Social Policy in Ontario

You’re more conservative than you think

Posted on April 23, 2016 in Equality Debates

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NationalPost.com – Full Comment
April 22, 2016.   F. H. Buckley

Donald Trump puzzles Canadians. He shouldn’t. He’s just the sort of person Canadians have always recognized as quintessentially American, which is to say non-Canadian. He is Thomas Chandler Haliburton’s Sam Slick the Clockmaker, the fast-talking Yankee peddler who could sell moonbeams to the country folk of Nova Scotia.

What requires an explanation, then, is not Trump, but rather his appeal to American voters. And in failing to understand this, Canadians reveal their ignorance of their own country as well as of America. For what they fail to understand is just how conservative their country is, and how liberal the United States is by comparison.

So it has always been, at the time of the American Revolution, at Confederation, and during the Vietnam War, when draft dodgers arrived at what seemed to them an admirably liberal country. Pierre Trudeau. Medicare. What was not to like? And yet, as they spent time here, they came to recognize Canada’s deep conservatism and few of them remained here after Jimmy Carter amnestied them.

Canada today is more conservative than the United States in one vital respect. The Great White North is a much more economically mobile country than the U.S., which is increasingly an aristocratic society of fixed classes. One measures these things empirically, by comparing the correlation between the earnings of fathers and sons. In Britain it’s 0.5, which means that if a father earned £100,000 more than the median, his son will earn £50,000 more than the average member of his cohort. The most mobile society is Denmark, with a correlation of 0.15. The U.S. is 0.47, almost as immobile as Britain. Canada is 0.19, not far off from highly mobile Denmark.

What’s more interesting still is which segments of the American income stream are immobile. Between 10 per cent and 90 per cent there isn’t much difference between Canada and the U.S., but look what happens when one compares the bottom and top deciles, as I do in my forthcoming book, The Way Back: Restoring the Promise of America (Encounter, April 2016). If your father was in the top 10 per cent of U.S. earners, you’re likely to be rich yourself. But if your father was in the bottom 10 per cent. he’ll likely pass on his poverty to you. The American dream, the idea that it’s a country where everyone has an equal chance to get ahead, isn’t dead. It’s simply migrated to Canada.

George Carlin said it’s called the American dream because you have to be asleep to believe in it

It wasn’t supposed to be like this. America was supposed to be the land of opportunity, where everyone stood an equal chance of getting ahead. If that’s no longer the case, that’s going to change American politics radically when it sinks in. Perhaps it already has. George Carlin said it’s called the American dream because you have to be asleep to believe in it. And the recognition that America is a class society is the most plausible explanation for the 2012 election and the Donald Trump phenomenon in 2016. It also explains why Canadian politics are so much more placid than those of the U.S.

In 2011, George F. Will told us that, given the dismal economy, the Republicans should get out of the business if they lost the next election. And then they lost the next election. Mitt Romney had a thoughtful 59-point plan for economic recovery which nobody read. People weren’t impressed by plans for growth when they thought the gains would all go to people at the top end. As a candidate, he came across as the boss who was about to give you the pink slip, and when he was heard explaining that 47 per cent of Americans were “takers” who would vote against him the election was pretty much over. Nobody thought that Barack Obama had handled the economy well, but at least he recognized the problems of inequality and immobility and conveyed the sense that he had your back.

Four years later, the Republican establishment still hasn’t caught on. We’re told that the recent rise in income immobility is a consequence of things we can’t change, such as the move to a high-tech world that offers premium wages to the highly skilled. That assumes that we didn’t see much technological change in the past, which scholars such as Claudia Golden and Robert Gordon would dispute. But even if the change is very recent, that can’t explain cross-country differences in mobility. The Danes aren’t exactly living in the Stone Age.

Bernie Sanders’ surprising success in the Democratic primaries also evidences the recognition that America has become a class society. The progressive’s prescriptions wouldn’t restore income mobility, however. The top marginal rates for capital gains and corporate taxes are about the highest in the First World, and if America wanted to compete it would have nowhere to go but down. As for income taxes, Ontario is a tax haven compared to California and New York when state and provincial taxes are added in. And there’s not much the U.S. can do to correct inequalities with its welfare benefits. The United States spends more on welfare as a per cent of gross domestic product than Canada, Britain, Australia, Denmark, Norway, the Netherlands, Japan, and all but four European countries. So much for the myth of stingy U.S. social benefits.

See Chart on Income Mobility:  < https://nationalpostcom.files.wordpress.com/2016/04/co0423_income_mobility2_c_mf.png >

Now here’s the surprise. What explains Canadian success is its conservatism and not its liberalism. Yes, Canada has its much-vaunted Medicare system, but cross-border differences in health care don’t explain the two diagrams. Rather, it’s a matter of differences in the education systems, immigration laws, the regulatory burden and the rule of law, where on all counts Canada is a conservative country and the U.S. highly liberal.

America’s K-12 public schools perform poorly, relative to the rest of the First World. As for its universities, they’re great fun for the kids, but many students emerge on graduation no better educated than when they first walked in the classroom door. What should be an elevator to the upper class is stalled on the ground floor. One study concluded that the gain to the U.S. economy, if American public school students were magically raised to Canadian levels, would be enough to resolve America’s projected debt crisis and amount to a 20 per cent annual pay increase for the average American worker. Call it the price of aristocracy.

As an aristocracy, the U.S. has a two-tiered educational system: a superb set of schools and colleges for the upper classes and a mediocre set for everyone else. The best colleges are the best anywhere and better than any Canadian university, but the spread is far greater in the U.S. and the average Canadian school is better than the average American one. At both the K-12 and college levels, Canadian schools have adhered more closely to a traditional, conservative set of offerings. For K-12, I suspect one reason for the difference is the greater competition offered in Canada with its publicly supported confessional schools. With its strict First Amendment barriers and Blaine Amendment laws, lower-class students in the U.S. must enjoy the dubious blessing of an American public school education.

Canadians take justifiable pride in their willingness to admit Syrian refugees. By comparison the American refusal to take in more than 10,000 refugees looks churlish, especially given that the crisis in Syria is a consequence of U.S. foreign policy disasters. But the real difference between the immigration policies of the two countries is the deep conservatism north of the border. Canada doesn’t have a serious problem with illegal aliens — it deports them, at least those who don’t qualify as refugees. As for the legal intake, Canadian policies have a strong bias toward admitting immigrants who will confer a benefit on native Canadians. In absolute numbers, Canada actually admits more immigrants under economic categories than the U.S., most of whose legal immigrants qualify under family preference categories. On average they’re less educated than U.S. natives (not the highest of bars), and unlike in Canada, second- and third- generation U.S. immigrants earn less than their native-born counterparts. In short, the U.S. immigration system imports inequality and immobility. If immigration isn’t an issue in Canada, that’s because it’s a system Donald Trump would love.

For the Ragged Dicks who seek to rise, nothing is more important than the rule of law, the security of property rights, and sanctity of contract provided by a mature and efficient legal system. The alternative, contract law in the state of nature, is the old boy network composed of America’s aristocrats. They know each other, and their personal bonds supply the trust that is needed before deals can be done and promises can be relied on. With its more traditional legal system, Canada better respects the sanctity of contract and is less likely to weaken property rights with an American-style civil justice system which at times resembles a demented slot machine of judicially sanctioned theft. Americans are great ones for talking about the rule of law, but in reality don’t have standing to do so.

American legal institutions are consistently more liberal than Canadian ones, and biased toward a privileged class of insiders, better educated and wealthier than the average American. That’s why America has become an aristocracy. By contrast, Canadian legal institutions are more egalitarian. The paradox is that Canadians employ conservative means to achieve socialist ends. And that explains my advice to my American readers: begin by recognizing the problem of immobility. And then emulate Canada.

National Post

F.H. Buckley is a law professor at George Mason University, and the author of The Way Back: Restoring the Promise of America (Encounter, April 2016).

< http://news.nationalpost.com/full-comment/f-h-buckley-youre-more-conservative-than-you-think >

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