The Final Decade: The Outlook for Canada

Perhaps no single issue has created such a massive shift in public opinion during the past 10 years than that of the environment. What in the '70s was a somewhat esoteric movement that seemed to evolve from the flower children of the '60s has become a world-wide concern. There is a growing realization that we are only life tenants on this planet and unless we deal with environmental imperatives the terms of our tenancy may be drastically revised.

While there is general agreement that something must be done, we have not yet come to grips with the economic costs of past abuse and future remedial action.

The indicated costs of some recent proposals submitted by President Bush range from $22 billion to $104 billion. A variety of economic measures are being actively discussed ranging from the granting and trading in licences to pollute to the fixing of fees or taxes reflecting the polluting impact of a specific activity.

Whatever the final numbers, the fact remains that if we desire the benefits that flow from sustainable development and reduced pollution, we must accept the costs.

Environmental protection will result in higher prices and the possible dislocation of enterprise, but with each challenge there will be investment opportunities that will reward the enterprising company.

We manage the largest mutual fund based on environmental concerns--total assets now exceed $85 million.

As companies realize that good environmental practices are good business, funds will flow into the market to assist in restructuring.

The second issue which will influence events in the '90s, will be that of Europe. The move to a virtual economic union in 1992 and the dramatic changes that have occurred in Eastern Europe and Russia are unprecedented.

While uncertainties create risk, the opportunities in meeting the consumer demand of Eastern Europe and Russia, present the greatest opportunity for expansion since the Second World War. However, the economies of the Eastern Bloc and Russia are particularly fragile and require varying degrees of assistance. In the case of Russia, there must be fundamental restructuring and immediate economic assistance.

The task that confronts us is comparable to that which Europe and Japan faced following the Second World War. Having won that war, the United States was determined to win the peace with one of the most magnanimous and farsighted policies--namely the Marshall Plan.

This time, the burden cannot rest on the United States alone but must involve to a large degree the European community and Japan. Europe and Japan were major beneficiaries of U.S. policy after the Second World War. They now have an obligation and a direct interest in promoting stability and growth in Eastern Europe and Russia.

A number of arguments have been raised against such a program: The cost of the undertaking, the tentative steps taken by Russia towards a market economy, our innate distrust of a government whose fundamental political philosophy remains Marxist in nature. As one U.S. Senator stated at a symposium I attended in Washington:

"Pray for Russia, but don't pay for Russia."

I suggest that it is imperative that we offer something more than our prayers. There must be tangible evidence that the industrialized nations are prepared to assist in the transition from 70 years of centralized state control to the risks and the rewards that come from a democratic market-driven system.

No one is suggesting that such a plan be a blank cheque. In fact, it will be important that conditions relative to currency convertibility, privatization, and human rights, form part of a package that would affix time periods for achieving established goals.

It is important that we take action that provides hope for the Russian People and supports political leadership striving to introduce democratic reform. Surely if we can find the will and the means to wage war, we can find the leadership and purpose to secure the peace.

For some 52 years since 1939 we have managed to survive hot wars and cold wars. If we can manage to survive peace the future is indeed bright.

On the domestic scene, we in Canada face the double strain of both economic and political restructuring. Our economic restructuring has, in many cases, proved to be unsettling and costly. But this is not unique to Canada Every industrialized country is experiencing the loss of manufacturing jobs to lower-cost economies. Our future lies not in resisting the inevitable, but in reshaping our economy to meet the changes engendered by the global economy.

We must recognize that the protective cocoon we Canadians have woven to shield ourselves from competition, from economic distress, and social change, has been penetrated. New technology, a changing marketplace, and the emergence of a global economy are factors to which no nation and no economic system can remain impervious.

Canada's social and economic agenda will be impacted by demographic trends. Canadians as a group are growing older. The proportion of those aged 65 and above has more than doubled since 1921, rising from five to 11 per cent of the population.

Young people aged 19 years and under are proportionately fewer today than 60 to 70 years ago.

During the decade of the '90s those of middle age will be the fastest growing segment of the population. This middle-age generation, by all financial measures, is the wealthiest in our history.

Those who entered the work force at the turn of the century, spent a large part of their earning years in the lean '20s and the depressed '30s. For those of us who entered the labour force after 1950, the situation has been dramatically different.

Our working lives have been spent in an era of extraordinary economic growth. Over the past four decades--a period equal to the work life of most individuals--real percapita disposable income has risen by 181.4 per cent.

As a result of current trends, we may be confronted with a new demographic and economic structure. An aging population. A relatively secure middle-class and reduced opportunities for our young people.

If we are to meet the challenges confronting us, there must be economic restructuring and political stability.

Many Canadians have the attitude that benefits belong to the people while deficits belong to the government. There is an apparent unwillingness or inability to accept the fact that we must either consume less or produce more.

In light of limited funds, we must establish priorities in government programs or we will be compelled by external forces to correct our fiscal irresponsibility.

It is within this context that the continuing turmoil of the post Meech Lake period must be resolved. The rest of the world will not afford us the luxury of endless domestic squabbles.

It is imperative that our political leaders accept their responsibility and so conduct themselves that the nation is preserved and that critical economic questions are addressed.

It has been said that those who refuse to read history are condemned to relive it. This would appear to be a danger we face in Canada. The Fathers of Confederation were confronting serious economic pressures and the very real threat of the United States. They realized that as separate economic and political entities they could not survive. And, while they were determined to cease being British Colonies, they were just as determined that Canada would not become a colony of the United States.

Those men accepted a seemingly impossible challenge. A new nation was created in 1867 and policies were developed to occupy the vast lands to the West and to preserve a separate identity in North America.

Unless the economic and cultural problems of various sections of Canada are approached in a spirit of understanding and goodwill, we will be compelled to repeat those trying days of the 1860s with all the rancor, political confrontation and social unrest that such confrontation must produce.

I am particularly concerned today because since the rejection of the Meech Lake Accord a corrosive anger has developed across this country. No longer do we talk of compromise or conciliation, but rather of confrontation.

Anthony Hampson in an article, Canada needs tolerance and less finger pointing, commented on the current public mood:

"Most of all there has been a frightening rise in the 'sore loser' phenomena with groups or individuals that do not get their way resorting to fundamentally undemocratic tactics in attempts to overthrow earlier decisions or wreak revenge on those they hold responsible for them."

He went on to say that if we do not repair these flaws in our national psyche: "We will put at risk not only our economic and social welfare, but our very future as an independent and democratic country."

We are in danger of becoming a nation of whiners, constantly blaming others for our failure. Virtually every day we see another addition to our litany of complaints. We are against constitutional change, we are against the GST, we are against high interest rates and we are against free trade. We are against a high Canadian dollar.

But when will someone speak out for what we stand for as well as what we are against? Where is the asset side of this balance sheet? The list of blessings that we enjoy as citizens of the country. When will we begin to acknowledge the freedom, the opportunity, the social benefits, the incredible achievements of a young country with a diverse and dispersed population?

We have created here in Canada something unique. Perhaps we lack emotion in the expression of our patriotism, but there is no less a love for this land and the quality of life that it has provided.

It is imperative that we Canadians begin the process of reassessing our national core values. The failure of Meech Lake and the new constitutional proposals must be viewed as an opportunity to redefine the fundamental aspirations of our People and put in place the political structures to achieve these goals.

Each of us, individually and in organizations such as yours, have an obligation to speak out in defence of this National Dream. I hope that we will view the recent past as that dark moment before the dawn. That the divisive spirit evidenced in the Meech Lake dispute will not be repeated. That we will never again see government officials negotiating with armed, masked men, as we did at Oka. That we will never again see our Senate turned into an assembly of unruly and undisciplined children.

That in addition to hearing on a daily basis a demand for individual rights, we will begin to acknowledge individual duties. That we will come to realize that if we expect the law to protect us we in turn must respect the rule of law.

I raise these issues because it is time we stood up, not on behalf of our narrow, regional, or provincial interests, but on behalf of this country. We need a leadership that points the way ahead to the broad upland of hope and away from this valley of despair.

We must reject out of hand both those in Quebec who say that Quebec can go it alone and those in the rest of Canada who say let them go. This is the counsel of despair. It can lead only to economic uncertainty and political turmoil.

We should make it clear that the creation of Canada in 1867 was not a term contract. It was not a treaty between nations. The British North America Act of 1867 took four separate provinces--colonies of Great Britain--and created a new nation, and no part of that nation can unilaterally secede. The existing Constitution is a dynamic instrument not frozen in time. It provides the flexibility to adapt current political and economic structures to meet the just demands of the provinces.

Let us discuss intelligently this question of provincial sovereignty. But, let us define what we mean by sovereignty. Our Constitution, for example, provided exclusive jurisdiction for the provinces in specific areas such as education and health. In the case of Quebec, special status was granted to its language and its civil law. There is no difficulty in providing a constitutional framework within which a province can exercise the sovereignty granted to it under our Constitution. But the role of a strong central government in defining goals and national policies remains essential.

Two days ago, the Prime Minister presented new constitutional proposals which provide another opportunity to redress long-standing grievances that have been identified in our political and economic structures. By all means, let's have another national road show. Let's openly discuss the proposals and suggest alternatives. But, if we are really concerned with the future of this nation, let us finally resolve the constitutional issues and get on with other problems which demand immediate attention.

Certainly this decade and the new century will present challenge, but my message is one of opportunity and encouragement. Recently our company retained the Gallup organization to conduct a survey of Canadians regarding their hopes and aspirations for the future. We learned that the youth of this country have lost none of their optimism about life in Canada. They remain committed to this country and have high hopes for the future. While we may be unable to fulfil all of those hopes, we have the obligation to provide political stability and economic opportunity.

The future will present difficulties. But, these are the same difficulties Canadians have faced and overcome many times in the past. This land we call Canada remains strong--but do we the People have the strength of will and the dedication to nation building that this country and its youth have the right to expect? I think we do, and it is on that basis that I am certain that a united Canada will prevail and that this noble achievement in nation building will be sustained.

The appreciation of the meeting was expressed by Peter Hendrick, Vice President and Director, Wood Gundy Inc., and a Director of The Empire Club of Canada.