Subsidies, union demands a plea for special treatment at the expense of others

Without the ideological justifications of the 20th century, special interests demands are blindingly obvious for what they are

CALGARY, AB, Jun 5, 2014/ Troy Media/ – Back in the 20th century, much of the world’s politics was shot through with deep-rooted ideologies that had a considerable, often negative, effect on humanity.

This month’s celebration of the 70th anniversary of D-Day and its aftermath provides us, therefore, with the opportunity to both recall the influence those ideologies had on political debates and to contrast them to the relatively more mundane, “back” to normal politics of the 21st century, as exemplified by a competition between narrow interests and the general, public interest.

A corporation in search of a taxpayer subsidy – say, the recent $700-million request by Chrysler Canada – is an example of a narrow interest, as it would divert tax dollars away from the general interest, whether to be spent on tax relief or a new bridge.

Of course, last century’s ideological battles were not immune to such “back-to-normal” political battles. They were simply subsumed beneath the fervour of ideology, such as Nazism in Germany, or Communism, which many countries faced after Nazism was defeated.

Communism, and the notion of collective action in the economy, had been around in various forms since at least Ancient Greek philosopher Plato, but it was given new life with the 19th century writings of Karl Marx and his acolytes.

Marx’ writings prompted debates about the role of government in the 20th century, even in liberal democracies such as Canada. Those who favoured free markets and open societies on the grounds that, practically and empirically, such an approach (combined with moderate governments) best achieved human progress were forced to squared off with ideologues who argued politicians and bureaucrats could centrally plan the economy with better economic results and more jobs.

But the fall of the Berlin Wall in 1989, the freeing of central and Eastern Europe from communism’s grip, the implosion of the Soviet Union, and the failure of central planning everywhere from Beijing to Budapest killed off Marxism/communism as an animating factor in debates over the role of government. Nazism/fascism, fortunately, was already dead.

That meant that, for many Western countries at least, the “normal” battles in politics – where competing interests try to influence politicians to use the public purse for their own ends – once again became more obvious.

In many ways, the 21st century resembles the 19th century – not so much in the size of government as in the obvious tussles between special interests and the general interest.

For example, in 1876, Liberal Sir Richard Cartwright, the first post-Confederation finance minister for the Dominion government (what we now call the federal government), objected to a Conservative proposal for higher tariffs on imported farm equipment.

His criticism centered on the fact that such tariffs would transfer wealth from people in rural Canada, where most Canadians lived, and would lead to higher prices for the buying public who would be forced to buy higher-priced made-in-Canada products because of the lack of foreign competition. While tariffs would benefit domestic manufacturers and their owners, the broader public would be harmed through inflated prices – thus Cartwright’s concern about the unjustifiable transfer of wealth.

Cartwright was attempting, quite properly, to look out for the wider public good as opposed to a narrow interest.

Today, without the ideological justifications of the 20th century to mask them, special interests are again blindingly obvious. When business leaders argue for a subsidy, they are demanding that the public treasury be used for their own interest; when government employee unions demand compensation and pensions higher and more generous than in the private sector, they are effectively demanding the general base of taxpayers serve them.

Special interests still dress up their demands for special treatment in lofty rhetoric – thus the chatter about “national champions” from business leaders or so-called “social justice” from many government union leaders. But now, in the 21st century, absent the more animated 20th century ideology of central planning, such special interest demands can easily be seen for what they plainly are: a plea for unique treatment at the expense of others.

Mark Milke is a senior fellow at the Fraser Institute.

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