Aboriginal Self-Government and Economic Self-Sufficiency

Chief Dan George once said: "One of these days every person in Canada will be a Canadian."

For those who have not yet achieved full equality of opportunity, the burning question is--when? When will all peoples of this country attain equality and self-sufficiency?

More and more frequently, this issue is being raised by the Native people of Canada. It is, with little doubt, past time to get history working again for Canada's indigenous people.

The image of Elijah Harper, gently holding his ceremonial eagle feather, will endure in the minds of students of Canada's constitution. On Friday, June 22, 1990, Mr. Harper--by using procedural rules to block the Manitoba legislature from ratification of the agreement--effectively killed the Meech Lake constitutional accord that would have bound all 10 of Canada's provinces together in a new federal agreement. So doing, he brought Aboriginal issues to the forefront of people's minds.

Canada is at a crucial, and very fragile, juncture in its history. One of the principal reasons for this fragility is the deep sense of alienation and frustration felt by many Aboriginal Canadians.

Issues affecting Aboriginal Canadians have, at last, barged their way to the top of this country's agenda. The present political and judicial structure, in my view, has failed Aboriginal people on a massive scale. It has been insensitive and inaccessible. Accordingly, any process of change or reform in Canada--whether constitutional, economic or social--should not proceed, and cannot succeed, without Aboriginal issues being an important part of the agenda.

The time is right for changing attitudes. The jarring images of Oka are still fresh; Native Canadians have an appealing new leader in Assembly of First Nations National Chief Ovide Mercredi; the federal Law Reform Commission has recently released its report to Parliament on Aboriginal Peoples and Criminal Justice; and a Royal Commission on Native self-government has just been launched.

In the context of constitutional reform and its impact on Aboriginal Canadians, it is crucial--to use an expression of an Inuit friend of mine--to cause "constructive damage to the status quo." This process of change represents a rare opportunity to improve the lives of Canada's one million Native people and, thereby, the lives of all Canadians.

At a time when constitutional reform is on the minds of many Canadians, the country's Aboriginal peoples are telling us that recognition of their inherent right to self-government is one necessary condition of their progress out of many social pathologies. I believe them.

"Self-government"--a term that invariably accompanies discussions of Aboriginal rights and the well-being of Native Canadians--can mean very different things to different people. The discussions on this subject are characterized by considerable debate and disagreement. These are the small "angels-on-the-headof-a-pin issues" that, in my view, serve to muddy the debate.

The Globe and Mail's Editor In Chief, William Thorsell, in a recent speech, argued that Native people's self-knowledge, self-respect and self-responsibility through self-determination are essential to the process of constitutional reform. Thorsell points out: " It cannot be a misty act of idealism, expunging historic guilt and serving by itself as a panacea for deep-seated cultural and social problems in the Aboriginal communities. (Similarly,) it cannot express itself as indulgent paternalism of Aboriginals that winks at wrongs and tolerates irresponsibility."

As German poet, dramatist and novelist Goethe once said: "To tolerate is to insult"--meaning that paternalism is contemptuous of those it indulges. Thorsell concludes that Canadians must guard against that classically liberal tendency in our passion to redress wrongs and address the Aboriginal question in Canada.

Norman Mailer once pointed out: "Idealism is fine, but as it approaches reality the cost becomes prohibitive." The goal of the Canadian Council for Native Business--or, CCNB--is to turn idealism into realism. The goal of this national, non-profit private-sector initiative by the Canadian business community is to develop for Canada's Aboriginal peoples the economic self-sufficiency that is the basis for self-government. In short, the goal is widespread affirmative action to counter the effects of racism and stereotyping and to give Natives access to mainstream corporate Canada.

Today, The Empire Club is honoured to have as its guest speaker Patrick Lavelle, CEO of CCNB.

Trying to synopsize Pat Lavelle's background is a bit like trying to pick out a colour of the rainbow! He has accumulated an extensive portfolio of experiences. Pat has considerable business experience, as a senior officer with Magna International. He has run a trade association, as President of the Automotive Parts Manufacturers' Association. He has been a reporter, an advertising and marketing executive, and a political aide to senior federal cabinet ministers. He also finds time to lecture at York University's Faculty of Administrative Studies.

Perhaps Mr. Lavelle is best known for his experience in government and the public service. As Ontario Deputy Minister of Industry, Trade and Technology from 1985 to 1988, he dealt with many of the critical issues determining Canada's ability to compete in the global arena--the free trade agreement with the U.S., establishment of the Premier's Council on Competitiveness, and efforts to overhaul education and skills training.

Ladies and gentlemen, I am pleased to introduce Pat Lavelle. His speech title today is Aboriginal Self-Government and Economic Self-Sufficiency.

Patrick Lavelle:

I am pleased and honoured to be back at this august forum where I first spoke almost 10 years ago on the future of Canada's automotive industry.

At that time I was reporting on my role as a co-chairperson, along with Bob White, of a Canadian Federal Government task force charged with the responsibility of devising a strategy for the industry which was then being challenged by Japanese imports.

Besides being the cheapest and, perhaps, the fastest government task force in history--we charged nothing and completed our work in three to four months--we devised an industry strategy, supported by management and labour, that led to some of the greatest growth the industry had ever experienced.

Regrettably, the Government in its free trade negotiations with the United States in 1988 cut the heart and soul out of the Auto Pact which has led to the sorry state of the industry in Canada today. I cannot predict what, if anything, will remain of it after the next 10 years.

Today I do not want to talk about autos or parts or bureaucrats or politicians. I want to discuss a subject which is vital to the future of this country--Canada's Aboriginal people and their justifiable claim to self-government.

The issue of self-government for the Aboriginal people of Canada is not a concept easily imagined or accepted by non-Native people like myself and many millions of other Canadians. Indeed, I am sure that even within this room there are as many concepts of what Native self-government is and the changes it would bring to both Native and non-Native Canadians as there are people sitting here.

After all, most of the people of this great country wish to remain united under one constitution. Providing adequate room for self-government of Aboriginal people and a Distinct Society for Quebec is the essence of the current debate. A solution to these two problems should bring us constitutional peace, at least for a while.

While most Canadians support proposals which will provide Aboriginal self-government, they are less certain about the quest of Ovide Mercredi for the inherent right of self-government to be enshrined in the Constitution. However, to Aboriginal people this is the fundamental principle that they are fighting for. One, in their opinion, which has been denied to them ever since Europeans took over this land centuries ago.

Neither the Aboriginal people nor the Government has really attempted, at this point, to spell out exactly what the word inherent means. Does it provide for another country within a country? Will Aboriginal people, for example, want to send their own representative to the United Nations?

Or does it mean that Aboriginal people in Canada, as they have in the United States and elsewhere, want to take control of their own schooling, social services, taxation, economic development, and most important, their land and assets? These issues will be clarified and defined as the discussions develop.

Unfortunately, many Canadians support self-government as a way of eliminating government support and special status for Aboriginal people. This view is not widespread because most fair-minded Canadians realize that Canadian governments and agencies have been the single, largest contributor to the downfall of Aboriginal culture and communities in this country. These policies have led to consistently high rates of social problems, record levels of teenage suicide and unacceptable unemployment levels.

Reality is the hard facts. The statistics we can see. Statistics that make us feel something about the lack of housing, education, employment and basic services we take for granted.

In recent years, governments at all levels have reacted positively to change and opportunities within the Aboriginal communities. But it will take many decades to right the wrongs that have been done to thousands upon thousands of First Nation peoples. We have an obligation to make self-government work, not only for Aboriginal Canadians, but for all Canadians. We have a vested interest in their success.

I am not here to debate the pros and cons of self-government. I support it and believe that the inherent right of self-government should be recognized within the Constitution. Most governments in Canada support self-government and are committed to its realization. The real issue is, are the economic underpinnings in Aboriginal communities strong enough to sustain it?

The private sector and governments, as well as Aboriginal people themselves, must find ways to build a solid base of economic stability using the benefits of land claim settlements, Native entrepreneurial activity, and government assistance to ensure not only that self-government works, but that it becomes an important economic boost to the entire Canadian economy for generations to come.

What is interesting is that the economic ills faced by Aboriginal leaders are not that different than those facing all Canadians. The creation of jobs, the ability to raise capital and sustainable growth in a risk-averse environment bedevil Aboriginal people just as they do Bay Street or Howe Street.

We are not in two different solitudes here. We are two peoples needing and looking for the same things economically, socially and, yes, spiritually. The question is, are we going to work together for success or take different paths which will end in failure?

The Native people of Canada have not been idle. In the past 10 years they have made tremendous progress. The advances in education are staggering, business start-ups are accelerating and socially the Native leaders have initiated programs to combat suicide and alcohol abuses on the reserves of Canada.

There are many examples of this determination. Shortly after joining the Council six months ago, I visited Tyendinaga, a Mohawk reserve near Belleville, where a Native-run technical training school is graduating Native pilots and computer experts. In Saskatchewan I visited the Federated Indian College, a part of the University of Regina, where 1,000 Native Canadians are moving toward degrees.

In the same city, at the Gabriel Dumont School, another 500 Native students--non-status and Metis--are working their way toward degrees in engineering science and business administration. At UBC, Aboriginal students are being taught courses with a high First Nations content by a growing number of Aboriginal professors and lecturers.

At the University of Brandon and Lethbridge in Alberta, a good percentage of the faculty is Aboriginal and the student body has a large and growing Native enrolment. No matter where you go in Canada, Native enrolment in post-secondary education is exploding, while at the same time--almost perversely- governments are reducing funding.

In 1981, there were only 4,000 post-secondary school Aboriginal graduates in Canada. Today that number has surpassed 100,000 with over 23,000 in classes leading toward degrees at this time. That number will continue to grow in the year ahead.

I have met some of these graduates. Some of them work for CCNB now and many others have participated in a unique CCNB internship program that places Aboriginal Canadians in the private sector for a one-year training period, which is supported financially by the private sector and the Federal Government.

In the past four years, CCNB has placed about 400 of these Native interns with a retention rate of about 50 per cent. It is regrettable that these 400 are so few when the demand is so great. We obviously must do more and the private sector must step up to the task.

I have had the opportunity to see that co-operative spirit between government, private sector and Aboriginal entrepreneurs in action. I visited the Aboriginal self-governing community of Sechelt on the sunshine coast of British Columbia where for over several years now Native Canadians have been running and administering a community which includes both Natives and non-Natives.

Based on initiatives taken largely by David Crombie and the Chief of the Sechelt Band, this unheralded development is only one model that exists among many, both in Canada and elsewhere. The principle of self-determination and control has been ceded to the Native leaders by both the Federal Government and the Provincial Government of British Columbia The positive results are beyond anyone's expectations as the community develops and prospers.

There is no turning back now. Before this century is over, Canadian Aboriginal people should be in charge of their schooling, tax regime, police, justice and welfare. This cannot be achieved simply by signing agreements and land claim settlements. It can only be done with a massive effort of economic co-operation between the private sector and Aboriginal entrepreneurs and business people.

But, we should make no mistake about it. There are enormous problems ahead for Canada's Aboriginal peoples if the rest of us just turn over the keys and clear out of land that has been returned to them. Economic development, the underpinnings of self-government, despite the successes I have detailed, is still in the formative stages and there have been more failures than successes.

Aboriginal communities are still more or less utilizing economic development assistance provided by any number of Federal Government departments who spend over $4 billion a year supporting Aboriginal infrastructure. The private sector of Canada is by and large absent from these developments and has demonstrated very little desire to get more deeply involved.

There are, of course, leaders in the business community who take the issue seriously, such as Murray Koffler and Edward Bronfman who founded the CCNB to help the process. But the difficulties of initiating joint ventures and making investments on the reserves of Canada have been more difficult than rewarding. Much of this is because Native entrepreneurs were seldom in a position to make decisions. Instead, they were usually second guessed by government officials who encouraged band councils to focus on short-term needs rather than on the creation of new businesses and jobs.

In my first several months in this job, I have reached several fundamental conclusions on how we must proceed to assist, rather than impede, the drive of Native business persons I have witnessed. You will note that what is striking about this agenda is that it is not all that different from the policy prescription for the entire economy.

Education is at the heart of our Canadian dilemma. We cannot compete, not because we do not have the brains, but because we do not have the skills. Native Canadians face double jeopardy-with cutbacks and limited availability.

If education is the key to the future of all Canadians, it is crucial to the economic self-sufficiency of First Nations People. Without economic freedom, which will only be attained by building on the initiatives which I outlined and improving the skills and opportunities available to young Native people, self-government and self-determination will be one more historic blunder that will be folly for Canada's First Nations and for the country.

Second, like all Canadian entrepreneurs, Native Canadians are starved for investment capital. What access they have to capital is highly leveraged and overtly controlled by others. While Native lending institutions, such as Peace Hills Trust, have been highly successful, they are a lending institution based on the same low risk principle as other lending and banking institutions in Canada.

I fail to see how economic development can proceed unless the availability of capital, both risk and non-risk, is greatly increased--and soon.

The creation of a venture capital corporation with both private sector Natives and non-Native capital is an urgent priority. So is the creation of an Aboriginal economic development bank.

Aboriginal leaders too have a responsibility to establish strong links to the Canadian private sector by putting a stronger emphasis on economic development. Band councils are often seen as anti-reserve development or biased in favour of the social side of the economic ledger or unwilling to provide entrepreneurs with long-term commitments.

These obstacles to development must be overcome. The separation of business decisions from band politics would be a first step.

Third, the resource development of Aboriginal land. The Government must remove strings attached to resource revenue and turn the stewardship over to the First Nations. There is no law or record which demonstrates that bureaucrats in Ottawa will have any greater success in utilizing these revenues than Aboriginal entrepreneurs. Besides, these royalties are a valuable source of investment funds that are required now.

Fourth, providing preference for Aboriginal Canadian entrepreneurs and manufacturers through government purchasing policies would also be a source of incentive and growth. These are not guarantees, but a process of encouraging the growth of Aboriginal service and manufacturing industry which, at the present time, make up a small proportion of Aboriginal economic development revenues.

The passage of "buy Aboriginal" legislation by the Federal and Provincial governments, establishing both purchasing and employment targets, should be a priority of all Canadian governments. These in turn should be emulated by the private sector and Crown Corporations.

Fifth, the thorniest issue of self-government is, of course, taxation. Not just the question of personal tax exemption enjoyed by status Indians, but the long-term tax implications of tax policies on Aboriginal entrepreneurs and business people both on and off the reserve.

Many Canadians will say that self-government will, and should provide, the right of Aboriginal people to impose taxes on their own people. This is the case right now. Native bands do tax just as they dispense funds provided to them under various government programs. But, with taxation comes choices and responsibility that has been exercised by others for them.

For example, should reserves be designated tax-free zones for the purposes of business development by both Aboriginal and non-Native business entrepreneurs either separately or jointly? Should unique Aboriginal products be sold, off reserve, tax free by Aboriginal or non-Native business people?

Finally, the role of Canada's private sector. Governments cannot create jobs, only the private sector can. Progressive and far-sighted Aboriginal leaders who are leading their people to a new and better environment need to be supported in tangible, and, yes, costly ways--by putting their resources where their hearts and their minds should be.

I am not talking about charitable donations. I am talking about hard-headed economic decision-making which satisfies shareholders and provides good returns of invested capital. For example, in Sechelt the Aboriginal leaders have provided the opportunity for a large cement contractor in British Columbia to utilize a gravel deposit base on Aboriginal lands for their purposes to the economic benefit of both.

There are Native entrepreneurs in diverse lines of businesses from running airlines to bus lines, from comer stores to theme parks. There is a role in all of these developments for the non-Native private sector, providing it is not exploitive or exclusively beneficial.

In the future, investments in communication, manufacturing, radio and television stations, banks, recreation and other institutions are a must for Canada's fastest growing population segment. At this point, I sense that the Aboriginal people welcome non-Native participation and that interest is likely to grow provided it is done now.

The pillars of self-sufficiency-education, capital availability, resource development, taxation and specific economic development tools, must be established by the Native peoples of Canada and governments at the federal and provincial level. However these pillars are fragile and in need of much support and reinforcement.

While the Canadian Government wrestles with the problem of a nine-per-cent unemployment rate across Canada, Aboriginal leaders are struggling with 60-per-cent unemployment rates and a high-school dropout rate which is unheard of in any other society. The ability of Aboriginal leaders to create jobs on and off the reserve, which will reduce the dependency on government, will be the key on which the success of self-government will be judged. The rhetoric fades while the reality explodes.

As these numbers indicate, the private sector and Aboriginal entrepreneurs face an urgency to address these stark realities. The time has arrived, the die has been cast and it is up to us to put the economic infrastructure in place to make it happen.

If, over the next few years, the standard of living of Aboriginal Canadians were brought up to the level of the average Canadian, the Canadian economy would have a permanent increase of 2.5 per cent. This is a larger jump than the intended growth as a result of the signing of the Free Trade Agreement with the United States. And, it is certainly larger than any other economic opportunity on the Canadian horizon.

The business leaders, both Aboriginal and non-Native, who founded CCNB eight years ago saw the Council as a means to bridge the gap between the two other solitudes--business and Native entrepreneurs. By and large it has started its job, but it has failed to deliver the message to the public sector or the private sector or to the Aboriginal business community.

We need the support of Canada's business community to expand our intern programs, to provide support for education at the secondary, post-secondary and community college levels. We need support to bring business people to create wealth on and off the reserve for Aboriginal and ordinary Canadians. And, more important, we need support to demonstrate that what efforts are and have been made, do have a pay-off and a better future for a group of Canadians that have been badly treated by our forefathers.

Thank you.

The appreciation of the meeting was expressed by Bart Mindszenthy, Partner, Mindszenthy and Roberts Communications Counsel, and a Director, The Empire Club of Canada.