Mcquaig’s economics throwback to old NDP
Candidate’s views haven’t changed since the ’90s
Linda McQuaig is smart, charismatic, tough, steeped in economic critique, and one of a very few well-known public intellectuals of the Canadian left. As such, she should be an ideal standard-bearer for NDP Leader Tom Mulcair in the bellwether riding of Toronto Centre, where the New Democrats face a Liberal candidate, Chrystia Freeland, who is also smart, also charming, also an economics wonk, and also has written extensively about income inequality. It’s like a set piece in chess, or a Victorian duel: Two rivals face each other across a field at dawn, holding matched flintlocks. Let the better woman win.
Except for this: From Mulcair’s point of view — that of a still-new leader, parachuted in from Quebec’s provincial Liberals, and confronted with the tricky task of shoving his left-leaning partisans toward the pragmatic centre — there could not be a more problematic candidate. Indeed, it would be better for Mulcair now if his party loses this byelection, which has yet to be called.
That’s because, throughout her lengthy career as an author and activist, McQuaig has consistently repudiated the neo-liberal economic orthodoxy that Mulcair insists he and his party now accept. Across a span of 30 years she has not budged. Nor is she someone likely to be cowed by party discipline. Yet she is too well known and admired on the left to be sidelined. The moment McQuaig is elected, therefore — if she’s elected — she becomes a problem for her leader to manage, if not an implicit threat to his leadership.
It was McQuaig who, 20 years ago, became the standard-bearer for nationalists and statists across Canada who believed the Liberal party of Jean Chrétien and Paul Martin had sold out to Bay Street carpetbaggers and fat cats when they stole the Reform Party’s fiscal-conservative mantra without a sideward glance, and adopted the defeated Mulroney government’s North American freetrade agenda as their own.
This was not what the Liberals had campaigned on in 1993. But Martin had become convinced the country could only get back to measured growth amid low inflation, if Ottawa first got back to balance. Mulroney’s reviled GST, the greatest budgetary golden goose ever devised, had made that possible. And so did the painful cuts to transfer payments and the military budget that began in earnest in 1995. By 1997 the federal deficit was history. In 2000 Martin delivered the biggest multi-year income-tax reduction in Canadian history, clinching the Chrétien Liberals’ third majority.
That narrative is so hoary now, it’s like one of Grimm’s fairy tales. The reasons it’s germane here is that McQuaig was squarely on the wrong side of the argument. She minimized deficit reduction and pooh-poohed inflation, alleging the entire fiscal crisis was an ideological construct of Bay Street, and the early ’90s recession an all-but deliberate creation of then-governor of the Bank of Canada John Crow. As for higher taxes, not only were they not a bad thing, they were a mark of high social virtue.
Mulcair, you will have noticed, is no fan of tax increases — at least not for individuals who, unlike corporations, each get a vote. Everywhere he goes lately, he’s asked if he’ll boost tax rates on upper income earners. His answer: No. “Several provinces are already at the 50 per cent rate,” Mulcair told the St. John’s Telegram in August. “Beyond that, you’re not talking taxation, you’re talking confiscation. And that is never going to be part of my policies, going after more individual taxes. Period. Full stop.”
McQuaig has no qualms about confiscation. Among the most intriguing aspects of her work is how very little her views have changed since the woolly ’90s. Some passages in her 2010 book with Neil Brooks, The Trouble With Billionaires, might as well have been taken verbatim from her 1995 bestseller, Shooting the Hippo.
Among the gems proposed in Billionaires: a 60 per cent tax rate on annual incomes above $500,000, and 70 per cent above $2.5 million. The government, in a McQuaig-ordered universe, would seize 70 per cent of any large inheritance (above $50 million) at the time of transfer. In effect, that would wipe out every large Canadian fortune. All that would be needed to prevent a flight of capital overseas, McQuaig figures, is a crackdown on overseas tax havens. As for a brain drain, she’s not worried about it. “Of course some people will leave, people are always leaving,” she told interviewer Allan Gregg in 2010.
“The neo-conservative movement has been successful in directing public anger towards taxes,” McQuaig writes in the book’s closing pages. “It will only be possible to rebuild a properly progressive tax system once the neo-conservative misconceptions are exposed and an appreciation of the importance of taxation in a democracy is restored.” Ah. Well then.
These are subjects worthy of de- bate. But they’re not debates Mulcair wants to have just now. Simply, for McQuaig to thrive in politics, rather than as Canada’s answer to Noam Chomsky, she will need to change her mind. That’s not something she’s done before.