Liberal Leader Justin Trudeau and NDP Leader Jagmeet Singh take part in a federal election debate in Gatineau, Que., on Sept. 9, 2021.POOL/Reuters
Not only does the latest expansion of the social safety net by the Liberal government, as part of its accord with the NDP, intrude into areas of provincial jurisdiction, it flouts the wisdom of Lester B. Pearson.
During the comprehensive expansion of health care, welfare and pensions in the 1960s, the federal Liberals deferred to provincial needs and interests, by making Ottawa smaller and the provinces more self-sufficient.
Justin Trudeau prefers to strong-arm. The country will pay a price.
When Emmett Hall produced his landmark report on health care in June, 1964, the Supreme Court justice advocated for universal public medical care, dental care, pharmacare, mental-health care and home care.
“There can be no greater challenge to a free society of free men” than truly universal public health care, the report concluded.
That was too much for the Pearson government, which focused solely on physicians’ services. In that sense, Mr. Trudeau will be finally moving to fulfill Mr. Hall’s original vision.
But in the Pearson government’s defence, medicare wasn’t the only thing on their plate. The Liberals also wanted to create a comprehensive contributory pension system, which became the Canada Pension Plan. And Ottawa sought to enhance provincial welfare programs through the Canada Assistance Plan. The goal, in the words of the 1965 Speech from the Throne, was nothing less than “the elimination of poverty among our people.”
But with the Quiet Revolution in full swing, Quebec’s premier, Jean Lesage, demanded greater autonomy for Quebec while John Robarts had no intention of surrendering Ontario’s control over social programs.
During the Second World War, Ottawa had “rented” from the provinces the authority over virtually all taxation. Twenty years later, the federal government still controlled much of that tax room. To secure provincial support for a national social safety net, Lester Pearson concluded that Ottawa should return a significant portion of its taxing power back to the provinces.
Mr. Pearson’s challenge was not so much to convince provincial premiers to sign on to his ambitious agenda, as it was to convince cabinet and the senior ranks of the public service that Ottawa should become smaller in the national interest.
He “had to convince many doubting colleagues,” Tom Kent, Pearson’s most senior aide, later wrote. But “the Prime Minister was fully convinced, and he was at his persuasive best.” Mr. Kent considered Mr. Pearson’s success in persuading ministers and deputy ministers to accept a tax-point-transfer from Ottawa to the provinces one of his greatest achievements.
After more than six years in office, Justin Trudeau has expanded the federal role in domestic policy in a way not seen in decades. On top of the carbon tax that he imposed on provinces that would not create their own, he has increased funding for mental health, and introduced a national child-care agreement, with Ontario this week becoming the last province to join. And now there will be new policies on dental care and pharmacare.
But unlike Mike Pearson, Mr. Trudeau fails to recognize that, if Ottawa is going to propose a new national policy, it must then equip the provinces to carry out that policy, preferably by ceding the necessary tax room, with expanded equalization for provinces that have weaker tax bases. Instead, he prefers the approach of direct federal transfers, with strict conditions attached.
This is both wasteful and hazardous. Wasteful, because provincial governments are the best judges of their priorities. They should not be dictated to by a federal government that – from Indigenous services to defence procurement – has proved itself incompetent in program delivery.
Mr. Trudeau’s heavy-handed approach will only increase resentments, both in Quebec and in the West. And those resentments will grow, when history repeats itself and the federal government reneges on its share of the funding responsibility.
This happened in the last century, when Ottawa cut provincial transfers in order to combat a dangerously high deficit. The deficit is dangerously high again.
Mr. Trudeau has pushed the federal government into places it does not belong, by either bribing or coercing provincial governments into doing his bidding.
This never works out well in the end. And it’s a lousy way to run this country.
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