Restructuring Canada's Welfare State

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Abstract
This paper highlights the development of the welfare state in Canada to its peak in the mid-1960s, and then traces the retreat from that height. While federalism and the complex relations between Ottawa and the provinces clearly represent a complicating factor, the paper argues that the fiscal crisis of the state has been the primary influence in the decline. As a major trading economy, Canada could not be immune from the onset of worldwide monetarism, though its effects were felt relatively late. Canadian monetarism has been marked by high taxes, an unwillingness/inability to cut government spending, and a singular absence of the anti-welfare state rhetoric of Reaganomics or Thatcherism. Neo-liberal outcomes are still likely to emerge, however, though they will be couched in market language and the need to be competitive internationally, particularly after the 1988 Free Trade Agreement with the United States.

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