Tag Archives: the ant and the grasshopper

…on the Entrepreneurial State

With the next Canadian federal election less than a year away – and undesirables like Wayne Gretzky soon to be purged from the voter lists – I’ve been getting a lot more fundraising emails lately. As of mid-December I’d received nineteen in eighteen days. It was like a Christmas advent calendar, but in my email inbox! (Like a beleaguered Silician storekeeper, I paid my “protection money” and now they’re leaving me alone. :) )

Politicians are often derided for their short-term thinking, which is probably a fair criticism. If you ballpark an election cycle at roughly four years, newly-elected officials might take a year to learn the ropes, a couple years trying to be effective, and then a year trying to get re-elected. Judging by how successful those old Soviet and Chinese Five-Year Plans typically were, that might not be quite enough time…

The kind of decade-scale industrial policy used so effectively over the past half-century by Japan and South Korea (and Singapore… and Taiwan… and to an extent in Norway) typically occurred when these countries were dominated by one political party. This political stability may have allowed government and industry to set effective long-term plans without fear that a few years on, a new Prime Minister would reverse course on everything.

Of course, one-party dominance is no guarantee of long-term economic success – as evidenced by Mexico, parts of both the American South and South America, and … Alberta. As recent history shows, our neighbours would rather stay a Saudi prince’s whim away from economic catastrophe, than raise sales and income taxes to build up a treasury to buffer themselves from the ravages of the resource cycle. It’s as if they’d read Aesop’s Fable about the ant and the grasshopper, and concluded the grasshopper was the role model!

Continue reading