Reading Richard Starr’s new book, Power Failure, which is about Nova Scotia’s long history of botching energy policy, I was struck by a 1926 quote from future Liberal senator Eugene Forsey. Echoing the local business and political mucky-mucks of the day, who were selling the coal industry as the Next Big Thing, Forsey celebrated Nova Scotia’s location “half way between two continents, just where they could supply Canada, take care of Europe, look after the rejuvenation of the British steel industry, and ultimately ship their ore and basic products into Pittsburgh itself.”
Caught up in such boosterism, governments went on to prop up the coal industry with millions of dollars of subsidies, but the big dreams of success never materialized.
The Forsey quote sounds remarkably like a recent Nova Scotia Business Inc. PR piece celebrating Halifax as a potential “global financial centre.” A few years ago, NSBI brought in some hucksters from Citco, an American financial services firm, to speak to our present-day mucky-mucks. The hucksters told them that Halifax is poised to become—and I shit you not—the “next Singapore.” Ever since, the mucky-mucks have deluded themselves on the notion, and are dumping millions of dollars of taxpayer money into subsidies for financial service firms.
“It’s not all about extensive incentive packages and tax breaks in Nova Scotia,” says NSBI’s PR piece. “The province offers the right balance of available talent, competitive costs, strategic location and time zone, business environment and quality of life for employees.”
I’m amused by the “time zone” argument, which I’ve heard literally hundreds of times: Nova Scotia is just one hour off New York, and four hours off London, England, so our highly educated workers can push paper between the two financial centres in the same day, so Halifax will soon fill up with skyscrapers full of geeks, and we’ll all get rich.
We should have learned the lesson after the call centre fiasco. Last decade, the mucky-mucks cited our English-speaking workforce that would work for pennies and, yes, our time zone, as reason for American firms to set up call centres. Well, with millions of dollars in subsidies, sure enough, a lot of firms did open call centres here. But then the subsidies ran out, and guess what? There are English speaking people in India and the Philippines who will work for even less than the pittance paid to Nova Scotians, so the firms up and left, leaving thousands unemployed locally.
There’s a pig-headed wilful ignorance among our mucky-mucks. They truly believe our universities are the bestest in the world, our time zone is the bestest in the world, our geography is the bestest in the word, our geeks are the bestest in the world, and if only we give millions of dollars to offshore companies to come here, they’ll see our bestestness for themselves, and their executives will travel here and leave big tips in restaurants, and that money will slosh around the economy as waitresses buy big houses with their big tips, and realtors will make so much dough off all these house sales that they’ll install pools in their homes, and suddenly we’ll have this booming pool boy industry, and then the resulting pool boy porn industry, and jeez gosh, there’s no end to the money to be made.
But of course, India has universities, too, and people in India will work in the middle of the night, for even less money than the high-wage jobs NSBI promises will come via the millions of dollars dumped into financial service subsidies.
Our mucky-mucks stage the very same train wreck, over and over and over again.
There’s a colonial mindset in Nova Scotia that thinks wealth can only come from exporting to or servicing the rest of the world; we’ll sell them coal, or Newfoundland hydroelectric power via a convoluted route through our province, or our geeks will move around the tax-sheltered ill-gotten gains of the world’s billionaires.
Here’s a thought: let’s think of wealth as something we produce ourselves, for ourselves. A power system that takes care of our own needs first. Employment based on local agriculture and production that is consumed by people right here in Halifax. Universities that educate people for the sake of graduating responsible citizens, and not to create serfs to the world.
Just a thought.
This article appears in Jul 21-27, 2011.
I have spent a lot of time in Singapore and we will never be like them. They have a strategic advantage of location which drives their port business and a retired leader who placed an emphasis on education and hard work. Remember when he banned long hair and certain visitors received a free haircut upon arrival ?
A university education won’t be of much use if the only employment offered is sharecropping some veggies on the back 40. You need to offer a better alternative than that f you want your opinion to have any credibility. Having said that, i don’t disagree that a lot of the “financial center” stuff is pure NSBI PR drivel. But I have to think there is some reasonable middle ground between them and your dismal vision of the future.
Another thought. Government can’t create wealth. And what they do get, is taken from someone else.
“In Soviet Russia, I go buy big TV for 20 Rubles! 15 inches! My neighbor Kirill works at TV factory outside town, he buy same TV.. 15 Rubles!!”
Say that in a thick accent a couple of times and maybe the utopian self-sustaining and self-sufficient society that Tim dreams of might begin to make sense, complete with our own locally-produced everything, from the eggs in your breakfast to the computer he used to type this article. All locally sourced, produced, sold, and consumed.
I was born in a communist regime that wanted to have something like that. My parents lived it and worked in loyalty to Comrade Brezhnev in the 70s, and the ideals of a society that lives sufficiently within the means provided by big brother. No more, no less.
Guess what? it was a fantasy. Reality in such a system sucked ass. I’ll take my global-village living any day over a closed “self-sufficient” system.
Thank goodness for governments flush with taxpayers’ money and willing to freely hand it over to corporate shills. This is the only thing keeping capitalism afloat these days.
Tim is right.
When the original Free Trade Agreement was signed with the U.S., it’s promoters alternately promised huge benefits (secure access to the U.S. market avoiding the old, cumbersome mechanisms for resolving trade disputes) or threatened economic stagnation that would turn Canada into a backwater in the globalizing world economy.
But trade disputes with the U.S. are still pretty much settled the old-fashioned way – a lot of politics and arm-twisting and giving in. The softwood lumber dispute, which dragged on for years even after Canada won its case before international trade tribunals, is a prime example.
As for globalism, it is an ideology which is about to begin its long decline into oblivion. The globalization of agriculture commodities markets has arguably caused more harm than good to populations in developing countries and isn’t sustainable in its current form. The manufacturing sector chased cheap labour markets all over the world in its quest for ever increasing profits, but increasing transportation costs are bound to erase this advantage sooner rather than later. The idea that advanced nations like Canada would somehow base their economic growth on “knowledge workers” was a sham from the beginning. Engineers and technicians in China, India and many other parts of the world are quite as capable as Canadians when it comes to the “knowledge economy” and they work for far less money.
No. Globalization will prove to be an economic dead end and the ideology of globalism will end up on the ash heap of history.
I think governments at all levels should be looking at ways to enhance local and regional economies. A whole host of goods and services that currently live at the end of 12,000 mile supply chains will eventually migrate back to the local and regional economies that they vacated years ago in pursuit of cheap labour, enabled by cheap oil.
The days of the $12 toaster (made in China and purchased at Walmart) are drawing to a close. Anyone who insists otherwise is either selling snake oil or has their head up their ass.
Shit thanks for the warning, I’d better go to Walmart and get my toaster now while I still can!! 😉
Tim
I really don’t think you have a clue what you are talking about.
These 5% rebates are well worth the money considering the economic benefit provided by these jobs. The direct impact from these are a net gain for the province. Also these aren’t call center jobs, these are skilled labour with well paying positions. They aren’t easy to move to India or pakistan. If they were do you think they would waste their time setting up shop here when they could go there and pay 1/10 the wages.
I guess it is your job to be sensational but it should come with a disclaimer so that people know that what you write isn’t factual.
I would think that issmat’s (and his family’s) experiences under a communist regime should throw cold water over any “Let’s do everything locally!” fantasy peddled by the Coast’s editorial board. I will take globalization any day of the week.
Didn’t India have that whole “self-sufficiency” policy up until the 1990s? Oddly enough, once they jettisoned this position and opened up their markets to the world, their economy went from virtually stagnant to annual growth rates of around 7%.