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Western University
Political Science
Political Science 2211E
Adam Harmes

Jan 23- Business and Canadian Federalism Today’s Topics 1) The basics of Federalism 2) The Neoliberal Approach to Federalism 3) The Keynesian-Welfare Approach to Federalism (reaction to neoliberal approach) 4) Business vs Activists in Canadian Federalist Federalism - At least 2 levels of government rule the same land and people - Opposite of federalism is a unitary government - Each level is enshrined in constitution so neither can abolish the other Federalism in Canada - Constitution includes national government and provinces - Municipalities are creation of provinces - Constitution outlines division of powers - Supreme court and ‘judicial review’ Division of Powers - Federal government: o National defense o Criminal law o Employment insurance o Trade and foreign affairs o Money and banking o Transportation o Aboriginals - Provinces: o Health o Education o Welfare o Environment o Municipalities o Property and civil rights o Admin of justice Why Federalism? - Makes it easier for different communities to live together in a given country o Example: Quebec language, education - Greater diversity of policies - More democratic as governments are ‘closer’ to people - Decentralization of power - Policy experimentation Neoliberal Approach - Free markets and less government o Lower taxes o Fewer social programs o Less regulation - Markets efficiently allocate resources - Markets promote freedom due to ‘exit option’ Neoliberal Constitutionalism - Use constitution and judicial review to lock-in free market policies o Property rights in charters or bills of rights o Balanced budget amendments Neoliberal Federalism - Use federalism to lock-in free market policies: o 1) Centralize powers related to enforcing national free trade - Creates ‘exit option’ within country - Key reason you want to centralize power is to ensure that o 2) Decentralize tax, social spending and regulatory powers - Create ‘policy competition’ - Force provinces to compete for mobile investors with lower taxes and regulations - Also known as: o ‘Market-preserving federalism’ o ‘Competitive federalism’ - Federalism is key battleground over economic policy Socially Conservative Federalism - Most prominent in US - Sought to go against federal civil rights policy by demanding “states’ rights” - Today is about gay marriage, gun control, immigration etc Keynesian-Welfare Appro
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