Sunday, June 28, 2009

Sizing Up Conservatism's Challenges

Conservatives in Canada, US and UK face very different challenges

In a blog post on the National Post's Full Comment blog, Hugh Segal makes the case that the challenges to conservative parties being posed by elections are largely immaterial compared to the challenges being posed by the current economic times.

At a time when even conservative administrations are instituting lavish Kenyesian economic policies, it's easy for fiscal conservatives to wonder precisely what this means for conservatism and the free market:
"Imminent elections focus the mind. But the global intellectual challenge to those of us who consider belief in free markets an integral part of our conservatism is larger than the next or last election.

The fact that parties of the left and centre left did not do well in recent European elections is a hint that voters do not see either an ideological culprit for the collapse of over-engineered credit structures or an ideological saviour from anti-free market apostles. What is apparent is that balance and fairness do matter and are not outside the conservative political realm.
Segal is making an important point by noting this.

While the election of Barak Obama as US President is being viewed by many as the nadir of conservatism, perhaps not even merely in the United States, it's important to note that other left-of-centre parties are not enjoying the same level of success.
"The political geography of each of the UK, US and Canada is vastly different. Americans have just come off two terms of Republican prominence. The UK is at the point where a Labour Finance Minister who managed during good times finds special challenges managing in different times. In Canada, what is still a fledgling Tory minority faces a more competitive Liberal opposition. So the short-term challenges for conservatives are genuine but not insurmountable. The American Republicans must be credible and engaged by the mid-terms in less than two years. Both David Cameron in the UK and Prime Minister Harper here face more pressing moments of truth."
In Canada, Stephen Harper may be facing a fall election opposing a strengthened and (at least temporarily) re-engergized Liberal party led by Michael Ignatieff.

In Britain, David Cameron isn't expected to have to fight an election against Gordon Brown and the Labour party until 2010, but the expectation is that he may win a Tony Blair-style majority government.

What remains to be seen for Harper is whether or not he can keep is majority government alive at all, let alone manage to win a majority. For Davoid Cameron, the test will be whether or not he can successfully defeat the Labour party during what is expected to be a time of economic recovery.

In the United States, meanwhile, Republicans are facing an althogether different challenge -- the challenge of not shooting themselves in the foot:
"In the United States, the Obama presidency, while not flawless, is sophisticated in ways the United States has not seen before. Some conservatives, doing themselves and the Republican Party's mid-term election prospects absolutely no good, have chosen an arch ideological scream over reasoned and thoughtful engagement. With the US government now owning large chunks of the financial and industrial United States, the intellectual challenge for Republican conservatives is defining the new balance between social and economic opportunity, necessary stability and the market freedom vital to rebuild the US economy."
If one reduces conservatism to the preservation of the status quo, one has to realize that government ownership of formerly private enterprise -- General Motors clearly being the most prominent example -- will have become part of that status quo.

If one subscribes to a far more nuanced definition of conservatism, one still has to realize the scope of the challenge that government ownership of financial and industrial industry poses.

One way or the other, conservatives will have to address the issue of this ownership. Privatization of these industries would be a simple solution for conservatives to pursue.

Yet when government privatizes public assets or enterprises one thing that is undeniably part of the transaction is a depreciated return on the public's investment. Privatized government assets have proven to be a bargain for many private buyers for this very reason.

But considering the scope of the public investment in ownership of these industries, government has the responsibility to recover the maximum value of that investment. As Benjamin Barber pointed out to Tim Geithner, the public has absorbed a great deal of risk in helping these companies effectively "start over" (something that has made GMs batch of PR ads on this very topic very much insufferable). The public has the right to expect a return on that risky investment.

For some conservatives, this may seem far too much like government reaping profits better left for private investors. This is market conservatism ad extremis -- one that denies the reality of this particular matter to the extent of being nearly self-destructive.

Conservatives the world over, meanwhile, should be as lucky as the British Conservative party's David Cameron:
"In the UK, Tory leader David Cameron, in embracing decentralization and more popular restraint on government excess, is true to both the Thatcherite and 'wet' side of Britain's Tory spectrum and the core centralizing myopia of 'big Government' Labour party approaches. The fact that this is done with a strong tilt to 'compassionate conservatism' provides both a spectrum-broadening base and intellectual frame for an eventual victory. But the intellectual challenge for British conservatism is being embraced head on.

At home, the universal kudos among critical international bodies like the OECD and World Bank for Canada's handling of the credit meltdown and US prime mortgage collapse speaking well of how Stephen Harper has managed to date. But the conservative intellectual challenge will also have to be met during the next election.
In facing the strengthening federal Liberal party, Stephen Harper will face a very different challenge than Cameron's.

For one thing, the Canadian Liberal party hasn't managed to burn nearly as many bridges as the British Labour party. And, as Barry Cooper points out, the Conservative party isn't nearly as adept at exploiting bureaucratic survival instincts for its own political advantage as the Liberals have been.

Even beyond this particular disadvantage, that the Canadian Conservative party has embraced stimulus economics with a fervour that seems to put the lie to fiscal conservatism, many of the challenges the Tories will face will be a result of their own emergency economic policy:
"That challenge might best be described this way. If stimulus and corporate stability investments have, along with economic downturn and tax cuts, produced a short-term deficit, what are the values Tories want to sustain through this for which they seek a mandate? This is not about what any government is doing or seeks to do in the future. This is about why we want to do it."
The Conservative party has provided a solid roadmap out of the current economic crisis for the country at large.

What the party has not produced is a solid roadmap for its own return to the fiscal conservative principles its expected to embody. This is certainly a problem, as it leads to a glut of policy deficiencies on numerous issues:
"National security is about domestic social and economic opportunity as well as a robust foreign and highly deployable defence capacity. It is about market freedom as an instrument of economic expansion and environmental competence. Ceding any of this ground to other parties weakens the Tory claim to a new mandate. Embracing it with clarity and intellectual integrity is what Canadians have the right to expect; it is what Conservatives under Prime Minister Harper have done when at their best. The argument to do it again has never been more compelling."
Of course, therein lies the rub.

It's easy for conservative political parties to be at their best during times of economic prosperity. They can move ahead on fiscally conservative programs without seeming callous or careless.

When times are bad, however, is when left-of-centre political parties tend to shine brightest. Canada's Conservative party hasn't led the country on any kind of a national project since sir John A MacDonald's ambitious railroad building project. This is a real problem for the party, as it leaves these opportunities to its left-of-centre opponents, who have led Canadians on national projects such as public health care.

Sadly, something in the conservative imagination tells conservatives that national projects are, in and of themselves, left-wing social engineering projects that undermine conservative values.

Yet an ambitious national project conceptualized and completed under the public-private partnership model embraces the principles of conservatives such as Segal. Such a project could be nation and enterprise at its best -- if only Canadian conservatives can muster the courage to attempt it.

There could even be opportunities to attempt such projects on an international scale:
"Kamalesh Sharma, the Commonwealth Secretary-General, recently called for an economic and social contract to ensure that the recovery does not make things worse for developing countries. In every country, the way out of the recession will be bracketed by concerns about market freedom and social justice. The challenge for Tories in the anglosphere is the same--a coherent plan for the way ahead that embraces both pillars underlying successful societies, market freedom and genuine equality of opportunity. Deserting either of these is not a rational way ahead in any industrialized country, and certainly not appropriate for conservatives of any variety."
As the world navigates its course out of the current economic crisis and its accompanying recession, we will also be confronted with opportunities to change the way we have approached policy issues such as foreign aid.

Jeffrey Sachs will certainly be first in line to attempt to re-start his (mostly) failed policies in the developing world. But conservative governments in countries such as Canada and (by then) Britain could -- and should -- quite easily bypass individuals such as Sachs and employ the wisdom of economists such as William Easterly, whose proposed policies vis a vis foreign aid call simply scream out for the P3 model.

The various industrial and financial firms that governments now find themselves owning significant portions of could even be offered the opportunity to work off their debt to the state by investing in these kinds of programs, allowing people in developing countries to shape aid programs through market forces and helping themselves out of poverty, as opposed to waiting to be saved.

It's on this note that one must remember something that Hugh Segal would certainly want Canadian conservatives to recognize: the current political and economic climate poses serious challenges to conservatives. But with difficult challenges come fantastic opportunities.

Conservatives, in Canada and elsewhere, can benefit greatly from these challenges if they can only prove able to grow into them.

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