The Leap is ambitious, but it’s not the end of capitalism

October 8, 2015

The Leap Manifesto: A Call for Canada Based on Caring for the Earth and One Another was launched by a group of prominent Canadians on September 15. So far, over 25,000 Canadians have added their names to the declaration. In the face of the ho-hum party platforms on offer, many see the manifesto as a way to give expression to their desire for bold climate action and social justice.

Many mainstream media commentators, however, promptly set their hair on fire.

The Globe and Mail claimed the document calls for “upending of [the] capitalist system.” An editorial appearing in the Vancouver Sun asserted the manifesto was released by “some of this country’s most left-wing and radical forces,” and alarmingly described it as “a chilling document that suggests pushing Canada farther to the left than has ever been imagined for this country. It is ultimately a plan to completely reject capitalism for something kinder and gentler.” In the National Post, the Leap prompted none other than Conrad Black to write an entire op-ed of extended albeit very creative insults.

You get the gist.

But it’s all nonsense.

For the most part, the Leap is merely a pronouncement that policy and politics should align with climate science (heck, even former Bank of Canada governor Mark Carney is saying that), that we should honour the treaties signed with First Nations, and that we should seek to seriously address inequality – hardly far-left field propositions.

True, the Leap is ambitious, but it only seems radical in comparison to the platforms of the major parties. And that’s only because the bandwidth of what is deemed politically acceptable has become so narrow. (Even the Green Party, whose climate plan is mildly more ambitious than the three main parties, has a platform that I’d call more of a hop than a leap.)

But that shouldn’t surprise us. As the Pope writes of the climate crisis in his recent Encyclical:

It is remarkable how weak international political responses have been… There are too many special interests, and economic interests easily end up trumping the common good and manipulating information so that their own plans will not be affected… Consequently the most one can expect is superficial rhetoric, sporadic acts of philanthropy and perfunctory expressions of concern for the environment, whereas any genuine attempt by groups within society to introduce change is viewed as a nuisance based on romantic illusions or an obstacle to be circumvented.

Nailed it.

In fact, what the Leap calls for is reasonable, affordable, and doable.

Much of what the Leap envisions is a bold infrastructure plan (transit, high speed rail, renewable energy, zero-carbon buildings, etc.). Infrastructure is rightly understood as an investment, and thus it makes sense to amortize the cost over many years.

Moreover, it is already the case that our governments spend billions of dollars a year on infrastructure, but these dollars go towards traditional projects (roads, bridges, and port and energy infrastructure) with the aim of accommodating cars and facilitating the extraction and export of fossil fuels. BC, for example, is slated to spend billions replacing the Massey Tunnel with a new bridge, in part to accommodate more vehicle traffic, but the biggest beneficiaries will likely be industrial users wanting ocean-going ships to be able to get further up the Fraser River to export US thermal coal. What is needed instead is to shift these expenditures from old-economy infrastructure to the green infrastructure we now need.

Let us imagine, however, an ambitious infrastructure and social program plan that sought to boost federal government spending by $50-60 billion a year. That sounds like a lot of money, and indeed it would allow for an exciting set of initiatives that, by any measure, would constitute a “leap” into a new and more caring economy.

But to put that into perspective: in an economy such as Canada’s, with an annual GDP of over $2 trillion, a bold spending and investment plan of $50-60 billion represents about 2.5 percent of GDP. Put another way, it would mean increasing federal spending from 12.8 per cent of GDP today to about 15.5 per cent. Hardly sounds like, “pushing Canada farther to the left than has ever been imagined,” as the Vancouver Sun opines. Exciting, but not a revolution.

And consider this: if one tallies up federal tax cuts over the last 15 years (disproportionately benefiting the wealthy), one finds that these have coincidentally depleted the federal treasury’s capacity to spend and invest by, you guessed it, about $50 billion a year; meaning, if the federal government collected taxes at the same rates that existed in the year 2000, we would have $50 billion more per year to spend on programs to meet our most pressing social and environmental needs.

Not only is a bold green infrastructure plan reasonable, there are compelling economic reasons why now would be a very good time to undertake such a program. If $50-60 billion a year were newly raised and then spent on a Leap program, it would undoubtedly represent a net boost to the economy and employment.

As economist and Nobel laureate Joseph Stigltz notes:  “There is a long-standing, strong argument for what is called a balanced budget multiplier—if the government increases taxes at the very top and increases spending on infrastructure, education, technology [by the same amount], it stimulates the economy.”

How could new revenues be raised? The options are many. In a background document prepared for the Leap’s release, I and some CCPA colleagues listed a few, including resource royalties, financial transaction taxes, higher upper-income and corporate taxes, and perhaps most advisedly, a national escalating carbon tax. (You can find our paper here:  

But whatever options we choose, the simple truth is that in a country as wealthy as Canada, we can afford to leap.

Seth Klein is the BC Director of the Canadian Centre for Policy Alternatives. Those wishing to add their names to the Leap Manifesto can do so here: