With the financial crisis as a backdrop, Stephen Harper’s minority Conservative government may not survive another week. Less than two months after the last election the government is facing a confidence vote on its budget update and all three opposition parties say they will vote against. Rumours are rife of a Liberal-NDP coalition to replace the Conservatives. The Conservatives must be defeated, but there can be no coalition with the bosses’ parties.

Yesterday, Canadian Finance Minister Jim Flaherty tabled a budget update. This had come after several weeks of speculation that Stephen Harper had had a sudden Keynesian conversion towards economic stimulus in the face of the global economic meltdown. However, rather than put forward a statement which mirrored the multi-billion dollar bailouts of the US and Britain, the government tabled a massively optimistic balanced budget achieved off the backs of the working class.

First of all, Flaherty outlined a ban on federal public sector strikes until 2011 and the institution of a 1.5% wage cap. In the words of John Gordon, president of the Public Service Alliance of Canada, “It’s an affront to free collective bargaining. It’s just atrocious.” It rips up 2.5% wage increases already agreed by the Canada Revenue Agency and hits against Canada Post and other workers in crown corporations. In addition, where the federal government leads the provinces will follow and this will be used as a model for an attack on the right to strike everywhere.

Second, the government proposes finding $2.3-billion of revenue from privatizing crown corporations and government assets, plus another $2-billion in cuts to public services. They are also planning to gut pay equity legislation. Exactly what will be on the chopping block remains to be seen, but you can guarantee it will not be good for the workers in those corporations or the people who access those services.

These measures are exactly what Fightback predicted. In an article we published on the 8th of September we said, “With the coming downturn the Conservatives are looking to follow the dictates of their corporate masters and institute whole scale attacks on the social wage. The Liberals work for the same people and they would be no different. The bosses will demand that the economic crisis be put squarely on the backs of the working class. There will be cuts in every social program, every small reform that workers wrenched away from the system. Privatization will come to the top of the agenda, probably starting with Canada Post. The last few years of long hours, few rights and poverty wages will seem like a holiday when they are replaced with government and corporate attacks, unemployment and privatization.” Canada Goes to the Polls: Socialist Policies Needed, Fightback Editorial Board.

Poison Pill

However, as well as attacks on the working class, the Conservatives included a nasty poison pill. They proposed to remove the $1.95 per vote political subsidy given out to political parties. The Liberals, the so-called natural party of Canadian capitalism, could probably have stomached the attacks on the workers, “for the good of the country.” However, now the Tories were putting the very existence of the Liberal party at stake. When you are voting to attack the poor that is one thing, but this would mean real pain and hardship for Liberal apparatchiks and that could not be allowed! The Liberals are massively in debt and divided in the run up to their leadership convention. In the last year they were not even able to raise as much money as the NDP. Despite still having the weak and pathetic Stephane Dion at their head the Liberals had no choice but to oppose the budget statement.

The NDP, the Bloc and the Liberals all stated their opposition on the grounds of the lack of economic stimulus in the statement. All three parties have been forced to fight on the high ground of economic policy, no matter if their real motivation is the receipt of money from the public purse. The Conservatives had miscalculated. They thought that they could kick the Liberals while they were down. They hoped that the Liberals, leaderless, would be forced to let the government stand. The latest reports state that the government has removed the campaign finance portion of the bill – however, now they have forced the Liberals on to the high horse of opposing the statement on the grounds of the lack of stimulus, the Liberals will have trouble getting off that horse if there is nothing in this area. The choice is either a massive revision of the economic statement, a massive humiliation of the Liberals, or the government will fall.

If the government loses a vote on a finance bill it is deemed to be a vote of confidence and the government falls. However, it does not necessarily mean that there will automatically be an election. The Governor General, representing the Queen, may turn to the Liberals to see if they can form a government that can win a confidence vote in the House of Commons. We cannot forget that under the Canadian (and British and Australian) constitution it is not the people who decide to form a government, it is the Queen. In the event of a party winning an election on a socialist platform there could be an entirely constitutional coup, where the Queen’s representative appoints an emergency cabinet “until order is restored” and it can be guaranteed that an election would produce the “correct” result.

The prospect of the Liberals being handed power has led to back room discussion about a Liberal-NDP coalition. Former party leaders Jean Chrétien and Ed Broadbent have apparently had a series of discussions. The deal is fraught with contradictions. Who would be Prime Minister? Stephane Dion has no credibility, but the Liberals have not elected a new leader. What would happen to the $50-billion corporate tax cuts that the NDP is committed to reversing? There is no way the Liberals would agree to this and an NDP back-down on this issue would be a complete capitulation. Finally, what would happen to the Canadian troops in Afghanistan? The NDP is committed to immediate withdrawal while the Liberals want to stay and fight until 2011.

Any such coalition with the Liberals would be a huge mistake and a betrayal by the leadership of the NDP. The Liberals are no less of a bosses’ party than the Conservatives and have supported an endless list of attacks on the working class. In the present financial crisis the Liberals will be forced to follow the dictates of their corporate masters. Will the NDP leadership throw the Liberals a lifeline in their hour of need, and be dragged down with them, or will the NDP let the bosses’ party sink into a well-deserved watery grave? There is a historic opportunity here to change the balance of forces of Canadian politics and it cannot be thrown away. Let the Liberals and Conservatives take responsibility for the crisis of the capitalist system they defend while the NDP builds support by proposing the only genuine alternative – Socialism.

The NDP is correct to oppose the budget statement, but for the wrong reasons. Economic stimulus and the Keynesian model, in other words bailouts for the banks, is no solution. Deficit financing was tried before and it resulted in the hyper-inflation of the 1970’s. The only way to save jobs of Canadian workers is a socialist economy. Productive plants are being shut down with the loss of hundreds of thousands of jobs. No matter how much money is thrown at these private corporations you cannot artificially create a market for the products out of thin air. Attempting to plan capitalism, while maintaining private ownership, is simply impossible. The only way out is to change the logic of the economy towards production for need and not for profit. By nationalizing these plants, putting them under the democratic control of the workers and integrating them through a democratic plan of production, millions of jobs can be saved and the economy can be run on a rational basis.

Some may say this is too radical and workers will reject it. Recently the Quebec NDP voted for nationalization in the oil and gas sector and this move was led by the striking Petro-Canada workers. Besides, if the choice is between radical action and unemployment and mortgage default, most workers will not support capitalist ideology as they walk to the food bank. Capitalism has shown that it does not work, the British and American governments have effectively nationalized large sections of the banking system in order to save capitalism from itself. All the capitalist theories are being thrown out of the window as useless in practice. The question is not whether nationalization is acceptable, Bush and Brown have shown that it is, the question is whether there is nationalization to bail out the bankers who destroyed the economy, or nationalization for the benefit of the workers who produce all the wealth and really know how to run society.

The coming weeks and months will see incredible turmoil. Sharp turns and sudden changes are on the order of the day. Fightback says, bring down the Conservatives and no coalitions with the Liberals. The NDP must adopt socialist policies to save jobs and lead millions of workers and youth towards the only alternative to capitalist poverty, homelessness, unemployment and war.

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Send Letters to Jack Layton saying,
“Defeat the Conservatives, no Liberal-NDP Coalition!”

Model Letter:

Jack Layton – Federal NDP Leader
laytoj@parl.gc.ca

Libby Davies – Parliamentary NDP House Leader
Davies.L@parl.gc.ca

Anne McGrath – Federal NDP President
ndpadmin@fed.ndp.ca

Dear Jack Layton,

I am writing to you as an NDP member in the riding of …/a union member working at …/a student at…/a concerned citizen/etc. I strongly encourage you and the NDP caucus to vote against the Conservatives’ economic statement. The measures to remove the right to strike, to privatize crown corporations and cut public services must be defeated.

However, I am deeply concerned with the rumours that the NDP parliamentary caucus is considering a coalition with the Liberals. In no way can the NDP join a Liberal government. They follow the same big-business interests as the Conservatives. In this time of economic crisis they will adopt a policy of making workers pay for the failure of the capitalist economy. The NDP cannot abandon its call to reverse the $50-billion corporate tax cuts and immediately withdraw troops from Afghanistan for the sake of a few ministerial posts. If the NDP joins the government it will surely be dragged down and discredited along with the Liberals.

Yours truly,

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