Coming Down from Mount Olympus

National pride, to endure, must have a strong foundation
April 1, 2010

The tidal wave of patriotism unleashed by our country’s performance in the Olympics is subsiding, but in most Canadians the euphoria lingers. Memories of our athletes’ feats at Vancouver and Whistler will be a wellspring of national pride for some time.

This uplifting of our public spirit is quite commendable, but if carried to extremes it can be more hurtful than helpful. It’s one thing to hail Canada’s success in international sport competition, quite another to interpret it as evidence of our country’s overall excellence. That could lead to smugness and a dangerous self-satisfaction.

One of the main causes of the current economic and social malaise of the United States has been its citizens’ entrenched ultranationalism. Convinced as so many of them have been for so long that they live in “the greatest country on Earth,” they have blinded themselves to its growing defects and inequities. Left to fester, these internal debilities have rotted their society from within.

The same sorry fate could befall Canada if we keep emulating the American system – particularly if we make the same mistake of putting our country, not just our Olympic champions, on the gold podium. Canada is far from being a great country. It is a good country. But it could be better. Far better. It could even actually become the greatest country in the world in time – but only if that objective were made a collective national priority. Only if all our political, industrial, natural, and human resources were harnessed to reaching that goal.

We certainly have the potential to attain true international greatness. But if we mistakenly delude ourselves that we’re already there -- that the race is won and the gold medal displacing the maple leaf on our flag – then the Olympic glow will fade and our future as a nation will not be bright.

Keep in mind that the country that won the most medals at Vancouver was the United States. Does that mean the U.S. is still – though it never really was – the No. 1 nation most Americans thought it was? Certainly not. It just means that a country that puts enough money, training, and determination into helping its athletes excel will triumph at the Olympic games. It doesn’t mean that their success is in any way representative of their society as a whole.

The victorious American champions returned to a country that still ranks far below most other industrialized nations in the social, economic, political, and environmental realms that make a country really great. So, for that matter, did the Canadian athletes when they returned to their homes.

We live in a country that is so richly endowed in resources that it could well be the world’s best in every way that counts. But more than a million of our children live in poverty. Our lack of a public child care system leaves 80% of our young children without regulated early care and education spaces. A million Canadians are unemployed, and 800,000 depend on food banks to keep them from hunger. Nearly one in every four jobs in Canada pays less than the median hourly wage. Our unemployment insurance system provides the lowest benefits among the 16 top industrial nations. The national inequality gap keeps widening, with more than 90% of the gains in income share over a recent 10-year period going to the richest 5% of Canadians. Our performance in environmental protection is so poor that Canada has been ranked a dismal 28th among the 29 nations of the OECD. Our public health care system falls behind those of most European countries in failing to cover drug, dental, and vision care.

I don’t list these national inadequacies to denigrate our country, but only to temper the Olympic ecstasy with some grim reminders – to show that we still fall far short of any legitimate claim to eminence as a nation.

Andrew Cohen, president of the Historica-Dominion Institute, also threw some verbal cold water on the Olympian celebrants in a post Olympics op-ed.

“The danger of Vancouver,” he wrote, “is that our success will reinforce our culture of complacency. It is a culture that is so comfortable with itself that it rarely pushes beyond itself... Blessed with staggering riches, we have learned to live off them. We have built an economy based on resources, rather than manufacturing, which would create high-value jobs. So we send our timber abroad, for example, and buy it back as expensive furniture...

“Instead of crowing about beating the Europeans, let us look at how they nurture the arts, build mass transit, and manage health care... How to make our golden moment last? Seize the ambition of Vancouver to commit ourselves to goals in the fields where mediocrity rules.”

The European countries with contestants at Vancouver didn’t garner as many medals as the U.S., and most even fell behind Canada, but that in no way diminished their national pride. They may not have devoted as much of their budgets to enhancing their athletes’ prowess, but they didn’t stint on maintaining their far superior social and economic systems. Their athletes went home to societies that are much more equitable, more compassionate, more secure, and more progressive than either the Americans’ or ours.

* * *

The countries in Europe that are most often cited as exemplary models for Canada are usually Sweden, Norway, Denmark, and Finland. For the past 60 years or more, the Scandinavian foursome have provided their citizens with cradle-to-the-grave social security. Their high standards in health care, child care, education, labour rights, and public pensions are rightly acclaimed. Canada’s “welfare state” pales in comparison.

But the Nordic states are not the only ones to create a just society in Europe. Many others, including France, Austria, the Netherlands, Switzerland, and Italy, have come close to matching the Scandinavians’ record.

So has Germany, which tends to be overlooked, but could also serve as a superb example for Canada. Its social programs are as beneficial as those in any other European country, but where it really shines is in its economic system, now one of the world’s most productive.

Not many Canadians know that, since 2003, it has been Germany, not China, that has led the world in export sales. I didn’t know that, either, until I read Thomas Geoghegan’s essay on Germany in the March issue of Harper’s. Geoghegan is a labour lawyer in Chicago. To pass on his enlightened comments, I quote him at some length:

“Germany has managed to create a high-wage, unionized economy without shipping all its jobs abroad or creating a massive trade deficit, or any trade deficit at all... And even as the Germans outsell the United States, they manage to take six weeks of vacation every year. They’re beating us with one hand tied behind their back.”

Geoghegan marvels at the scope and depth of industrial democracy in Germany, where workers and their unions have a major role in running their country’s major corporations. They do this through works councils, co-determined boards, and regional wage-setting institutions.

“Germany is now the country in which workers have the greatest amount of control over (dare I say it) the means of production... And, because German workers are at the table when the big decisions are made, and elect people who still watch and sometimes check the businessmen, they have been able to hang on to their manufacturing sector. They have kept a tool-making, engineering culture, which our own entrepreneurs, dreamily buried in their Ayn Rand novels, have gutted.”

Geoghegan describes in detail the functions of the works councils that in effect share in the management of business firms – in setting work hours, who gets what shift, on promotions, layoffs, and other operating issues.

“The result is that there are thousands of clerks and engineers in Germany who now are elected officials, with real power over other people. They are responsible for other people. They are responsible for running the firm. They make up a powerful leadership class that represents the kind of people – low-income, low-education – who don’t have much of a voice in the affairs of other industrialized countries.”

On the co-determined boards, which are set up for the largest companies (those with 2,000 or more employees), half the directors are elected by the workers. Not a fifth, not a third, but half.

“Of course, there’s a catch,” Geoghegan admits. “Under German law, if the directors elected by the clerks and the directors elected by the shareholders are deadlocked, then the chairman can break the tie. And it’s the shareholders who pick the chairman. So capitalism wins by one vote, provided the stockholders, the bankers, and the kids from Goldman Sachs all vote in a single bloc. But the workers still have a lot of clout... and they have all this power without owning any shares! In this stakeholder model, they need only act on their interests as ‘the workers’.”

(Germany is not a welcome host for foreign companies like Wal-Mart that are fiercely anti-union. It is no coincidence that Wal-Mart, after managing to open 85 stores there over the past nine years, recently gave up battling the country’s unions and the democratic co-determination system. It sold all its stores to a rival domestic retailer and completely pulled out of Germany, losing an estimated $1 billion in the process.)

Germany’s powerful unions do all the bargaining over wages, benefits and pensions, but at a macro level under the country’s model of regional or multi-employer negotiations. The goal, although it is never entirely reached, is to have every employer in an industry pay the same wage for the same type of work.

Geoghegan views these regional or industry-wide wage-setting institutions as “probably the single most important way in which Germany is a ‘socialist’ state.” The overall effect is to achieve a level of compensation parity at the national level that is unequalled anywhere else.

“All my life as a labour lawyer,” says Geoghegan, “I have read the same thing in The Economist about the United States and its wonderful ‘labour-market flexibility.’ What they mean is this: Unlike the Germans, U.S. working people are completely powerless. But it’s precisely because of our ‘labour-market flexibility’ that we can’t compete. Our workers have been flexed right out of their high-wage, high-skill jobs and into low-wage, low-skill jobs. That’s bad for the workers, of course, but it’s also bad for the country.”

His sharp criticism applies with equal force to Canada and the failure to respect and institutionalize labour rights in our economy.

Other countries in Europe are now keen on experimenting with co-determination and works councils. A former German government official told Geoghegan that “co-determination is our biggest export.” It’s a model that may soon spread to establish industrial democracy throughout Europe to the same extent that Sweden’s welfare-state model has spread social security.

As the Europeans build truly first-class nations, economically as well as socially, environmentally as well as politically, we Canadians seriously need to re-assess our own values and priorities. If we keep following the deeply flawed American example instead of being inspired by the splendid European model, our Olympian dream of national greatness is bound to become a nightmare.

(Ed Finn is the CCPA’s Senior Editor.)