Rural phase out

Lawrence Solomon
National Post
April 21, 2004

For the first time in memory, possibly for the first time in Canadian history, a prominent government panel is recommending that unsustainable rural areas in Canada’s heartland be taken off life support and allowed to die a natural death.

Most of rural Canada cannot sustain itself. Rural residents need help to cover basic needs, from airfare to city hospitals for their medical needs to subsidized energy for their homes. Rural towns need provincial subsidies to cover up to 90% of their infrastructure needs. Rural industries, agriculture above all, need subsidies, too. If the subsidies vanished, so, too, would most farming, logging and mining in remote areas.

Until last week, all of Canadian officialdom was in denial about the de facto bankruptcy of the rural economy, paying lipservice to the importance of rural industries even as officials continued to sign cheques to prop up rural institutions. Last week marks a turning point, at least in one government’s perception of the rural economy. A major Ontario government report, produced by its Panel on the Role of Government and praised by Ontario’s premier, dismissed the notion that the rural economy is a bedrock. The panel concluded that much of rural Canada is economically unsustainable, that it is futile to try to artificially sustain rural industry, that population decline is inevitable, and that the government should abandon regional development programs. Instead, the panel concluded, the government should retrain young people in rural areas who are willing to move away from their communities as part of a rural restructuring and – by implication – an eventual abandonment of much of rural Ontario.

“The province should phase out regional economic development programs, such as the provision of subsidies and tax incentives to businesses, which risk promoting permanent government-induced dependency,” the panel states. “The province, in co-operation with the federal government, should consider providing appropriate transitional arrangements, such as those aimed at retraining for those willing to pursue opportunities beyond their home community.”

The panel based its conclusion on “Small, Rural, and Remote Communities: The Anatomy of Risk,” a background study it commissioned to tackle the politically explosive issue of how to manage rural decline. Although the background study couched its recommendations in gentle language, it was often brutally honest in its assessment of the prospects for rural areas, which it defined to include most of Ontario, including much of Southern Ontario.

Rural areas have a rapidly ageing population that inexorably declines as young people leave, the study states. These areas have few industries, thin labour markets and little ability to attract either educated workers, entrepreneurs or immigrants. Apart from low housing costs, almost all consumer goods are expensive in rural areas. Delivering government services is also costly, and will become more costly as rural areas increasingly become dependent. As for highly touted panaceas for the rural areas, such as programs to bring the Internet and broadband to rural Canada, the study deems them all but worthless, and criticizes other government bodies, such as the province’s Smart Growth Secretariat, for raising false expectations about rural areas’ viability.

The real question for society, the study states, is how to mercifully manage the decline of the rural areas. It suggests doing so slowly, by maintaining basic services for the mostly older, less mobile rural residents who might want to stay in their home communities. At the same time, it would cut off subsidies designed to develop the rural economy, encourage the young and mobile to leave, and even walk away from government’s traditional responsibility to provide public services in future northern settlements. As a possible model for Canada to consider, the study points to the success that Sweden, Finland and Norway have had in shutting down unviable rural communities by resettling residents in regional centres. “An important issue of debate is whether communities that cannot survive in the absence of disproportionate senior government funding (when compared to other urban areas) should exist at all.”

The study’s bottom line: “Most communities in the periphery cannot be self-sustaining, economically, socially or fiscally,” making the fate of their residents one of welfare dependency. For this reason, “hard choices have to be made. The provincial government cannot provide subsidies to everyone everywhere in the province. Nor can all small communities survive, and provide a reasonable minimum level of services and jobs, within a climate of population and economic decline.”

The Panel on the Role of Government has taken the findings of the background study to heart. The future of the province lies in its urban centres, the panel concludes, but that future won’t allow the government to be all things to all people. “Against this fiscal backdrop, it behooves us to acknowledge that if the government were to commit to our priorities (or some variant on them), it will only be able to implement them if it is prepared to make a number of wrenching decisions. The reality is stark. … while fiscal reforms and working smarter are important, they are unlikely to be sufficient. [As a result], Ontario will have to face difficult trade-offs in a number of areas, including support for economically unsustainable rural and remote communities.”

The panel had, as part of its mandate, the task of determining for government “what and how it should start doing, stop doing, or keep doing either on its own or in partnership with others.” On what the government should stop doing, the panel has spoken with rare clarity and courage.

Lawrence Solomon is executive director of Urban Renaissance Institute and Consumer Policy Institute, divisions of Energy Probe Research Foundation. E-mail:

Readers’ responses

Farm & Countryside Commentary

If you buy into the rhetoric that globalization is all there is, countryside does not matter much. If the technology treadmill to ever lower production costs is all there is, the countryside’s historical resources: food, lumber, energy and minerals do not matter much. If global capitalism is all there is, the countryside may be waiting a long time for some benefits to trickle down. If life – human beings included – is just so much DNA caught in a vast and remorseless evolution beyond our control, there is not much the countryside can do about its fate.

Some have bought in. Back in April, Lawrence Solomon wrote an essay in the National Post in which he gloats over what he calls a “prominent government panel,” that recommends that unsustainable rural areas in Canada’s heartland be taken off life support and allowed to die a natural death. The headline on the essay reads: “Rural phase out: In a major turning point, an Ontario government report suggests a restructuring and eventual abandonment of much of the provincial hinterland.”

I have not bought in. But globalization has a way of getting into our thinking and doing without realizing it – and undermining the future of countryside.

In London, last week, Avi Lewis came to the seventh rural development conference sponsored by the Ontario Rural Council with a message about constructive resistance to globalization. Lewis has just returned from Argentina where he has been engrossed in producing a documentary, The Take, a passionate tale of workers wresting control of the means of production from the global capitalism that has failed them.

The conference sparked some fresh thoughts about our circumstances.

Globalization creates distance between decisions and effects. Head office is somewhere else than in rural Ontario. Laws are for the benefit of others. Solution: welcome more local decision-making. Downloading more responsibilities to municipalities is the right agenda. It’s high time the resources are there to do the tasks well.

Globalization is top down. The management structure is a pyramid where CEOs rake in vast rewards. Solution: favour cooperatives, partnerships, networks and local democratic decision-making.

Globalization favours “one size fits all.” It reduces us to “units” and consumers. Solution: make every community different. Build on the uniqueness of our local countryside. Capitalize on the strengths of local people.

Globalization wants governments to stay out of the way of markets and be an ambassador for trade expansion and the profit principle. Solution: demand that governments return to first principles – public service and fairness for competing interests.

Finally, globalization wants us all to shrug: there is no other way. Solution: stand up to the shrug and set an example.

For details about The Ontario Rural Council, visit

Elbert van Donkersgoed P. Ag. (Hon.) is the Strategic Policy Advisor of the Christian Farmers Federation of Ontario, Canada. Corner Post has been heard weekly on CFCO Radio, Chatham and CKNX Radio, Wingham, Ontario since 1997.

You keep Yonge St.

Two writers from Alberta take on Lawrence Solomon’s view that rural Canada is an unviable drag on cities. What about all those urban subsidies?

Lawrence Solomon has written several columns about rural Canada. His main points: the rural economy is grossly subsidized, the resource sector – also heavily subsidized – generates only 6% of Canada’s GDP; rural Canadians are fat and depressed; and both the rural economy and rural communities should be encouraged to die.

While we wholeheartedly believe the Canadian economy should be de-subsidized and, above all, deregulated, much of what Mr. Solomon has said is factually wrong. First, the issue of subsidies. He seems to regard the rural economy as singularly subsidized and, therefore, a parasite on wealth-generating urban Canada. But he’s letting his urban idyll deceive him.

Let’s spend a night on the town and play “spot the subsidy” as we go. After a hard day’s column writing, we’re ready to cut loose with our thin urban intellectual buddy. We eschew our cars, more likely than not built in federally and provincially subsidized auto plants, for mass transit.

Purchasing massively subsidized bus fares, we settle in for a good read. One opts for Canadiana, published by a house kept alive by federal subsidies and protectionism. Another leafs through that other national newspaper, whose owners benefit from such anti-competitive measures as foreign ownership restrictions.

While passing through the charming inner city, we glimpse youths breaking into an automobile – no bus riding for them dudes – as we peer down an alley at some ghost-like figures shooting up heroin and dealing Ecstasy. In the city of light, you can never be too thin or too happy.

On the great white way lies our municipally, provincially and federally subsidized concert hall. Tonight it’s gloriously lit, thanks in part to subsidized nuclear energy provided by a tax-exempt Crown monopoly. Inside, we rub shoulders with professors, doctors, teachers and government officials – all owing their livelihoods to state outlays. Some of the bureaucrats work for agencies doling out subsidies, including to those fat, depressed Ruritarians. Mr. Solomon chortles when we point out the irony. The uniformly thin, happy multitudes are delighted by the Heritage Canada-funded musicians and singers.

Our point should now be clear. Rural subsidies are dwarfed in number and magnitude by the subsidization of urban life and the urban economy. Nor are rural areas singular repositories of social pathologies. Rural people may be chubby and downbeat, but they are far less likely to die of AIDS or be raped in a parkade.

Still we’re unclear why Mr. Solomon is obsessed with destroying a part of Canada that, by his own reckoning, is so inconsequential. There may be some aesthetic elegance to rural depopulation, but it defies economic and social realities. His underlying, imputed urban-rural divide, while true for some isolated communities, is typically not two solitudes, but a continuum.

Look at Calgary. A high-density business/residential core is ringed by older neighbourhoods, in turn by vast, expanding suburbs, then acreage developments and country-style subdivisions, then former farming towns mushrooming into bedroom communities, and finally still more acreages and hobby farms. Hundreds of thousands live in a rural setting, but work in an urban environment, thereby supporting urban and rural economy alike.

One of us lives on an acreage. Some days he works in the city, others he avoids the lengthy commute. Is he urban or rural? Office work makes him fat and grumpy, while yardwork and fly-fishing restore physical form and contentment. Reading or watching the sun set over the Rocky Mountains doesn’t make him feel isolated. He doesn’t confuse solitude with loneliness. His neighbours are farmers doubling as commercial pilots, city travel agents married to rural contractors and retirees – are these rural or urban?

The same false dichotomy extends to the economy. Remove the resource sector that Mr. Solomon claims generates almost no wealth and you essentially wipe out two major cities. The office workers shuffling paper in the shiny towers are tallying all the oil and gas the rural “rig pigs” produce and process.

And what about the claim that Canada’s entire resource sector generates a heavily subsidized 6% of GDP. News flash: In 2003, Canada exported $62-billion worth of energy. One portion of one branch of the resource sector accounted for 6% of national GDP. The entire resource sector is much larger. By any measure – revenues and profits, taxes remitted, employment created, capital appreciation (including for urban pensioners) – resource industries generate enormous wealth. The Hemlo gold deposit alone is worth upwards of $6-billion – and how much infrastructure has been built north of Superior?

If subsidies are out, then urbanites must choose: Either pay real prices for hinterland products or import from Botswana.

We itch to annihilate Canada’s nasty apparatus of subsidies and subsidy-granting agencies, plus all the anti-competitive, protectionist, anti-foreign-investment regulations. While that should include killing farm subsidies – not least supply-managed poultry and dairy in Quebec and Ontario – our “night on the town” shows there would be a vastly greater harvest downtown than on the farm. The savings should enable major tax cuts.

Ironically, Prairie grain farming is one of the few substantially de-subsidized sectors. Begun by the Crow freight rate phase-out in the 1980s, our grain farmers are now much less subsidized than their counterparts in Europe and the United States. This Western contribution to balancing the Mulroney government’s budget sadly fell short in part because the same bracing medicine wasn’t administered to central Canada’s hugely subsidized aircraft industry.

If “unsustainable rural areas” were “taken off life-support and allowed to die a natural death,” as Mr. Solomon recently suggested, the consequences might surprise him. Many rural communities, in Alberta at least, are booming. Alberta’s “Highway 2 Corridor” between Edmonton and Calgary was recently named Canada’s most productive economic zone. This mixed area, from farms to small cities, has an economy based on energy, agriculture and related industries – transportation, manufacturing, services. It’s one reason we fat, depressed rednecks can afford to transfer a net $11-billion per year to Canada’s “have-not” provinces.

Don’t all cities spring out of the countryside? London, England, began as a Roman military camp – talk about “unsustainable.” Calgary was buffalo pasture 150 years ago. If we neglect rural areas, aren’t we aborting our next cities?

Fort McMurray in Alberta’s oil sands is the scene of the greatest capital investment in Canada’s history, with investors worldwide awakening to the implications of a 500-year supply of oil. In our lifetime, Fort McMurray has soared from little more than an outpost to a population of 47,000. If this is the unsustainable rural economy, then Canada needs more of it.

Cut off rural communities’ infrastructure funding, but allow our big city mayors to subvert the constitution and get their grubby fingers on federal tax dollars? It’s a false economy to crow about saving, say, $500,000 by re-wilding McBride, B.C., if you then hand Montreal $500-million in tax points.

Mr. Solomon specifically mentioned cutting loose northern communities. Obvious political suicide, but he also seems unaware that Canada’s North is on the cusp of becoming a net wealth creator for the first time since the fur trade. This is thanks to diamond mining, two massive planned natural gas pipelines, possible oil development, hydroelectric projects and, at long last, some highways. Canada’s resource sector has a lot left to give. What is needed is a campaign to free up the machinery of wealth creation everywhere.

George Koch and John Weisenberger are Calgary-based writers. This response was published by the National Post on Saturday, May 15, 2004.

Slowly and methodically over the past years, rural communities have had their post offices, schools and churches (all community establishments) closed. The latest affront has been the forced amalgamation of our townships. It now appears the Ontario government’s Panel on the Role of Government is recommending relocation of communities.

Rural areas are burdened with regulation heaped on regulation. They are harangued by every conceivable government ministry. They are tired of being the fall guys for major pollution problems, which are actually traced to heavily populated urban areas – e.g., regular urban sewage spills that are polluting our rivers lakes and streams. Infrastructure in urban areas is so old and fragile it is unable to contain the vast amounts of waste coming from heavily populated areas. Urban centres seem to be allowed to continue on their regular pollution kick without too much government intervention. If that were to happen in a rural area, the authorities would sit on our doorstep and impose stiff penalties or even incarceration. As for polluted air, just step out in the city and take a deep breath.

The panel suggests rural communities are not worthy to receive funds for assistance. Let me assure them, urbanites are just as quick to sidle up to the trough as rural folk. Listen to the news, read the papers. Who cries for financial assistance any more than city politicians? As for giving support to rural communities, Mr. Solomon, our hard-earned tax dollars are just as valuable as urban money. We deserve good roads, education and health care as much as any citizen of this province.

Farmers are the lifeblood of the nation. The slogan “If you ate today, thank a farmer” should be emblazoned in every home. Dedicated farmers work their soil, tend their animals and harvest their crops so the likes of columnist Solomon and other Ontarians will have food on their tables.

Frances Thurlow, secretary, Frontenac Landowners, Godfrey, Ont.

Lawrence Solomon‘s column illustrates the contempt and ignorance with which the far-removed urban and bureaucratic mindset views rural communities (Rural Phase-Out, April 21).

It’s no wonder the “Rural Revolution” started in Eastern Ontario is gaining wide acceptance and broad support when such people as Mr. Solomon have the government’s ear and common people and common sense are absent from our democratic process.

The only dangers and obstacles threatening the rural economy and culture are government intrusion: legislation such as the Nutrient Management Act, which slowly starves family farms; new Ontario water regulations that parch all rural businesses of profits; the gun registry, which creates lifestyle criminals; the Environmental Protection Act, which cuts down our logging operations because sawdust is thought to be toxic; and the Species at Risk Act, which endangers all property owners with legislated theft of our lands.

These are but a few examples of the government’s assault on rural communities, but the list is as endless as a bureaucrat’s quest for meaningful tasks. Leave rural people and communities alone and we will thrive and survive long past the cities’ demise, just as we have for hundreds of years, and throughout history.

It is evident the rural economy is being dismantled, and its people are under siege, but this is being done by people such as Mr. Solomon and urban bureaucrats who legislate misplaced urban standards and regulations upon rural residents and their businesses.

Metropolitan legislation intended to protect urban dwellers from the dangerous effects of an intensive and dense living environment has no place or purpose in the wide-open and clean countryside.

The consequence of urban legislation on rural communities is hardships and a dying culture and heritage.

Clearly, the same consequence would befall urban communities if rural living standards were allowed in densely populated cities.

To suggest that rural residents and communities cannot sustain themselves and require the guidance and support of the cities is to have a complete lack of knowledge or understanding of rural people and our lifestyle. It is a clear contradiction of reality: It is the densely populated cities that need rural people and their communities, in order to protect Canada’s environment, food supply, culture and heritage of democracy.

Government academics are building fences that divide rural and urban, causing each to look upon the other with disdain, but rural people know who will climb to the other side first.

The only question is will we in the rural areas let them in and allow them to escape the culture of socialism that entraps them? Or will we create a new rural province first, in order to protect our rural heritage, culture, property and democracy – and separate ourselves from the dangers of academic minds empty of reality and filled with ignorance.

Randy Hillier, president, Lanark Landowners Association, RR2 Carleton Place, Ont.

Rural Phase Out suggests that financial support to rural areas in Ontario be phased out because “most of rural Canada cannot sustain itself.”

The comment goes on to applaud the government of Ontario’s Panel on the Role of Government, saying its report has spoken with rare courage and clarity.

To add to the panel’s courageous suggestions, perhaps the government should examine a few other unsustainable programs. Welfare, subsidized housing, breakfast programs in schools and drug needle programs should be phased out. Employment Insurance only encourages workers to take holidays and should be abolished. Arts and culture programs, libraries, museums and publicly funded recreational centres should be 100% privately funded. The government cannot afford to support public entertainment.

All irony aside, we don’t have to look far to find programs that heavily burden the taxpayer. Some tax-supported programs or services should be eliminated immediately, namely the Ontario government’s Panel on the Role of Government.

This panel has conveniently overlooked the high cost of supporting the infrastructure of high-density urban areas and has focused on the lightly populated rural areas with fewer votes.

The motive for this report is transparent and serves only to alienate urban and rural dwellers and further the government’s attack on rural residents. The government of Ontario is waging a war against the rural lifestyle through studies such as this, onerous environmental regulations and complete disregard for property rights.

We will not back down from the attack and will not surrender our rights. We pay taxes, as do all other citizens, and demand the services and respect normally expected by other residents. What we really need is to phase out the government of Ontario.

Terrence MacLaurin, Woodlawn, Ont.

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