The free market socialism of Maurice Strong

Lawrence Solomon
National Post
August 15, 2000

No wonder so many critics of the free market economy abhor him. He’s Canada’s most astute, most daring privatizer, among the very first both to recognize the failure of state ownership of industry and to successfully start to unravel it. Thanks to his efforts, Canadair, de Havilland, Teleglobe and other government-owned businesses were sensibly placed in private hands.

But Maurice Strong also arouses fury among conservatives, and not just because many of them share their ideological opposites’ belief that this 71-year-old is conspiring to somehow rule the world. Mr. Strong is not like the rest of us. Mostly, he operates as a freelancer in the nether world of the United Nations, World Bank and other international institutions, answering neither to national governments nor to multinational corporations. Often, he uses language less to communicate than to confound, speaking in generalities and always, always guarding against words that might come back to haunt him.

Yet his critics are also to blame for failing to understand him: Rather than assuming him an ideologue and attributing to him Machiavellian motives, they should see him as a pragmatist and read him very literally.

The motives of a politician who will say anything to get elected, or a corporate CEO who mouths free-market platitudes while lobbying government to keep out competitors, are easy to understand. We know these people, and understand the extent to which we can trust them. Mr. Strong is hard to trust because he’s hard to pigeonhole.

He calls himself a socialist who employs capitalism to good ends, making himself alien to many in both camps. He is so comfortable in both the public and private sectors, and so fully understands their similarities, that he speaks in generalities encompassing both, raising suspicions among those who regard these spheres as strictly distinct.

I do not share Mr. Strong’s enthusiasm for international organizations. I believe many of them — and in particular, many that he supports — should be shut down. I also do not share his enthusiasm for a global carbon tax — a chief proposal in his recent book, Where on earth are we going? (Knopf Canada), which has reinflamed many of his critics. But Mr. Strong is not a flaky do-gooder who flits from job to job, as some portray. His prescriptions for the planet are overwhelmingly based on the environmental benefits of free markets. And when he has worked at the domestic level, where we can best judge him by what he has done rather than what we think he might be plotting, he has an unsurpassed record at zeroing in on organizational problems and moving deftly to deal with them.

In the early 1980s, Mr. Strong recognized that the federal government’s role in industry was counterproductive. To extract government-held corporations from the ministries that controlled them, he helped convince the governing Liberals to create a divestment agency — the Canadian Development Investment Corp. — to clean up the businesses and make them suitable for sale. The Progressive Conservatives, in opposition, derided the CDIC’s creation and vowed to dismantle it. When the PCs, under Brian Mulroney, took power the next year, they soon recognized the wisdom in CDIC, reversed themselves and carried Mr. Strong’s privatization plans through to completion.

When the Ontario New Democratic party recruited Mr. Strong to rescue Ontario Hydro in 1992, he succeeded a hapless string of chairmen from both the public and private sectors who had let the Crown agency expand willy-nilly. Unlike his predecessors — all empire-building monopolists — Mr. Strong set about dismantling Hydro. To prepare it for privatization and the power sector for competition, he cut Hydro’s staff from 36,000 to 21,000, ended its wildly uneconomic nuclear expansion program, slashed billions being spent on wonky conservation schemes, organized the monolith into logical business units, reduced the company’s debt, eliminated rate hikes and made Hydro profitable.

Equally impressive, he came within a whisker — one vote at a contentious NDP Cabinet meeting — of convincing the government to privatize the utility, losing only because the privatization would have occurred prior to an election in which the NDP needed labour support. Had the NDP been re-elected, Hydro might well be privatized now.

Instead, Mike Harris’ Progressive Conservatives won. Unlike Mr. Mulroney, Mr. Harris did not follow through on Mr. Strong’s privatization plans. Rather than boldly breaking up the Hydro monopoly, selling the system to retire its unsupportable debt and lowering rates for consumers, the Ontario Tories have moved timidly and ineptly through two mandates. Mr. Strong — vilified for being power-hungry — had a vision of decentralized, competitive, privatized electricity markets. His Tory successors resume the string of empire-building monopolists.

As Mr. Strong’s recent book attests, he has turned against foreign aid — it breeds dependency among recipients. He believes private capital — not government ownership — must finance most Third World development. He wants to end an estimated US$700-billion in subsidies that governments worldwide spend on water, energy, agriculture and transportation. His socialist critics abhor him for good reason. His conservative critics do not.

Lawrence Solomon is executive director of Urban Renaissance Institute, a division of Energy Probe Research Foundation. He has been acquainted with Maurice Strong for 20 years.

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