specified and particular set of goals for cultural development to the
marketplace, keeping in mind that the proponents
of marketplace thinking will have their own agenda
for cultural development. Both Filion and Raboy are
more tuned in to this way of thinking than most of
the other essayists. Public policy supporting Canadian industry producing and distributing symbolic
representations is in the aid of a particular vision of
the state and the nation, not culture per se. It would
be far more useful from a policy point of view to
articulate the particular national vision behind cultural policies; that is, to be honest regarding the ideological base upon which cultural and communications policies stand.
The culture/economy dichotomy is deeply buried in this collection as it is in most publications in
the field. Nevertheless, the collection is exceptionally informative and up to date with respect to those
industries engaged in the production of representations. It is a must for the shelf of anyone, scholar or
consultant, working in the field.
JOHN D. JACKSON, Centre for Broadcasting Studies,
Concordia University
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Qualities of Mercy: Justice, Punishment, and
edited by Carolyn Strange. Vancouver: University
of British Columbia Press, 1996. Pp. xii, 186. $24.95.
In this collection of scholarly essays, readers will
find five mutually complementary and yet separate
topics on the issues of state punishment for law
breakers. It covers more than a single society and
therefore is both comparative and historical.
Each author presents his/her study in clear and
eloquent style. Greg T. Smith writes about the decline of physical punishment in London, 1760-1840,
and Simon Devereaux, covering almost the same
time period (1770-1830), explains some alternatives
to death in the English State, such as transportation
and other penal practices. Barry Wright takes the
case of Canada with his penetrating “‘Harshness and
Forbearance’: The Politics of Pardon and the Upper
Canada Rebellion.” This essay explains the role of
the pardon in the dynamic period of early nineteenthcentury Upper Canada. According to Barry Wright,
pardons were not granted simply on compassionate
grounds but rather according to political and tactical needs, agendas and the circumstances of an individual case. Tina Loo’s contribution is a summary
of her research entitled “Savage Mercy: Native Culture and the Modification of Capital Punishment in
Nineteenth-Century British Columbia.” The central
theme in Loo’s essay is the question of cultural diversity and how organized societies can govern it,
especially concerning the question of jurisprudence.
As well as editing the book, Carolyn Strange wrote
about comparative justice by contrasting political
culture and the death penalty in New South Wales
and Ontario, 1890-1920. Readers will enjoy her
summary about British justice and cultural values
as she compares Canadian and Australian laws and
their adaption to local conditions of justice administration. And the last contribution to this valuable
anthology is an “Afterward” about punishment in
late twentieth-century Canada by Anthony N. Doob.
Doob suggests that the Canadian Parliament has
given the country’s judges very little guidance about
how sentences should be handed down, thus leaving to judges opportunities to exercise personal discretion and to apply a degree of mercy.
This collection treats mercy not as a theological
concern but rather as a judicial aspect of organized
societies and their law-enforcing institutions. By
using the history of predominantly Protestant countries (Australia, Canada, and England), the editor
convincingly shows that scholars, like the
policymakers of the present time, know very little
about the various qualities of mercy. Many misconceptions exist about its quality and applications. For
this reason alone, one may wish that someone will
complement this book with similar research on a set
of predominantly Roman Catholic countries of the
same period in Europe, for example, France, Spain,
and Italy. It would be a fair matching for the three
countries used in this book.
In general, this volume is a welcome addition to
the criminological and legal library of important
books. It can be used by both professionals and students alike. The essays are well written and each
topic is primarily based on historical data along with
statistical evidence. With the type of historical facts
used and other archival evidence, a scientific explanation for the history of the quality of mercy is unquestionably achieved. The contributors to this volume, including the editor, have enriched legal and
sociological literature. Sociologists of correction or/
and sociology of punishment, criminologists, law
professionals, parliamentarians, and other
policymakers, and of course students, need to be
made aware of the content of this anthology.
VLADISLAV (VICTOR) A. TOMOVICH, Department of Sociology, Brock University
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466 Reviews/Comptes rendus
When We’re 65: Reforming Canada’s
Retirement Income System
by John B. Burbidge, James Cutt, Paul Dickinson,
Newman Lam, Michael J. Prince, Christopher Ragan
and William B.P. Robson. Toronto: C.D. Howe Institute, 1996. Pp. vii, 224. $16.95.
This book, thirteenth in the C.D. Howe Institute’s
“Social Policy Challenge” series co-editored by John
Richards and William G. Watson, consists of five
papers: the first two present specific pension policy
proposals while the other three more general papers
provide background to the pension policy debate.
Of the specific proposal papers, the first, by
William Robson, is entitled “Ponzi’s Pawns: Young
Canadians and the Canada Pension Plan.” Here, the
CPP is likened to a pyramid scheme, purportedly
invented by American con man Charles Ponzi in the
early decades of this century. Obviously, Robson is
no fan of pay-as-you-go systems in which retirement benefits are paid out of current payroll taxes
and not out of a pre-existing fund. Fearing the changing age structure and wishing to be fair to younger
generations of Canadians, he advocates “beefing up”
the CPP fund in the short-run — through higher
contribution rates and lower benefits — and then
replacing the CPP (probably around 2030) with a
private pension system. In the second paper,
Christopher Ragan focuses on tax-deferred savings
plans (TDSPs) such as Registered Retirement Savings Plans (RRSPs), proposing that they be abolished and replaced by increased consumption taxes.
He argues that TDSPs do not increase savings and
that they redistribute wealth in favour of upperincome persons. To encourage savings and to eliminate such wealth redistribution, he proposes eliminating all tax (i.e., public) support for all TDSPs
and establishing a consumption tax system by reducing income tax rates and increasing the GST rate.
Burbidge’s paper, the first of the more general
contributions in this volume, has two major themes:
one, over the long run, it will not be feasible to
maintain current levels of intergenerational transCANADIAN PUBLIC POLICY – ANALYSE DE POLITIQUES,
fers to elders and, two, public assistance for the aged
must be tied more closely to the well-being of the
generation whose taxes provide public pensions. He
views the CPP as the logical place for cuts, suggesting that it could be phased out over ten years or
altered so that payment levels are tied to growth in
the real earnings of workers. Lam, Prince, and Cutt
focus on ways to restore the CPP, a program whose
repair they view as important to reviving a Canadian collective identity. Noting that population aging is only one of many factors affecting the feasibility of the CPP, they sift through a number of options for reform and for each option consider its rationale, effect on contributors, socio-legal implications, and financial impact. They then recommend
the following five measures to reform the CPP:
(i) quickly raise the contribution rate to 8 percent;
(ii) invest contributions through the capital market,
with investments regulated by an independent authority; (iii) gradually raise the age for full pension
entitlement to 79; (iv) freeze the retirement pension
at its current level of purchasing power; and (v) remove survivor and disability benefits from the CPP
and provide them through another program such as
Worker’s Compensation, Old Age Security, or the
Guaranteed Annual Supplement.
The volume concludes with Paul Dickinson’s
paper on six common misperceptions/myths about
the CPP as presently constituted. These
misperceptions are: (i) few of today’s seniors are
poor, and a large portion of federal benefits goes to
high-income seniors; (ii) the CPP is regressive because low-income workers contribute a larger share
of their earnings than high-income earners; (iii) the
CPP does little to help low-income elderly persons;
(iv) future generations of workers will have less
disposable income than today’s workers because
CPP contribution rates must increase to finance the
plan when the baby boomers retire; (v) today’s
younger workers will earn no interest on their CPP
retirement contributions, and future generations will
receive less in benefits than they pay in contributions; and (vi) the CPP is approaching bankruptcy.
He points out the danger that these misperceptions,
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if left unchallenged, could be accepted without question and could even lead to the demise of the CPP
through self-fulfilling prophecy.
When We’re 65 is somewhat mistitled — it is not
really about reforming the Canadian retirement income system. While the paper by Dickinson, and to a
lesser extent that by Burbidge, explicitly recognize the
inter-connectedness of our pension system, the other
papers discuss reforms to one part of the system only,
without considering the implications of changing that
part on the other parts and/or on the whole. The papers are ordered in an odd way — from the specific to
the general — with background papers preceding specific policy-proposal papers. On the other hand, there
is a clear, albeit implicit, “right to left” ordering of the
papers. While there is much for thought provided in
this volume, there is one major disappointment. I am
truly amazed that a book dealing with pension reform
in the 1990s fails to deal with women, and ignores
gender differences in a discussion of the effects of
public policy and public policy changes.
ELLEN M. G EE, Department of Sociology and Anthropology, Simon Fraser University
Less Than Zero: The Case for a Falling Price
Level in a Growing Economy
by George Selgin. London, UK: The Institute of
Economic Affairs, #132, 1997. Pp. 81.
In this brief monograph, Professor Selgin makes the
case for a “productivity norm” as the operating rule
for a central bank. With rising productivity, there would
have to be falling prices, hence the title of the book.
Selgin eloquently makes the case for a falling price
level, both theoretically and empirically, and points
out repeatedly how this “productivity norm” and accompanying deflation are to be preferred to zero inflation. In Selgin’s world, “change in velocity would
be prevented ... from influencing the price level through
offsetting adjustments in the supply of money” (p. 10).
While those who agree that “... unemployment is a nonmonetary or natural economic condition ...” (p. 9) will
probably find much to like in Selgin’s arguments,
Selgin also strongly posits the argument that “Monetary disturbances have real effects” (p. 19).
In this statement of the argument “... it is assumed
that there is a fiat-money-issuing central monetary
authority capable of insulating the price level from the
effects of innovations to the velocity of money or real
output” (p. 21). The most interesting question is thus
done away with: How and when does the central bank
know that there have been “innovations to the velocity
of money or real output?” The central bank has gone
from being a preprogrammed dispenser of money to
an omniscient corrector of “innovation.”
Selgin also sides with those “revisionists” who now
deny that there was a depression in England in the last
quarter of the nineteenth century contravening the testimony of those who lived through it now that they are
not here, in terms which are quite similar to those who
are praising the Bank of Canada’s current deflationary policy in the face of 10 percent unemployment
because it is “natural,” and ignoring the voices of those
who decry the high and persistent unemployment of
the 1990s in Canada. Although he concedes there was
a depression in the 1930s, I suspect that that will be
eliminated by his followers in another couple of decades when those who experienced it are also conveniently gone.
Whether you agree with its thesis or not, this book
is an interesting and useful addition to the debate on
central bank policy which will certainly generate much
further discussion and research.
RALPH KOLINSKI, Department of Economics, University of Windsor
Economic Growth, Technological Change, and
Canadian Economic Policy
by Richard G. Lipsey. C.D. Howe Institute Benefactors Lecture. Toronto: C.D. Howe Institute, 1996.
Pp. 87.
No one in Canada has done more to foster public
understanding and academic study of economic
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468 Reviews/Comptes rendus
growth than Richard Lipsey. The views he has put
forth in numerous publications, meetings, and public speeches have helped shape Canadian policy discussions. Through the Canadian Institute for Advanced Research he has been a leader in new growth
theory at the highest level. These lectures summarize his views on growth and sketch their implications for Canadian public policy.
Lipsey advocates a radical break from mainstream economics, which he argues cannot deal
properly with the origins and consequences of technological change, the mainspring of growth. Technological change, which in neoclassical theory is
purely exogenous, is in fact endogenous to economic
life, and especially to economic policy, which influences the level and direction of research and development, patterns of technological diffusion,
sectoral and regional adjustments, and the ability
of private individuals and firms to coordinate their
decisions in an ever changing world. The lectures
illustrate some of the policy implications of endogenous technology, with examples running from the
regulation of monopoly, which he argues, following Schumpeter, should be geared more to preserving incentives to innovate and less to fostering static
efficiency, through to federal science and technology policy, which he argues must not be blinded by
either protectionist or laissez-faire dogmas.
Lipsey maintains that technological change takes
place not just through the continuous accumulation
of new ideas in the form of new and better goods,
but through a punctuated succession of “general
purpose” technologies that pervade the economy and
transform society. These radical structural changes
raise our welfare in ways that can’t be captured by
standard growth accounting methods, which assume
an invariant underlying technological structure, or even
by existing endogenous growth theories, which also
assume a constant underlying structure, although at a
deeper level than does neoclassical growth theory.
The deep structural adjustments that often accompany new general purpose technologies are the
source not only of long-run prosperity but also of
much short-run hardship. Lipsey recognizes the
costs imposed on displaced workers and bankrupt
businesses, but argues that society typically places
too much emphasis on the costs and not enough on
the long-run benefits. He uses historical examples
going back to the bronze age to emphasize the enormity of the benefits attributable to new general purpose technologies. He also applies his insights repeatedly to the particular example of the information and communication revolution that is currently
transforming the world.
Committed neoclassicists will probably not be
persuaded to abandon their research programs by
this or any other historical argument. Nor will those
of us who are pushing Schumpeterian endogenous
growth theories. Economic theory, like technology,
has a habit of producing trajectories that no one had
thought possible. But all of us would be well advised to push our theories as far as possible to accommodate the discontinuous structural changes that
Lipsey argues have sustained economic growth for
millennia. And policymakers who want to help
Canada prosper in the new economy cannot afford
to ignore Lipsey’s message.
PETER HOWITT, Department of Economics, Ohio State
Hard Bargain: Transforming Public Sector
Labour-Management Relations
by Peter Warrian. Toronto: McGilligan, 1996.
Pp. 205. $18.95.
Peter Warrian’s Hard Bargain sweeps readers in with
the verve of a management bestseller. The New
Public Management is “disaggregating” service delivery everywhere. Public sector Wagnerism is obsolete, and unions that resist multi-skilling and cooperation court disaster. Impelled by restraint, and
informed by Reinventing Government, local managers can now plausibly threaten “political exit”
from practically every field. GM may always make
cars, but “Premiers like Ralph Klein ... and Mike
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Reviews/Comptes rendus
Harris ... have no such base commitment to government services” (p. 19).
Yet service and productivity gains ultimately require enthusiastic workers, and excessive contracting out “means putting yourself out of business”
(p. 128). Ignoring these realities means deadlock,
or “a downward spiral of bloody-mindedness,” layoffs, and cuts (p. 102-3). Only flexible, participative
workplaces can survive restraint more or less intact.
So Warrian offers a post-Wagner compromise. In
exchange for accepting multi-skilling, with wages
and job security tied to productivity, state unions
would be consulted on performance standards, and
workers would be retrained for a wider variety of
jobs, via “sector councils,” etc.
Warrian suggests that new bargaining strategies
might allow for “completely autonomous working
arrangements,” and perhaps co-management (at
Ontario Hydro!) (p. 33). But both depend on friendly
governments and enlightened (or desperate) managers. He cites unions in Indianapolis that successfully bid for city contracts. But the city included
overhead costs in all bids, and even here, “some
work has been lost” (p. 129). Given the threat of
political exit and the paucity of consistently friendly
governments, this is hardly reassuring. And how can
the value of democratic workplaces be quantified
in a competitive bid?
Despite the air of inevitability he creates, Warrian
is curiously ambivalent about the forces propelling
public sector change. The Harris/Klein approach will
produce deadlock, he says, but it is the crest of the
wave sweeping Wagnerism away. Trends in the private sector compel change in the public sector, but
so far convergence has not occurred.
More seriously, Warrian simply presumes a common interest in service. He notes that managers have
helped define the “client” needs which drive TQM,
and that similar efforts often produce more staff reductions than quality gains. Yet he never raises the
obvious questions: Is management really committed to service? Has service ever been more than an
incidental concern of the state itself?
He chides public sector unions for assuming that
the welfare state has popular support, and that state
workers and clients share similar economic interests. Yet he claims confidently that the bad old days
of unregulated management tyranny are over. So
what restrains managers, and supports government
regulation of the workplace, if not some public support for the welfare state’s “social wage”? And is
this not precisely the economic interest shared by
state workers and clients?
Warrian’s strategy would have state workers settle for minimal gains at a time when cracks are appearing in the neoconservative facade, and coalitions
with clients are creating new forms of accountability. Workers can achieve greater control of their
workplaces, and better service to clients, but
progress here will come despite state managers and
outside market mechanisms.
Hard Bargain remains a valuable guide to the
mechanics of restructuring in bargaining, hospitals,
Hydro, and local government. It provides a concise,
accessible, and wide-ranging account from the
standpoint of a veteran negotiator who, perhaps, sees
too much as non-negotiable.
GREG MCELLIGOTT, Division of Social Science, York
Understanding Canada: Building on the New
Canadian Political Economy
edited by Wallace Clement. Montreal and Kingston:
McGill-Queen’s University Press, 1997. Pp. x , 408.
This volume may be seen as a sequel to the 1989
publication, edited by Wallace Clement and Glen
Williams, The New Canadian Political Economy.
Many of the same authors appear in both volumes,
though the confident moralism of the earlier book
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470 Reviews/Comptes rendus
is more soberly and indirectly presented here. There
is still talk of social democratic (and even Marxist!) “solutions” to various economic, cultural, and
environmental problems. Clever postmodern titles
employing parentheses to make puns are both used
and cited. Many of the essays have bibliographies
as well as endnotes, so readers looking for an extensive collection of materials, all of which are ideologically compatible, not to say homogeneous, will
be well served. If a note of criticism may be permitted, it was (to this Westerner) amazing to read about
the National Energy Program in terms of Canadian
economic nationalism. It was odd as well in a book
written from the “tradition” of political economy to
read an analysis of aboriginal self-government that
never mentioned the more basic problem of aboriginal self-sufficiency. Finally, the discussion of “social forces” in Quebec that led to an “emerging
francophone bourgeoisie and ... labour movement”
neglected to attend to the fact that these “forces”
amounted to the most rapid and thorough
secularization of a people in Western history. Nor
did it mention the possibility that these new
francophone organizations might usefully be seen
as heirs to a previously existing francophone organization, the Church. Using language favoured by
many of the contributors, this collection exhibits
many fine examples of the aspiring hegemonic discourse of an English-speaking central Canadian intellectual class, located primarily in Ottawa and
Toronto, and strategically sited at York and Carleton
universities. If you liked the perspective presented
in The New Canadian Political Economy, you will
like Understanding Canada.
B ARRY C OOPER , Department of Political Science,
University of Calgary
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Reviews/Comptes rendus
Canada-Japan Trade Council. The Japanese Market for Quebec Software. Ottawa: Canada-Japan
Trade Council, 1996. Pp. 27.
Richard E. Feinberg. Summitry in the Americas:
A Progress Report. Washington, DC: Institute for
International Economics, 1997. Pp. xvi, 261. $20.00.
James Gwartney and Robert Lawson. Economic
Freedom of the World 1997. Vancouver, BC: The
Fraser Institute, 1997. Pp. xxi, 287.
Wolfgang Hoffmann-Riem. Regulating Media: The
Licensing and Supervision of Broadcasting in Six
Countries. New York, NY: Guilford Press, 1996.
Pp. xxi, 424. $49.50.
Isabella Horry, Filip Palda and Michael Walker
with Joel Emes. Tax Facts Ten. Vancouver, BC: The
Fraser Institute, 1997. Pp. xvi, 155.
Mark Janis, Richard Kay and Anthony Bradley.
European Human Rights Law: Text and Materials.
Don Mills, ON: Oxford University Press, 1995.
Pp. xxxvi, 516. $59.50.
George Macesich. Transformation and Emerging
Markets. Westport, CT: Praeger Publishers, 1996.
Pp. ix, 128. $52.95.
National Council of Welfare. Healthy Parents,
Healthy Babies. Ottawa, ON: Minister of Supply and
Services Canada, 1997. Pp. 42.
National Council of Welfare. Child Benefits: A
Small Step Forward. Ottawa: Minister of Supply and
Services Canada, 1997. Pp. 22.
National Council of Welfare. Poverty Profile 1995.
Ottawa, ON: Minister of Supply and Services
Canada, 1997. Pp. 94.
National Council of Welfare. Welfare Incomes
1995. Ottawa, ON: Minister of Supply and Services
Canada, 1996. Pp. ii, 44.
Willis J. Nordlund. The Quest for a Living Wage:
The History of the Federal Minimum Wage Program.
Westport, CT: Greenwood Press, 1997. Pp. xviii,
283. $57.95.
E. Rico Sabatini with Sandra Nightingale.
Welfare-No Fair: A Critical Analysis of Ontario’s
Welfare System (1985-1994). Vancouver, BC: The
Fraser Institute, 1996. Pp. x, 292.
Philippe R. Scholtès (ed.). Industrial Economics
for Countries in Transition: Evidence from Eastern
Europe and Asia Pacific. Brookfield, US: Edward
Elgar Publishers, 1996. Pp. xviii, 192.
Thomas T. Schweitzer, Robert K. Crocker and
Geraldine Gilliss. The State of Education in
Canada. Montreal, PQ: The Institute for Research
on Public Policy, 1995. Pp. 141.
VOL . XXIII, NO . 4 1997