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‘It’s not market failures as much as government failures’: Pro-market conservatives make their case to workers

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In the wake of a wide-ranging ideological rethink after Donald Trump’s presidency, it seemed that for North American conservatives, everything was on the table.

Even free markets, for decades the lifeblood of just about every right-of-centre idea, were now being eyed with a new kind of skepticism.

A new crop of policy wonks, gathering at think tanks like the American Compass, skewered old orthodoxies by questioning free trade, advocating slightly more government intervention in the economy, and prioritizing policies like family benefit cheques over balanced budgets.

These ideas have provoked keen interest among Canadian conservatives and even found themselves in the most recent Conservative platform, which was touted by the party as “pro-worker.”

Now, as the post-pandemic economy roars to the extent that inflation has become a serious problem, some right-of-centre thinkers are yanking the reins on these new ideas.

Aside from a few highly concentrated areas, North American workers are doing relatively well, argued Scott Lincicome, the director of general economics and trade at the Cato Institute, a libertarian think tank, and the editor of the new book Empowering the American Worker: Market-Based Solutions for Today’s Workforce, in an interview with The Hub.

“We really need to first start out with the fact that the general story of the last 30 or 40 years for the median American worker is pretty decent,” said Lincicome. “In general, median inflation-adjusted wages are going up, and they have gone up substantially since the hyper-globalization days of the 1990s. People have found jobs outside of manufacturing. Yes, manufacturing jobs have generally declined, but they’ve been declining since basically the 1950s.”

Lincicome argued that intervening to save “good jobs” and supporting workers in these declining industries may seem like a compassionate short-term idea, but it encourages people to cling to sectors that are no longer viable.

The city of Youngstown, Ohio receives more federal aid than any city in the United States, but is still synonymous with industrial decline, he argued.

“Youngstown today is still talking about reviving the old Youngstown steel plant,” said Lincicome. “They are still trying to embrace this kind of nostalgic view of the U.S. economy… Quite frankly, I think it’s perfectly fine for the residents of Youngstown after 40 years of futility to say, ‘to heck with this. I’m out.'”

As Lincicome’s book marks a growing response from libertarian-minded conservatives to the more interventionist thinkers like Cass, a similar transition could be playing out in Canadian politics.

Conservative leader Pierre Poilievre has mentioned the libertarian economist Milton Friedman half a dozen times in the House of Commons. He has twice referenced Friedman’s reading of I, Pencil, an essay about how a pencil is manufactured, which argues that the process is a triumph of global cooperation brought about by the free market.

People close to Poilievre say it is free market economists like Friedman and Friedrich Hayek who shaped his thinking on these issues, although Poilievre has shown some flexibility in the last year as he makes populist appeals to voters.

Even as he sounds those populist notes, it’s still a big tone shift from his predecessor.

Former Conservative leader Erin O’Toole unveiled a platform in 2021 that was touted as worker-friendly, and O’Toole worked hard to attract blue-collar workers.

A Labour Day message from O’Toole not only blamed “big government” for layoffs in the manufacturing and energy industries, but also “big business,” which he argued “cares more about their shareholders than their employees.”

O’Toole’s plan even caused concern on the Left that he was going to flank the progressive parties with his opposition to unfettered free trade with countries like China.

Former Alberta Premier Jason Kenney said in 2019 that he was closely following the ideological debate around reform conservativism and expected that these ideas would gain momentum in Canada. Kenney had planned to bring his own brand of reform conservatism to Alberta before deciding that the province needed a supply-side jolt to encourage investment.

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Lincicome argued that the fixation on free trade with China, whether from the Right or the Left, is unproductive.

“I think that the general approach to China in the 1990s and 2000s was actually about the best we could plausibly hope,” said Lincicome, who argued that no country, even the United States, had a veto on China joining the World Trade Organization.

At the time, any dissenting countries would simply miss out on a chance to enter the massive market that China represented while losing the opportunity to settle trade disputes through the WTO. Lincicome argued that more than two-thirds of China’s export growth came from internal reforms, rather than the WTO and anything decided by Western countries.

Cass’s book, entitled The Once and Future Worker, seeks “the renewal of work in America.” For Lincicome, the best way for a government to help workers in the future is to hedge its bets and provide flexibility rather than choosing which industries or workers need to be saved.

“Labour policy really needs to focus on maximizing autonomy and flexibility, and adaptation, because the trends of a few years ago are not going to be the trends in a few years. A few years ago, we thought everybody was moving to New York and San Francisco. Now those places are struggling to find commercial tenants. We thought that everybody wanted a nine-to-five job with health insurance, or whatever. Now we’re seeing this explosion in independent work,” said Lincicome.

Ontario looks to private clinics and the ‘B.C. model’ to clear surgical backlog

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Ontario Premier Doug Ford said he hopes private clinics will bring the province’s surgical backlog to normal levels in a matter of months and promised on Monday that the expanded capacity at for-profit clinics is here to stay.

“We’re going to change people’s lives, we’re going to make sure we get caught up,” said Ford, at a news conference in Toronto.

The plan follows other provinces, including British Columbia, Quebec, and Saskatchewan, that have swiftly cleared surgical backlogs caused by the COVID-19 pandemic by turning to private clinics that perform publicly-funded procedures.

“We need to look to other provinces and countries to see what they do differently and borrow the best ideas. We also need to be clear Ontarians will always access health care with their OHIP card, never their credit card,” said Ford.

As part of phase one of Ford’s plan, the province will tackle an extensive backlog for cataract surgeries by working with for-profit surgical and diagnostic centres in Windsor, Kitchener-Waterloo, and Ottawa. The plan is expected to add the capacity for 14,000 new surgical procedures each year, which the province hopes will clear about a quarter of the backlog for cataract surgeries.

Ontario is also spending $18 million at existing centres to boost the amount of MRI and CT scans, cataract surgeries, ophthalmic surgeries, minimally invasive gynecological surgeries, and plastic surgeries.

Phase two of the plan will further expand capacity for cataract surgeries and colonoscopy and endoscopy procedures, among others. Phase three will expand MRI and CT scanning at for-profit clinics and expand surgeries for hip and knee replacements starting in 2024.

By using these private clinics, Ontario expects the waitlist to return to pre-pandemic levels by March.

Although support for private clinics, even those that are performing publicly-funded services, has been historically unpopular in Canada, the massive health-care logjam caused by the pandemic may be changing things.

A year ago, the province’s surgical backlog reached a million procedures and the Ontario Medical Association said the backlog of health-care services, including cancer screenings, MRIs, and CT scans, had reached 20 million. The province now estimates there are more than 200,000 people waiting for a surgical procedure.

In a recent interview with The Hub, Janice MacKinnon, who was a cabinet minister in Saskatchewan and has written extensively about the province’s experience with private delivery, said the political difficulties can be overcome if political leaders focus on straightforward goals, like clearing a certain amount of patients off the waiting list.

Emanuela Tura, a family doctor in Victoria, B.C. who is also licensed to work in Australia, argued that Canadians aren’t currently getting bang for their health care buck.

“Australia subsidizes the cost of most medications. It also partially or fully pays the costs of psychologists, (and) allied members such as podiatrists, physiotherapists, chiropractors, dietitians, et cetera,” said Tura. “Similar to medications and allied care, it allows hybrid care for family doctors, surgical, and medical services.”

Tura points out that the per-person cost of health care in Canada, which was $7,507 CAD in 2022, according to the Canadian Institute for Health Information, is very similar to the same cost in Australia, which was $7,248 CAD.

In August, it was reported that British Columbia’s NDP government had paid almost $400 million to private clinics to perform surgeries on the province’s backlog.

Brian Day is a surgeon in Vancouver who helped found the Cambie Surgery Centre in 1996.

“Almost every doctor’s office in Canada is privately operated, and the funds to support generally come from the taxpayer,” says Day. “Our private centre in B.C. opened smack in the middle of a 10-year rule of the NDP.”

In 2020, Day launched an unsuccessful constitutional challenge to the laws preventing patients from accessing private health-care delivery when wait times are too long. The case is expected to end up at the Supreme Court of Canada. Day says there is nothing “earth-shattering” about the B.C. and Ontario government’s engagement of private clinics to clear the backlogs.

Day says the involvement of private clinics must continue or Canada’s health-care system will bankrupt the country.

“I understand that the surgical facilities in Canada outside Quebec are still fully subsidized by the government,” says Tura. “In general, I am not sure why we are banning private care. It is used in pretty much all countries with universal care, and overall their care is better.”

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During a press conference on Monday, Ford said the increased capacity at private clinics wasn’t just a temporary measure to deal with the pandemic backlogs but would be maintained to take the burden off hospitals as the population ages.

“I always believe it’s not ‘either-or,’ it’s ‘and.’ We have great hospitals working hand in hand with the clinics and that’s the way we’re going to operate, excuse the pun,” said Ford.

Critics argued there would be a migration of doctors and nurses to private clinics from the public system.

“Ford’s plan will mean you’ll pay extra fees for care while more health care workers are driven out of the public system,” said Marit Styles, who is running unopposed in the Ontario NDP leadership race and will officially become the party leader in March. “On behalf of every Ontarian, I will fight to protect publicly funded, publicly delivered health care.”

Ontario Health Minister Sylvia Jones said the vast majority of new nurses were hired in the public system and said the province would be interrogating the private clinics about how they plan to staff up to handle the extra work.

With files from Stuart Thomson