TORONTO, ON-Canada should be looking to market-based public
policies to deal with a broad array of concerns ranging from
environmental issues to energy pricing to aboriginal poverty,
Preston Manning and Mike Harris say in a new policy paper
released today by independent research organizations The Fraser
Institute and the Montreal Economic Institute.
Vision For a Canada Strong and Free is the final summary volume in the Canada Strong and Free series prepared by Manning, former leader of the federal
opposition, and Harris, former premier of Ontario. Both men are
now senior fellows with The Fraser Institute.
In this book, the two summarize previous policy recommendations
and lay out their far-reaching vision for building a stronger,
healthier and more prosperous Canada. The foundation for many
of their recommendations is an embrace of free market
principles along with greater individual responsibility and
"We have yet to fully realize all the benefits a free and
open market can provide because of the excessive financial
demands and regulatory constraints of oversized and
protectionist federal and provincial governments," Manning
Manning and Harris suggest that the environment is one area
where many Canadians are too quick to call for additional
government regulation, rather than relying on having the proper
price signals and financial incentives in place.
"Far too many politicians of all stripes think the solution
to a problem that appears to be created by business is to
propose some new form of regulation," Harris said. "But why
can't we look to the market and the appropriate pricing and
profit signals to satisfy our demand for cleaner water, air,
and energy, and sustainable soil, wildlife, and forests."
Manning and Harris point to the Kyoto Protocol as an example
of a typical government response to an environmental issue.
"Regulatory agreements like Kyoto are typically slow to
respond to the dynamic market circumstances under which
environmental threats occur and change, have high transaction
costs, and are frequently oriented more to micromanaging
process than to securing positive outcomes," Manning said.
Water is a primary example where Canada could benefit from
the application of market principles. At present, public
subsidies and the absence of any substantial price constraint
encourage individual Canadians to think of water as virtually
free; the same is true for industry. The result is gratuitous
waste and disincentive for innovations in efficiency that might
delay future shortages, Manning and Harris write.
"To send a clear signal of the true value of water to every
Canadian dozens of times a day, whenever one of us turns on a
tap or a business sticks a pipe into a river, aquifer, or
reservoir, there is no substitute for a pricing system based on
a full accounting of costs," Harris added.
The two recommend that Canada implement policies requiring
universal water metering and progressive volume pricing, based
on the full cost of delivery from source and research-based
estimates of the cost of ensuring an adequate supply of water
into the future.
Manning and Harris also write how market based policies
should be applied to Canada's energy sector. They call for
deregulation of electricity pricing, allowing prices to be
determined by competitive market forces. At the same time, they
acknowledge that energy pricing must include the full costs of
environmental protection so consumers can make informed
"If we decide that greenhouse-gas emissions should be
reduced, then emitters of those gasses must absorb the full
cost. The prices of different energy products will have to
reflect those costs, creating price incentives for consumers to
use the most environmentally-friendly source of energy,"
On the issue of aboriginal poverty, Manning and Harris write
that the reserve system, years of reliance on government
funding, and the traditional tribal governance model has
stifled individual freedom and repressed personal choice.
"Rather than simply redistributing dollars from federal
government coffers to aboriginal reserves, why not strive for a
better distribution to aboriginals of the 'Tools of Wealth
Creation,'" Manning said. "These would include better access to
property rights, capital, markets, information, technology, and
Among other things, Manning and Harris recommend encouraging
private property ownership on reserves; in particular, home
ownership for individuals and families. They also recommend
that the $5 billion now sent by government to chiefs and
councils be instead distributed directly to First Nation band
members with a concurrent provision to allow bands to tax back
some of this money to fund their activities.
"We began this series of policy papers as a way to
articulate a vision of Canada as a nation whose people could
enjoy the highest quality of life in the world; have access to
good jobs, high incomes, and quality goods and services
provided by the best performing economy in the world; and
exercise their freedom in the security of the best-governed
democratic federation in the world," Manning said.
"Markets amount to choice. There are clear benefits to be
gained from a more assertive application of market-oriented
thinking, both in areas in which market-based approaches are
well accepted, but could be more rigorously practised, and
others where the application of market-based approaches
represents a break with conventional thinking. Embracing these
principles will help build a Canada Strong and Free."