Why the NDP Needs to Become the Party of Growth

Broadbent Institute conference hears economic growth critical for social equity, public services.

By David Bieber 3 Oct 2016 | TheTyee.ca

David Bieber is a Vancouver political communications consultant who has worked with civic, provincial and federal political leaders, unions in B.C. and political parties in Europe, Asia and the Middle East. He was director of party communications for the BC NDP from 2003 to 2009. Find him on Twitter @dcbieber.

Social democratic parties in Canada haven’t had a lot to say about economic growth lately.

There’s been plenty on offer about redistribution of economic gains — directing tax revenue towards productive investments in education, health care and infrastructure as opposed to handing it back to citizens, mostly the very rich ones, in the form of politically targeted tax cuts. But not so much about facilitating stronger economic growth needed to generate those public revenues.

Take for example the BC NDP’s 2013 election campaign, one in which fiscal responsibility was put front and centre because it was well known that voters are nervous about how the NDP can manage the economy. The campaign explained, in exhausting detail, how changes to tax rates here and there could free up money for much-needed public investment while still balancing the budget. Similarly, the federal NDP’s 2015 campaign tried to hang on to an early lead with cautious positioning, offering major public investment balanced with tight fiscal policy that promised a balanced budget every year.

Putting aside the various factors that led to the blowout in each case, note that both campaigns, while ostensibly profiling an NDP vision for the economy, talked about redistribution rather than growth.

Partly this is tactical. Public opinion research shows consistently that the NDP is the most trusted party on issues like health care, education and helping the vulnerable, yet much less trusted on managing the economy. Conventional thinking has long held that the path to victory is to focus on the former issues, and avoid the latter.

Partly it is borne of habit. For decades now the NDP’s turn in government has come rarely, and outside of Manitoba and Saskatchewan, more or less fleetingly and only when voters are looking to throw somebody else out of government. There hasn’t been as much experience in government, hence less comfort dealing with the engines of the economy.

A bias against growth

Increasingly, it is a point of pride. Where the NDP has retreated to urban and more affluent regions, there has been a greater tendency to dismiss economic growth as indistinguishable from the consumption of non-renewable resources and the production of waste, therefore incompatible with the urgent need to achieve environmental sustainability.

Either way, it’s something social democratic parties in other countries have been better at grappling with. But as long-robust market-based economies find themselves mired in slower and slower growth, threatening jobs, pensions and investment in public assets, it seems more urgent than ever for progressive parties to take an interest.

Here in B.C., it’s certainly proven a big obstacle for the New Democrats. Despite scandals and broken promises, deteriorating health care and declining education, the BC Liberals have won elections in 2001, 2005, 2009 and 2013 by riding the public perception, rightly or wrongly, that all that aside, the economy will do better when they are in power. There are few indications they plan to change the strategy in 2017.

So it was encouraging to see the Broadbent Institute gather leaders of progressive groups across B.C. and confront them with the question of what the economy should look like in years to come. At its inaugural Progress Summit in Vancouver last week, the non-partisan organization, headed by former NDP leader Ed Broadbent, provided an opportunity for community activists to sit down with respected business leaders to chat about finding common ground.

The session opened with an extensive presentation by Tamara Vrooman, former B.C. deputy finance minister and now CEO of Vancity, Canada’s largest credit union, controlling $20 billion in assets. She laid out a compelling business case for co-operative enterprises like Vancity, not just because of their long record of community support, but also because they are more efficient and more economically productive.

“When you look at business results, most of the things that other corporate forms are recognized for actually are things that co-operatives can do better, stronger, more efficiently, faster,” said Vrooman. Co-operative businesses tend to be closer to the ground, she explained, more integrated with communities and responsive to consumers, and thus tend to make better decisions. They are also more efficient because they have no shareholders to extract a portion of each transaction, more innovative because they are participatory, and generate higher employment and incomes.

Taken together, these businesses generate greater long-term economic performance and exhibit greater resilience in the face of challenges that might cripple more traditional business organizations.

And in a world of increasing social unrest driven by economic inequality and disruptive change, there are great benefits to economic activity that is participatory, focused on long-term value and responsive to communities instead of shareholders.

Prem Gill, CEO of Creative BC, followed Vrooman with thoughts on the importance of the film and digital industries, which have grown to provide thousands of highly-paid jobs and a significant portion of the tax revenues powering the province.

“We have an excellent foundation,” she said, “and in the last five years we’ve become a global leader in visual effects and animation.” The industry depends on the pool of skilled workers that has developed in the last two decades, and she noted that its future is now threatened by the challenge of hanging on to people, and attracting newcomers, in the face of the skyrocketing cost of living.

Economic growth and social equity

Taleeb Noormohamed, former chief growth officer for Farfetch, a global online fashion business, and vice-president of strategy and partnerships for Vancouver’s 2010 Olympics, spoke about the economic and social potential of B.C.’s growing technology sector. By creating jobs where people are paid not just a living wage, but a “thriving wage” that allows them to do much better than just get by, he said the tech sector can play a big role in creating the conditions which offer everyone an opportunity to participate in economic success.

Economic growth is fundamental to social equality, he argued. Wealth creation is necessary to create opportunity and provide investment for social infrastructure like health, education and housing. “The challenge for progressives,” he pointed out, “is that you have to be willing to get comfortable with the notion of creating an environment where economic growth, wealth creation and social good are not seen as oppositional.”

He suggested that a progressive government could help create more jobs in the technology sector by thinking of how to provide capital — not just financial capital, but other forms like office space, which is expensive in B.C., and education, which is needed for the highly skilled and constantly evolving work. And he stressed that governments of all stripes must be prepared to take more risks.

Ross Beaty, a leading mining entrepreneur who is now working on conservation and renewable energy, offered a different approach, taking dead aim at the costs of economic growth.

”I think we have to move off of our growth model,” he said. “It’s been the dominant economic model of our lifetime. The problem is this model is just not sustainable.” Economic growth has built a society providing many benefits, he said, but at the cost of our soil, our water and our air, and unchecked economic growth now presents an existential threat to the future of life on the planet.

“We need to change our direction and change it quickly,” Beaty said. “The result might be less choice, less speed, less stimulation and less stuff, but it will result in a more healthy, more happy and more prosperous people and province. Prosperous in the biggest sense. And truly sustainable.”

“Let’s get our priorities right: slow down, use less junk, and get outside a bit more.”

This led to an interesting exchange.

“I’d like to respectfully disagree with you,” said Noormohamed. “I think one of the challenges is that people are trying to figure out where their next meal is going to come from. It’s pretty tough to take the time out to slow down when you’re figuring out how to make ends meet.”

“I couldn’t agree more with that,” responded Beaty, quickly.

Later, when asked how to help transition workers whose livelihood depends on our current carbon-intensive economy, Beaty acknowledged that this was a thorny question.

Thorny indeed, and in the discussions to follow the answer remained elusive. Certainly Beaty’s zero-growth vision, while describing an attractive, if not utopian, end point, cannot reasonably be achieved. Nor would it be wise for the NDP to embrace it, lest they consign themselves to the support of a shrinking constituency of supporters in the wealthier quarters of Vancouver and Victoria.

The other presenters provided options for smart policy, but little tactical advantage for winning elections.

Film and technology, great successes that were substantially kickstarted by the NDP’s much-maligned 1990s government, create jobs for younger, urban and creative voters who are more likely to vote NDP. But both sectors have lately enjoyed attention from the BC Liberals, making it more difficult for the NDP to showcase them as examples of their ability to generate robust and sustainable economic growth.

Furthermore, while tech arguably benefits small communities across B.C. due to its integration with resource industries, neither it nor the film sector are seen to benefit rural B.C., so too much focus on them would strengthen the impression the NDP doesn’t understand or care about jobs in resource communities.

Co-operative enterprise, while sharing a common social democratic heritage with the NDP and extremely promising in the face of current economic challenges, is still too small a part of the B.C. economy and arguably too far off the mainstream to deliver a convincing message that the NDP is committed to growing the economy and working with the established business community.

And therein lies perhaps the best path forward. Engagement and listening, as exemplified by the Progress Summit itself, inviting a growing circle of diverse perspectives, is the best bet for establishing that social progress and a strong economy are not mutually exclusive.

In fact, one depends on the other. That’s something the left understood implicitly back when strong unions and strong growth went hand in hand, and helped establish the social programs that created opportunity and hope for working people.

Today, with extremism on the rise, central bankers and corporate leaders around the world are increasingly calling for higher wages, higher taxes and greater public investment to stimulate the economy and create the more inclusive growth needed to reduce polarization and restore faith in democratic government.

The NDP, and the left in general, has a historic opportunity to come to the table and work with new partners to define and deliver growth that is strong, sustainable and shared.  [Tyee]

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