Unit 5
Regulation, De-regulation, and State Restructuring

Introduction

Unit 5 explores the areas of economic, social, and constitutional policy and the politics of neo-liberal governance in Canada. The recent Canadian experience with neo-liberal governance is contrasted with the past practice of Keynesian policy discourse. The themes of restructuring, regulation, and de-regulation are examined. The differences between the neo-liberal and Keynesian eras in terms of nation-building and the politics of consensus versus polarization are specifically highlighted. The meaning that each of these policy regimes holds for governance is examined.

The readings in this unit tackle the question of which constitutional form is best suited to neo-liberalism. In the Canadian case, the preferred option of neo-liberal policy-makers is a more decentralized federation, one that imposes constraints on the freedom of governments to intervene in the economy. In the realm of social policy, neo-liberals argue that the federal government should play less of a role in setting and regulating national standards in the areas of health, education, and welfare and allow the provinces wide scope for social policy experimentation. According to the Canadian neo-liberal approach, reinventing the welfare state in Canada—building a new social union—is to be done on a more decentralized basis (see Courchene 2001, chap. 6; Inwood 2000). It will also mean a “leaner and meaner” social policy order (see Russell 2000; Block et al. 1987).

Learning Objectives

When you have completed Unit 5, you should be able to achieve the following learning objectives.

1. Explain why government expenditure restraint is central to neo-liberal forms of governance
2. Outline the relationship between monetarist economic policy and state deficits and debt
3. Explore the pivotal role of privatization and deregulation for neo-liberal policy
4. Discuss why regional development policy has been an important part of nation-building in Canada and how recent new directions in this policy area affect national unity
5. Explain why federalism is such a crucial consideration with regard to social policy-making in Canada
6. Identify the significance of the policy shift away from “passive” income support programs to “active” labour market ones
7. Outline the role Canadian public broadcasting has had with respect to national unity and identify how contemporary policy change may have affected this role
8. Discuss the preference of neo-liberal policy-makers for decentralist approaches to constitutional change
9. Explain what the Meech Lake and the Charlottetown Accords are and outline how they relate to the issue of neo-liberal governance