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New book tracks how neoliberalism gutted Canada's social services

Nora Loreto’s new book explores the history of neoliberalism in Canada

September 26, 2024

6-minute read

Nora Loreto recently published Canada in Decline: The Social Safety Net, the first book in a planned series on the history of neoliberalism in Canada. This first book covers the impact of neoliberal restructuring on social services in Canada since the 1980s. The Monitor caught up with Loreto for a discussion on the rise of the neoliberal economic model in Canada.

This interview has been edited for length and clarity.



The Monitor
Your latest book is about the history of neoliberalism in Canada. What is neoliberalism? Where does it come from? And where do we find its origin point in Canada?

Nora LoretoAround World War Two, neoliberalism emerges as an idea, a potential economic order, in the mind of some economists. It would take another 40 years for it to actually become the status quo.

Neoliberalism is the process of giving control of everything over to markets, and in doing so, deregulating and shrinking the size of the state. This shifts how people understand their relationship to democracy at a fundamental level. Now, because it was not popular, it had to be introduced into Canada very, very slowly, by stealth, over the course of the 1980s and into the 1990s.

From the average person’s perspective in Canada, neoliberalism truly comes with free trade. All of a sudden, the 100-year experiment of building Canadian industries with tariffs, with planning in the economy—not a planned economy, but some level of planning—is just obliterated by our drive to attach ourselves to a market that has at least 100 million people. In the 1980s, that was the estimate of what was necessary to ensure the success of Canadian businesses. The market, of course, was not actually 100 million—it was 300 million people, it was the United States. This then expanded to just be free trade with as many nations as we could sign free trade agreements with.

The impact of all of this today is a reality in which we have no real control over our politics, where politicians are at the complete whim of the market, and everything has been financialized, right down to basic necessities like housing.

To what extent is neoliberalism multip-party, multi-jurisdictional ideology and practice? How broad of a hegemony has neoliberalism had in Canada?

It's our status quo, it touches literally everything. It replaced the post-war Keynesian order, which built the state that Canadians would look at and say, “that's Canada, that's public health care, that's that's a public education system, that social services, that's giving people what they need to survive, and not leaving them at the whims of the market.” Neoliberalism supplanted that entirely.

We never had full Keynesianism in Canada, and I go through this in the book. We had a kind of “Goldilocks Keynesianism”—one where corporations still were able to make profits, and still had tremendous power over politics and over people's lives. But there were some market interventions that made life better for Canadians.

When neoliberalism was implemented, we lost the democratic control over institutions that we once had. Corporate logic has been imposed on things that it absolutely has no business being imposed on, like the health system or the education system—and because it's hegemonic, because it's so all encompassing, it's very hard for Canadians to see past it, to see alternatives and to actually resist this logic.

It can feel abstract to talk about neoliberalism. For a regular, working Canadian, what is their daily interaction with neoliberalism?

Neoliberalism touches you at every single moment of the day. Whether you're sitting in traffic, because our cities were totally oriented towards getting people into cars rather than into public transit, whether you're sitting in an emergency room for hours because there's just no funding,, whether you're a nurse working 16 hour shifts, whether you're a factory worker who is worried that that plant is going to be removed from Canada, whether that is that you're a temporary foreign worker and you're working for poverty level wages and you don't even get the right to stay in Canada—all of these things are tied up in the neoliberal logic of the current order.

I think the best example is when you look at the housing crisis. The housing crisis is not going to be solved by more housing supply or reducing housing demand. It's a manufactured crisis, because land—and building structures on top of land—has been incredibly financialized, so every step of the process, someone's making a ton of money. So in the end, your house is going to cost you $700,000 because there's been a lot of palms greased all along the way.

And if you're a renter, the odds are very high—almost half—that you have a corporate landlord. That corporate landlord's primary job is to not house you, it's to take your rent and give it to shareholders. And if they take 90 per cent of their rent or more and give it all to shareholders, they're rewarded by paying no tax!

When you build a system like this, of course you're not going to have affordable housing.

Over the past couple of years, we've seen some genuine expansions of public services at the federal level—things like dental care, pharmacare, and $10 a day child care. How do you understand these developments in the context of neoliberalism?

Neoliberalism is bad politics. It's really, really hard to sell the effect of neoliberalism to average people, and politicians know that reining in neoliberalism is very popular, and so some of the expansions in the state that we've seen have all been done out of political necessity

If the Liberals primary goal is to be elected, or the primary goal is to save neoliberalism, we see two different kinds of approaches that they can take. If their primary goal is to get elected, then you have to offer people some level of relief, because we all know that savings are being obliterated, and that's bad politics for politician wants to get reelected. Just look at the rhetoric that Pierre Poilievre is using. Not that he's going to fix any of this, but he knows very well that the rhetoric sells.

These politicians are in the service of neoliberalism, and so that means we get half measures like the National PharmaCare program that is not a PharmaCare program at all, that covers two drugs out of thousands. It's a dental care program that's opt in, that's not automatic, that's not pay with your health card. It’s expanded health coverage that doesn't include all of the other things that we need, like physiotherapy, vision care, or mental health care. It's half measures, quarter measures, fifth measures—that that do kind of expand the state, but that will not give Canadians the kind of relief they need from the forces of neoliberalism,

What does challenging neoliberalism look like?

It's a rebalancing of forces. It's economic planning in the economy that includes things like price controls. In 2022, Canadian corporations made record profits. It’s expropriating properties and making more public housing. It’s taxing profits, forcing those profits to be putting back into like the communities in which they were made through workers salaries and other kinds of investments. It’s de-financializing the pension system and the insurance system. It’s putting a cap on user fees for things that we need for daily life, like the internet or transit or food

There are really easy fixes on paper, but they would be very hard to get a politician that's completely imbued in this kind of logic to sign onto. But we need an end to this profits-at-all-cost logic that is literally killing people and that will kill even more people as it continues to march on.

Your latest book is the first in a series called Canada in Decline. What is your vision for the rest of the series?

It's a huge topic to talk about Canada in decline, and even that's a contested term. I wanted to be provocative in choosing it.

The first books focuses on the social safety net, because that is what touches people the most. It's a very important question to put this into concrete terms for average people, and it felt like telling the history of the rise and the fall of Canada's social safety net was the most logical way to enter this conversation.

The next book, which is out in May 2025—it's already written, so I'm really excited for this to get out—is about the corporate control of Canada, which really gets into financialization. After that, there will be a book on democracy, the interaction between democracy and neoliberalism, and how we've lost so much democratic power in the last 40 years. And then for the rest of the series, the hope is that there will be a look at media, and there will be a look, finally, at the security apparatus that's needed to keep everyone in line under these crumbling conditions.

Thanks for your time.


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