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(05 July 2011) We have been rationing budgets for the last 20 years in three of the pillars sustaining the progress of our province:  Education, health care and transport & infrastructure.  Rationing has been our strategy to put a cap on the budgets of these three large spending ministries and contain the threatening consolidated deficit of the province.  The result is today troublesome:  Not only have we failed to square off the deficit, but quality of services in the three pillars has suffered to the point of putting into jeopardy our own progress.

In the critical sector of education, standards have gone down from prep schools to universities.  We are levelling off from the bottom and allowing an easier graduation flow through.  Yet dropout rates in high schools remain scary.  From misguided reform to another, citizens are losing trust in the public education system and the ability of politicians to fix it.  In the public health arena, we are wondering whether we will ever truly shorten the waiting lists in surgeries, waiting times in urgencies, and the list of people without a family physician.  It seems we can’t see the light about this.   Despite additional billions pumped into the health care systems, the performance needle hardly moves at all. 

After health care and education, we are now seeing the ramifications of our rationing model applied to the third pillar in transport & infrastructure.  Evidence is currently spreading about another terrible mess:  A long practice of lousy patching in highways and roads, extensive collusion in the construction industry, mismanagement at municipal and provincial levels, questionable short term planning by an overstretched bureaucracy.  Infrastructures have been the playground of politicians:  You could hear party insiders state that a promise for a bridge could last for four elections.  Infrastructures have not been perceived as fundamental and necessary economic building blocks.  Rather, they have been more important to milk as contributions to political parties. 

We are now caught in a bind.  Rationing is a losing proposal even if politicians mask it as rational management.  In the long run, we are cornering ourselves. The trouble is that rationing is winning over deep changes in practices because vested interests have learned to protect their turf in the face of mild political courage.  We are entering an era of defensiveness, in which lobbyists and interest groups of all shades will hold the high ground.  In a background of limited wealth creation, high public debt and budget constraints, everyone will want to protect its piece of the cake.  Resistance moves up and mobilisation requires unusual leadership.

Behind rationing and political tepidity, hides the root of our predicament:  The management of our economy.  We have been content to ride on the American economy for the second half of the 20th century.  It brought us enough prosperity to modernize the state of Quebec, and to crank up borrowing to sustain a social model copied from the French.  It has been a comfortable ride for the baby boomers.  In fact it was all about managing wealth, easily acquired.  We built a social model we can’t afford to pay today, even under our rationing model.  As Warren Buffet says, it is under low tide that we see who is swimming naked.  With the rise of Asia, the tide is pulling back.  Creating wealth will be much harder in the 21st century.  Our chronic level of unemployment is hurting, entrepreneurship is dwindling, the technology wave of the late 1990s was wasted, our manufacturing firms are struggling to catch up to a strong dollar and we are losing more R&D capability than we are creating new ones.  No wonder we are once more turning to natural resources, to play our best card, the ‘Plan Nord’.  The ‘Plan Nord’ would have looked visionary ten years ago, today it is a fine and safe initiative. We will come down to either implementing deeper budget cuts, or else lifting our economic growth. 

Quebec exited the last financial crisis in good shape, protected by the Canadian shield in banking.  The auto crisis did not hit Quebec, since it had already lost its small position in that industry.  Local banks held up reasonably well, but not without significant losses, picked up by Ottawa.  The financial crisis did not reach and poke at our treasure of debt in Quebec.   Luckily, we were given a reprieve, some additional time to sort out our problems, push up competitiveness and boost our economic engine.  In the last 20 year we have been managing a gentle decline, soft, impervious and treacherous.   Rationing might extend the ride for another 10 years, but our political masters would be leading us towards closer to bankruptcy.   We feel desolate about extreme partisanships in the United States, but we witness the same stubbornness here in Quebec:  The PQ blinded by independence at all costs, and the Liberals afraid of their shadows.  When are we going to see a real ‘plan Montréal’?

What could possibly lie beyond rationing? 

The Quiet Revolution gave birth to a new local enterprising business class.  The voice of the business executives has been too quiet for its own good, much too reactive to the siren calls of the government.  If we can’t trust our politicians and bureaucrats on the three basic pillars, we ought to require a greater involvement from the business class about a stronger economy and a strategic response to the economic challenges of this new century.    The economy must rise on the political agenda.  It is now up to this Business Class to show the way in shaping a stronger vision for our economy, in finding new growth paths, and in raising expectations on government policies and practices affecting business.  Business must pressure Government, not the other way around.   Some recent initiatives have sprung up and  are noteworthy:  The Ecole d’Entrepreneurship de la Beauce, the Secor Strategic Forum on Quebec 2010, etc.   Yet much more must be done.  Absence of true leadership from the business community will condemn us to a landscape of competing interest groups in the face of continuous decline.  Once that landscape sets in, reversal will be much harder.  Then, we might very well find out, like Greece, that our list of friends is rather short.

 André Du Sault

Posted in Governance, Management ideas.

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4 Responses

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  1. P. Brissette says

    Direct sur le bouton!

    • Kindsey says

      Son of a gun, this is so heplufl!

    • Aldo says

      A judge in a court of law must look to credible scueors for the meaning of words. When looking for the meaning of “nation”, say, within the constitution or the meaning of “National Assembly”, the plain meaning is now defined by parliament. Someone will make the arguement that it means a sovereign jurisdiction within another jurisdiction. i.e. all internal powers have now be devolved to Quebec. I warned you guys that Harper wants to bulkanize and Americanize the counry… you were warned. Harper wins and Canada lost…. all that needed to be added was “historic nation” and we would have been fine… but that ain’t so now.

  2. Wika says

    Meti are a culture is from the west and Que9be9cois are Native-French that never left… Quebec is a ntvaie word and not french… Its a word that the french hijack over time… The British did not set out, however, to persecute Quebec’s ntvaie French population. The Quebec Act, passed in 1774, allowed the Quebecois to have religious freedom.Also at the time was slavery of ntvaie population… so to state that your ntvaie descendent are would bring about bad things like capture or get shot That’s why many left and changed to Me9tis I know because I am from Me9tis-Quebecois And we had to keep are mouths shut and go to church or no job or money went to you we the French people who the Algonquin adopted created the nation of people called Quebecois Don’t forget that it’s like 270 years of new Native-French kids being born…to 1774The word Nation is used in Canada to describe First Nations Natives like the Cree-Nation so when you talk about the Quebecois they are mostly the Native-French descendents who lived and created Quebec city before 1774 Not Meti who are from the west… If your family tree dates back that far then your a Quebecois.France back then in 1500 did not build jails they just ship you here to Quebec it was way to get development going here When my great grandfather came over on one boat escaping prosecution he had to change his last name… I think it was a way to track down his descendents… The story was handed down to show the truth how we got here…Father Paul Le Jeune proposed to the governor, Champlain that they try to promote Huron-French intermarriage. Champlain agreed not only for religious reasons, but also because intermarriage was a way of further cementing French-Native alliances. He also thought that by building a settlement in the Huron country, the French/Huron population could complete the exploration of the continent.26 While the Huron were ambivalent about accepting this proposal, the French court accepted and still promoted it during the late 1660s, namely that French and Natives mingle and constitute only one people and one race. After the initial 1755 deportions, England decided to sent the French back to France instead of to the American colonies.. When Louisbourg fell in 1758, over 3000 Acadians from the Ile St. Jean area were exiled to France. When Quebec fell in 1759, hundreds of prisoners of war were also sent to France. In 1763, 753 more Acadians arrived from England. Generally, they lived in poor conditions. Most lived in coastal cities, though several attempts were made to settle them elsewhere. When the opportunity came to leave in 1785, over 1500 of them traveled to Louisiana.England did not remove the Native-Franch only the real french…So when did the French come to Canada? LOLQuebecois are people of old Quebec they are mix blood that created an identity for them selves a long time ago Vikings and other Europeans also came to Quebec before France and mingled with ntvaies as a new nation This all happed before the British came To state that all Quebecer’s are Quebecois then you actually change their identity It’s like saying the Cree and Mohawk should now be the same under one name The Quebec Provence should not discriminate or set up pollicise that state that all people from Quebec are Quebecois . That like creating an assimilation province under one culture Under First Nations of many nations a nation is not defined by its boarders Only a selected few Quebec are trying to redefine this as all people under a boarder are Quebecois When they do this they are erasing history of the true Quebecois

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