The Thoughtful Conversation: How Inter-provincial Competition Is Harming Our Province

It can be argued in non hyperbolic terms that we in Newfoundland have less access to Ontarian markets than does Germany.

The ongoing NAFTA trade negotiations have provided an opening to discuss something which would have a much greater impact on the future of our Province, and that is an inter-provincial trade agreement.

The slow crash of American tantrums has led to our having to sell 4000 tons of newsprint to India last month. Newsprint which ordinarily would have found its way into American markets. International trade agreements can certainly have profound and lasting local effects, but for the smaller Canadian provinces, internal trade and competition is of far greater significance.

When Newfoundland joined Canada in 1949, an interesting clause was added to the terms of Confederation. Term 46 prohibited margarine to be shipped or sold from Newfoundland to any other Canadian province. We were the only place producing margarine at all in Canada, at the time. This was a sure sign of things to come and a small understanding of the impact our new country would have on us.

Sir John A MacDonald is quoted as saying that his only regret in the formation of Canada is that he allowed Ontario and Quebec to be too large. With hindsight, he said that he would have split Ontario and Quebec into 4 or even 6 separate provinces in order to even the playing field within the Federation.

Sir John A MacDonald is quoted as saying that his only regret in the formation of Canada is that he allowed Ontario and Quebec to be too large. With hindsight, he said that he would have split Ontario and Quebec into 4 or even 6 separate provinces in order to even the playing field within the Federation. He foresaw some of what was to come.

Fast forward to the present day. Our major media is owned by non local companies, VOCM being the latest outlet to fall when it was recently purchased by a Quebec company. Nearly all financial institutions are run out of Ontario, and what industry we do have is being bought by larger corporations elsewhere and promptly closed, not due to any lack of profitability, simply to get rid of competition and reduce supply in the market.

It can be argued in non hyperbolic terms that we in Newfoundland have less access to Ontarian markets than does Germany. The restrictions within our own country on things like beer, wine, spirits, agricultural products and energy to name but a few, are stark reminders of the unequal conditions which surround trade in this country.

Unfortunately, a trade imbalance isn’t the only issue. Last month the provincial NDP led marches for an increase to the minimum wage. Due to an increase in the cost of living, this is undoubtedly a good thing, but the number they chose to advocate for, 15 dollars an hour, wasn’t chosen arbitrarily.

Ontario had a few months earlier set its minimum wage to $15 an hour, Alberta intends to match at $15 and British Columbia, who in turn declared its intention to raise its minimum wage to $15.20 an hour. The competition to retain or attract even unskilled labour has become increasingly onerous for the smaller provinces.

We can’t talk wage competition without talking about Healthcare and Education. Our medical institutions are locked into cold war style medical arms races, escalating salaries in order to fill vital needs at the expense of other provinces. Universal Healthcare is without a doubt one of the greatest achievements of the Canadian Federation, and not without a note of morbid humour it very well may be inter-provincial competition which causes it to end.

Education is another flashpoint of crippling competition. Education, if you weren’t already painfully aware, is big business. Nova Scotia’s universities, in an attempt to maintain salary and infrastructure parity with Ontario and Quebec, have saddled themselves with the highest tuition rates in the nation and have begun to struggle to fill their classrooms.

Memorial University has maintained high salaries to attract the very best Professors and has maintained low tuition rates, but at the cost of eliminating jobs and severely underfunding its infrastructure. Both approaches are unsustainable. Meanwhile Quebec uses its wealth to create the lowest tuition rates in the country guaranteeing its schools are full to capacity, and Ontario maintains competitive tuition rates while pushing salaries and infrastructure spending ever higher to ensure superiority.

And now for the final shoe to drop, politics. When Newfoundland entered Confederation we had nearly 3% of the seats in the House of Commons, a very small voice, but a voice nonetheless. Today, we only have 2% of the Federal seats and in 10-20 years when the populous provinces again demand more representation our voice could fall to 1% or less. Taxation without meaningful representation is the same as no representation, and just as worrying.

Without a Federal government willing to intervene, without an inter-provincial trade agreement, it is fair to ask how long we expect this Federal experiment to continue.

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