New book looks at Canada’s position in emerging global economy

The latest book by award-winning author and York political scientist James Laxer, Beyond the Bubble: Imagining a New Canadian Economy, argues that last year’s economic crash marked the end of one world age and the beginning of another. Gone is the neo-liberal age of globalization, and with it the American-centred global economy, and Canada needs to position itself for success in this emerging new economy.

Given the nature of the financial system whose collapse is at the centre of the global crisis, and the crushing economic problems faced by the United States, it is highly unlikely the American-centred global economy will make a comeback, says Laxer. The US is struggling to scale what Laxer calls the three peaks of the American debt mountain. The US government owes US$11 trillion, an amount matched by individual Americans with credit card and other debt. Add to that the rapidly increasing net indebtedness of Americans to the rest of the world, also totalling trillions of dollars, and it’s easy to see the US is not going to be on top for a while, if ever.

Laxer, a former Toronto Star columnist, is the author of 23 books, including Mission of Folly: Canada and Afghanistan (Between the Lines, 2008), The Perils of Empire (Penguin Group Canada, 2008) and Red Diaper Baby: A Boyhood in the Age of McCarthyism (Douglas & McIntyre, 2004). He teaches in the Department of Equity Studies in the Faculty of Liberal Arts & Professional Studies.

Beyond the Bubble (Between the Lines, 2009) examines the changing global political economy and documents the causes and consequences of the vast and multi-layered problem of American indebtedness. Laxer suggests Canadians need to consider the choices available to them in this volatile environment if they are to combat the crash in this country. These choices are as crucial as those faced by Canadians when the British Empire lapsed into economic decline at the end of the First World War, he says.

Laxer gives an overview of past Canadian economic policies in the critical areas of resource exports and manufacturing. He asserts that Canada continues to export the staple products that other countries need without figuring out how to use the resources to further its own development qualitatively. 

Right: James Laxer

The federal government’s attempt, under Stephen Harper’s leadership, to turn Canada into an energy superpower is a failure, says Laxer. This country’s reliance on the Alberta oil sands as the source of major petroleum exports to the US makes it impossible for Canada to reduce its greenhouse gas emissions.

In addition, he says, it is perilous for Canada to simply follow the policies of the Obama administration in the US. At a time when the global automotive industry is being completely restructured, Canada needs an integrated approach to transportation equipment industries. The transportation sectors need to be developed in conjunction with the other major changes underway, which include the pressures of climate change and peak oil, the passing of the age of readily accessible petroleum on a scale sufficient to meet global needs. Industrial societies have to rebuild their cities and their transportation systems.

In Beyond the Bubble, Laxer argues that the neo-liberal approaches of recent decades need to be replaced with new and progressive policies aimed at democratizing the control of capital in Canada and around the world. That alone can establish the basis for a sustainable economy that avoids the vast inequalities of the age that has ended.

For more information, visit the Between the Lines Web site.