Mandate letters send Liberals into uncharted waters

Liberals have always believed that government can be a force for good in our society. And, as fate would have it, this government comes to power at a time when openness to some kind of government activism is back in fashion. But what kind of activism?The clue lies in the past. Following the near collapse of the financial system in 2008, then-Federal Reserve Chairman Alan Greenspan was forced to admit that the invisible hand of the market had failed to prevent the crisis. It was a watershed moment in recent economic history.In the decade since, free market enthusiasts have come under heavy fire. Several important books—I'd include those by John Plender and Thomas Piketty—have wrestled convincingly with the assumptions of market capitalism and found them wanting.Not that the critics want to revive the old dream of a planned economy. There is lots of agreement that markets must be allowed to work and governments should be careful not to get in the way. Rather, the search is on for a better balance between laissez faire capitalism and old-style intervention.If concerns over the inequality of income are one part of this discussion, the need for what we can call a collaborative approach to competitiveness is another.Last week's mandate letters landed smack in the middle of this trend. They commit every federal minister to helping the government rebuild prosperity in the middle class, on one hand, and building public trust in government through openness and collaboration, on the other. The challenge now is to put the ideas to work.A very promising approach recently surfaced in an unlikely place: the Forum on Canada's Agri-Food Future (CAFF15). Indeed, the seeds of something new and different may have been sown in this soil.The Canadian Agri-Food Policy Institute and Canada 2020 convened some three hundred delegates to discuss ways to improve competitiveness in the agri-food sector.Much of the discussion revolved around a novel distinction between what delegates called "competitive" and "precompetitive" spheres in the food system.While the former includes ways that individual businesses compete for market share, the latter is about how openness and collaboration can strengthen Canada's competitive advantage.This challenges conventional thinking, which holds that the way to improve competitiveness is to free up markets, say, through deregulation. Supply and demand then forces businesses to compete for market share, which keeps them lean and innovative.The delegates at CAPP15 took a very different tack. Consumers, they noted, are increasingly concerned about a growing list of issues around health, food safety and the environment. A failure to meet their expectations can alienate customers and/or weaken supply chains.Delegates went on to discuss whether stakeholders would be willing to collaborate to make Canada's agri-food system the most trusted food system in the world; and, if so, what this would take.At bottom, they agreed, such a project requires government and stakeholders to work together to deepen the food system's commitment to core values like transparency, openness and authenticity, in order to gain consumers' trust.Branding our food system this ways would allow Canadian businesses to meet and even exceed consumer expectations anywhere in the world. This, in turn, would distinguish them from other food producers and give Canadians an edge in all kinds of key markets, such as the highly informed consumers in the Japanese beef market.The collaborative approach thus provides a novel way to enhance competitiveness, and thereby increase prosperity. It also takes government and stakeholders into uncharted waters. And that leaves me wondering how ministers will respond to the commitments in their mandate letters. Here are four points they may want to consider.First, agri-food is not the only sector where this type of collaboration is an option. Concerns over sustainability, fair trade, health and human rights are raising new kinds of consumer expectations in a wide range of industries, from energy to financial services. Ministers could search their own portfolios for interesting ways to work with stakeholders to make these industries more competitive through openness, transparency, authenticity, and so on.Second, there was lots of agreement at CAFF15 on what falls inside the precompetitive sphere. Dividing activities this way seemed to help clarify what kinds of tasks require collaboration. This, in turn, makes it much easier for governments to engage in productive discussions with industry and/or public-interest organizations and arrive at a real plan for action.Third, ministers (and their officials) should not confuse such talks with traditional consultations on government regulation of the sector. Government may or may not have a regulatory role to play in the final plan. Every case is different. Based on the discussions at CAFF15, much of the heavy lifting in agri-food's precompetitive space belongs to industry, such as taking steps to align supply chains or provide greater transparency on animal welfare.Finally, because these talks call on stakeholders to do some heavy lifting for the collective good, ministers (and their officials) can't manage the process from the top down. Stakeholders must be engaged as full-fledged partners in the initiative. Openness, transparency and collaboration apply as much to government's relationships with them, as to the system they are working together to improve.In sum, the big idea here is that governments and stakeholders can work together to enhance industry competitiveness by promoting values such as openness, transparency and authenticity, which, in turn, earn consumers' trust.Far from conflicting with traditional market imperatives, this kind of collaboration creates a business environment where fair competition can flourish. In the end, the competitive and precompetitive spheres are two sides of the same coin.Collaboration, it turns out, can enhance competition. Dr. Don Lenihan is Senior Associate, Policy and Engagement, at Canada 2020, Canada's leading, independent progressive think-tank. Don is an internationally recognized expert on democracy and Open Government. He is currently the Government of Ontario's principal advisor on its Open Dialogue Initiative. The views expressed here are those of the columnist alone. Don can be reached at:[email protected] or follow him on Twitter at: @DonLenihan