The Case for Canada: A Perspective on Canada’s Political and Economic Future

February 13, 1997

Today, I am here to talk about the future of my country, and to make the case that Canada’s political and economic prospects are bright, and that the country has almost unparalleled, long-term potential as it prepares to enter the 21st century.

My visit is in response to an invitation from my old friend, Professor Charles Doran, who for many years has dispensed wisdom on the politics and economics of Canada. And, I should like to add, he has done so applying the best of his professorial skills and objectivity while not concealing a genuine admiration and affection for his northern neighbours.

I also am here in part to respond to a challenge – the challenge that Professor Doran issued last autumn with the publication in the journal, Foreign Affairs, of an article entitled "Will Canada Unravel?"¹ In that article, as many of you here will know, Professor Doran raised the real possibility that Quebec would secede from Canada and he went on to argue that a Canada without Quebec could very well disintegrate and even cease to exist.

In responding to Professor Doran, let me put my cards squarely on the table. I do not ascribe to the apocalyptic or fragmentalist vision of Canada that he outlines in Foreign Affairs – a vision, by the way, that has no small number of adherents in my own country. My optimism does not spring from blind faith, nor from parochial ignorance. I take great pride in knowing Canada well and my work and my interests over many years provide me with linkages and personal associations in every part of the country.

I also am privileged to know Canada from beyond my country’s borders since my professional, business and personal life has allowed me to travel frequently and extensively. This having been said, you will readily understand why I did not act with surprise when a highly respected international business leader at the World Economic Forum in Davos last week said to me, "all round, Canada is the most successful country in the world, bar none". In the same vein, you also will understand why I responded so approvingly to the now oft-quoted words of a former Mexican Ambassador to Canada when he looked me squarely in the eyes in Ottawa several years ago and said, "Most countries are problems in search of a solution. Canada is a solution in search of a problem!"

Having staked my ground, let me turn now to the first of Professor Doran’s arguments. He says that Quebecers may very well choose to leave Canada. In support of his argument, he points to the results of the Quebec referendum in October 1995 when some 63 percent of Francophone voters replied in the affirmative to the following question. "Do you agree that Quebec should become sovereign after having made a formal offer to Canada for a new economic and political partnership within the scope of the bill respecting the future of Quebec and of the agreement signed on June 12, 1995?" An astounding 94 percent of Quebecers voted in the referendum and, as you know, the question was answered in the negative by the majority of the voters – but, by less than 60,000 votes.

Was this a great moral victory for the independentist cause as Quebec Premier Lucien Bouchard claimed on the night of October 30? I do not believe so and here is why. First, by any objective assessment, the question was tortuous, tendentious and purposely vague. It was not meant to elicit a response based on a clear decision between affiliation with Canada and independence. Secondly, it implied and promised much to Quebecers – in other words, it was meant to reassure affirmative voters that the negative consequences of voting "yes" would be minimal. Evidence of this can be seen in a poll conducted on the eve of the referendum which showed that close to 80 percent of Quebecers who planned to vote "yes" believed that victory would entail the automatic use of the Canadian dollar; a remarkable 90 percent believed that Quebec’s economic ties with Canada would remain unchanged; 50 percent believed that they would continue to use a Canadian passport; and 25 percent believed Quebec would continue to elect representatives to the Canadian Parliament.²

These responses spell out something that is both bizarre and frightening – in retail parlance, a great number of Quebecers were about to take delivery of something they had not ordered.

If a question were put to Quebecers today on the basis of a "yes" or "no" to independence, I remain convinced that a significant majority would vote "no". My confidence in such an outcome is based not only on recent polls but also on a belief that a solid majority of Quebecers take pride in a double identity – that which is foremost to them, namely the strong sense of affection for their motherland, Quebec itself, and that which is more intangible, but very important nonetheless, their attachment to Canada.

My confidence in such an outcome if a vote were held today is not borne of any sense of complacency or satisfaction with the status quo, far from it. The situation could change and support for outright independence could rise. As a long-time student of nationalism, I know too much – and so should we all – to underestimate its potency, its spell-binding attraction, particularly when it is offered by a clever and charismatic leader who promises to correct historical injustices, protect the mother culture, liberate the national spirit and build a new Jerusalem – and all this with negligible sacrifice!

Having conceded that Quebec independence is not a fantasy, that it could happen, what combination of policies and circumstances could significantly diminish its attractiveness and perhaps even relegate it to the status of a spent force? Like so many others, I revisited this question with a new sense of urgency in the autumn of 1995.³ I said at the time that we must pay heed to the hard lessons learned from the referendum campaign and that "it now should be abundantly clear that the allegiance and attachment of Quebecers to Canada will never be won by campaigns based on fear, belittlement or the threat of economic loss. Nor will the commitment of Quebecers be won by federalists who dare not champion the virtues of Canada and what it means to be Canadian".

"Perhaps the most important lesson of all to be drawn from the referendum result," I went on to say, "is that Quebecers are deeply dissatisfied with the status quo and are seeking far-reaching change …. The vast majority of Quebecers want, and have every intention of achieving, more direct control over their affairs, and there is a strong likelihood that they will choose to leave the Canadian family unless they can be made to feel more secure within the federation".

Looking ahead, I urged that the federal government and the nine provinces in alliance with pro-federalist Quebecers seize the agenda and quickly push forward political reforms that would respond to Quebec’s concerns, but more broadly, set in motion changes that would be beneficial to the federation as a whole. My colleagues at the Business Council on National Issues embraced this approach and we launched The Confederation 2000 Initiative aimed at helping to build a new consensus for political change in Canada.⁴ Independently of our efforts, concerned citizens from across Canada began to press for reforms as well.

What has happened since the autumn of 1995? The federal government has acted by passing a resolution in the Parliament of Canada that recognized Quebec as "a Distinct Society within Canada that includes a French-speaking majority, a unique culture and a tradition of civil law".⁵ This in turn was followed by a legislative enactment that would require the consent of the Atlantic provinces, Quebec, Ontario, the three Prairie provinces and British Columbia before any constitutional amendments could be proposed in Parliament by the Government of Canada.⁶

Next, the federal government embarked on an initiative⁷ aimed at "rebalancing the federation" and opened a dialogue with the provinces. Ottawa said it was willing to vacate areas that fall within the exclusive competence of the provinces. It promised devolution of responsibilities in a limited number of areas, manpower training being a case in point. It responded to an invitation on the part of the provinces to re-examine how the two levels of government should deal with social policy and the social union. The federal government even went so far as to say it was prepared to no longer use its spending power to create new shared-cost programs in areas of exclusive provincial jurisdiction without the consent of the majority of the provinces. In so doing, it signalled its willingness to address one of the most serious sources of federal-provincial acrimony over many years.

The federal government has sought to balance these initiatives aimed at enhancing provincial autonomy and responsibility with measures that would strengthen the economic ties that hold the federation together – one such measure is to accelerate the removal of internal barriers to trade. Another is to establish a Canada-wide regime for securities regulation. The virtue of this rebalancing initiative is that it could lead to a more efficient federation and almost certainly to a lessening of intergovernmental conflict – conflict that has escalated over the years with disputes over jurisdiction and financial resources. It also would provide the provinces with more breathing room, and to Quebecers in particular, it would respond to one of the most fundamental and long-standing of nationalist aspirations.

So, you might ask, is Canada well on its way to providing an antidote to the illnesses besetting the federation? We have made a start but we have a long way to go. Worrisome is the fact that the rebalancing initiative which has so much to commend it is currently bogged down in tedious and complex intergovernmental negotiations. Another source of concern is that Premier Bouchard and his government have repeatedly rejected involvement in the process of federal renewal. To some, this is seen as an impossible obstacle. It should not be. The reforms that are currently under negotiation and those that in due course will be proposed are meant to appeal to Quebecers who want to be part of Canada. They are not targeted at hard-line ideologues who have made it clear that they want to quit the Canadian family.

And this is not the only point. Reforms to the federation should not be seen as benefitting Quebecers alone. They are essential for efficient and effective governance as Canadians prepare for the 21st century and should not be held up in deference to separatists who have no interest in renewing the country’s institutions.

Let me now turn to the other most fundamental of nationalist aspirations in Quebec – the desire for cultural and linguistic recognition and security within the federation. The federal government’s parliamentary initiatives pertaining to distinct society and regional vetoes are not seen as adequate in Quebec because they provide no permanent guarantees under the basic law of Canada. It should be of no surprise to any of us, therefore, that federalists in Quebec, led by Liberal Opposition leader, Daniel Johnson are demanding that Quebec’s distinct society status be entrenched in the Canadian Constitution.

So far, the provinces have not responded in any concrete fashion, in part because the Premiers are fearful of reopening the constitutional question, and in part because of very considerable opposition to distinct society designation for Quebec. The irony in all of this is that public acceptance in Canada of the substance behind distinct society designation is probably much stronger than most people think – in other words, people by and large seem prepared to acknowledge Quebec’s uniqueness within Canada in terms of history, culture, language, civil law and the right to exercise the fullest degree of competence within the provinces’ areas of jurisdiction. What Canadians clearly are unwilling to accept is an interpretation of "uniqueness" that would accord to Quebecers financial and political advantages within the federation that would be denied to citizens in other provinces. Sensitive to this concern, the Liberal Party of Quebec in its December 16, 1996, report entitled, "Recognition and Interdependence", spelled out its position. [Quebec], it says, "does not want to take from the federal government advantages that are not given to the other partners of the federation".⁸

How then can this logjam be broken? One way would be for Canada’s Premiers to launch a collective initiative in the coming months that would result in resolutions being introduced in each of their respective legislatures recognizing Quebec for what it is. If the words "distinct society" get in the way, they should be dropped without hesitation in favour of plain language that all Canadians can readily understand. Reaching a consensus on substance rather than on catch phrases should be our foremost concern. Surely this can be the only basis for a genuine and lasting reconciliation with Quebecers. I readily admit that legislative resolutions in nine provinces will not satisfy the need for constitutional entrenchment. But the resolutions at least will signal a fresh resolve and generate the goodwill that eventually will create the conditions for entrenchment. The march towards this goal may take time but properly handled will lead to a successful outcome. Folly of the greatest order would be to attempt yet again to pursue the entrenchment option and fail.

Before returning to Professor Doran’s arguments, I want to deal with another factor which is of critical importance to reversing the independentist momentum – the economic factor. A powerful component of separatist mythology and propaganda has been to denigrate Canada’s economic performance and prospects. Separatist leaders repeatedly have spoken of "a bankrupt Canada", of "a Canada that does not work". Premier Bouchard even went so far as to say that "Canada is not a real country". That they have been able to get away with these distortions for so long is in itself startling, and to many of us throughout Canada who know better, deeply offensive. But now the mythology grows even more difficult to defend. Canada’s economic performance is strong and the country’s prospects are bright.⁹ Adaptation to global economic forces is well advanced, inflation is at rock bottom levels, productivity is rising, exports are booming, interest rates have fallen dramatically, and public deficits are fast disappearing. In most of Canada, job growth is picking up and unemployment levels are falling. In Quebec, regrettably, the picture is a very different one. Malaise is pervasive, investment is stagnant and levels of unemployment are much higher than most other parts of Canada.

Premier Bouchard and his Minister of Finance respond to this growing disparity in economic performance by blaming Ottawa or by castigating those who allegedly are trying to "punish" Quebec. This is nonsense, of course. Canadian and international investors know different, and so do Quebecers in ever growing numbers. Quebec business leaders, I am happy to say, have not given up on their province and are leaving no stone unturned in the battle to shape a more hospitable environment for investment and to revitalize Montreal.¹⁰

As we look to the future, Canada’s star continues to look bright – this is the judgment of the United Nations which has listed Canada as number one in quality of life among all the world’s countries for the past three years; this is the judgment of the Organization for Economic Cooperation and Development which projects that Canada will have the highest growth rate among the G-7 countries this year; this is the judgment of international markets which have designated Canada as one of the world’s most attractive havens for investment; this is the judgment of tens of millions of would-be emigrants around the world who consider Canada as their country of first choice.

Now back to Professor Doran’s arguments and specifically to the most negative of his "what if" scenarios: what if a significant majority of Quebecers for whatever reason opt for secession? While I do not believe this will happen, Professor Doran nevertheless deserves a response. The fact is that secession, if it comes, will be immensely more manageable if Quebecers and all Canadians have the clearest possible understanding in advance of what secession will mean.

In my country, sometimes this is referred to as "Plan B", a subject which in some circles is considered politically incorrect to mention. I disagree. While I am a passionate defender of a Canada that includes Quebec, I always have argued that it is in the best interests of Quebecers and all Canadians to understand the process by which secession would be achieved and the basic terms and conditions that Canada would require be met including partition of the national debt, management of the currency, conditions of citizenship and the determination of Canada-Quebec economic linkages. Some people say that discussing these matters in advance would lead to a self-fulfilling prophecy, that it would be too divisive. This point of view is shortsighted and irresponsible. It invites destructive uncertainty in advance of secession, it allows separatists in Quebec to paint deceptive scenarios as they did in the October 30, 1995 referendum, it invites a disastrous lack of preparedness if the moment of truth arrives.

How then do we prepare? What steps should be taken? The Canadian government has tiptoed forward and has referred the matter of the legality of secession to the Supreme Court of Canada. This is a step in the right direction. But it is not enough. Former Clerk of the Privy Council and Secretary to the Cabinet, The Honourable Gordon Robertson, has proposed tabling in the Parliament of Canada contingency legislation that would deal with many of the fundamental issues – the legislation to be passed by the Parliament of Canada only after a decision by the National Assembly of Quebec to proceed with secession^.11

The virtue of contingency legislation is that it would offer all Canadians a sober and realistic insight into the full implications of Quebec secession. It would be of inestimable value to Quebec voters in an eventual referendum campaign. It would give notice to the world that Canadians, while totally dedicated to keeping Canada whole, are intelligent, rational and disciplined individuals who would insist on a minimal disruption of the political and economic life of Canada and of Quebec should secession come.

Let me return now to Professor Doran’s other "what if" arguments and in particular those that suggest that Canada would unravel in the aftermath of Quebec secession. I reject them outright. First, let’s comprehend what a post-secession Canada would look like: some 23 million people with one of the highest per capita incomes in the world, bordered by three oceans and with its vast array of political and economic alliances and associations intact. Canadians still would be custodians of one of the largest and richest land masses in the world and Canada easily would qualify as one of the ten most advanced economies measured by today’s G-7 standards.

Professor Doran worries about the separation of the Maritimes from the rest of Canada. I would be less concerned – corridors of passage between Ontario and the Maritime provinces would be an essential condition of a negotiation with a secessionist Quebec. And has he forgotten that Alaska and Hawaii enjoy successful statehood in the United States despite their geographical distances from the motherland?

Professor Doran fears that Canadians in the wealthier, so-called "have" provinces would balk at having to provide economic transfers to the "have-not" provinces of Maritime Canada – provinces made even more distant by the secession of Quebec. The totality of Canadian transfers to the Maritime provinces are both affordable and a diminishing draw on the wealth of the remaining provinces. Moreover, the historical, cultural, family and economic ties that bind Maritimers to the rest of the country are much stronger than Professor Doran apparently knows.

A final point, the people and the lands that today constitute New Brunswick, Prince Edward Island, Nova Scotia and Newfoundland and Labrador, are important assets to the federation. They are rich in resources and it would be foolhardy to discount their economic potential in the long-term.

But Canada dominated by an immensely powerful Ontario would not work, Professor Doran warns. I have heard this argument in my own country, and frankly, I do not take it seriously. Ontario would be an enormous asset to the new Canada and adjustments to the political institutions of the country to balance its preponderance would be in everyone’s interests, including Ontario’s. In fact, a post-secession Canada no doubt would accelerate long overdue changes to the central institutions of federalism. High on the list of priorities would be an elected second chamber that would give a more effective voice to the provinces at the centre of the federation. Institutional change would be particularly welcomed by citizens in western Canada, notably in Alberta and in my native British Columbia, who are seeking a federation that is more accurately reflective of the westward shift in population, wealth and political power.

In his attempt to be thorough, Professor Doran did not shirk from confronting the explosive issue of territorial boundaries. He warns that "Quebec ultimately must confront the paradox of sovereignty. If Canada is divisible, then why is Quebec indivisible? If Quebec is indivisible, then on what grounds should Canada be obliged to allow Quebec’s secession?"

While most Canadians would prefer not to have to even think about this issue, it is an issue nonetheless and Professor Doran is right to raise it. I have heard many points of view on this question. They range from the totally dismissive on the part of the separatist leadership, to those that argue that the partition of Quebec is a matter of right especially in those parts of the province where significant majorities would favour remaining part of Canada.

The truth is that neither separatists nor partitionists can be certain of how things would unfold in the province of Quebec itself in the event of secession. Of one thing I am certain, however – the impact on Canada will be relatively minor in comparison with the impact within Quebec where a decision in favour of secession will pit Quebecer against Quebecer and tear the fabric of that extraordinary society asunder.

I now want to deal with the last of Professor Doran’s hypotheses, namely the prospect of a post-secession Canada or its parts striking some sort of deal with the United States. I must say that the image of a weakened, broken, quarreling group of provinces having to negotiate, cap in hand, with our powerful neighbour to the south, is so at odds with my perception of the circumstances that would face us, that I am almost at a loss for words.

As you have concluded from my remarks so far, I do not accept the fragmentation thesis. Quebec’s secession would indeed subject Canadians to unprecedented difficulties, but they would be far from insurmountable. After a certain period of adjustment, I have no doubt whatsoever that Canada would revive, grow and continue to prosper.

But the question still must be asked. In the trying circumstances surrounding Quebec’s secession, would the vast majority of Canadians want to sacrifice institutions, values and way of life in return for membership in the great Republic? In responding, I wish to tread carefully and not offer any offense directly or implied – I am, as Professor Doran knows, an unabashed admirer of the United States and I regard Americans as close friends and allies. But the answer by most of my fellow Canadians to this question, I believe, would be a resounding "no", and speaking for myself, I would strongly support such a decision.

I know that some of my fellow citizens, the publisher Conrad Black among them, may take issue with my rather brusque rejection of the idea of Canada joining the United States. But I am totally comfortable in my views because I really do believe that Canada is the finest country in the world with a unique society and unmatchable prospects. Should Quebec leave the family, I will regard this as a great tragedy and I will deeply mourn its loss. But I will continue to believe, nevertheless, that the new Canada that will emerge still will be without peer in the world.

So there you have it, ladies and gentlemen – two very different views on Canada’s future. My preference, of course, would have been to avoid any mention of the various calamitous scenarios that Professor Doran has raised – in part, because I do not believe they are likely to materialize and, in part, because I find them almost too painful to even speculate about. But Professor Doran has done Canada a service and for this he should be commended. He has forced many of us to confront our great country’s future more honestly, more sensitively and more wisely. Thus armed, we will be able more readily and more resolutely to deal with whatever challenges await us.

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