Understanding the Competent Concierge: Canada’s Prime Minister Mark Carney

Carney gave an important speech yesterday, which you can read here. That lead to a lot of people praising him for his honesty in noting that the rules-based order was accepted by developed nations because they benefited from it, even though everyone knew it was bullshit: if you weren’t in the club, the rules didn’t apply to you. And even if you were in the club, the rules didn’t always apply to you, but most of them did and overall the benefits outweighed the costs, at least as far as our ruling class was concerned.

Carney points out that this deal has been violated in a rupture. The old world order is dead. People who say that it died in Gaza are WRONG. Mass murder of brown people in a non-developed country is acceptable to the rules based order. (It would not be acceptable in South Korea or Japan.)

But there’s something very important in Carney’s speech: he brags about having dropped taxes and that’s a clue.

Carney is clear eyed and honest enough to recognize the hypocrisy of the old system. He was a participant, but he was one of the rare powerful participants who was able to function and realize some of the injustices of the old system. He knew it was bullshit. Most people need to entirely believe in a system, they can’t handle the moral dissonance. To Carney the trade off was worth if it you were part of the Global North, and he was willing to live with that and participate in it.

Now long before Carney was Prime Minister I had criticized him. As a central banker he blew two housing bubbles, one in Canada and one in Britain, which massively hurt ordinary people and he bailed out bankers and rich people during the financial collapse. In fact, his performance in Canada was abysmal, in that it set up a new housing bubble basically immediately.

But housing bubbles are good for rich people. They get the benefits, not the costs.

And that’s the key to understanding Carney. He’s not a left winger. He’s not a post war liberal. He’s a neoliberal technocrat, and the job of neoliberal technocrats is to keep making the rich richer. It really is almost that simple and if you use that as your guide to their actions you’ll be right most of the time.

Let’s go back to those taxes. One of Carney’s goals is to reindustrialize Canada. It’s a real goal, he’s taking action on it, spending money on it and cutting deals pursuing it. But low corporate taxes and low marginal top individual tax rates undercuts that goal. The higher corporate taxes are the more it makes sense to reinvest earnings in production. If top individual rates are low, the rich want money cashed out thru stock buybacks (which should be illegal if you want industrial growth, because they too encourage wasting money that could be reinvested in production) or dividends.

You should also have high capital gains taxes on short term gains. Ninety percent if cashed out under five years, dropping 10% a year after that is a good benchmark, with exceptions for primary residences and a few other niche cases. Again, you want people investing for the long term, and this also cuts out a lot of the bullshit that happens due to stock options.

So if Carney’s only goal was re-industrializtion, and he was method-agnostic, not an ideologue, he would raise certain taxes rather than lowering them.

But he didn’t do that, because Carney, like most politicians and senior technocrats in our system, is a concierge for the rich. His job is to make them better off. They don’t want to be annexed by the US or to have to live in fear of a fickle US changing deals at a whim. But they still want to be super rich. In the old world order that meant having access to the US, because US returns were outsized compared to non-US returns. Every elite in every other country wanted access to US financial markets. But that access is not worth the price any more.

What makes Carney different from most current elite concierges is that he is actually competent, not a worthless courtier, and that he’s able to see the hypocrisies of the system. He’s self-aware.

I supported Carney in the last election and I still support him because while he’s far from what I want, he’s at least doing some of the right things. Enough of the right things to be worth supporting. That doesn’t mean I like him, or even think he’s a good person. He isn’t. But he’s competent and has enough guts to move away from the US. While he does so he’s making a lot of compromises like joining the Board of Peace. That’s an evil act and I’m sure he knows it is, being clear eyed, but it’s a minor evil act because Canada doesn’t have a potential veto on how Palestinians are treated.

I wish he was better and my support is very conditional. Perhaps I’m not as pure as I should be. Feel free to flay me in the comments. But a man who helps break up the American Empire, and that’s what Carney is doing by being the first to make a real break with the US and with his speech calling for the middle powers to abandon America, is doing enough to make it over to the “on the balance, more good than evil” book in my mind. Now if he had a veto on Gaza the way an American President does, it’d be different.

He doesn’t and he’s helping destroy the old world order while being by far and away the best current option for Canada.

We need better if we’re ever going to move back to a truly good economy in western countries or a more good than evil world order. Carney’s still a concierge for the rich. But in helping protect Canada’s rich, he’s helping destroy the American Empire and that will be good for billions of people, including Palestinians, and he’s protecting Canada from America and some of what he’s doing will be good for ordinary people.

Even if Carney’s motives for helping destroy the old order are crass, the fact that he’s doing so is enough for me.

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