Federal government pursuing Soviet-style central ‘climate’ planning

Ambitious junior and mid-level federal public servants might want to use their summer vacations to bone up on the history of central planning in the Soviet Union. I offer this advice after reviewing the Trudeau government’s new “Sustainable Jobs Act,” the latest example of the Liberal government’s quest to shift Canada from a largely market-based economy to one where politicians and bureaucrats aspire to control the principal levers that shape economic and industrial development.

The new legislation is one of 10 “action areas” outlined in the government’s Sustainable Jobs Plan, an expansive initiative that features (mostly non-defined) partnerships with industry, organized labour, environmental groups, Indigenous communities, as well as provinces and territories -- “including via Regional Energy and Resource Tables.” The main task of these putative partnerships and the already established regional tables, we are informed, is to identify and pursue “key economic opportunities across Canada, which will enable the creation of sustainable jobs.”

The Sustainable Jobs Plan itself is somewhat vague on what constitutes a “sustainable job,” and it does not directly pinpoint the “key economic opportunities” expected to arise as Canada stumbles toward a lower-carbon future. The massive clean/green subsidies and tax incentives doled out in the 2023 federal budget—amounting to $80 billion and counting—presumably signal the industry sectors and business activities in line for Ottawa’s support.

Elements of the Sustainable Jobs Plan, including the new legislation, promise to add to the growing array of agencies and bureaucratic structures that lie at the heart of the Trudeau government’s unfolding climate policy. These include:

• a “Sustainable Jobs Partnership Council” that will share “perspectives and recommendations” with government on how to foster sustainable jobs
• a “Sustainable Jobs Secretariat” charged with forging “links” between workers, employers and training institutions as the Canadian economy transitions away from the production and use of fossil fuels
• the Net Zero Advisory Body—a cross-sectoral “group of experts” formed to advise federal policymakers on how Canada can achieve “net zero” greenhouse gas emissions by 2050
• a veritable alphabet soup of other climate-related research and advisory groups generously funded from the bottomless pit of taxpayer funds

The push for comprehensive economy-wide planning in aid of achieving Ottawa’s fantastical climate policy goals brings to mind the Soviet Union’s system of central planning, which lasted from the early 1920s until the collapse of communist rule in 1991. That system rested on rolling five-year plans that sought to manage resource allocation, investment flows and production across the sprawling Soviet economy. At the core of the system was Gosplan, the agency responsible for developing, refining and administering all aspects of economic planning. As described by historian Robert Daniels, the Soviet economic planning process overseen by Gosplan was fairly straightforward:

“Gosplan calculated the sum of the country’s resources and facilities, established priorities for their use, and handed down output targets and supply allocations to the various ministries and through them to every branch and enterprise in the entire economy.”

Under the guise of tackling the “climate crisis,” the Trudeau government appears to be moving in a similar direction. The underlying vision is of an economy where policy goals, a shifting cast of political decisionmakers, and a mishmash of publicly funded advisory and consultative bodies increasingly will determine the allocation of capital, the structure of production and the patterns of economic growth. It’s a vision that downplays the roles and contributions of market forces, entrepreneurs, private-sector investors and profit-seeking businesses—even though Canada remains a market-based economy where the private sector accounts for more than three-quarters of all jobs and almost 100 per cent of exports and where hundreds of thousands of companies furnish Canadians with the bulk of the goods and services that “sustain” our way of life. It’s also a vision that vastly exaggerates the knowledge and foresight of elected officials, public servants, policy advisors and the numerous organized interest groups that today are heavily invested in the climate policy file.

Soviet-style central planning ended in failure. There’s a good chance the same fate awaits Canada’s emerging regime of climate-driven central planning.