COVER -> DAY ONE
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As the Editor thinks that there have been altogether too many contributions on "Banana Republic" lines, I shall not comment in detail, the methodology being trivial compared with the outcome, on Canada's capacity last week to count 16 million votes manually in four hours without incident or challenge.
There was a decisive vote in favour of the Liberal Party in the face of the remnants of conservatism that survived its overweening triumphalism under Joe Clark et al.
That is the likely fate of William Hague's Conservative Party in a British General Election next year, the same post triumphalist incohesion.
For reasons geographic and temperamental the British and Canadians were always the most likely to volunteer for extreme liberal (as opposed to Liberal) economic policies and so it is no surprise that other 'Western' economies have been less entranced by Hayek and Friedman, as interpreted by Reagan and Thatcher.
Casting a rapid glance around the globe there are few signs that countries enjoying healthy economic growth and resulting public sector surpluses are minded to cut taxes rather than increasing investment in social and physical infrastructure. The brutalities of free market capitalism may well have been necessary to break wartime corporatist practices which had lingered too long in peacetime but enough of us have seen where that leads if it goes unchecked.
One does not want to throw out the vulnerable socially responsible baby with nanny's dirty public sector bath water.
In Britain the electorate was split down the middle in 1992 when it voted for a Conservative Prime Minister by the narrowest of margins but it emphatically made up its mind in favour of state investment in 1997. One can only hope that the shallow but symmetrical differentiation in the American elections presages a similar, radical verdict next time, bringing it into line with more or less all the other major and medium sized industrial and post industrial powers.
The one immediate exception is, of course, Mexico, where corporatism, mixed up with corruption on a scale which makes Japan's cosy arrangements look pristine, is about to receive the Fox treatment very much on the lines pursued by Reagan, Thatcher and Clark. I don't see this going down all that well but Fox has promised a medium term policy that looks very much like Britain's New Labour 'Third Way' which Mr. Clinton would have pursued if Congress had allowed him so to do.
Having had a relationship with the United States akin to a love affair that has gone steadily sour, I hope that the recent results are simply a staging post on the way to a fundamental re-appraisal. There can only be a limited amount of time before the lack of public investment in people and infrastructure becomes a serious bar to the kind of economic growth which Americans have come to expect.
It is bound to dawn on politicians sooner or later (and one hopes sooner) that putting blacks through school is a much better investment than putting them through a punitive and very expensive criminal justice system.
With an ever-tightening labour market the idea of getting the poor into work might just catch on. The bottom of the labour market may survive for some time yet on immigration (legal and illegal) but the problem of immigrant non-working dependents and the practice of country-of-origin remittances both need to be faced. If an immigrant constitutes a net loss to the country where he settles there must be a temptation, surely, to raise the skill levels of the indigenous poor and devise schemes to put the unskilled into work.
In broader foreign policy terms it is also important that Washington does not allow itself to drift away from the rest of its older allies. It is only right that it should be more concerned with the Trans Pacific than the Transatlantic, but its interests will not be served by abandoning European ideas and ideals in favour of the joint leadership with China of a ramshackle coalition of state controlled (Oh, the irony!) freebooting economies, committed to the World Trade Organisation, indifferent to pollution, advocating the survival of the fittest and the triumph of the cheapest.
If this line persists then there will be trouble.
An enlarged European Union with an increasing self-sufficiency in defence will take some time to acquire the cohesion and courage to stand up to American orthodoxies but this is a matter of when not if.
Canada has shown that it can, even within NAFTA, reject Washington's strictures. Japan has never bought the Anglo-Saxon dream and is not likely to applaud ever closer friendship between the United States and China.
I doubt that there will be any formal alliance based on Canning's principle of the balance of power, more likely there will be sullen and stubborn resistance on a piecemeal basis until a piece of egregious bullying is essayed by the State Department. On the other hand, both Houses of Congress may well change hands in 2002 and the occupant of the White House is likely to be vulnerable two years later.
In the meantime, a small but important test of how the wind is blowing will come when out-going President Clinton asks Congress for a generous settlement of developing country debt, following the British initiative. The omens are not good but the very balance of forces in Washington must give some hope that it is worth hanging on yet a while before giving up on my old flame.
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