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Through the Looking Glass with Jim Flaherty

On the political art of doing nothing.

By Murray Dobbin 27 Sep 2007 |

Murray Dobbin writes his State of the Nation column twice monthly for The Tyee.

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Finance Minister James Flaherty

Federal Finance Minister Jim Flaherty has said repeatedly in recent weeks that the Canadian economy is "the strongest it has been in a generation." His obvious pride in this situation prompted The Tyee to interview the minister to explore the government's policies that led to this development.

Tyee: Mr. Flaherty, you stated recently that the economy is the strongest it has been in a generation. Could you describe for Canadians the set of economic policies that have led to this extraordinary situation?

Flaherty: Certainly, I would be happy to. Our New Government -- that is the New Government of the New Prime Minister, Stephen Harper -- has taken the view that the economy is best directed by the market itself and that government -- new or otherwise -- should just keep its hands off.

Tyee: So let me get this straight so Canadians can get it straight, too. You are saying that this unprecedented situation comes to us from the marketplace, left alone by your new government to do its magic.

Flaherty: Absolutely, dead on. You've understood me completely.

Tyee: Perhaps you could elaborate just a little on just which policies you have followed that have ensured that government does nothing to interfere in the marketplace. That is to say, which policies is your new government pursing that will ensure you have no policies which will interfere in the economy running itself?

Flaherty: Well, it's pretty complicated, I am not sure you would understand. Our position is that people -- including reporters -- should just be happy with the situation and not ask too any questions.

Tyee: I am willing to give it a try, Mr. Minister. We've been covering economic policy and budgets for a long time. Frankly it doesn't sound that complicated if your basic economic policy is to make sure none of your policies have an effect on the economy.

Flaherty: I can understand why it appears simple. When things work well, of course it looks easy. Take your professional athlete for example. They make it all look easy -- Tiger Woods makes a drive from the tee look easy but it involves all sorts of extremely complicated moves, concentration, follow-through, the right stance, confidence. But you don't see all those things -- you just see the results. It's the same with the booming economy being cleverly guided by our New Government. You see the wonderful results but not the complex set of manoeuvres and nuances behind it.

Tyee: It sounds to me like your economic policy is -- correct me if I'm wrong -- is to get out of the way of the economy so it can just get on its way doing what it does best. Again, I don't wish to sound flippant, but unless I have missed something your policy sounds a lot like doing nothing at all.

Flaherty: That's a very simplistic interpretation of what I have been saying and certainly doesn't give credit where credit is due. Getting out of the way of the market -- or "doing nothing" as you so glibly describe it -- is not easy. There's nothing like it in the history of government.

Tyee: Pardon me for being so obtuse, Mr. Minister, but given what you have said so far our readers might conclude that the best way to keep the economy chugging along is to simply get rid of the government altogether. I mean, if doing nothing is your economic policy, why do we need a finance department and other departments at all. There are thousands of employees in these departments -- all apparently dedicated to doing nothing. How many people do you need to effectively do nothing?

Flaherty: That depends. And let me say that your questions betray a shocking misunderstanding of how government works.

Tyee: Don't you mean how government doesn't work?

Flaherty: Same thing.

Tyee: Let me try another tack as we don't seem to be getting anywhere or, as you might prefer, we're getting nowhere. It seems to me that from what you have said, any political party could accomplish robust economic growth by doing nothing. After all, doing nothing requires no particular set of skills, no experience, no complex vision of what you want to accomplish. Playing the devil's advocate for a second, one could argue that a class of Grade 3 students might be the best bet for running the economy.

Flaherty: Nothing could be further from the truth. Doing nothing in government is actually one of the most complex undertakings imaginable. Doing nothing -- of course we prefer to say "getting out of the way" -- and at the same time getting kudos for good results is a tricky business. In fact, it's nothing short of magic.

Tyee: I would like an illustration -- you know, paint a picture for our readers.

Flaherty: Sure. For example, in the finance department and the industry department -- not to mention agriculture and regional development and fisheries departments -- there are many very smart people who want to do something. It's not for nothing they work so hard. So we need a lot other people -- just as smart or preferably even smarter -- who must counter this quaint but destructive imperative to do something. It's a constant battle. I know it is counter-intuitive, but Doing Nothing requires focused, relentless action.

Tyee: Give me some examples from the so-called real economy.

Flaherty: That's easy. Take the loss of auto industry jobs. Doing nothing in this situation is extremely difficult. People actually expect governments to do something when thousands of jobs just disappear over night. That's partly due to departmental names like "industrial development" which imply that we are going to develop something. That, of course, would mean getting in the way. Then there is the sell off of all those corporate icons -- Stelco, Noranda, Fairmont Hotels, the Hudson's Bay Company. People get very emotional about these corporations being bought up like so many raw logs. We're working on reframing the names of the relevant departments to begin changing the political culture. It's not easy. We've focus-grouped "Economic Development -- Not" we've tried "Industrial Abandonment Department." The results haven't been what we hoped. Same with words like desist, discontinue, abdicate, surrender, relinquish. People just aren't there yet.

Tyee: But your goal as a government is to do nothing.

Flaherty: That's our long term goal. Our short term goal is to do as little as possible.

Tyee: How would you say that's going -- or not going?

Flaherty: I think we're doing -- or doing not -- very well.

Tyee: Thank you, Minister.

Flaherty: De nada.

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