Three questions have been central to the field of comparative political economy: What economic forces and social agencies shaped the historical trajectories of each national state? What specific class structures and political strategies determined the national model of development? What location did the national state come to occupy in the hierarchical ordering of states in the world market? For the countries of the Americas, these questions have always been answered with reference to two coordinates: their individual legacies as export-based raw-material (or staples) economies that developed over the course of the Atlantic triangular slave trading system; and the relationship of each national model of development to the United States as it transitioned from a series of colonial settlements to the world’s leading capitalist state and global superpower.
For students of the comparative political economy of Canada, these questions have typically been discussed with reference to the “staples theory of economic growth.” Building on the “frontier thesis” once common in explaining U.S. development, the staples theory formulated the view that the “colonial export” served as the leading sector of development. The export earnings provided an economic surplus to pay for imports and new investments; linkages to other sectors could then build up and a general pattern of economic and institutional development follow—including social and political systems—as the home market deepened. To the extent that these linkages encouraged capital goods and manufacturing industries to flourish, industrial diversification occurred and an integrated national economy formed, with the United States as the archetypical case.
In contrast, in some cases the staples economy became a “trap” with few linkages forming beyond, say, sugar or tobacco production, and reproducing only distorted development and political dependency, as occurred in much of the Caribbean. In still others, where the population-to-land ratio was low and resources abundant, there was the possibility of a “staples switch.” As one staple’s terms of trade turned negative, another one’s terms turned positive, and so fur extraction could be replaced by agricultural wheat exports, wheat by pulp and paper, and so on. Each staple encouraged some diversification of the industrial base, but a dependence on commodity exports and a pattern of arrested industrialization remained. The processes of class and state formation that ensued, moreover, politically blocked full modernization and national independence. This was the case, many staples theorists argued, for the so-called “white Dominions,” notably Canada, Australia, and New Zealand.
In debates about Canadian development, neoclassical growth theorists have contended that Canada broke out of the staples growth process by the mid-nineteenth century and followed the American pattern of development of steadily accumulating more productive capital and labor inputs through time in the expanding manufacturing and services sectors. In contrast, liberal and left nationalist analysts, influenced by Harold Innis’s concern for societies on the margins of the world market dependent on staple commodity exports, have stressed the continued dependent—and even distorted—development of Canada based on staples exports, and an inability to pursue national policies that might alter these conditions as Canada moved from an adjunct of the British Empire to incorporation within the American. Marxian political economy took still another tack in insisting that the comparative development of Canada needed to be located, first, in the differentiated class and social relations that formed the foundation for capitalist commodity production; and, second, in the class and state strategies that led to the capital formation, wage levels, and institutional capacities that placed the country—even with its relatively overdeveloped extractive sector—within the group of advanced capitalist states by the beginning of the twentieth century (where it has since remained as part of the North American zone).
Escape from the Staple Trap is firmly located in the last position (arguing from within the “state capitalist” tradition of Marxian theorizing) and offers the most comprehensive survey of these debates on Canada’s comparative political economy to date. In the process, Paul Kellogg offers three valuable contributions. First, in the initial chapters, he provides a careful comparative summary of debates over the categorization of states within world systems theory as core, semiperiphery, and periphery. He concludes that “any reasonable application of world systems theory to the Canadian reality needs to situate Canada in the core of the system, not in the semi-periphery” (p. 56). For Kellogg, as with the neoclassical economic historians, Canada achieved effective sovereignty as a liberal democratic state in the nineteenth century.
Second, liberal and left nationalist interpretations of the staples thesis have claimed that Canada remained a staples dependency—overreliant on basic commodity exports, with a truncated, innovation-averse and backward manufacturing sector dominated by American ownership, and a state and comprador capitalist classes only capable of further integration into the U.S. empire. Across three chapters, Kellogg forwards an empirical rebut: Canada’s manufacturing sector is similar in its economic weight and composition to other core capitalist states; foreign direct investment has a unique prominence in Canadian economic development but provided the capital goods that built up processing and manufacturing capacities and is now declining in relative importance; and the composition of Canada’s trade and production is different in degree in the role of agricultural and raw material commodities and trade linkages to the United States, but not qualitatively different in kind from other core states. “Canada’s economy,” he concludes, “possesses all the key features of a member of the core of the world system” (p. 139).
The third contribution turns away from the direct interrogation of the staples thesis to locate Canada as a “principal economy” in the world market. In the final four chapters, Kellogg’s empirical argument is expanded to demonstrate that Canada has long had an integrated and developed “home market” since the nineteenth-century transition to capitalism. Canada’s class structure has evolved into a “postindustrial” service economy like those of other core states, with a relatively high-wage and high per capita income–waged class and an independent and internationalizing capitalist class. The theme here returns to comparative political economy, and the central conclusion of Escape from the Staple Trap: “If, in fact, Canadian capitalism’s hand is stronger than most suspect, then an entirely new political orientation for combating that capitalism will have to be advanced. . . . No ‘industrial strategy’ with increased investment in research and development or a focus on the ‘high-tech’ sector will suffice” (p. 227).
Kellogg’s text makes an important addition to the writing on Canada as an imperialist state, stretching from Bill Carroll’s Corporate Power and Canadian Capitalism (1986) to the more recent Todd Gordon’s Imperialist Canada (2010) and Jerome Klassen’s Joining Empire (2014). Many issues are left hanging, particularly with respect to the Canada–U.S. relationship that has animated liberal and left nationalists. Once Canada is firmly placed within the core countries, is it simply a rival imperial power to the United States? Or are there particular patterns of competition and cooperation between the two through the interpenetration of capitals and international production chains? How is the extensive interstate architecture of NAFTA, NORAD (the North American Aerospace Defense Command), border security, the security and surveillance cooperation, and much else to be understood? Perhaps these vexing questions will be taken up in the companion volume that Kellogg promises. Until then, discussions of the political economy of Canada still lack an adequate analysis of the Canadian state as a foundation for political projects of democratization.
