Tuesday, June 22, 2010

Wildrose AGM begins Friday

I've returned to Alberta, having failed to blog for so long that the vast majority of bdell.ca readers have undoubtedly moved on to writers who don't disappear for months at a time... but if you have stumbled on this page and it is not yet June 25, be advised that if you are a Wildrose member, the party's Annual General Meeting will kick off shortly before 6 PM at the Capri Hotel in Red Deer on Friday. Give my mobile a call at (780) 497-2740 if you are Edmonton-based and interested in sharing a ride or accommodation.

In anticipation of the AGM, I'll make a few comments here about what we'll be voting on.

With respect to the policy resolutions and amendments, when I first saw them at the beginning of May, the proposal sponsors were identified and a "policy committee recommendation" was sometimes provided. This policy committee recommendation could potentially be very useful, but unfortunately is of limited utility this time around, primarily because there is little or no transparency with respect to who is serving on this committee, why they are on the committee, etc. Ideally, the membership would be fully informed on that count, and even then rather than just rely on an appeal to its own authority the committee would provide additional information that would help inform the membership, like identifying a specific statute that could conflict with a proposal, noting think tank studies or reports that are relevant, etc. One of the proposals that appeared several weeks ago (but appears unlikely to come to a vote this weekend) called on the party to support charging a user fee of $25 for emergency room visits in excess of six per year. The policy committee was simply "opposed" to this. From a policy perspective, I don't see what the problem is, and the committee doesn't help me see what the problem is when no explanation is provided for the recommendation. In fact, I would also oppose the proposal, but that's because whatever the merits of the proposal on policy grounds, it is terrible politics. Were I on the policy committee, I would advise expressing no opinion on the policy proposal despite the fact adopting it would hurt the party, simply because if we are serious about direct democracy, then we ought to leave to the membership matters which they can judge as readily and competently as any expert. The mandate of the policy gurus should be limited to weighing in on questions of policy, in other words. If there is an optics issue as opposed to an economic or legal issue, anyone's opinion is presumably as good as anyone else's.

So much for a general observation. What of the specific proposals? There are several which I would be inclined to vote against simply because they don't say anything substantive, and if we mean to avoid politics as usual, we would avoid statements on the order of "the party will be all things to all people." An example of this would be "the Wildrose Alliance supports making improvements to the Securities Act to increase transparency and to provide greater protection for issuers, intermediaries, and investors." Do I think that the party needs to spell out the exact improvements it has in mind? No, but a philosophy needs to be articulated. The interests of issuers and the interests of investors are fundamentally opposed such that it is the regulator's job to strike the appropriate balance. By calling for increased "transparency", the party seems to be taking the side of investors, such that the "Public Company Accounting Reform and Investor Protection Act of 2002", better known as Sarbanes-Oxley or SOX, would be the sort of thing the party would presumably support, since, after all, SOX mandated increased disclosure. But the statements that have been issued by the party suggest that the exact opposite conclusion should be drawn, since they have called for issuers to have the right to opt-out of regulatory regimes they don't like. The bottom line in my view is that the party should

1) remain silent on the issue and just let the caucus/leadership articulate the party's position (as is currently the case)
2) attack the proposed Canadian Securities Act specifically
3) support a national securities regular

Readers of this blog know where I stand on this particular issue. I believe a national regulator would be business-friendly in the same way free trade is business-friendly. If you poll businesses about free trade, obviously some domestic producers will be opposed because they will not want foreign competitors entering the domestic market. A refusal to accommodate those protected domestic producers would not mean taking an anti-business approach; it would rather mean that the tax and regulatory environment would be more competitive - giving the "losers" the right to "opt out" would be to dress up a reversal of economic liberalisation in the language of liberalisation. Ultimately, the ideological confusion arises from a focus on "freedom" when the focus should be on "competitiveness", but that's a matter for another post.

There is, in any case, a policy proposal that is substantive and, in my view, mistaken. It calls for the repeal of the plank

A Wildrose Government will restore education as an essential service under the Labour Code ensuring that no child’s right to an education is denied by school strikes or lockouts.
and replacing it with
A Wildrose Government will examine what services should be categorized as “essential services” and implement reforms that will ensure those employed in “essential services” are treated fairly

This particular proposal reportedly originated from "caucus", and all else equal I would normally defer to caucus because the caucus has more experience with respect to electibility issues than the rest of us. I thought Paul Hinman played a very useful role at the last AGM, for example, when he spoke out on environmental issues. Hinman had actually been elected, and knew that a dismissive view of environmental concerns would be a very difficult sell in a general election. I would fully acknowledge here that this particular plank is one of the very few that has been specifically attacked by the opposition. The Premier called it "draconian", if I recall correctly. But I have to ask since when is it draconian to say the party supports the interests of consumers, in particular when those consumers are children in need of an education? The proposal at hand here does not just say that the interests of "those employed" by the government will also be considered, by calling for the deletion of the reference to service consumers it suggests by implication that "those employed" are the only group whose interests will be considered.

The reality is that the denial of the right to strike is simply the denial of the right to exercise monopoly power over the supply of labour. We don't tolerate monopoly behaviour with respect to the supply of other inputs, but because "labour" has more sympathy than the interests of capital generally, the same economic phenomenon is often given a pass in most democracies. Economically, a monopoly over the supply of labour is just as inefficient. There is nothing stopping a teacher from resigning and going to work for someone else if he or she is not receiving a competitive package of wages and benefits. "Fair" is the word choice of leftists everywhere who do not support free markets, so it is less than comforting to see such phrasing spread into Wildrose policy documents.

Alberta has enough leftist political alternatives without Wildrose going down that path. If it were a matter of just being "moderate", that would be one thing. But if the party folds like Superman on laundry day as soon as a civil service union protests it seems to me the party has crossed over from "moderation" into being just a more populist version of the PCs. When I was a candidate for the party in 2008, a key plank was a reduction in the corporate income tax rate. Since that time, nothing at all has emerged from the party with respect to corporate taxation. In my view, the party needs to take a stand for fiscal prudence, and that means something substantive as opposed to rhetorical. Why is this issue so substantive? Because it goes to the heart of the fiscal crisis governments are facing. Heard about the gold plated pensions some California public servants collect and the connection to that state's fiscal woes? In fact, Illinois has overtaken California as the worst credit risk among American states. Is it just coincidence that "in 2008, Illinois had the country's lowest level of voluntary turnover in state employment, under 2% per year"?

A policy plank calling for limited spending is not going to amount to anything if the party cannot say "no" to anyone when actually in government. Denying a right to strike does not deny anyone a dime in competitively determined compensation, it is rather just a denial of the "right" to the profits of a cartel.

1 comment:

Enlightened Savage said...

Brian: Welcome back. Great post.

And, possibly, the best line I've read in months: "If the party folds like Superman on laundry day..."