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The Promise and Peril of International Trade
by Jeff Colgan. Peterborough: Broadview Press,
2005.
Free trade — yes or no? This is the basic but beguiling question Jeff Colgan poses in this balanced
analysis of the attributes of international trade.
Through a series of very useful case studies, he acknowledges the multifaceted nature of the free trade
debate as both economic doctrine and policy prescription. He clearly outlines the economic case for
free trade in an accessible manner which undergraduates will easily grasp, preparing them for
analysis of the cases Colgan canvasses. Students will
benefit immensely from the care and balance in the
presentation of those cases, though experts in each
area will no doubt decry the lack of analytical detail. But in a text of this sort detail must give way to
précis, and this the author does very well. Colgan
also does a commendable job of bestriding the vast
empty reaches between pro- and anti-free traders, a
space that needs to be surveyed more thoroughly;
the debate is so polarized that a reasoned, detached
perspective is precisely what is required.
But the one major drawback of Colgan’s approach
is that even after making and accepting the economic
argument for free trade in theory, the real-world
cases undermine it. In the end, Colgan must, as any
proponent of free trade, rest his argument on a fundamentalist leap of faith that the rationalism of economics will prevail over the emotionalism and
pragmatism of human behaviour in other spheres
like politics. But this is not very helpful in the world
of power politics. When the United States simply
says “no” yet again to Canadian complaints about
unfair penalties against softwood lumber, notwithstanding victory after victory before various WTO
and NAFTA tribunals, one is left wondering about
the utility of endorsing a doctrine whose rules are
observed only when it suits the most powerful actor
to do so.
To be fair, the harsh reality of real-world conditions failing to bend to the theoretical schemas of
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mainstream economists is alluded to and described
in Colgan’s study. He illustrates, often implicitly,
(though does not condone) in several of his cases
that “might is right,” theory be damned. But he nonetheless holds to the economic arguments. As the
author readily acknowledges time and again, significant numbers of people continue to be adversely
affected — even harmed — by free trade. Demonstrations in the streets where the WTO and world
leaders meet confirm that huge parts of civil society remain un-persuaded of the merits of free trade.
Moreover, one does not need to be a conspiracy theorist or old-school Marxist to note the studies that
show the disproportionate benefits of free trade
flowing to the rich and powerful.
However, as Colgan documents, free traders
themselves are often their own worst enemies. Given
the glorious opportunity to prevail prescriptively,
they allowed their ideological blinkers to blind them
to the downsides of their project, both within North
America and globally. Hence the real value of
Colgan’s approach, which is to thoughtfully document the many pitfalls and even tragedies associated with the stronger ideological imposition of onesize-fits-all free-trade policies. Whether the issue
is AIDS/HIV and the power of multinational pharmaceuticals to hold back life-saving drugs, or genetically modified foods with all their attendant
controversies, or the deleterious impact of unbridled
trade on the environment, it seems the ideologues
remain closed to any hint that there is considerable
nuance beyond just applying free market principles
to policy problems. The ideological anti-free traders, of course, fare no better, as Colgan derides their
knee-jerk responses to international trade initiatives.
It is a measure of the author’s fairness that the
answer to the question: Free trade — yes or no? is
highly elusive. However, despite case studies that
show that free trade does at least as much harm as
good, the author places his faith therein. He does
argue for a more comprehensive approach to policy
questions by advocating a balance between economic growth, social justice, Canadian democracy
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and the global impact of free trade. But the illustrative diagram he uses to make his point is perhaps an
unfortunate choice. It shows these four concepts on
the four points of a compass — all pointing away
from each other and suggesting disengagement
rather than integration.
bag of policy prescriptions — fair trade in all things;
free trade in those that do no harm; and some measure of protection when it does harm. There is no
simple “yes or no” answer to the question. Let’s
throw off the ideological blinkers and, as Colgan
desires, see the light.
Surely by now the answer should be clear that a
broader theoretical underpinning is needed for economic development strategies, along with a mixed
GREGORY J. INWOOD, Department of Politics and Public Administration, Ryerson University
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Continentalizing Canada: The Politics and
Legacy of the Macdonald Royal Commission
by Gregory J. Inwood. Toronto: University of Toronto Press, 2005.
In this provocative book, Gregory J. Inwood describes how neoconservative continentalist interests
captured the Macdonald Commission to turn Canada
away from Liberal nationalism and to free trade with
the United States. Inwood examines the research
output and public submissions associated with the
Macdonald Commission and establishes that it ranks
as one of the largest and significant Royal Commissions in Canadian history that should be considered
on a par with the Rowell-Sirois and Gordon Commissions. Inwood also argues that the commission’s
defining recommendation that Canada pursue free
trade with the United States was a strategy adopted
by a desperate commissioner and controlling oligarchy whose commission was portrayed as a “white
elephant” waste of taxpayer dollars. The commission needed a legacy and free trade was the one they
picked. Thus, a handful of individuals changed the
future of Canada through their control of the commission. What the book does not adequately resolve,
however, is whether the Macdonald Commission
“saved” Canada with free trade or harmed Canadian
society at massive taxpayer expense.
Inwood demonstrates that the submissions to the
commission showed that the Canadian public did
not want free trade, and manufacturers were divided
as to whether they wanted it. Perhaps more importantly, Inwood makes the case that the public submissions had little influence on the commission’s
final report. Based on interviews with Donald
Macdonald, commissioners, research directors, and
key bureaucrats Inwood reveals that there was essentially no debate over free trade as a direction,
inside or outside the commission. Inwood concludes
that Canada’s move to free trade came from the
chair, Donald Macdonald, a former Gordon nationalist, controlling the agenda with his policy committee steering the commission’s recommendations
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with the large undefined research program that was
disproportionately represented by the work of neoconservative economists. The large diverse group of
part-time commissioners also contributed to the
commission being easy to control from the top.
Inwood suggests that when the commission was
put together, the research program was intended to
be headed by a political economist in the tradition
of Harold Innis. Instead, the research program was
split into an economics stream with David Smith of
Queen’s University as director, and a political science stream under Alan Cairns of UBC. Inwood argues that “economic nationalists, neo-Marxists, left
political economists, Innisian economic historians
and others were almost completely shut out, resulting in a stilted and narrow review of economic options for Canada” (p. 207). Inwood invokes Mel
Watkins’ exclusion from the commission’s research
program as evidence that Liberal nationalist perspectives were not represented in the commission’s work,
and even seems to suggest that Watkins could have
saved Canada from the continentalists. Inwood’s
critique of economics and economists as narrow and
out of touch with reality is one commonly heard
from the other social science disciplines, but in this
book, mostly from Stephen Clarkson.
In reading the book, I was also not certain what
aspects of Liberal nationalism could have been reformed or revamped to solve Canada’s emerging
economic crises of high inflation, high unemployment, declining productivity, and growing public
debt. Inwood himself suggests that a lack of ability
to articulate such a vision was a problem for Liberal nationalists. Inwood does not discuss in any
detail the apparent failures of Liberal nationalism
that led to the Macdonald Commission. The closest
the author comes is in his review of Donald
Macdonald’s experiences with the failures of nationalist policies while in government. While Liberal
nationalism worked well for Ontario (if anywhere),
something about it had broken down some time after 1878. Where the National Oil Program of the
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1960s demonstrates how well things can work in a
federal system, the National Energy Program (NEP)
of the 1980s was the darker side of the coin. Free
trade has been portrayed as a solution to western
alienation; the west had always wanted free trade
and after 1980, the existence of a Canada-US free
trade agreement would prevent liberal nationalist
governments from introducing another NEP.
The irony of this book is that where the author
laments the disproportionate influence of economists in the report and the free trade recommendation, the author chooses to focus on the social and
political legacy of the commission, but not so much
on the economic legacy. Inwood concludes that in
reflecting
the interests and beliefs of some Canadians, but
failing to reflect those of most others, the
Macdonald Commission legitimized continentalist accumulation for Canada, signaling the ascendance of market principles and loss of concern
for preserving distinctiveness…. Antipathy towards embracing the free market model in total
is evidenced by the vibrant ongoing debate in
Canada over health care, the provision of other
public services, and culture … as well as the vocal growing anti-globalization movement. The
politics of the Macdonald Commission produced
a legacy within which crisis persists (p. 324).
Is this negative assessment of the commission’s
legacy an obvious one to embrace? Given the choice
by Jean Chrétien’s Liberal Party to not tear up the
North American Free Trade Agreement, as they had
promised in their 1992 general election campaign,
was it really the case that the commission had not
reflected the opinions of most Canadians? Free trade
also appears to have grown on Canadians as
Macdonald had hoped when he recommended the
“leap of faith.” Michael Hart, a central figure in the
story line of the book, in a publication from the In-
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stitute for Research on Public Policy cites surveys
showing strong support for free trade in Canada
today (Hart 2004).
To the extent that free trade was to be justified
on the size of economic gains, the economic legacy
of the commission needed more development.
Inwood raises the key issue for the book when he
attributes a key quote to several (unnamed) commissioners: “why do all the economists agree, and
what if they are all wrong?” (p. 202). Inwood should
have been able to provide more of an answer to this
question. We have now had 15 years of free trade,
ten years since the reforms to the Unemployment
Insurance and the removal of the Crow Rate, all key
Macdonald Commission recommendations. We have
seen the expected productivity gains that the commission research economists predicted (e.g., see
Trefler 2004). Thanks to the post-1993 economic
boom, the deficit crisis was solved. We still have
public health care, employment insurance, and public pensions, thanks in large part to a productive
economy and the elimination of deficits. At the same
time, organized labour is weaker as an interest than
it was 25 years ago and the country seems more
regionally fragmented, but it would appear that these
were emerging trends in Canada before the
Macdonald Commission.
In the end, readers of this book will likely agree
that the structure of the Macdonald Commission did
allow for a handful of individuals to produce the
final report and start Canada down the path toward
free trade with the United States. Where Inwood
seems to paint these individuals as villains who
harmed Canadian society, I am not sure that all readers will agree with this view. Canadian society
changed after the 1980s, which many believe is due
to free trade, but Canadians in many respects also
have more security and higher incomes than they
did in the 1970s when the Liberal nationalists dictated Canadian policy.
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REFERENCES
Hart, M. 2004. “A New Accommodation with the United
States: The Trade and Economic Dimension,” in The
Art of the State II: Thinking North America, Volume
2, no. 2, ed. T.J. Courchene, D.J. Savoie and D.
Schwanen. Montreal: Institute for Research on Public
Policy.
443
Trefler, D. 2004. “The Long and Short of the Canada-US
Free Trade Agreement,” American Economic Review
94(4):870-95.
J.C. HERBERT EMERY, Department of Economics, University of Calgary
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Second Growth: Community Economic
Development in Rural British Columbia
by Sean Markey, John T. Pierce, Kelly Vodden and
Mark Roseland. Vancouver: University of British
Columbia Press, 2005, 338 pp.
Community Economic Development (CED) is a development approach that assumes a community’s
problems are best understood and solved endogenously. For decades it garnered no interest from
policymakers as a mainstream development approach. However, that changed during the 1980s.
Amidst the growing perception that conventional
regional development policies and programs were
ineffective, both federal and provincial levels of
government in Canada began looking for alternative development approaches — ones that were more
inclusive and capable of integrating both economic
and social objectives.
Second Growth deals with CED in a particular
development context that has challenged policymakers for decades: the more remote rural areas.
Mindful of the criticism that CED has garnered for
lacking a theoretical underpinning and systematic
research, the first part of the book draws on staples
theory to explain the emergence and implications
of economic dependency among BC forest communities. Of the two identifiable schools within staples theory — dependency and comparative
advantage — Markey and his colleagues are clearly
aligned with the former. Accordingly, staples development is viewed as altering the economy in a way
that prevents sustained growth. In the main, the authors argue that government, particularly through
its policies, has been largely responsible for the
negative consequences being experienced within the
forest sector and forest-dependent communities in
BC. In pursuing conventional growth-oriented approaches, the principle of sustained yield was never
fully adhered to, and the role of non-economic factors in creating well-being was ignored. The evidence used to document the negative impacts of
pursuing growth at the expense of diversification
provides compelling support for the authors’ asserCANADIAN PUBLIC POLICY – ANALYSE DE
tion that policy has been detrimental to long-term
community stability as well as corporate sustainability.
Dealing with the negative consequences of staples development and an increasingly complex
policy environment create a formidable development
challenge. The authors contend that if local development is to have more influence, it needs to focus
on capacity-building. Indeed, strengthening local
economic capacity is the aim of the research upon
which the book is based. With this as the central
issue, it is somewhat disappointing that existing
definitions and criteria used in measuring and assessing capacity are presented but not critically assessed. Subsequently, the authors propose a “success
factor framework” that was developed and used in
their research as the basis for assessing and influencing local development capacity. In my view, the
use of the word “success” detracts from an otherwise credible exploratory framework.
Essentially, the authors argue that there are four
main determinants of a community’s capacity to
engage in CED — human, social, economic, and
ecological capital. Collectively, these factors are said
to constitute a community’s capital, which in turn
influence success in impacting economic development. While the conceptual origins, indicators,
measures, and data sources for each factor and its
subcomponents are well justified, the same cannot
be said for the link between capacity and success in
influencing economic development.
While the framework was used to guide the research, its usefulness in measuring and affecting development capacity was not systematically tested.
This is unfortunate since a key function of empirical research is to bring data to bear on a conceptual
framework. Considering that one of the main objectives of the investigation was “to provide theoretical
substance to an investigation of CED,” systematic assessment of the framework would be appropriate.
This aside, the book does present a timely and
rich account of the community-based planning pro-
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cess the four case-study communities engaged in.
The research is very accessible to policymakers and
development practitioners. In highlighting the interrelationship between a community’s capacity and
the development context, the contingent nature of
development process is underscored. For instance,
as the state of “readiness” to engage in the development process varies, so too will the resource requirements. This is an important consideration.
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outcome(s) of the process. The authors do acknowledge the importance of evaluation and suggest some
evaluation variables. However, without systematic
analysis of each community’s progress in achieving
its vision, goal(s) or objective(s), the relationship
between capacity-building and effectiveness in influencing economic development is elusive. Empirical investigation of this issue is needed.
The description and insights into the participatory research process are particularly valuable.
Funding for research has increasingly placed importance on the “relevance” of the research as well as
university-community relationships. The book
presents a realistic evaluation of the benefits and
constraints associated with this type of research.
Moreover, the methods used are well documented
and assessed.
Fundamentally, to provide an adequate rationale
for local development policy, evidence that CED can
be more effective than top-down development approaches is required. Can CED enable a community to generate greater prosperity, sustainability,
adaptability to change or a diversified economy?
Does it develop entrepreneurship? Among which
community constituents? Can it overcome dependency on external stakeholders when it relies on government funding? Second Growth provides a solid
foundation for dealing with these questions.
At the outset the investigation is said to look at
“the capacity of CED to be a contributing force to
the successful transformation and/or continued prosperity of rural areas.” This begs examination of the
MONICA DIOCHON , Schwartz School of Business and
Information Systems, St. Francis Xavier University
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Risky Business: Nuclear Power and Public
Protest in Canada
by Michael D. Mehta. Lanham, MD: Lexington,
2005. 128 pp., index.
At its best, this compact book is a closely textured
and candid case study of a small community-funded
advocacy group, Durham Nuclear Awareness (DNA)
of Oshawa, Ontario and its attempt in 1994 to
constrain the relicensing by the federal regulator,
the Atomic Energy Control Board (AECB), of the
nearby Pickering Nuclear Generating Station. The
nuclear reactors at Pickering A were among the first
in the Ontario Hydro system to feed power to the
grid, and in the summer of 2005 have been scheduled for de-commissioning, as being too compromised by limitations in their initial design and the
wear and tear of decades of use to warrant rehabilitation. This denouement gives the DNA struggles
of a decade ago an aura of prescience, and a certain
eerie relevance within contemporary debates about
how to meet rising energy demands in the presence
of the Kyoto Accord and aging nuclear facilities.
The opening chapters set the socially constructed
and culturally embedded risk paradigms of the DNA
and the technically defined positivistic concepts of
the AECB with the risk literature as it existed in
1996. The middle chapters describe the anti-nuclear
movements of France, Sweden, Germany, the United
States, and Canada and situate the DNA history of
interactions with the regulator within the institutional structures that existed in 1994. Soon after, the
AECB was reconstructed as the Canadian Nuclear
Safety Commission and the findings of its in-house
scientific establishment were opened up to peer review and wider scholarly scrutiny. These changes
may not be sufficient resolutions for the dilemmas
of too close alliance between the industry and its
regulator that Mehta finds here. We cannot know
from this work, for the only post-1996 references
in the bibliography are to two of the author’s own
CANADIAN PUBLIC POLICY – ANALYSE DE
publications. Neither the key mid-1990s studies by
William Leiss and his colleagues of scientific appraisals of risk within the federal public service,
spurs to reform in Canada, nor the highly influential cross-national studies that emerged from Sheila
Jasanoff’s analysis of the BSE crisis in Europe and
led to reconsiderations of risk analysis within the
European Union, are cited and neither appear to inform Mehta’s appraisal of the forces at work in the
Pickering relicensing.
But the two ethnographic chapters, “The Battle
over the Pickering Nuclear Generating Station” and
“David and Goliath Meet on the Shore of Lake Ontario,” told on the basis of fine insider knowledge
of the information and tactics accessible to the Durham advocacy group show well the clashes of technical and social constructions of technological risk.
As these disputes unfold at the meetings with the
AECB in Ottawa, at municipal council sessions,
DNA strategy conferences, and at the 14 December
AECB hearing which resulted in the 22 December
decision to relicence Pickering without an environmental assessment, we see the power of closely held
information and institutionally venerated expertise
to hobble public interventions in matters of deep
moment for the neighbours of nuclear sites. In the
telling of these narratives, Mehta is frank about his
own mis-steps as an observer, their effects on his
access to information and the unfolding of events.
There is no formal discussion of his ethnographic
methodology, but he has the courage to offer his experiences as cautionary tales. Young scholars, about
to embark upon field studies among actors similarly
constrained by the absence of public information and
the presence of scientific knowledge that yields more
uncertainty than definable estimations of risk, will
learn a good deal from this book.
JOY PARR, Interdisciplinary Canada Research Chair
Technology, Culture and Risk, University of Western Ontario
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