One of the books on my shelves of economics literature in my hallway is Protectionism by Jagdish Bhagwati who has taught at Colombia University for many years. It was published in 1989 by MIT press but most of it is still very relevant to the current world of globalization and the rise recently of protectionist arguments fuelled by the presidency of Donald Trump . Bhagwhati was an outspoken advocate of trade liberalization and a strong critic of protectionism. He also makes the case that protectionism harms the interests of the vast majority in order to protect the interests of the minority that benefit from protected domestic production even if global productivity. suffers because of truncated trade and punitive oligopoly prices because of tariffs. The rise of Donald Trump and economic nationalism is the consequence of the failure of globalists and trade liberals to take seriously the actual consequence of freer trade on the employment prospects of workers who increasingly were affected by job losses, off-shoring and income lost due to lower wages and loss of jobs. Globalization of supply chains already was recognized by Bhagwati in the 1960s. One should also cite the work of Stephen Hymer and his pathbreaking work on the rise of the multinational corporation. But the political impact was underestimated . We are now living with the consequences in this covid age. (more on this later)
The theme of economic nationalism was also one of the appeals that the newly elected leader of Canada‘s Conservative party Erin O‘Toole . O‘Toole won the leadership at a virtual convention yesterday by capturing 57 % of the vote on the third ballot. He ran a campaign that tried to build a coalition of Alberta energy provincialists, Quebec nationalists and older bleu Quebec tories, and social conservatives who are found throughout the country. The Conservatives hope to force an early election by passing a non confidence motion aimed at the recent controversy over the We charity and the failure of Justin Trudeau and Bill Morneau the Finance Minister to recuse themselves from the approval process of a proposal to allow the We charity to administer the roll out and delivery of a program to fund student jobs. The controversy turned into a debacle for the Liberals with Bill Morneau resigning and Trudeau receiving lots of criticism. I could be wrong but I would be surprised if there were an election given the covid crisis and the relative youth of this Parliament. The NDP may well support the government fearing an early election. Whether the new Tory leader would do well in a new election is very debatable. A new election so soon after the last one in the midst of a pandemic seems unwise at the very least.
In the current parliament the Liberals who received 33.1 % of the vote have 157 seats;Jody Wilson-Raybould as an Independent 1; the Conservatives 34.4 % and 121 seats; the NDP 15.9% and 24 seats; the Bloc Québécois 7.7% and 32 seats; the Green Party 6.5% and 3 seats; other 0.4 % and 0 seats.There are 338 seats and 170 seats are needed for a majority. Seats are not proportional to the vote share because of our first past the post plurality electoral system which cries out for reform.The latest polls show virtually identical results once the margin of error is factored in with the Liberals at 35.3 %, the Conservatives at 30.7 %, the New Democrats at 17.4 %, the Bloc Quebecois at 7.3 % and the Greens at 3 seats with 7.2% others 1.8%.
