by Paul Martin
One reason for Canada’s success over our 150 years has been the ability of successive governments to build on the achievements of their predecessors, regardless of political stripe. The Harper government has not only walked away from what my government built, it has turned the clock far back. It is not only Liberals who should be upset, but Conservatives as well.
Of all the projects I have taken on since leaving the Prime Minister’s Office, writing this book has in some ways been the toughest, because it has meant looking back rather than going forward.
The chief archivist of Canada, Ian Wilson, contacted me within a few days of the election to organize an oral history of my political career. Within a few weeks, he had recruited Sean Conway, the former provincial Ontario minister and academic, to lead the project. Along with former journalist Paul Adams, Sean conducted literally hundreds of hours of interviews with me, and also with many of the people who worked most closely with me in politics, the public service, and Parliament. The transcripts of those conversations make up the spine of this book. By the time you are reading this, I can guarantee you that any desire for retrospection on all those past glories and goof-ups will be pretty much completely out of my system.
What was of much more interest to me in the weeks after the 2006 election was what I might do next. I wanted to concentrate my efforts in my new life on the places where poverty was the greatest. To my mind, that meant Africa from a worldwide perspective, and our Aboriginal peoples from the Canadian point of view. If you think about it, there are real parallels. Both have fast-growing populations, which means that their populations are skewed heavily toward the young. And both are living a reality shaped by the depredations of colonialism. In Africa, traditional societies were disrupted or decapitated, and an arbitrary set of new borders imposed on them as the colonial powers started exiting the continent a half-century ago. I have already written about what has happened to Canada’s Aboriginal peoples, whose land has been taken and whose cultures and societies have been subjected to merciless pressures. In both cases, these experiences have been hugely damaging to their self-confidence and identity, as well as to their political, social, and economic structures.
Not long after the election, I received a phone call from Kofi Annan, who was at that time still secretary-general of the United Nations. He asked me to come to New York to discuss the African Development Bank, the largest African-run financial institution on the continent. In the 1990s it became seriously overextended and was forced to spend roughly a dozen years getting its house in order, largely by becoming less ambitious than it had been. The new president of the bank, Donald Kaberuka, had decided that the time had come for it to move from this era of retrenchment back into being a leading force for African development. He approached Kofi Annan to help him assemble a high-level advisory panel that could help set a strategic direction for the bank. Kofi asked whether I would be willing to co-chair the panel along with Joachim Chissano, whom I had met just weeks earlier in South Africa. It did not take long for me to say yes.
For the next year and a half, during many trips to Africa, many hours of meetings with experts in international capitals including Washington, Paris, and Beijing, and many hours of reading, I plunged into the issues facing Africa and its economic development. Africa comprises fifty-three states — the greatest number of countries per square kilometre of any continent. The average GDP of these countries is only about $4 billion. Africa’s share of international trade is shockingly small — just 1 per cent of the world’s trade — and it is falling. The small, fragmented internal African markets offer no economies of scale, and the infrastructure is so poor that intra continental trade is almost inconsequential.
What Chissano and I — and the panel we led — concluded was that there needed to be a massive effort in Africa directed to building up infrastructure, ensuring capable governments, promoting the local business sector, and upgrading skills — and that the guiding star for all these efforts needs to be the creation of a single African common market that would create economies of scale and open up markets to build prosperity. This may not be a sufficient condition to alleviate poverty on the continent, but it certainly is a necessary one.
When I was a young man, I worked for a while as an intern in the legal department of the European Coal and Steel Community (ECSC) — the forerunner of the European Union (EU). Our job was to start developing competition law for a common market that did not even exist yet. There were only six member-countries in the ECSC, but the interns I worked with were drawn from across Europe, including countries that did not join the EU until decades later. The farsighted planners behind the European project were already thinking about building up a European public service, and part of the purpose of the internship program was to develop those skills. This is just one example of the institutional foundation that was laid down for the European Union, long before it became a reality.
The same kind of preparation in a wide range of areas is crucial now in Africa. Without it, the task of building regional common markets on the way to the creation of the Pan African Economic Union — something contemplated by the charter of the African Union — will be impossible. Right now, if a smaller or poorer African country seeks to create an economic union with a larger or richer neighbour and the two co-exist behind high common tariff walls or customs duties, the smaller country will lose its industrial base to the larger country. This is what happened when Kenya, Uganda, and Tanzania created a single market for a time: Kenya’s better-developed economy quickly became a threat to the health of its partners. The European Community avoided this problem by planning long in advance, committing itself to building up vital infrastructure such as roads and rail, and by creating transitional funds that allowed poorer members to adjust. Joining the European Union was scary for Spain, and Ireland too, but look at them now. This approach is what Africa needs, though, unlike Europe, it does not have enough wealth to manage the planning and sustain the transitional funding. The panel therefore recommended that the African Development Bank should become the focal point for these efforts, and I believe that the rich nations must participate. Having made the argument for the African common market, I have been asked by the bank to follow up in the years to come and to work with others who share this important goal. I intend to do so.
Not long ago, just before he became prime minister of the United Kingdom, I got a phone call from Gordon Brown. He said he had a favour to ask. Gordon had been approached by Dr. Wangari Maathai — a Kenyan scientist who formed a grassroots environ mental movement in Africa in 1977. She is also a leader on women’s issues and has served in the Kenyan parliament and cabinet. In 2004, she won the Nobel Peace Prize for her environmental work, the first African woman to have done so.
Wangari had approached Gordon Brown to discuss the Congo rain forest. Though it is not well known in the West, the Congo rain forest is the second largest on Earth, after the Amazon. Some people nowadays call it the “world’s second lung.” The Congo rain forest is twice the size of France, and it sprawls across the borders of ten1 countries, though it is concentrated in six of them, particularly the Democratic Republic of Congo (DRC). Earlier in this decade a treaty was signed to manage the rain forest because its continuing deforestation threatens both the global climate and the economic sustainability of the people who live in it. But very little had been done, and that’s why Wangari had come knocking on Gordon’s Brown’s door. Convinced that this was an important project for the future of the world as well as for Africa, he decided to allocate £50 million in his upcoming budget (his last before becoming prime minister) to a fund to sustain the rain forest. The Norwegian government has now joined the fund, which has doubled to £100 million, or roughly $200 million.
The favour Gordon was asking was for me to co-chair the fund. There would have to be a lot of planning, a lot of local diplomacy, and a lot of international politicking to make sure the fund got up and running and started getting the job done. There would als
o be tremendous opportunities. At the moment, for example, the countries of the Congo basin — some of the poorest in the world — do not get carbon credits under the Kyoto protocols for preventing deforestation. That could change in 2012, when deforestation will be on the agenda for the next round, which could create an important opening for those working to save the rainforest. But it will take a great deal of negotiation to ensure the right result.
So I signed on.
Not so long afterwards, I found myself in a place called Mbalmayo in Cameroon, one of the Congo Basin countries. Sheila, Jim Pimblett, and I had ridden in a truck over some very rough jungle roads to get there. A worker from a NGO who was acting as our guide took us to an empty field. On the map, he showed us, it was marked as rain forest.
I asked a villager what had happened.
“There was a forest here three months ago,” he told me. “But it was cut down.”
“Why didn’t you stop it?” I asked him.
“It happened too quickly,” he replied.
“Why haven’t you informed the government?” I asked.
He shrugged and indicated a forestry official who was standing nearby. It didn’t take a lot of imagination to guess why nobody had done anything. Later we went to the local sawmill, where the head of the mill shook his head in disapproval when we told him about the clear-cut field. But as we left, our NGO guide produced a photo for us of that very same mill operator standing and watching as the logging had taken place.
As our experience in Mbalmayo showed, no one really knows the extent of the rain forest’s degradation. The maps aren’t always accurate. One of the first things our fund is devoting itself to is fixing that. We will do this with a combination of satellite technology and community projects that will engage local people, not only in identifying the contours of the forest but also in understanding how they see and use it in their daily lives.
Ultimately, alleviating poverty and saving the rain forest are closely linked, and this is the nexus our fund will explore. Poor people need the rain forest for their survival and their long-term well-being. But this is not true of others who exploit the forest. Moreover, logging may generate desperately needed, if short-lived, cash for local people. Our fund will work to find ways for local people to make a living from the rain forest without destroying it. And we need to make sure that they and their governments are compensated, perhaps through an international regime, for the losses they may suffer from curtailing logging for the benefit of humankind. In essence, what we need to do is to make these forests more valuable standing than they are cut down — not only for the world, but for the people who live in and around them.
One day in Northern Ontario, an Aboriginal boy about fifteen years old came up and said that he had read a bit about me on the Internet.
“It says you were a lawyer but became the head of a shipping company,” he said. “How did you do that? How did you learn to run a shipping company?”
“Well,” I said, “I went to work for Canada Steamship Lines when I was young, and I learned the business from the people who worked there. That’s what they call mentoring.”
Then he said, “I read you bought the company. You must have had a lot of money.”
“No, not at all,” I said. “I borrowed a lot of money.”
“Do you think when I grow up someone will mentor me?”
I said, “Yes.” But of course I wasn’t sure it was true.
“Do you think that someone would lend me money to buy a company?”
Once again, I said, “Yes.” But I wasn’t sure of that either.
That conversation captured what I believe to be a huge problem with the way we approach the advancement of Canada’s Aboriginal peoples. Mentoring is an enormously important part of our informal educational system. A student who graduates from engineering school doesn’t really become an engineer until he or she gets a job and learns the business. An accounting graduate doesn’t become an accountant until he or she has some working experience under the belt.
And if you don’t have that work experience — if you don’t learn a business, as I did shipping, at the side of people who have been at it long before you — then no one will ever lend you money to buy a company or start up a new one. It is a vicious circle, and I wondered whether there might be a way to help break it.
That gave my son David and me the idea for one of the projects we are most immersed in here in Canada. Its purpose is to create a private-sector equity fund that would invest in Aboriginal ventures and ensure the mentoring and transmission of entrepreneurial skills to a rising generation of Aboriginal Canadians. Our goals are to bridge the Aboriginal entrepreneurial gap and to demonstrate to Canadian investors that there are opportunities that are passing them by. We hope to have the fund underway in the very near future.
One complication we encountered as we raised money for the fund is that it is neither fish nor fowl. That is, when I asked investors to join in, they would often ask, “Will I get a charitable deduction?” And I would say no. The whole idea is to invest in profit-making businesses, not to create a charitable institution.
Then they ask, “Will I get a market rate of return?” And I would have to say no to that too. It would be unreasonable to expect each of these businesses to make a profit similar to other enterprises, at least in the early years.
We will succeed because those who have invested in the fund have done so recognizing that there is a growing body of Aboriginal business people who seek a hand up, not a handout. But I do believe that if there was a change in the tax laws and regulations recognizing hybrid proposals such as ours we could do so much more. This is not a new idea. It’s well advanced in the United Kingdom and the United States. It’s called social enterprise, and I believe its time has come in Canada.
We recognize the essential role that business entrepreneurs play in filling gaps in the economy. Why wouldn’t we recognize that social entrepreneurs can play the same role in filling gaps in society?
This may shake conventional wisdom a bit, but so did Donald K. Johnson. Johnson was the man who convinced me, and through me the Department of Finance, that if we reduced by half the capital gains tax on securities donated to charities, it would open the doors to a huge influx of funding for our universities, hospitals, and other worthy and important causes. He later convinced Ralph Goodale to eliminate the tax completely, and the new government carried this through after the election.
As a result, gifts and donations are being made in amounts that would have been impossible to imagine a decade ago. All because Don Johnson challenged the status quo.
Well, I believe that the time has come to challenge the status quo again, and to give social entrepreneurs the same opportunities that business entrepreneurs have of realizing their dreams for a better Canada.
The other big project we have underway is much further advanced because I didn’t have to raise the money to get it up and running. The high school dropout rate among Aboriginal Canadians is much worse than it is for non-Aboriginals. Forty-three per cent of Aboriginals between the ages of twenty and twenty-four have not graduated from high school compared to 16 per cent for the non-Aboriginal population. The issue is what can we do about it? Some years ago, I heard about a program that began back in 1987 in the South Bronx in New York with a single teacher, Steve Mariotti, who had a business background. It occurred to him that many of the low-income “at risk” kids he was teaching had street smarts, and perhaps they could be converted to academic and business smarts. He started a high school program that emphasized entrepreneurial skills, connecting schoolwork to practical business skills, and exposing the students to businesses and business people, all as a means of keeping kids in school. The program has been a phenomenal success, and has spread to fourteen countries (including the United Kingdom, Ireland, Austria, Israel), with more than one hundred and fifty thousand students going through the program.
I’m not an educator so I asked Sean Conway, who used to be min
ister of education in Ontario, whether he could connect me with an educator with an expertise in Aboriginal education who could help me think this through. He found Dr. Carlana Lindeman, who is based in Thunder Bay. I asked her to go to New York and take a look at the program, and to go to UCLA to sit in on a teacher-training session for the program. She came back saying it was one of the most exciting things she had ever seen in all her years in education.
One issue remained, however. Could the program be adapted to Aboriginal students and their cultural needs? Furthermore, would a program that worked in inner-city New York or inner-city Dublin be transferable to a reserve school in northern Saskatchewan or northern Ontario? To find out, we decided to do a pilot project. We worked with a teacher, Judy Flett, who spent eight months adapting the curriculum and enrolled thirteen students in a pilot program at Dennis Franklin Cromarty School in Thunder Bay. This is an Aboriginal high school that services many fly-in reserves in northwestern Ontario. We’ve had a few kids drop out — no surprise, considering all that they have going on in their lives — but most of them have stuck with it, and are succeeding.
One of the amazing things to me was that the first time I met with the students, they were intensely shy. It was very difficult for me to get them engaged in a conversation. A few months later, when I was back, these young women and men were standing in front of a gymnasium with a hundred people and pitching their business plans with full voices and a clear gaze.
