The Limits of National Policy: Integrating Regional Development into the Federal Agenda

Abstract

In a country the size of Canada, with its uneven distribution of population, resources, and fiscal capacity, programs designed to ameliorate regional inequalities take on a particularly important role. Since at least Confederation, and in many cases long before, provincial leaders have been voicing concern over their particular region's place within the national or international economy. The aggrieved politicians have often blamed the situation on federal policies that have favored the economic development of the central provinces at the expense of the peripheries. The high tariff barriers introduced by Canada's first prime minister, John A. Macdonald, under the Policy, are only the most obvious example of a federal decision that has been seen to disadvantage economically some regions of the country, while simultaneously building the manufacturing corridor between Windsor (Ontario) and Quebec City. National policies of transportation and tariffs, one commentator noted in the 1930s, increased rigidities which [were] resistant to readjustment and further ... thrust severe and disproportionate readjustments on exposed regions and groups. (1) As a shifting economy increasingly left certain regions out, complaints from the peripheries became more common. But despite the fact that provincial calls to address the uneven distribution of economic growth in Canada have been virtually constant, the federal government has entered the debate only sporadically, usually to offer relatively specific and generally temporary solutions to regional grievances. Better terms for Nova Scotia in the aftermath of Confederation, the crow rate for grain shipments from the prairies, and the appointment of the Duncan Commission on Maritime Claims were all very explicit federal answers to complaints from the regions. (2) None got to the root of the problem, and regional inequality remained. Since the 1960s, however, Ottawa has echoed this regional unease and attempted to provide some longer-lasting solutions to uneven economic development. One of the most important strategies for addressing the problem of inequality has been to make regional development part of national policy; Donald Savoie, one of Canada's most astute students of regional development, has recently argued that part of the solution to underdevelopment in the Maritime Provinces (i.e., New Brunswick, Nova Scotia, and Prince Edward Island) and elsewhere is to ensure that national economic policy is recast from a regional perspective--and one that takes into consideration regions outside of Ontario and Quebec. (3) Canada's experience in this regard--especially considering the origins of the federal Department of Regional Economic Expansion and the experience of economic development in the Maritimes--suggests that there are some important structural impediments to making regional policy national. This article argues that regional development policies have been undermined in the past in a number of different ways, including the process by which policy is designed in the federal state, the speed with which national priorities can shift, and the shortcomings of federal penetration into regional economies--a sort of reverse intrastate federalism (4)--through the offices of individuals. policy must certainly be formulated to reflect the asymmetrical nature of regional economic development; but to do so, policy-makers must be made aware of the difficulties inherent in such a strategy. The Maritime region has historically developed at a slower pace than has central Canada. Due in part to changing economic realities and the collapse of traditional Atlantic industries, and in part to policy decisions made in Ottawa, the Maritimes have struggled following their golden age in the late 19th century. (5) By the end of the Second World War, the per-capita income in the Maritimes was 24 percent below the Canadian average; in neighboring Newfoundland, incomes were just 51 percent what they averaged in the rest of the country in 1950. …