Towards a more diversified Canada: economic arguments for re-confederation

Abstract: In the ongoing Canadian debate on confederation, variations across the country are almost invariably viewed as conditions that must be removed or at best tolerated. This paper provides an alternative view and model of confederation that builds on portfolio notions of diversification. Here, instead of seeing regional differences as barriers to a strong confederation, we envision building solidly on these differences and encouraging regions to differentiate themselves. Canada's diverse regions might then realize futures that are most appropriate to their resource endowments and human aspirations and that at the same time improve the economic growth and growth-volatility characteristics of the nation as a whole. Regions might pursue their comparative advantages rather than having to forego their distinctness in striving for a “national mean” - a mean all too frequently defined by values at the centre of economic and political power. The ensuing discussion expands this argument and applies it using two specific examples: securities regulation and housing policy. The paper concludes with some suggestions for instituting a more differentiated, diversified and decentralized form of confederation. Sommaire: Dans le cadre du debat perpetuel sur la confédération au Canada, on con-sidère presque toujours que les variations qui existent à travers le pays doivent être éliminées ou, au mieux, tolérées. Dans cet article, on présente un autre modèle de confédération qui s'inspire de la notion de diversification du portefeuille. Au lieu d'envisager les differences régionales comme autant d'obstacles s'opposant à une confédération forte, on veut bâtir du solide sur ces differences et encourager les régions à se différencier entre elles. Les régions variées du Canada seraient alors à même de suivre le cherninement le mieux adaptéà leurs richesses naturelles et aux aspirations de leurs populations, tout en améliorant les paramétres de croissance et de volatilité de la croissance de la nation toute entiére. Les régions poursuivraient alors leurs avantages comparatifs, au lieu d'abandonner leurs traits distinctifs pour tendre vers une moyenne, nationale trop souvent tributaire de valeurs situées au centre du pouvoir économique et politique. On élargit ensuite cet argument et on l'applique au moyen de deux exemples concrets: la réglementation des valeurs mobilières et la politique sur le logement. En conclusion, l'article offre quelques suggestions pour quel'on adopte une confédération plus différenciée, plus diversifiée et plus décentralisée.     

Organized economic crime and corruption in Urkraine: The problem of countermeasures

The collapse of communism in Ukraine created opportunities for organized criminal groups to expand their economic criminal activities in the “shadow economy” by penetrating all levels of public and economic administration. Ukrainian law enforcement agencies are poorly equipped to handle this increase in criminal activity, especially with respect to uncooperative foreign and domestic economic institutions. State machinery for regulation and control of industry and commerce was easily accessible to organized crime through bribing of state officials, who received no supervision during economic restructuring. Notwithstanding the active assistance of corrupt government officials, organized economic crime has benefited from chaos and lost government control as the result of recent economic reforms in Ukraine. Researchers in this study hypothesize that the social and economic disorder, as well as a common and justified mistrust of state officials, fosters a pessimism and erodes moral standards, which in turn fosters criminal activity. Of late, judicial sentencing for those convicted of economic crimes has become lighter while many economic criminal cases are never investigated or prosecuted in the first place. In order to combat large-scale corruption, there must be better supervision of government officials and better monitoring of foreign economic transactions. One of the most disastrous consequences of the collapse of the Ukrainian communist system has been the widespread increase of economic crime. This phenomenon is self-sustaining, penetrating all levels of Ukraine's economy and administrative sectors. Criminal activity helps to sustain the shadow economy in Ukraine, which has been estimated by various sources to constitute 50 to 60 percent of the economy. Law enforcement and administrative efforts have been largely futile in curbing this corruption. Nevertheless, it is possible to overcome the criminal social and economic order that has become ingrained in this “shadow economy.” This paper seeks to propose policy solutions for Ukrainian economic crime and corruption that could be implemented at the national level.