It seems strange to even ask this question, but some who call themselves socialists do, so it is good to revisit the it every so often. Is Canada best described as a colony or imperialist power?
By Yves Engler
Published on the author’s own website, Sept 17, 2019
Recent issues of the Economist and Northern Miner highlight the weakness of the dominant “staples trap” political economy perspective. Regardless of its popularity in left nationalist intellectual circles, Canada is not a victim of international capitalism. Instead it has long had a privileged place in an extremely hierarchical global economy.
In “How a Canadian firm has taken on Wall Street’s private-equity titans” The Economist reported that Brookfield Asset Management is as big as famed Wall Street competitors Carlyle and Blackstone. The Toronto-based company has “over $385billion in assets under management” and owns businesses in “more than 30 countries around the world.”
Brookfield has been the quintessential rebuttal to left nationalism for decades. Begun in 1899, Brookfield’s predecessor (otherwise known as Brazilian Traction, Brascan or the Light) employed almost 50,000 Brazilians at its high point in the 1940s. Trolleys and electricity production were the company’s backbone, but it also owned a sardine cannery, fishing boats, a tin mine, a brewery, banks as well as real estate. Possibly the biggest firm in Latin America by the end of the 1950s, Brascan was commonly known as the “the Canadian octopus” since its tentacles reached into so many areas of Brazil’s economy. Between 1918 and 1952 more than $200 million ($2.5 billion today) was taken out of this ‘underdeveloped’ country and sent to Canada.
As Brascan sucked cash from Brazil, the company also squeezed local competitors. “The Monopoly created by the Light Company inhibited Brazilian initiatives”, notes Rosana Barbosa in Brazil and Canada: Economic, Political, and Migratory Ties, 1820s to 1970s. “[It] slowly absorbed the local competition.”
Putting the squeeze on local businesses went hand and hand with poor labour practices. In a confidential September 1923 letter between Brascan’s Rio and Toronto offices, company officials admitted they paid their workers poorly even by Brazilian standards. The letter further noted that “our secret agents have just informed us that [some] of our men are taking part in meetings at which an early strike is advocated and we are all becoming somewhat concerned over the situation.”
Brascan was well connected in Ottawa. The initial group of investors included Senator George Albertus, Canadian vice consul for Argentina Frederic Nicholls and Sir Henry Pellatt, who financed the 98-room Casa Loma as his private residence in Toronto. The (close) nephew of former Prime Minister Robert Borden later became Brazilian Traction president and Liberal ministers Robert Winters and Mitchell Sharp held top positions in the company.
Brascan’s political clout helped the company get public support. Brascan was the first firm to receive World Bank financing in Latin America. In 1949 it was given $75 million and received a total of $120 million ($1 billion today) from the World Bank through 1959.
Brascan had influence with pro-business politicians and the company actively supported Brazil’s right wing. Like its earlier spying on union activists the company spied on politicians as well. In 1957 the Canadian ambassador to Brazil stated: “During a recent conversation, a senior executive of the Light told me that his office had been keeping track of the number of Brazilian politicians who’ve been officially invited to visit the USSR and that during the last 18 months the list of visitors had grown to some 300.”
Spying was part of Brascan’s role in beating back rising economic nationalism in the late 1950s and early ’60s. Brascan officials participated in the moves and operations that led to the 1964 coup against social democratic President João Goulart, whose government made it more difficult for companies to export profits. The post-coup military dictatorship was good for business. Between 1965 and 1974 Brascan drained Brazil of $342 million ($2 billion today).
Today Brascan’s successor is among the largest private equity and property management firms in the world. Would one expect to find such an internationally powerful corporation in a colony?
If you’re still not convinced by the Economist story about Brookfield that Canada is better described as an imperialist power, the September 2 Northern Minerhighlights Canadian dominance over another major rapaciously imperialist industry.
On the front page of the Toronto-based paper was a story on a Canadian company extracting resources in Chile and another focused on a firm operating in Papa New Guinea as well as an ad for a mineral conference in Chile. There were articles about a Canadian firm in Armenia and stories about Greenland and one titled “Security measures critical amid heightened risk in West Africa.” The “leading authority on the mining industry in Canada” published two stories about Canadian companies extracting resources in Nevada and one about a firm in Idaho. The biweekly paper had a six-page supplement on mining in Mexico, which included 300-word briefs on nine TSX listed firms operating there. The supplement included three longer articles on specific companies and a story headlined “President of Mexico says ‘no new mining concessions’”. The September 2–15 issue of the Northern Miner had a single story dealing with mining in Canada.
Last week the head of Franco-Nevada Pierre Lassonde complained that Canada was losing its major mining head offices, a position some left nationalists would sympathize with. But, with only 0.5% of the world’s population Canada is home to half of all mining companies. Given that reality, complaining about the “hollowing out” of Canadian mining is like foreign visitors complaining there are not enough gourmet restaurants in Haiti.
Left nationalists think Canada is “a ‘rich dependency’, skewed in its industrial development by a weak manufacturing base and massive staples exports to the US market.” As such, explains Greg Albo, left nationalists generally believe it’s necessary to develop “an industrial strategy backed by an alliance between national capitalists and Canadian workers” rather than simply promote socialist measures to democratize the economy.
Looking at the world through a left nationalist lens generally leads individuals to ignore, or downplay, the destruction wrought by Canadian corporations abroad and Canada’s power on the international stage. While there’s a role for nationalist economic policies in constraining the power of capital, improving working conditions and enabling environmental transformation, nationalist ideology is dangerous in powerful, imperialist, states. It seems to blind people to the imperialist forest as they focus on the clear-cut colonial trees.