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Welfare Institutions and Foreign Aid: Domestic Foundations of Canadian Foreign Policy*

  • Jean-Philippe Thérien (a1) and Alain Noël (a1)

This article examines the relationship between Canada's development assistance policy and its welfare state institutions. Through an analysis of the Canadian experience, the article argues that the differences between the social policies of developed countries help to understand the nature of their participation in the international aid regime. Although this hypothesis is not entirely new, it is here refined with the help of the comparative literature on the welfare state, and assessed systematically for Canada. Through this case study, the article explores the extent to which values and principles institutionalized at the domestic level influence foreign policy and the international order.

Cet article étudie la relation entre la politique d'aide au développement du Canada et son Etat-providence. L'article soutient que les différences entre les politiques sociales des pays développés permettent d'expliquer la nature de leur participation au régime international de l'aide. Cette hypothèse n'est pas tout à fait, nouvelle, mais elle est ici réévaluée à la lumière de la littérature comparative sur l'Etat-providence, et appliquée au cas du Canada. L'article explore dans quelle mesure les valeurs et les principes institutionnalisés au niveau interne influencent la politique étrangère et l'ordre international.

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1 United Nations Development Programme, Human Development Report 1992 (New York: Oxford University Press, 1992), 7.

2 The most thorough exploration of this hypothesis is found in the two companion volumes by Pratt, Cranford, ed., Internationalism under Strain: The North-South Policies of Canada, the Netherlands, Norway, and Sweden (Toronto: University of Toronto Press, 1989); and Stokke, Olav, ed., Western Middle Powers and Global Poverty: The Determinants of the Aid Policies of Canada, Denmark, the Netherlands, Norway and Sweden (Uppsala: The Scandinavian Institute of African Studies, 1989).

3 A better understanding of domestic politics is often presented as a prerequisite for the development of international relations theory. See Keohane, Robert and Nye, Joseph, Power and Interdependence (2nd ed.; Glenview: Scott, Foresman, 1989), 267; and Milner, Helen, “International Theories of Cooperation among Nations: Strengths and Weaknesses,” World Politics 44 (1992), 496.

4 In their recent survey of the literature, David R. Black and Heather A. Smith argue we should draw from “the wider body of international and comparative politics literature,” “engage in comparison across countries, issue areas and time” and better integrate the domestic and international determinants of Canadian foreign policy. This is basically what we are trying to do in this article (Black, David R. and Smith, Heather A., “Notable Exceptions? New and Arrested Directions in Canadian Foreign Policy Literature,” this JOURNAL 26 [1993], 755).

5 See, for example, Spicer, Keith, A Samaritan State? External Aid in Canada's Foreign Policy (Toronto: University of Toronto Press, 1966); Triantis, S. G., “Canada's Interest in Foreign Aid,World Politics 24 (1971), 118; and Nossal, Kim Richard, “Mixed Motives Revisited: Canada's Interest in Development Assistance.” this Journal 2l (1988), 3556.

6 See Carty, Robert and Smith, Virginia, Perpetuating Poverty: The Political Economy of Canadian Foreign Aid (Toronto: Between the Lines, 1981); Dupuis, Monique, Crise mondiale et aide ‘Internationale: strategie canadienne et developpement du tiers monde (Montreal: Nouvelle Optique, 1984); Pratt, Cranford, “Canadian Policy towards the Third World: Basis for an Explanation,” Studies in Political Economy 13 (1984), 2755; and Tomlinson, Brian, “Development in the 1990s: Critical Reflections on Canada's Economic Relations with the Third World,” in Swift, Jamie and Tomlinson, Brian, eds., Conflicts of Interest: Canada and the Third World (Toronto: Between the Lines, 1991), 2577.

7 See Lyon, Peyton, “Introduction,” in Lyon, Peyton and Ismael, Tareq, Canada and the Third World (Toronto: Macmillan, 1976), x–1; Sabourin, Louis, “Analyse des politiques de coopération internationale du Canada: des projets d'aide à la straté gie de développement,” in Painchaud, Paul, ed., Le Canada et le Québec sur la scéne internationale (Quebec: Centre québécois de relations internationales, 1977), 209251; Hébert, Jacques and Strong, Maurice, Le grand branle-bas: le Canada espoirdu Tiers Monde (Montreal: Quinze, 1980); and Réal Lavergne, “Determinants of Canadian Aid Policy,” in Stokke, ed., Western Middle Powers, 33-89.

8 This idea was developed in particular in Silcock, T. H., “Aid: National or International Policy?Australian Outlook 24 (1970), 3750; Sumberg, Theodore A., “Foreign Aid as Moral Obligation?The Washington Papers 1 (1973), 172; Cassen, Robert, Jolly, Richard, Sewell, John and Wood, Robert D., eds., Rich Country Interests and Third World Development (New York: St. Martin's Press, 1982); Little, Ian M. D., Economic Development: Theory, Policy, and International Relations (New York: Basic Books, 1982), 329; and Norbye, Koht O. D., “Mass Poverty and International Income Transfers,” in Parkinson, J. R., ed., Poverty and Aid (Oxford: Basil Blackwell, 1983), 1539.

9 Silcock, “Aid: National or International Policy?” 39.

10 Lumsdaine, David, Moral Vision in International Politics: The Foreign Aid Regime, 1949-1989 (Princeton: Princeton University Press, 1993); and OECD, Twenty-five Years of Development Co-operation: A Review (Paris: OECD, 1985), 131132.

11 Lumsdaine, Moral Vision in International Politics, 121.

12 Imbeau, L.-M., Donor Aid The Determinants of Development Allocations to Third World Countries: A Comparative Analysis (New York: Peter Lang, 1989), 149164.

13 Hans Henrik Holm, “Denmark: Bridge-Building over Widening Gulfs,” and Bergesen, Helge Ole, “Norway: The Progressive Free-Rider or the Devoted Internationalist?” in Bergesen, Helge Ole, Holm, Hans Henrik and McKinlay, Robert D., The Recalcitrant Rich: A Comparative Analysis of the Northern Responses to the Demands for a New International Economic Order (London: Frances Pinter, 1982), 6384, 148-69.

14 See Pratt, ed., Internationalism under Strain; and Stokke, Western Middle Powers.

15 Olav Stokke, “The Determinants of Aid Policies: Some Propositions Emerging from a Comparative Analysis,” in Stokke, ed., Western Middle Powers, 284.

16 Liberal internationalism is “compatible with a generous development assistance programme towards the less developed countries (LDCs), but is quite sceptical of the structural changes associated with reform internationalism” (Pratt, Cranford, “Middle Power Internationalism and Global Poverty,” in Pratt, Cranford, ed., Middle Power Internationalism: The North-South Dimension [Montreal: McGill Queen's University Press, 1990], 10). On Canada, see Cranford Pratt, “Has Middle Power Internationalism a Future?” in Ibid., 144-47.

17 Comparisons will be made between Canada and the other members of the Development Assistance Committee of the OECD. For a more detailed comparative analysis of Canadian aid policy, see TheYien, Jean-Philippe, “Canadian Aid: A Comparative Analysis,” in Pratt, Cranford, ed., Canadian International Development Assistance Policies: An Appraisal (Montreal: McGill-Queen's University Press, 1994), 315333.

18 For a historical review of Canada's policy toward developing countries, see Lyon and Ismael. Canada and the Third World; and Cranford Pratt. “Canada: An Eroding and Limited Internationalism,” in Pratt, ed., Internationalism under Strain, 24-69.

19 See Ahmad, Jaleel, “Canada's Trade with Developing Countries,” in Helleiner, Gerald, ed., The Other Side of International Development Policy: The Non-Aid Economic Relations with Developing Countries of Canada, Denmark, the Netherlands, Norway, and Sweden (Toronto: University of Toronto Press, 1990), 3133.

20 Maureen O'Neil and Andrew Clark see foreign aid as the “principal policy instrument” Canada has “for dealing with the Third World” (O'Neil, Maureen and Clark, Andrew, “Canada and International Development: New Agendas,” in Hampson, Fen O. and Maule, Christopher J., eds., Canada Among Nations 1992-93: A New World Order? [Ottawa: Carleton University Press, 1992], 220). A similar argument is made in Therien, Jean-Philippe, “Le Canada et le regime international de l'aide,” Etudes Internationales 20(1989), 312.

21 OECD, Development Co-operation: 1992 Review (Paris: OECD, 1992), A8. The like-minded countries include Canada, Denmark, the Netherlands, Norway and Sweden.

22 Ibid.,A8,A92.

23 Ibid.,A8.

24 House of Commons, Standing Committee on External Affairs and International Trade, For Whose Benefit? Report of the Standing Committee on External Affairs and International Trade on Canada's Official Development Assistance Policies and Programs (Ottawa: Minister of Supply and Services, 1987), 7.

25 See Kohl, Jiirgen, “Trends and Problems in Postwar Public Expenditures Development in Western Europe and North America,” in Flora, Peter and Heidenheimer, Arnold J., eds., The Development of Welfare States in Europe and America (New Brunswick: Transaction Books, 1981), 309319; and Therborn, Goran and Roebroek, Joop, “The Irreversible Welfare State: Its Recent Maturation, Its Encounter with the Economic Crisis, and Its Future Prospects,” International Journal of Health Services 16(1986), 321325.

26 Lumsdaine, Moral Vision in International Politics, 41 -42 and 268.

27 For useful surveys, see Larkey, Patrick D., Stolp, Chandler and Winer, Mark, “Theorizing about the Growth of Government: A Research Assessment,” Journal of Public Policy 1 (1981), 157220; and Pierson, Christopher, Beyond the Welfare State? The New Political Economy of Welfare (University Park: Pennsylvania State University Press, 1991), 1424.

28 Cameron, David R., “The Expansion of the Public Economy: A Comparative Analysis,American Political Science Review 72 (1978), 12511253.

29 Uusitalo, Hannu, “Comparative Research on the Determinants of the Welfare State: The State of the Art,European Journal of Political Research 12 (1984), 405406.

30 Skocpol, Theda and Amenta, Edwin, “States and Social Policies,” Annual Review of Sociology 12(1986), 133; and Pierson, Beyond the Welfare State? 17-18.

31 Keating, Tom, Canada and World Order: The Multilateralist Tradition in Canadian Foreign Policy (Toronto: McClelland and Stewart, 1993). 132.

32 Korpi, Walter, “Social Policy and Distributional Conflict in the Capitalist Democracies: A Preliminary Comparative Framework,” West European Politics 3 (1980), 297.

33 Skocpol and Amenta, “States and Social Policies,” 141.

34 Alber, Jens. Esping-Andersen, Gosta and Rainwater, Lee, “Studying the Welfare State: Issues and Queries,” in Dierkes, Meinolf, Weiler, Hans N. and Antal, Ariane Berthoin, eds., Comparative Policy Research: Learning from Experience (New York: St. Martin's Press. 1987), 462.

35 Shalev, Michael, “The Social Democratic Model and Beyond: Two ‘Generations’ of Comparative Research on the Welfare State,Comparative Social Research 6 (1983), 326329.

36 Esping-Andersen, Gosta, The Three Worlds of Welfare Capitalism (Princeton: Princeton University Press, 1990), 2629,49.

37 Ibid., 53,60.

38 Katzenstein, Peter J., Corporatism and Change: Austria, Switzerland, and the Politics of Industry (Ithaca: Cornell University Press, 1984), 4244, 73, 241-43; Katzenstein, Peter J., Small States in World Markets: Industrial Policy in Europe (Ithaca: Cornell University Press, 1985), 18889; Pelinka, Anton, “The Politics of Neutrality,” German Politics and Society 21 (1990), 20; and A. Skuhra, “Economic Egoist, Diplomatic Activist and Political Conciliator,” in Bergesen, Holm and McKinlay, eds., The Recalcitrant Rich, 22.

39 Marklund, Staffan, “Welfare State Policies in the Tripolar Class Model of Scandinavia,” Politics and Society 16 (1988), 484. See also Stein Kuhnle, “The Growth of Social Insurance Programs in Scandinavia: Outside Influences and Internal Forces,” in Flora and Heidenheimer, eds., The Development of Welfare States, 134, 145.

40 Bercuson, David, Granatstein, J. L. and Young, W. R., Sacred Trust? Brian Mulroney and the Conservative Party in Power (Toronto: Doubleday, 1986). 7.

41 Esping-Andersen, The Three Worlds of Welfare Capitalism, 74.

42 Alain Noel and Jean-Philippe Therien, “From Domestic to International Justice: The Welfare State and Foreign Aid,” paper presented at the annual meeting of the American Political Science Association, New York, 1994.

43 Noel, Alain, Boismenu, Gerard and Jalbert, Lizette, “The Political Foundations of State Regulation in Canada,” in Jenson, Jane, Mahon, Rianne and Bienefeld, Manfred, eds., Production, Space. Identity: Political Economy Faces the 21st Century (Toronto: Canadian Scholars Press, 1993), 171194.

44 See, for instance, Lise Bissonnette, “Une forme d'arnaque,” Le Devoir (Montreal), March 6-7,1993, A10.

45 Canadian International Development Agency, Sharing Our Future: Canadian International Development Assistance (Ottawa: Minister of Supply and Services, 1987).

46 Rudner, Martin, “Canada's Official Development Assistance Strategy: Process, Goals and Priorities,Canadian Journal of Development Studies 12 (1991), 34.

47 Canadian Council for International Cooperation, “Le réxamen de la politique canadienne d'aide exteéieure s'impose,” press release, Ottawa, February 26, 1993.

48 Canadian International Development Agency, “Comité permanent des Affaires étrangères et du commerce extérieur: Monique Véina explique le budget de défenses de l'ACDI,” press release, Ottawa, April 21, 1993,2.

49 See Clark, Andrew, “Secret Paper Steers Aid Policy Changes,” Review: A Newsletter of the North-South Institute (Spring 1993), 12.

50 O'Neil and Clark, “Canada and International Development,” 222.

51 Khan, Jooneed, “Ottawa cesse toute aide aux pays les plus nécessiteux,” La Presse (Montreal), March 3, 1993, E7.

52 MacDonald, David, “Canada's Trade-Driven Foreign Aid Budget,” Canadian Foreign Policy 1 (1993), 99.

53 This is precisely one of the key arguments developed in a much-discussed External Affairs document leaked in 1993 and entitled International Assistance: Policy Update.

54 Delisle, Norman, “Selon Ouellet, Ottawa reformulera sa politique d'aide au tiers monde pour faire plus avec moins,” La Presse (Montreal), February 7, 1994, A10; and Khan, Jooneed, “André Ouellet et le développement: ‘Faire mieux avec moins, ’La Presse (Montreal), February 9, 1994, A12.

55 Tuohy, Carolyn, “Social Policy: Two Worlds,” in Atkinson, Michael M., ed., Governing Canada: Institutions and Public Policy (Toronto: Harcourt, Brace, Jovanovich, 1993), 280281.

56 The details are provided in National Council of Welfare, Welfare Reform (Ottawa: National Council of Welfare, 1992).

57 Tuohy, “Social Policy: Two Worlds,” 297; and McQuaig, Linda, The Wealthy Banker's Wife: The Assault on Equality in Canada (Toronto: Penguin, 1993), 111.

58 In fact, health expenditures increased, while the funding for postsecondary education diminished. See McQuaig, The Wealthy Banker's Wife, 110; Maslove, Allan M., “Reconstructing Fiscal Federalism,” in Abele, Frances, ed., How Ottawa Spends 1992-93: The Politics of Competitiveness (Ottawa: Carleton University Press, 1992), 5777; and Banting, Keith G., “Neoconservatism in an Open Economy: The Social Role of the Canadian State,” International Political Science Review 13(1992), 160.

59 Battle, Ken, “The Politics of Stealth: Child Benefit under the Tories,” in Phillips, Susan D., ed.. How Ottawa Spends 1993–1994: A More Democratic Canada? (Ottawa: Carleton University Press, 1993), 426427,438-40; Banting, “Neoconservatism in an Open Economy,” 159; and McQuaig, The Wealthy Banker's Wife, 111-16.

60 Banting, “Neoconservatism in an Open Economy,” 158-59.

61 James J. Rice and Michael J. Prince, “Lowering the Safety Net and Weakening the Bonds of Nationhood: Social Policy in the Mulroney Years,” in Phillips, ed., How Ottawa Spends, 393-94.

62 Alan Freeman, “Ottawa Talks Tough on Social Programs,” The Globe and Mail (Toronto), January 12, 1994, Bl.

63 Théien, “Canadian Aid: A Comparative Analysis,” 323. Canadian aid has been criticized often for being too dispersed. Keating, for instance, wrote that development assistance was spread “more widely and thinly than considerations of economic efficiency or political influence might warrant” (Canada and World Order, 132).

64 The propositions contained in the policy paper entitled International Assistance: Policy Update may never be implemented, but they tell us much about the nature of current debates in government circles. See Black and Smith, “Notable Exceptions?” 755.

65 International Assistance: Policy Update, 20.

66 See Muszynski, Leon, “A New Social Welfare Agenda for Canada,” in Drache, Daniel, ed., Getting on Track: Social Democratic Strategies for Ontario (Montreal: McGill-Queen's University Press, 1992), 171; and Pratt, Cranford, “Towards a Neo-Conservative Transformation of Canadian International Development Assistance: The SECOR Report on CIDA,” International Journal 47 (1992), 600.

67 Compare, for example, Battle, “The Politics of Stealth,” 438-40, and Plewes, Betty, “Preparing for the 21st Century: Why Canada Needs a Foreign Policy Review,Canadian Foreign Policy 1 (1993), 104105.

68 Canadian Council for International Cooperation, Examen fait par le CCCI du document du Ministère des Affaires extérieures, intitulé International Assistance: Policy Update (Ottawa: Canadian Council for International Cooperation, 1993), 7.

69 Total government programme spending includes all government expenditures except public debt charges. The less than 2 per cent figure for aid is for 1992-1993; the more than 65 per cent figure for social policies is an estimate for 1991-1992 (the exact proportion is 67.8 per cent) (Clark, “Secret Paper Steers Aid Policy Changes,” I; and Rice and Prince, “Lowering the Safety Net,” 385-86).

70 Liberal Party of Canada, Creating Opportunity: The Liberal Plan for Canada (Ottawa: Liberal Party of Canada, 1993), 21, 37, 73-74.

71 Ibid., 108.

72 Philp, Margaret, “Consensus Growing for Social-Policy Reform,” The Globe and Mail (Toronto), January 25, 1994, Al.

73 York, Geoffrey, “Grits Vow Radical Social Reform,” The Globe and Mail (Toronto), February 1, 1994, Al; and Dubuisson, Philippe, “Ottawa mise sur la réforme du régime de sécurité sociale pour relancer l'emploi,La Presse (Montreal), February 1, 1994, Al.

74 Nossal, “Mixed Motives Revisited,” 36. See Khan, “André Ouellet et le développement.”

75 Stokke, “The Determinants of Aid Policies,” 300-02; Keating, Canada and World Order, 202; and Pratt, Cranford, “Canada's Development Assistance: Some Lessons from the Last Review,” International Journal 49 (19931994), 109110.

76 Canadian Council for International Cooperation, Le déft de la dette et de l'ajustement structurel (Ottawa: Canadian Council for International Cooperation, 1991), 2.

77 Pratt, “Towards a Neo-Conservative Transformation,” 611-12.

78 Milner, “International Theories of Cooperation among Nations,” 488-96.

79 See Myles, John, “Introduction; Understanding Canada: Comparative Political Economy Perspectives,Canadian Review of Sociology and Anthropology 26 (1989), 19.

* An earlier version of this article was presented at the “Canada, Political Economy and the World” Workshop held at York University's Centre for International and Strategic Studies (North York, May 31, 1993). We are grateful to Sandra Whitworth and Mark Neufeld for their invitation, and to the workshop participants for their helpful comments. We also wish to thank Bernard Cantin for his muchappreciated research assistance, as well as Stéphane Dion, Cranford Pratt and the Journal's anonymous reviewers for their comments on earlier versions. This research was supported by grants from the Fonds FCAR and the Social Sciences and Humanities Research Council of Canada.

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