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The Mulroney Years: Transformation and Tumult

The Mulroney Years: Transformation and Tumult

THE MULRONEY YEARS: TRANSFORMATION AND TUMULT

Kim Richard Nossal

Brian Mulroney was the only Conservative leader since Sir John A. Macdonald to win consecutive majority mandates. Yet Mulroney’s rare acclaim as he took office was followed by unprecedented unpopularity as he left it. Still, no one would accuse Mulroney of hoarding his political capital. From to the goods and services tax, he restructured the Canadian economy. From -US relations to la Francophonie, he realigned Canada’s foreign policy. From Meech Lake to , he tried to redefine the relationship between and the th provinces. Kim Richard Nossal considers Canada’s 18 prime minister, and The Gazette, concludes Mulroney’s record is both over- and under- appreciated. , prime minister from 1984 to 1993. From free trade to the Depuis sir John A. Macdonald, Brian Mulroney a été le seul chef du Parti GST, no one accused Mulroney of progressiste-conservateur à faire élire deux gouvernements majoritaires consécutifs. hoarding his political capital. Mais si son arrivée au pouvoir fut saluée avec une rare unanimité, il était d’une impopularité sans précédent lorsqu’il a quitté ses fonctions. Personne ne pourrait cependant accuser Brian Mulroney d’avoir ménagé son capital politique. Du libre- échange à la taxe sur les produits et services, il a restructuré l’économie canadienne. Des relations canado-américaines à l’essor de la francophonie, il réorienté notre politique étrangère. Du lac Meech à Charlottetown, il s’est employé à redéfinir les rapports entre Ottawa et les provinces. Kim Richard Nossal en conclut que le bilan du dix-huitième ministre du Canada est à la fois surestimé et sous-estimé.

rian Mulroney’s tenure as prime minister from 1984 Over the four years before Mulroney came to power, to 1993 demonstrates the appropriateness of the relations between President Reagan and Prime Minister B hoary Chinese curse “May you live in interesting Pierre Elliott Trudeau had increasingly soured, not least times.” For Mulroney was prime minister at a time of a rad- because of Trudeau’s concerns about what he termed the ical transformation in politics — in Canada, in North “parlous” relationship between the superpowers. Trudeau’s America, and globally — even though those changes were vision of world politics differed dramatically from Reagan’s, not always evident in September 1984 when Mulroney led and Trudeau was not hesitant to press those differences. The the Progressive Conservative party to victory, with a massive result was a friction in the personal relationship between majority in the House of Commons. the two leaders that exacerbated some of the more material When Mulroney came to power, the was at its conflicts between Canada and the in the early coldest. The shooting down of Korean Air Lines 007 by the 1980s. Indeed, trade relations between Canada and the Soviet air force in September 1983 had brought relations United States had deteriorated as protectionist sentiment in between the United States and the to a new low, Congress deepened with the onset of . Attempts by with President characterizing the Soviet Union both governments to duplicate the success of the sectoral as an “evil empire.” The decision by the Reagan administration free trade arrangements in autos and auto parts and in to provide sophisticated military aid to the mujahideen in defence procurement had failed to achieve any substantial Afghanistan fighting the Soviet occupation force would turn progress, instead revealing the depth of protectionism on the tide of a war that was already not going well for the Soviet both sides of the border. Given the generally poor state of Union. And the publicly stated determination of President Canadian-American relations, it was little surprise that one Reagan to find a way to put in place a shield against nuclear of the widely promised planks in Mulroney’s election plat- attack threatened to undermine the very foundation of the bal- form in 1984 was his promise to “refurbish” the Canadian- ance of terror between the United States and the Soviet Union. American relationship.

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CP Photo The Shamrock Summit: Prime Minister Mulroney greets President Reagan off Air Force One at on March 17, 1985. The Shamrock Summit marked the restoration of close Canada-US relations after the chilliness of the Trudeau era. The Mulroney/Reagan- Bush years saw the negotiation of the Canada-US Free Trade Agreement, the NAFTA and the Accord.

omestically, Canada in 1984 was And in 1984, the political party sys- y the time Mulroney left office in D marked by political and eco- tem in Canada looked as it had for many B 1993, this canvas looked radically nomic discontents. The deep frac- generations: two national parties, both of different. At the global level, the Cold tures left by Trudeau’s of which had difficulty in transforming War was over, the Soviet Union having the constitution and the refusal of national support into seats, thanks to the ceased to exist at the end of 1991 and the Québec government to attach first-past-the-post electoral system. Washington and Moscow having itself to the new constitutional Under Mulroney’s leadership, seized agreed to reprogram their nuclear arse- arrangements were continuing con- from in 1983, the Progressive nals. Across the globe, the end of cerns. Moreover, the country’s finan- Conservative party grew to embrace a superpower confrontation had cial situation was grim: the recession wide variety of interests from across brought political change as the calcu- of the early 1980s produced large- Canada, particularly in Québec, enabling lus that had prompted great-power scale unemployment, particularly in Mulroney to repeat the achievement of support of despotic, corrupt or author- central Canada; after 16 years of the Conservatives under John itarian regimes changed and those deficit spending by the federal gov- Diefenbaker in 1958 and sweep into regimes collapsed. On occasion, the ernment, the deficit was continuing power with an unprecedented majority collapse prompted particularly vicious to spiral upwards. of 211 seats in the House of Commons. civil wars, but this too ushered in

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another change: the willingness of the By 1993, Canada’s political land- because, unlike Trudeau, Mulroney international community to intervene scape would be unrecognizable as a does not have champions in the scrib- in a number of civil conflicts. result of the disintegration of the bling classes writing on his years in The of an increasing- Progressive Conservative party over power, spinning the story of his time in ly globalized economy had also changed the course of the Mulroney mandate. power in particularly favourable ways. during this period. The Uruguay Round Two new political parties, each with a On the contrary, books on the of multilateral trade negotiations, regional base — the Reform party in Mulroney government’s corruption launched shortly after Mulroney came the West and the Bloc Québécois — become best-sellers, while in-depth to power, was in the final stages, and the were formed during this period. Their investigations into the charges of cor- World Trade Organization would be in appeal to voters would lead to the dec- ruption levelled against Mulroney him- place a little more than a year after imation of the PC party and the self are not widely read. Mulroney’s departure as prime minister. entrenchment of the Liberals in power Moreover, with the end of the Cold War, after Mulroney’s departure. By 1993, s a result, appreciations of the multilateralism enjoyed a rebirth as national unity continued to be a prob- A Mulroney era are themselves “global governance” began to make its lem, with Mulroney’s efforts to resolve mixed, with the consequence that appearance in political discourse. the national unity dossier having been some aspects of his record are, it can be firmly rejected, first with the death of argued, appropriately appreciated, n North America, the Canadian- the in 1990, and while some others are overappreciated I American relationship was in the then by the voters across Canada in and some are underappreciated. process of being transformed by two the referendum on the Charlottetown One of the most important changes trade agreements negotiated during Accord — both of which set the stage in Canadian politics that will be associat- Mulroney’s tenure. While the effects of for the 1995 Québec referendum. ed with the Mulroney era is the transfor- both the Canada-US Free Trade mation of the political landscape. agreement that came into force Appreciations of the Mulroney era Mulroney had been very success- in January 1989 and the North are themselves mixed, with the ful in forging a winning coalition American Free Trade Agreement result that some aspects of his in 1984. But it proved impossible that came into force in 1994 to sustain. Part of the problem would not be fully evident until record are, appropriately was the fundamental contradic- the mid-, and while these appreciated, while some others are tion deeply rooted within the PC agreements did not bring overappreciated and some are party. Like many a shaky mar- American protectionist impulses underappreciated. riage, the union between the to an end, there can be little “Blue ” — those with an doubt that the achievement of a compre- And Mulroney himself would ideological outlook more comparable to hensive trade agreement with the United leave politics widely disliked by the the right wing of the Republican party in States brought huge changes. While Canadian public; journalists would the United States — and the “Red Tories” some suffered as a result of the write unflattering accounts of his — those who had a more traditional unemployment and dislocation that tenure as prime minister; and he would ideology — worked well enough as long occurred as firms rationalized their oper- be hounded by an allegation of corrup- as no one actually talked about the mari- ations, in the aggregate Canadians would tion and scandal in a notorious case tal problems. Differences could be — and be much better off as a consequence of that was not finally closed until 2003 were — papered over, not mentioned, left the massive increases in trade. with no proof of the original allegation to be resolved at a later time. By the end of the Mulroney man- having been presented, six years after As a strategy for opposition, this date, Canada would also have a goods the government settled his libel lawsuit might have been appropriate and and services tax, a highly visible tax of on the courthouse steps, with an apol- politically effective. However, the 7 percent introduced to replace the ogy to the former PM and his family as process of governing exposed all the completely invisible manufacturer’s well as payment of his entire costs. contradictions inherent in the union sales tax of 13.5 percent. But the of these disparate ideological groups. Mulroney Conservatives proved no iven the scope and rate of political And although Mulroney is frequently more capable than the Trudeau Liberals G change during Mulroney’s prime portrayed by critics as a leader in the at grappling with government expendi- ministership, it is perhaps inevitable mould of or Ronald tures: by 1993, there had been no seri- that his record could be judged as Reagan, in fact he shared little of the ous assault on the budget deficit, even mixed. Moreover, appreciations of his willingness of those leaders to engage though Ottawa was by then in an oper- tenure are made more difficult because in the kind of harsh politics with ating surplus — taking in more in taxes of his personal unpopularity; because which the neoliberal is normally asso- than it spent on programs. he has yet to write his memoirs; and ciated. The reality was that Mulroney,

78 OPTIONS POLITIQUES JUIN-JUILLET 2003 The Mulroney years: transformation and tumult while himself no , was unwill- Liberal lock on that province was well tunity to change Canada’s hugely ing to risk the coalition he had so care- beyond Mulroney’s capacity to prevent, unrepresentative electoral system — fully put together. even if he had used a less cynical phrase and chose not to take advantage of the The irony is that that very desire to than “roll the dice” to describe the opportunity offered by this historic please caused major disaffection, with process of constitutional amendment. correlation of forces. the result that the Reform party, founded The sustained assault on the Meech y contrast, one of Although Mulroney is frequently portrayed by critics as a leader B Mulroney’s enduring in the mould of Margaret Thatcher or Ronald Reagan, he shared positive legacies will be the free trade agreements with little of the willingness of those leaders to engage in the kind of Canada’s North American harsh politics with which the neoliberal is normally associated. trading partners that were negotiated during his man- in 1987 as a protest against the putative Lake Accord mounted by prominent date, despite the fact that he had spo- failure of the Mulroney Conservatives to Liberals from January to June in 1990 ken out against free trade in 1983 and protect Western interests, ended up put- was one of the key reasons why the 1984. But there can be no doubt that ting at least half of the nails in the Constitution Amendment 1987 died on free trade — even if it did not achieve Conservative party coffin. And the other June 23, 1990. And, ironically, by the Mulroney’s stated goal of guaranteed nails were provided by the collapse of the time that the access to the United States market — Québec part of the winning coalition of was proposed with the agreement of all had a transformative impact on 1984 with the failure of the Meech Lake the major political actors, the die of Canada and the wealth of Canadians Accord and the decision of Lucien regional protest had been cast, with a (even if it was not until the mid-1990s Bouchard to leave the Conservatives to significant majority of ordinary that those effects began to be revealed). form the Bloc Québécois. Canadian voters in all regions rejecting But while the Free Trade the recommendations of their elites on Agreement will always be associated n short, it is clear that the collapse of the constitutional dossier. And in this with Mulroney, it could be argued that I the historical, two-dominant-party mix, we cannot ignore the impact of this is a somewhat overappreciated model of Canadian politics will be one the personal political ambitions of aspect of his record, in the sense that of the enduring legacies of Mulroney’s , whose departure given the broader structural conditions tenure as prime minister. But to what from the Conservative Cabinet assisted it is likely that a comprehensive free extent can the rise of these parties of in the eventual collapse of the PC trade agreement with the United States protest that ended up balkanizing party’s national support in 1993. would have been sought regardless Canadian politics in the 1990s and who was in power after 1984 — at least beyond be attributed to Mulroney him- here is, however, one change that eventually. In other words, it is likely self? Here the answer is less clear. On the T Mulroney could have introduced, that had and the Liberals one hand, there can be little doubt that and which would have had an endur- won the 1984 election, the Royal many of the decisions of the Mulroney ing effect on the Canadian political Commission on the Economic Union government fuelled system. The huge size of the and Development Prospects for — the decision to award the CF-18 Conservative parliamentary majority Canada under Donald Macdonald maintenance contract to Québec rather in 1984 would have allowed Mulroney would still have recommended taking than , for example. And there to introduce legislation altering the the “leap of faith”; the logic of grow- can be little doubt that the dominance electoral system that had kept the ing American protectionism would of the Red Tory mix in the Mulroney Conservatives from power for much of still have suggested a comprehensive cabinet did not sit well with large num- the twentieth century. But changing free trade agreement. bers of Western backbench MPs. On the the electoral system was never on the The difference, it can be argued, other hand, there was a certain political radar screen in these nine was in the timing. Given the number inevitability to the rise of a Western years; instead, the dominant assump- of members of the Liberal caucus who protest party: had the Mulroney tion was that since the new prime min- were then (and remain today) either Conservatives embraced the agenda ister’s political skills appeared to have deeply sceptical about, or outright that would have soothed Western con- broken the Liberal lock on Québec — opposed to, Canadian integration with cerns, PC support in central Canada twice, no less — further action on the the United States, it would have taken would surely have been jeopardized. plurality system was not necessary. much longer for the Liberal party to Likewise, the collapse of the coali- Ironically, one of the most negative have the internal debate on continen- tion with nationalists in Québec that legacies of the Mulroney mandate was talization and the US that it eventual- had enabled the PC party to break the that the Conservatives had the oppor- ly had in the early 1990s when they

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were in opposition. Where it can be argued that Mulroney made a differ- ence was in the speed with which he made up his mind to change his mind, and the leadership he showed in mak- ing free trade a reality. By contrast, it can be argued that the legacy of the goods and services tax is widely underappreciated. In this case, it is not at all clear that another leader or another party would have taken the very real political risks in introducing a major visible tax of such magnitude, and extending this tax to a vast swath of the economy previously untaxed. Despite the huge unpopulari- ty of the GST at the time, it has proved to be a major contributor to the suc- cess of both the Free Trade Agreement and subsequent efforts by the Liberal government of Jean Chrétien to grap- ple with the federal deficit after 1993. For the GST not only boosted federal revenues, but also effectively gave Canadian exporters a 13.5 percent boost — since GST is not charged on exports, while the MST was applied to all manufactured goods, regardless of who bought them.

owever, where the Mulroney H record is perhaps most underap- preciated is in the realm of foreign pol- icy. While defence policy during this period suffered from an excess of enthusiasm for new military spending followed quickly by an excess of enthusiasm for cutting the defence budget, Mulroney took a number of important foreign policy initiatives and embraced a number of changes in foreign policy over his nine years in power. While one can disagree about whether these initiatives were good or Courtesy of the Woodrow Wilson Center bad, there can be little doubt that Former Prime Minister Mulroney addresses a Washington Conference on the 10th Mulroney — aided by Joe Clark as his anniversary of the NAFTA in 2002. “Democracies,” he said, “are inspired by the collision of great ideas, and the vigourous disagreements and debates they provoke.” secretary of state for external affairs — was one of the most activist prime ministers in foreign policy in the twen- Africa file a personal anger at During his time in office, tieth century. that was both unusual in Mulroney withdrew Canadian forces On foreign policy, Mulroney is itself, and unusual in the degree to from Europe, although the withdrawal often best remembered for his atti- which this anger was translated into was motivated by the desire to reduce tude towards apartheid in South policy. But the foreign policy record expenditures than for strategic rea- Africa. And there can be no denying of the Mulroney government was sons. The government also withdrew that Mulroney brought to the South much wider and diverse. the Canadian contribution to the

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United Nations peacekeeping opera- n Canadian-American relations, Wars. The politeness of the refusal to tion in , arguing that peace- I Mulroney made good on his election participate was not only designed to keepers had become part of the promise to “refurbish” the relationship. see if Canada could have its cake and problem and were hindering the devel- While some of the more symbolic ele- eat it too on the defence contracts like- opment of peace there. Mulroney also ments of that refurbishing might have ly to ensue from the Strategic Defense departed from traditional Canadian been corny or cloying (Brian and Mila Initiative, but also to soften the impact foreign policy positions by arguing in Mulroney and Ronald and Nancy of the absence of Canada and the legit- favour of the use of force in humani- Reagan singing When Irish Eyes Are imacy that Canadian approval would tarian intervention and pushing for a Smiling together at the Québec summit have lent to SDI. more activist role in pushing govern- in 1985 has become the icon of choice Mulroney also proved to be a good ments to observe human rights and for corny and cloying), there can be little diplomat and negotiator with the US, good governance. One example of this doubt that during the Mulroney years, and able to defend Canadian interests. was the tough response of the the Canadian prime minister enjoyed a The thorny and highly political issue of Canadian government to the massacre level of access and influence at the Arctic sovereignty was removed from in Tiananmen Square in June 1989. White House not seen before or since. the Canadian-American agenda, with a Another example was Mulroney’s per- This is not to suggest that there major concession provided by the sonal initiative on children’s rights. were no conflicts in Canadian- United States on this issue, almost American relations during this period. entirely as a consequence of Mulroney’s ulroney also used personal diplo- Trade disputes proliferated, despite the personal relationship with Ronald M macy to good advantage on inter- free trade negotiations. There was no Reagan. The acid rain issue likewise dis- national environment policy, appeared from the agenda (even playing an active role in the Rio Under Mulroney, Canada was an if acid rain itself has not entire- summit in 1992. On develop- ly disappeared), partly because ment assistance, the Mulroney active multilateralist, joining the of Mulroney’s close relations government actually considered Organization of American States, with George Bush père. On the idea of untying foreign aid — opposing American unilateralism, extraterritoriality, Ottawa took for much longer than the usual and arguing for multilateral the important step of introduc- nanosecond it takes for ing legislation make it an entrenched interests to assert solutions to such conflicts as the offence to obey the extraterrito- themselves. Under Mulroney, Iraqi invasion of Kuwait. rial application of foreign law. Canada was an active multilater- I have argued that alist, joining the Organization of agreement on Reagan’s pet Star Wars Mulroney’s time in power will be American States, opposing American project. There was conflict over marked by mixed results and different unilateralism, and arguing for multilater- American extraterritoriality on Cuba, kinds of legacies. To date, those lega- al solutions to such conflicts as the Iraqi American unilateralism towards inter- cies have in large part been clouded by invasion of Kuwait. national institutions, American policy the extraordinary antipathy he ended One of the most important foreign in Central America, and American up provoking in Canadians — an affairs legacies was Mulroney’s initiative challenges to in interesting psycho-political dynamic to put in place a francophone summit the Arctic. And acid rain was as impor- that in itself deserves further study. But similar to the Commonwealth Heads of tant a source of conflict during most of with the passage of time, and as the Government Meeting. Prior to the Mulroney years as it had been dur- results of some of the initiatives intro- Mulroney’s arrival, efforts to create a fran- ing Trudeau’s final term of office. duced by the Conservatives in both cophone summit had always foundered domestic and foreign policy become on the highly centralized vision of the hat was different about the more evident, it is likely that Canadian federation articulated by Pierre W Mulroney years is how conflicts Mulroney will be judged rather differ- Elliott Trudeau, and the efforts to keep in the relationship tended to be man- ently by history than by those who so the role of the provincial governments aged. Policy disagreements were always readily voted for anyone but a on the international stage as limited as conducted with the shadow of the Conservative in 1993. possible. Working with both Parti future very much in mind, and always Québécois and Liberal governments in with a recognition that the Canadian- Kim Richard Nossal is Professor and Québec, Mulroney broke through the American relationship was paradoxical- Head, Department of Political Studies, logjam and oversaw the establishment of ly hugely complex but at the same time Queen’s University, and co-editor, with an international institution in which fragile and easy to damage. A good Nelson Michaud, of Diplomatic Canada’s francophone provinces play a example was the so-called “polite no” Departures: The Conservative Era in permanent and legitimate role. delivered to the US in 1985 on Star Canadian Foreign Policy, 1984-1993.

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