NAFTA, the Information Revolution, and Canada-U.S. Relations: An Ontario Perspective

Introduction The pervasiveness and the relentless onslaught of globalization and the knowledge/information revolution--henceforth, GIR--are transforming economies and societies everywhere. This emerging global order is variously referred to as the information revolution, the techno-economic paradigm or, as noted, GIR. However defined, among the key features of this dawning era are: that it is altering the nature of the nation-state--especially the federal nation-state; that it will do for human capital what the industrial revolution did for physical capital; that it is rewarding individuals as the principal beneficiaries of the information revolution; that it is fundamentally altering the nature of capitalism, since a corporation's key assets now go home every night; and that, at a more general level, the information revolution is serving to reduce economic, cultural, and geographical distance and to collapse economic time. Small wonder, then, that this profound constellation of forces is likely to have a similarly profound effect on small, economies like Canada, where the reference to small and open is synonymous with being a price-taker in terms of the global order. While the theme of this volume relates to thinking in Canadian-American relations, what follows is more along the lines of new directions in policy for the northern half of North America in light of the implications of the global era. Actually, the analysis is more constrained still, since it addresses GIR largely from a provincial--Ontario--perspective. The analysis proceeds as follows. The first section presents an overview of GIR as it relates to governments, and enterprise, including speculation about what this ought to imply for Canadian governance in the millennium. Part two then examines those aspects of the above analysis that impinge more directly on Canadian-American relations. In particular, the analysis will detail the emergence of Ontario as a North American region-state. The final section then focuses selectively on some implications for Canadian governance and Canada-U.S. relations. The Anatomy of the Information Era Drawing from Courchene (2000a and 2000b), Figure 1 embodies a framework for assessing the implications of GIR first on markets, and governments (the rectangular blocks), then on the citizen-market, citizen-government, and market-government interfaces (the circles in Figure 1), where the ultimate objective is to focus on the resulting challenges for Canadian policy, for institutional design, and for governance. Proceeding in terms of the entries in Figure 1, the implications of GIR can be summarized along the following lines. GIR and Governments - Powers are being transferred upwards and downwards from central governments of nation-states, especially federal nation-states. - In terms of the former, the rationale is straightforward: economic space is transcending political space, with the result that countries are transferring power to supranational structures and regulatory bodies (for example, NAFTA, EU, the European Central Bank). - Powers are also being passed downward to markets (through privatization, contracting out, and deregulation), to lower levels of government (for example, transferring forestry, mining, tourism, and training to the provinces) and to citizens (via the information revolution). [FIGURE 1 OMITTED] - A convenient description for this process is glocalization (the combination of global and localization). GIR and Citizens - GIR enfranchises individuals as consumers. Indeed, Ohmae (1990) actually defines globalization as consumer sovereignty. - But globalization also tends to disenfranchise individuals as citizens, in the sense that some key policy decisions are increasingly taken in forums where citizens have no direct representation. …

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