SOURCE: PressProgress.ca, 2020-07-09
Don't let the Saskatchewan Party's name fool you -- Premier Scott Moe's party is actually funded with corporate cash flowing into Saskatchewan from corporate donors located outside of the province.
According to a new analysis of Elections Saskatchewan donation records reviewed by PressProgress, the governing Sask Party collected $3.4 million donations in 2019.
Just over one-third ($1.2 million) of all Sask Party donations came exclusively from corporate donors. Of that, one-fifth ($246,045) of all corporate donations came from out-of-province corporations.
That's up slightly from a year earlier in 2018 when the Sask Party accepted $127,160 in out-of-province corporate donations, or just under one-fifth of the $749,385 in corporate donations the party collected that year.
The party's top 2019 out-of-province corporate donor was Manitoba-based Qualico Developments, which donated $10,000. Qualico has donated a total of $41,125.00 to the party since 2011.
About half of the Sask Party's 2019 out-of-province corporate donations ($134,345) came from corporations based in Alberta -- largely from the oil & gas industry.
Donations from British Columbia totalled $26,845. The donors included Vancouver-based NexGen Energy ($9,355), construction giant Ledcor ($3,200) and Vernon-based Tolko Industries Ltd ($3,180).
Donations from Ontario-based companies totalled $27,070, including CIBC ($4,000), TD Bank ($4,000), Shoppers Drug Mart ($2,000), and the healthcare companies Dynacare ($1,180) and LifeLabs LP ($1,180).
International corporate donors totalled $16,615, including KPMG ($9,740), Mosaic, ($4,200), the Hudye Group, ($2,000).
Saskatchewan has been called the "Wild West" of campaign finance laws and is one of only three provinces that allows unlimited individual and corporate donations, including from companies not based in Saskatchewan or Canada, something that allows Moe's Sask Party to raise money from the same wealthy business interests lobbying their government.
"There's a legitimacy problem here," Canadian Centre for Policy Alternatives Saskatchewan> (CCPA) director Simon Enoch told PressProgress.
A 2012 CCPA report titled "Mapping Corporate Power in Saskatchewan noted that "the only legal reason for their executives to give away the shareholders' money is that the gift will advance their business."
Enoch described the province's political financing laws as a "system where it seems like the highest bidder can influence the government and it doesn't matter where they're from or what interests they have, as long as they have a fat cheque book."
Duff Conacher, co-founder of Democracy Watch, said unlimited out-of-province corporate donations can also undermine the democratic process.
"By allowing unlimited donations from businesses and other organizations, including from outside of the province, you're essentially violating that democratic principle of 'one person, one vote' in every way," Conacher said.
Conacher explained that this is "endangering the people of Saskatchewan by allowing foreign business to have undue, unethical influence over Saskatchewan politics and the government."
SOURCE: Canadian Centre for Policy Alternatives Saskatchewan (2012-12), "Mapping Corporate Power in Saskatchewan" (pdf) | pdf | local copy (pdf)
There is little doubt that Canada is currently undergoing a seismic shift in economic and political power as populations, money and political influence move from the traditional enclaves of eastern and central Canada to the west. As the Canadian economy becomes more reliant on primary resource extraction and less on manufacturing, the geography of Canadian corporate power is also undergoing a commensurate transformation. As Maclean's recently notes, western-based energy and mining companies accounted for eight of the country's 20 most profitable public companies in 2010. "That year, oil giant Suncor Energy earned $36 billion in revenues, more than either the Bank of Montreal or CIBC. And Calgary, home to one in seven major corporate headquarters, now has more head offices than Montreal." Indeed William Carroll identifies the move of corporate head offices from the traditional Toronto-Montreal corridor to the western provinces in the past two decades as "a shift in the command centre of industry."
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The following study seeks to identify networks of corporate power in the province by documenting the inter-locking relationships between corporations, industry and trade associations, advocacy groups, policy institutes, universities, political parties and government itself. We draw upon the traditions of sociological power structure research that emphasize the social networks in which these enterprises are embedded and the importance of viewing these networks as "arenas of power."
The study of corporate interlocks is at the centre of this form of research. An interlock exists when a particular individual sits on two or more corporate boards, with multiple interlocks between corporations revealing a level of dense corporate elite integration. Equally important to our research are the interlocks that exist between corporations and the governing boards of other corporate-sponsored or corporate-interest organizations and/or institutions, such as policy planning groups, inter-sectoral organizations, trade or industry associations, government advisory boards or other corporate interest advocacy groups.
Cross-membership in such organizations can be said to constitute a network of elite interaction that provide corporate elites with a "structural base for business leadership in a society." These interlocks create social relations between enterprises and individuals that even at its weakest, creates the potential for the exercise of influence and power. Such relations are "traces of power" in both an economic and social sense. Links between corporations at the level of governance enable some measure of inter-corporate coordination and control of the accumulation process while also serving to integrate leading directors into a corporate elite sharing a common outlook and capable of exercising political and cultural leadership in civil society.
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As one of the most powerful economic institutions of the modern age, the relationship between the corporation and democracy has always been fraught with tension. Fears that the unprecedented economic power of the private corporation could overwhelm the democratic process have been a recurring concern within liberal democracies almost since the birth of the corporate form. Certain scholars view these fears as partially unfounded due to the perceived inability of the corporate sector to act in unison towards a coherent political vision. This is the infamous "Disunity Thesis" that views corporate leadership as a highly fractured group, solely concerned with the particular short-term interests of the firm and thereby incapable of "transforming their specific interest into the political interest." While the pressures of competitive capitalism no doubt mediate against the ability of corporate leadership to act in a concerted, unified manner on political issues, it does not foreclose the possibility for concerted political action on the part of corporate elites should the stakes be perceived as high enough.
It is well documented that Canada's corporate elite made such a concerted effort to influence the political climate of the country beginning in the tumultuous economic times of the 1970s. In response to a political climate that was deemed to be hostile to the interests of business, leading corporate executives called for a renewed business activism in Canadian politics. The formation of the Business Council of National Issues (BCNI), the Canadian Federation of Independent Business (CFIB), the Fraser Institute and the pro-corporate turn of the C.D. Howe Institute are often cited as evidence of a concerted mobilization of business activism beginning in the 1970s and continuing to the present day.
Indeed, Carroll views these policy-planning and advocacy organizations as "the most important means by which the Canadian corporate elite has formed and exercised its collective will in recent decades."The BCNI -- considered by many to be the most powerful business lobby in the country -- concurs, noting:
One of the Business Council's most remarkable attributes is its ability to forge common positions on major issues ... Consensus has been achieved in virtually every task force initiative since 1981. There are several reasons for this. First the Council asks members to consider issues from a national perspective. Advocacy of individual company concerns is discouraged. Second, great emphasis is placed on balancing interests when specific issues are under consideration. This requires compromise and long-term thinking."
Such organizations can serve to advance corporate interests in numerous ways. As Brownlee explains, they can provide a setting where business leaders can meet with each other and with government representatives to familiarize themselves with policy issues and discuss general concerns. Secondly, policy organizations help to infuse the information and concepts provided by other 'experts' into the perspectives of corporate leaders and government officials, who are better able to use the information for political ends. Third, they supply a possible forum from which the elite can informally select business leaders capable of serving in government. This informal recruiting ground may extend to other experts, such as academics, who advance corporate policy ideas. Lastly, these organizations can act to mediate conflict within the corporate elite and facilitate consensus and unity on contested issues of policy.
Such organizations are also crucial in the production of corporate leaders that possess the ability to look beyond their specific firm or industry interest and represent the general interest of business as a whole. American sociologist Michael Useem characterizes such corporate leaders as "the inner circle." This is a segment of the corporate elite with the "capacity to promote the broad, overall needs of business and to act as political leadership for business as a whole." By virtue of their special positions within corporate networks and extensive connections within the business community, this group is uniquely suited to mobilize corporate resources and act at the forefront of business-government relations. The "inner circle" is informed by a "class-wide rationality" derived from common participation in various policy network associations and multiple board interlocks. This "class-wide rationality" helps inner circle executives to successfully advance public policies of significant concern to large numbers of firms. Useem explains that if the 'inner circle' "promote these concerns, both individually and through select organizations, government policy-makers will hear, though of course not always heed, a point of view far more indicative of the general outlook of business than representatives of individual companies could ever provide."
While governments may not be quite the dutiful lapdogs of corporate power that some may believe, they nevertheless would be loath to dismiss the suggestions of such a powerful constituency. Beyond the substantial direct means that corporations can advocate on their own behalf, such as through campaign contributions, lobbying, public affairs and other forms of advocacy, corporations also hold an inordinate amount of indirect, or structural power due to the impact that their economic decisions can have upon a region. The most important mechanism of structural power stems from the ability of corporations to privately determine the allocation of investment and resources, which subsequently can impact levels of employment, consumption and economic growth within a region. Following this, governments of all political stripes are extremely reticent to enact policies that might discourage private investment for fear of capital and job flight to more "business-friendly" regions and all the attendant political consequences that such a flight would entail. Given this inordinate level of economic power, governments must always seriously consider the arguments advanced by the leading representatives of the corporate sector.
In the case of Canada, it certainly appears that at both the federal and provincial level, governments have been quite attentive to the policy suggestions of the country's corporate elite. Indeed, since the renewal of corporate activism in the 1970s, the country has witnessed sweeping changes in public policy, much of it aligned to the political priorities of Canada's the primary facets of neoliberalism that have been implemented over the past thirty years, including the
drive for bilateral and multilateral free trade agreements;
the weakening or elimination of social programs;
promoting "flexibility" of labour through the erosion of trade union rights;
the targeting of deficit reduction and inflation to the detriment of full employment policies;
restructuring of the taxation system to the benefit of capital;
the deregulation and privatization of sectors of the economy, and
the shielding of key aspects of domestic policy from democratic contestation
Change is now broadly accepted by Canadians as necessary and I am pleased to say that business leaders are leading the charge. Even more significantly, Canada's political class has experienced a collective conversion. The need for personal, corporate and capital gains tax relief is now firmly entrenched in the dogma of the mainline parties. Debt reduction has become the sensible thing to do. New economy principles are now the rage. Free trade commands widespread support.
Further assessing the impact of the corporate lobby on public policy, d'Aquino remarks:
If you ask yourself, in which period since 1900 has Canada's business community had the most influence on public policy, I would say it was in the last twenty years. Look at what we stand for and look at what all the governments, all the major parties ... have done, and what they want to do. They have adopted the agenda we've been fighting for in the past two decades.
Indeed, recently released documents published by the Globe and Mail regarding Finance Minister Jim Flaherty's private Wakefield meetings with top Canadian CEOs demonstrates that Canada's corporate sector continues to have inordinate access and -- if we take the current government's policies as any indication -- an enduring influence over the federal government's policy direction.
What the above illustrates is that despite the claims of the disunity theorists, the corporate sector can act in a relatively unified manner and can exercise substantial influence over public policy provided the requisite networks, organization and committed leadership exists. In light of this, to what extent does Saskatchewan's corporate sector compare? Does it maintain similar networks, organizational capacity and a leadership capable of advancing the general interest of the corporate sector within the province? It is to these questions that we now turn.
One of the most direct and visible ways corporations participate in the political process is through financial contributions to political parties. While corporate contributions are prohibited at the federal level due to the campaign finance laws enacted in 2003, corporations can still make contributions to provincial political parties. In Saskatchewan, there is no legal limit to how much corporations can contribute to the provincial parties:
Saskatchewan's electoral legislation does not limit the amount of contributions a registered political party or candidate may collect, however, contributions cannot be collected from persons outside Canada who are not Canadian citizens. As well, no anonymous contribution in excess of $250.00 may be accepted by a registered political party or candidate. Any such contribution must be reported and forwarded by the chief official agent or business manager to the Chief Electoral Officer (Elections Saskatchewan, 2012).
Indeed, as was mentioned, 2011 saw some of the largest corporate contributions to the two major political parties in Saskatchewan history. However, before examining the top corporate contributors to the two major provincial parties, we should briefly explore the academic literature on why corporations make political donations in the first place and what they ultimately expect to gain -- if anything -- from the financing of political parties.
On the subject of campaign contributions, the standard public response from corporate executives as to why corporations contribute to political parties is usually the rote answer that they are "contributing to the democratic process" or demonstrating "good corporate citizenship." Despite this admission, few among the general population -- or even among corporate executives -- would view corporate contributions as pure altruism on the part of business. As Tom Kent reminds us, contributions based solely on the basis of "assisting the democratic process" would actually be in violation of a corporation's legal mandate to advance the financial interests of its investors:
Business corporations are licensed by law to conduct particular enterprises for the benefit of their investors. The only legal reason for their executives to give away the shareholders' money is that the gift will advance their business. Political donations are never admitted, by the recipients or openly by the donors, to be so motivated. But if they are not, they are an illicit diversion of money from its due use. Corporations are licensed to run their own affairs, not to intervene in the nation's business.
Perhaps only the most naïve of liberal pluralists would believe that corporate financial contributions to political parties are somehow devoid of obligation or reciprocity. The question is, what sort of obligation do contributions confer on political parties? Much of the academic literature on this question tends to view corporate contributions as either ideological or pragmatic. They can be ideological in the sense that they are contributions to a party that will advance certain policies while in power that donors perceive will contribute to a hospitable business climate.
Conversely, they may also contribute in order to keep parties that they view as inhospitable to business out of power. Pragmatic considerations would use contributions as a means to extract private goods from the political system, whether certain policies, government contracts, purchase of access to politicians or signals to bureaucrats or other officials. Fortunately, in a liberal democracy such as Canada, outright political corruption and bribery is for the most part rare. Retired UBC Commerce professor W.T. Stanbury notes that large contributions only very, very rarely purchase a specific action favourable to the donor. Rather, what contributions purchase is access. As Stanbury (2003) explains, access can refer to a variety of things:
It means getting one's telephone calls and other communications returned promptly. This is a non-trivial matter when a minister receives hundreds of calls per day, and only has time to handle a fraction personally. More than one politician has remarked that big donors usually get much higher priority in having their calls returned promptly. Access means getting a face-to-face meeting (with the heavy-hitters) where others have to make do with written communication (from persons with less influence) ... Access also means creating a sympathetic (or at least neutral) reputation to precede requests for careful consideration of one's proposals. It also may mean ensuring the availability of an opportunity to appeal decisions to a higher (read political) level if one loses at a lower level (read in the bureaucracy). Of course, access means that ministers connect faces to issues/ problems/concerns ... Finally ... access helps the big donors obtain a more complete and frank assessment of how government sees the issue. Obviously this can be of great help in shaping how the donor makes his/her case.
As Stanbury notes, there can be no influence without first securing access to key decision- makers. How often this privileged access for corporate donors translates into influence appears to be an open question. McMenamin likens business contributions to an investment with an "uncertain and relatively low probability of return at an uncertain point of time." However, while the size of the return is also uncertain, it is also likely to "be very large indeed." Nevertheless, corporate donors must deem the probability of return reasonable enough to explain their historic and continued funding of political parties.
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As the chart above illustrates, the CEOs that possess the most direct linkages to other corporations and corporate-interest groups are Paul J. Hill of the Hill Group of Companies, Gavin Semple of Brandt Industries, Bill Doyle of PotashCorp and Ron Styles of SaskTel. Paul J. Hill could certainly be considered the biggest power player of the group insofar as he retains membership in organizations that have national significance. Hill personally holds governing roles in the Canadian Council of Chief Executives (CCCE), the Fraser Institute, the C.D. Howe Institute and holds a leadership role in the Paul J. Hill School of Business CEO Advisory Circle at the University of Regina.
As has been mentioned to some extent, the CCCE is considered by many to be the most powerful corporate lobby in the country. The Fraser Institute and C.D. Howe Institute also enjoy national prominence in their efforts to advance corporate interests through their full-throated advocacy of neoliberal policies over the past thirty years. Given his membership in these exclusive organizations, Hill could certainly be characterized as belonging to Michael Useem's "inner circle" of corporate elites. Indeed, in a profile of Saskatchewan's ten most influential businessmen in SaskBusiness, Hill "not only gets through to Canadian corporate leaders and cabinet members, his calls are also answered in Washington and Rome."
Following close behind Hill, at least in national prominence is PotashCorp CEO Bill Doyle. During the period under review, Doyle held governing positions with the Canadian Council of Chief Executives, the C.D. Howe Institute and Canpotex. Doyle has been the subject of controversy over his statements that Saskatchewan's past social democratic governments promoted a "philosophy of failure" and a "gospel of envy."
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As we have mentioned, CEOs like Paul J. Hill, Bill Doyle and Gavin Semple maintain membership in high-profile national corporate lobby and advocacy groups like the CCCE, the Fraser Institute and the C.D. Howe Institute, all of which promulgate some variant of neoliberal economic policy. However, as can be seen from Figure 1.2, our sample also identifies multiple corporate-organizational linkages with other provincial and locally based organizations that can be considered equally important to both elite cohesion and the promulgation of corporate interests in public policy discourse.
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