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Sean Speer: The budget is a sign that progressives are winning the battle of ideas

Commentary

The world of political ideas moves similar to the way Ernest Hemingway described going bankrupt in his novel, The Sun Also Rises: “gradually, then suddenly.”

It wasn’t that long ago that British Prime Minister Tony Blair was talking about “third way” Labourism, U.S. President Bill Clinton was declaring the “era of big government was over,” and Canadian Finance Minister Paul Martin was balancing the federal budget “come hell or high water.”

The end of the twentieth century and the start of our current one seemed to mark the ascendancy of a new, limited government orthodoxy that prioritized low taxes and balanced budgets and was wary of the economic and fiscal costs of large welfare states. That the chief proponents of this nascent consensus were often center-left politicians spoke to its fecundity.

It didn’t happen overnight of course. It took years — even decades — for conservative intellectuals such as economists Friedrich Hayek and Milton Friedman and social scientists Irving Kristol and Nathan Glazer to chip away at the “mixed economy” model (including large-scale entitlement programs, high marginal tax rates, and a “visible hand” in market outcomes) that was popularized in the immediate post-WWII era.

These intellectual activities, including conferences, policy papers, journal articles, and so on, mostly occurred outside the mainstream of western politics. They weren’t quite fringe ideas, but they didn’t have much purchase in the political arena either. Conservative politicians like Republican President Richard Nixon or British Prime Minister Edward Heath were mostly upholders of their era’s big government consensus.

Yet these intellectuals continued to cultivate a new ideational framework in waiting. They sharpened their critiques of government intervention in the marketplace and the failings of welfarism and began to develop an alternative policy programme that sought to reduce the size and scope of the state in the economy and society.

As important as these efforts were, ideas alone weren’t enough to change the course of history. Events also needed to conspire. It required a crisis of the prevailing system — the so-called “stagflation” crisis of the 1970s — to fully open the door to a conservative revolution in ideas. A combination of Britain’s “winter of discontent” in late 1978 and Jimmy Carter’s famous “malaise” speech in July 1979 in hindsight marked key intellectual turning points.

By then, both Hayek and Friedman had won the Nobel Prize and Margaret Thatcher had been elected prime minister. Ronald Reagan would follow in November 1980. What had started slowly soon moved quickly. It spread across the developed world including, of course, Canada.

The subsequent 30 years or so were mostly shaped by this broadly-defined center-right orthodoxy. Although governments sometimes deviated for various political economy reasons, the overwhelming policy trends were in the direction of significant tax reductions, free trade agreements, privatization efforts, and lowered expectations for the welfare state. That these policy reforms spanned the political spectrum reflected how overwhelmingly conservatives had wrestled control of the terms of contemporary policy debate.

The side that’s shaping politics is typically the one that is genuinely and relentlessly committed to the realm of ideas.

I retell this abridged version of the Right’s slow yet steady intellectual ascendancy in the late-20th and early-21st century because I was reminded of it by yesterday’s federal budget.

In response to the Trudeau government’s announcement of massive new funding for universal childcare, a $15 minimum wage and various other progressive priorities, University of Victoria economist Robert Gillezeau tweeted the following:

I’m halfway through #Budget2021 and it’s amazing to see a decade of work from progressives bearing fruit. Universal child care, a $15 federal minimum wage, and expanding the Canada Workers Benefit…. if folks put aside cynical politics this could be a Pearson-Douglas moment.”

As a social democrat this is a moment of triumph. Many of the centrepieces of the policy agenda that Jack [Layton], Tom [Mulcair], and Jagmeet [Singh] have articulated are here. They have shaped not just our dialogue, but the direction of the country.”

Are there pieces missing? Of course and social democrats should offer a path there (particularly on housing and inequality), but we can also acknowledge our successes as progressives.”

Although I generally disagree with Gillezeau on politics and policy, I think he’s both highly smart and highly decent. I also think he’s right.

Yesterday’s federal budget (along with the Biden Administration’s activist ambitions in the United States) signals the rise of a new, confident progressivism that has set its sights on the commanding heights of policy and governance.

It mostly rejects concerns about the disincentives of high rates of taxation, the economic costs of deficits and debt, or the limits of state action. Instead it advances a governing vision rooted in the idea that inclusion and equity are not only greater priorities than economic efficiency but are actually themselves drivers of growth and long-term value. This is a far cry from limited ambitions of Blairism, Clintonism or what the Fraser Institute has described as the “Chrétien Consensus.”

As Gillezeau observes, this progressive advance similarly didn’t occur overnight. It started as an intellectual movement that rejected centrist compromises and instead sought to restore a more robust left-wing politics that more closely resembled the post-war orthodoxy that Hayek, Friedman, and others had undone. Its ideas were mostly confined to university campuses and the world of social activism. Its chief political proponents were third parties like the New Democratic Party or outsiders like U.S. Senator Bernie Sanders.

But progressive intellectuals kept up the important work of ideation and policy thinking in academic journals, think-tank reports, and other venues. They utilized their privileged position in academia to build support among young people and became effective users of multimedia channels to promote and disseminate their ideas.

Eventually, though, as in the past, events have contributed to their growing salience. If the global financial crisis was a pivotal moment, the COVID-19 pandemic has created a massive opening to see these political ideas come to fruition. The Trudeau government’s adoption of some of them in yesterday’s budget represents the culmination of these efforts. It’s a powerful (and perhaps sobering) sign that progressives are winning the battle of ideas.

There are a couple of key lessons here. The first is that there are no permanent intellectual victories. One can never become complacent because a combination of new generations, new challenges and unexpected events are bound to threaten previous intellectual advances. It’s incumbent therefore for intellectual movements to remain rigorous and dynamic.

The second is related: political progress starts with ideas. They may not be all that matters but they matter more than we often realize in the moment. The side that’s shaping politics is typically the one that is genuinely and relentlessly committed to the realm of ideas.

Depending on one’s persuasion, a recognition of the rising progressive tide is either a cause for celebration or a call to intellectual action. Either way, it’s a reminder of Richard Weaver’s famous adage: “ideas have consequences.”

Boessenkool and Roth: The key to childcare is choice and flexibility

Commentary

A fresh childcare debate is emerging in Canada as attention starts to turn to post-pandemic economic recovery and as one of the most prominent voices in the debate has expressed it, “no recovery without a she-covery. No she-covery without childcare.”  

The key difference in this debate is between those who would maximize flexibility for working parents and those who would build an entirely new one-size-fits-all institution for the care of children. 

For us, government support for families with children must maximize choice and flexibility. New cash payments and tax benefits for families introduced under former Prime Minister Stephen Harper and expanded under the current Liberal government exemplifies this approach. It recognizes the inherent value society places on children — kids are not boats, after all — but gives parents flexibility by recognizing and supporting that societal value in the form of cash for parents, not programs from government. 

While we don’t doubt that those on the other side of the childcare debate share this end goal, their approach often loses sight of it, distracted as it is by another objective: a brand new normative government entitlement. A recent paper by Senator Rosemary Moodie and New Brunswick Lieutenant Governor Margaret McCain summarizes this objective as follows: 

“First, strong early childhood education should be a non-mandatory entitlement starting at two years of age and therefore properly recognizing the first tier of education — a tier just as important as primary, secondary and post-secondary education. This would complement enhanced parental leave benefits to more families. It should be the norm, whether or not parents are working, and be protected from economic downturns,” the paper reads.

The oxymoronic “non-mandatory entitlement” is an interesting turn of phrase belied in other places where the authors call for a program that is “universal and therefore accessible to all children,” which gets at what the authors are really interested in and prompted one of us to summarize that the study as follows

“So here we have a call to institutionalize all children at age two, whether or not parents of those children are working or not working and whether or not the parents of those children are very rich or very poor.  Just so we’re clear.”

Our view, in contrast, is that policy that enables parents to work must not restrict their choices.

Our approach to childcare means maximizing choice and flexibility when two parents (or one in the case of single parents) are engaged in work or school outside of the home. It can be done primarily through tax or cash payments to parents who require care so they can choose the care best for their children.

In practical terms, this means parents could choose from a variety of arrangements including everything from regulated, institutional care to support from a grandparent or neighbour. This approach recognizes the value society places on parents of children being engaged in work or school outside of the home but gives parents flexibility to arrange family care in the way that works best for them.

The size and specifics of this subsidy should be a matter of public debate, but at the core of our support for public investment in childcare is the view that public policy should recognize the additional cost of working or going to school. Put another way, if you work you should not be disincentivized to have children and if you have children, you should not be disincentivized to work.  

Childcare policy should also seek to correct for two other market failures. First, a signalling failure regarding the quality of care. A strong childcare policy should ensure that when parents take the leap of faith required to leave their children with someone else for the day, they can have some assurance and expectation of quality of care. But in a dynamic childcare market, providers will always have more information than purchasers of care. For this reason, governments should play a role regulating the quality of care. The level and degree of regulation should be a matter of public debate, balanced by the need for the flexibility for parents choosing care.  

Second, the market may fail to produce enough childcare spaces to meet the demands of new parents. Available spaces will be heavily influenced by the level of tax or cash support for childcare because more generous support will make more money available to build spaces. It will also be influenced by the degree of regulation because a more stringent regulatory regime will increase the cost per space.

Even with very generous tax or cash support and modest regulation, the market may not produce adequate spaces. Good childcare policy must prioritize accessibility, but a scarcity of spaces does not necessitate a universal, institutional approach. Filling this gap can be achieved by targeting public subsidy for spaces, the size and scope (operating vs capital) of which should be a matter of public debate. 

This trifecta of policy tools — support for parents, regulation and funding spaces — describes Canada’s current system of childcare. And this system provides a great deal of policy flexibility. You could have modest tax support coupled with light regulation and modest subsidies for new spaces.

This could produce a system of public support for a broad mix of types of care, from private to non-profit to public to personal care by family or friends. Or you could have $7 per day care by heavily subsidizing both parents and spaces coupled with a very stringent regulatory regime on the quality of care.  

Those on the other side of this debate have one singular goal, an end in and of itself, detached from the policy aims of assisting with the cost of childcare so parents can go to work or school. They want to create an entirely new public institution, like our primary and secondary schools, into which children above the age of two will go. Moodie and McCain’s concluding sentence really says it all: “Universal, high-quality early learning and childcare that is a publicly funded and publicly managed entitlement will transform our society.” 

Unfortunately, a publicly-funded, publicly-managed universal childcare institution for children under two would transform our society for the worse. It would unravel the choices parents currently have about the type and style of care they prefer for their children when they go to work or school, care that we agree should receive public support, just not the kind of support that would institutionalize children at the age of two.