Stephen Harper, fellow economic control freak, finally gets comfortable in China
richard poplak

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What do these countries share in common? They all have something akin to the Chinese model of state capitalism, according to a recent Economist special report titled The Visible Hand: One-party rule and tightly centralized power, driven by state-financed megacompanies that operate in economies garnished with the sprigs of liberalism.

It's the vogue way of doing business in the developing world, this “socialism with Chinese characteristics,” as Deng Xiaoping once put it – beloved by those with an authoritarian streak. And it has surprising corollaries with the Canadian system.
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Try to find an appreciable difference between parastatal China Mobile, with its 600 million customers, and the Rogers/Bell duopoly – an institution that a true-blue neo-con would have annihilated within seconds of coming into power. (Along with China National Petroleum Corp., China Mobile raked in $33-billion in 2009, largely because there's no air for competition. Sound familiar?)

Likewise, there isn't a Canadian who has lived through the age of commercial flight who doesn't think of Air Canada as a ward of the state – its striking employees forced back to work by the government, its operating costs underwritten by an unspoken guarantee.

We're constantly reminded that we didn't have to bail out our banks during the recent financial meltdown, but that's mostly because we'd already bailed them out in the 1990s, and were smart enough to learn our lesson. Anyone who assumes Ottawa would let RBC fail should it bet the farm on, say, micro-lending in South Sudan, doesn't know foreclosure from Foursquare.

State capitalism provides governments with the ability to control critical segments of the market, hands them the keys to the economy's engine room and allows them political influence over the men and women who make up the management class. It transforms the governing party into mandarins of a well-behaved economic court, all of whom are eternally grateful for the beneficence of the statist Sun King.

Despite the doomsday prognostications, Mr. Harper never devolved into an unholy compound of Ronald Reagan, Margaret Thatcher and Dick Cheney's board at Halliburton. He's much closer to being Lula da Silva without the leftist rhetoric, Vladimir Putin without the Botox or Hu Jintao without Ai Weiwei to beat up.

Of course, Canadians enjoy the rule of law, freedom of speech and expression and fair elections. The Chinese, famously, don't. We're rich; we're safe; we are doused by water cannons only on special occasions. Far from proving that Canada doesn't practise a version of state capitalism, this suggests that even a country run by a hard-core free-market ideologue finds it much more orderly and calming to fix the game as much as possible in advance, and make an early night of it.

Call it “state capitalism with Canadian characteristics.” After playing coy for so many years, Mr. Harper probably feels right at home in China.

Read the rest here: http://www.theglobeandmail.com/news/nat ... nt=2334950
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Interesting analysis. As a Canadian I don't know if I should be proud or ashamed?

Two reasons why this exists.

1. Some of these companies either are, or are close to being, natural monopolies. There's no country in the world with a largely fragmented telco industry. Size confers advantage, and if left to the own unregulated devices there would probably be one large telco monopoly in every country. Bell or Rogers would have bought TELUS, and then the larger would eat the other.

2. Opening up to international competition would reduce consumer prices but would take control out of nationalist hands as international giants would buy up the Canadian companies. Neither Bell nor Rogers would survive. The telco industry in Canada has always been protected by nationalist regulation that prohibited majority foreign ownership of the regional telcos. Neither Canadians nor Chinese want foreigners owning all their industries.

True blue neocons would probably also leave Wall Street banks unregulated, and would deregulate airlines so they could skimp on maintenance as much as they want. Crashes? The market will take care of it.

Need I say more?