Citizens as consumers, as producers, and as political actors are emerging as the principal beneficiaries of the knowledge-based era (KBE). The tandem of information empowerment and the democratization of technology will ensure that this will continue to be so. To be sure, this has been a gradual process, reflecting the march of technology. As Lawrence Grossman, former president of NBC News noted:

Printing made us all readers;
Xeroxing made us all publishers;
Television made us all viewers;
Digitization makes us all publishers.

In their role as consumers, citizens have become evermore powerful, even to the point where performance standards are progressively being set by those that buy the products not those that regulate or produce them. Indeed, globalization guru Kenichi Ohmae actually defines globalization as “consumer sovereignty.” In their role as producers, human capital as a factor of production is now on the cutting edge of innovation and competitiveness. Finally, on the political front, like-minded citizens networking within and among nations are emerging as dominant players in domestic and world governance: of the 25,000 NGOs operating internationally in 2000, fully 20,000 of them did not exist a decade earlier. In other words, NGOs are Internet phenomena. Relatedly, while the voluntary or third sector has long existed, its KBE-informed and citizen-empowered variant— civil society— is in ascendancy everywhere and has taken its rightful place alongside business and government as the institutional pillars of modern societies.

This encapsulation of the rise in citizen power in the KBE is the appropriate backdrop for addressing the subject matter of this essay, namely the changing relationship between the citizen and the state in its several dimensions— rights, cultural, political/democratic, socio-economic, and federal dimensions— as well an assessment of the evolving relationship of Quebecers and Aboriginals with their respective nations and the Canadian state. In line with the silver anniversary theme of this issue of Policy Options, the time frame will be the 25 years from 1980 to the present, with a few concluding comments on how the next 25 might evolve.

The obvious launch point for the analysis is the 1980 to 1982 patriation process culminating with the Constitution Act, 1982, and, in particular, the Canadian Charter of Rights and Freedoms. As Alan Cairns noted at the time, these Charter rights and freedoms are country-wide in scope, enforced by the Supreme Court, and entrenched in a constitution beyond the reach of fleeting legislative majorities at either level of government. Phrased differently, the language of Charter rights is a Canadian language, not a provincial language. In terms of how this might influence the then status quo, John Whyte ventured that, in a Charter-based society, citizen-state relations will become systematized, centralized, uniform, constant, unilateral and direct, whereas in a federal system they are diverse, filtered, diluted, subject to mediation and complicated.

In addition to embodying individual rights and freedoms, the Charter also enshrines selected collective or group rights, for example, those relating to gender, language, visible minorities, disabled persons, as well as those relating to the recognition of the Aboriginal and treaty rights of the Aboriginal peoples of Canada. Almost immediately, Canadians overwhelmingly embraced the Charter and for many it became the centrepiece of their Canadianess. For present purposes, the implications flowing from the Charter include the following: the cleavages in the federation focused less on territory and more on pan-Canadian Charter interests vs. vested interests (or on the Court Party vs. the Reform Party, as it has been termed); at the interprovincial level, the long-standing tradition of asymmetry fell prey to Charter-informed symmetry, including the equality of the provinces and the call for a triple-E Senate; and that the “affirmative action” clause (s.15(2)) paved the way for the admittedly overdue pay equity legislation as well as the much more controversial employment equity provisions. More recently, the courts have interpreted the equality provisions under the Charter to extend to same-sex marriage. Although subsequent events such as the North American economic integration and the emergence of cross-border economic regions have served to return federal-provincial cleavages and the symmetry-asymmetry issue to policy centre stage, it is nonetheless the case that the Charter arguably represents the single most important defining moment in the evolution of citizen-state relationships and, indeed, in our constitutional and societal evolution.

Given Canada’s status as one of the foremost immigrant nations, and our unique position in having two official languages of convergence, it was and is essential that we put in place a comprehensive approach to integrating immigrants into Canadian society. In so doing, we have rejected the US “melting pot” approach and instead have embraced an impressive Charterinformed policy of multiculturalism. From the Canadian Multiculturalism Act, 1988, the policy of the Government of Canada is inter alia to:

recognize and promote the understanding that multiculturalism reflects the cultural and racial diversity of Canadian society and acknowledges the freedom of all members of Canadian society to preserve, enhance and share their cultural heritage.

As an integral part of the way Canada implements multiculturalism, mention can be made of the following: the Charter and associated rightsrelated bodies such as the Canadian Human Rights Commission which, among other areas, is charged with redressing any discrimination on the basis of race, national or ethnic origin, or colour; the Employment Equity Act, which is designed to achieve equality in employment for any disadvantaged individuals or groups; selected measures such as the formal recognition of foreign-obtained credentials and qualifications which serve to enable newcomers to contribute to their full ability to their own and Canada’s advancement; and of course of the various acclimatizing programs relating to language, civics and skills acquisition available to immigrants and refugees alike.

As Will Kymlicka has informed us, Canadians (along with Australians) do a much better job of respecting ethnic diversity while promoting societal integration than do citizens of any other country. Specifically, and in comparison with the US melting pot approach, our naturalization rates for immigrants are roughly double, our intermarriage rates are much higher, political participation and official language acquisition are also higher, residential segregation is lower; and ethnicity is less salient as a determinant of friendship in Canada than in the US. All in all, a success story and indeed even a model. This is especially the case in the post-9/11 era when comparisons are made with the ongoing societal questioning of multicultural policies in Britain and in several continental European countries (Germany and the Netherlands for example).

The political/democratic component of the citizen-state nexus is arguably the most complex, in part because it is influenced by both globalization and the information revolution. As already noted, the latter privileges citizens, relative to governments and capital, by virtue of the democratization of technology and the consequent information empowerment of citizens on the one hand, and the emergence of human capital and knowledge as the wellspring of innovation and competitiveness on the other. Moreover, along the lines of the principle of subsidiarity, globalization has served to transfer powers upwards and downwards from central governments of nation-states including, as will be dealt with later under the “federal” rubric, the catapulting of cities (especially what have come to be called global city regions, GCRs) into the role of the new dynamic engines of the global economy. In other words, both the “citizen” and “state” components of the citizen-state relationship are in full evolutionary flight.

In terms, first, of the increasing power and influence of citizens, the days when governments had a virtual monopoly over information and, therefore, power, are long gone. We can access, transform and transmit all manner of information flows in ways that governments of whatever stripe cannot prevent. Moreover, whereas “transmitters” traditionally have determined the nature of information flows, it is increasingly the “receptors” are calling the shots now. And this certainly applies to the mushrooming electronic relationship between government and citizens, who are the winners in this “e-the-people” reality as governments progressively act in ways that recognize and accommodate citizens as their valued “clients.”

There is, however, a widespread concern that this new era is characterized by “democracy deficits,” by which is meant that important decisions are made in fora (typically international) where citizens do not have direct representation. While this rings true at one level, at a more fundamental level the opposite is arguably the more accurate depiction, and this for two reasons. The first is that as selected powers pass upward to the international level, indirect representation will increasingly be the order of the day. Indeed, Will Kymlicka argues that most Europeans do not want direct representation in a powerful EU Parliament. Rather they prefer indirect democracy, i.e., to debate amongst themselves, in their own language, to determine what the position their governments should take to Brussels on EU issues. In other words, the emerging global model appears to be more confederal than federal, therefore by definition calling for more indirect than direct representation in supra-national decision making. The second is to note that powerful citizens’ lobbies, often organizing themselves at the transnational or global levels, are beginning to confront or countervail both global capital and global institutional structures, as illustrated by the “Battle in Seattle” and Canada’s own Maude Barlow’s role in derailing the Multilateral Agreement on Investment. The World Bank is taking the lead among supra-national institutions in welcoming the presence of a major civilsociety role in its internal deliberations. This is direct representation, albeit not of the electoral variety.

Civil society institutions are also altering the citizen-government relationship domestically. Those voluntaryor third-sector institutions that occupy the socio-economic space between citizens and markets/enterprises are typically referred to as NPOs (nonprofit organizations) while those that occupy the space between citizens and governments are often called NGOs (non-governmental organizations). In an era characterized by the impersonal forces of (global) markets and the seeming impenetrability of the layered levels of government, NGOs and NPOs and the voluntary sector more generally serve to generate new bonds of community for citizens and to create new spheres of effective citizenship. Moreover, this enhances citizen participation by mobilizing action through appeals to values and social purposes, and not via the profit motive or government directives. It behooves us all to ensure that the civil society institutions achieve this potential, one aspect of which is that they remain responsive and accountable to citizens and that they not be taken over by governments, i.e., that they remain non-governmental organizations and not become neo-government organizations.

A final but hardly exhaustive aspect of the political/democratic dimension relates to the electoral system itself and, in particular, to the several ongoing provincial attempts to rethink and replace the first-past-the-post system with some version of preferential voting. The intent is to ensure that the distribution of elected representatives across parties correlates more closely with the proportion of votes received. While it is appropriate to remain skeptical of some versions of proportional representation (especially those that bestow increased power and influence on political parties), it is nonetheless true that having “every vote count,” as it were, should stimulate citizen interest in voting, with presumed benefits for the health of the citizen-state relationship.

Focus is now directed to the manner in which globalization and the KBE are altering the socio-economic nexus between citizens and their governments. The disquieting societal challenge here is the one articulated by Harvard’s Dani Rodrik, namely to ensure that international economic integration does not lead to domestic social disintegration. This concern was heightened in the time frame of the millennium because the increasing internationalization of global markets (replete with concerns about the vanishing middle class and the outsourcing/off-shoring of work), was occurring alongside a welfare state that appeared to be retrenching everywhere. In other words there were fears of a citizen-government disconnect that would mirror the globalization-driven, citizen-market disconnect. While Canadian governments’ program spending as a percent of GDP did fall to rates not seen since the early post-war years (which by itself is serving to alter the citizen-government relationship as elaborated below), Canada’s fiscal house now appears to be in order (at least federally) and program spending in areas such as health care, equalization and child care appears to be making a significant recovery. Nonetheless, vigilance is required with respect to this challenge since it is critical to ensure that the benefits of the KBE are not obtained on the backs of the disadvantaged amongst us.

Canada’s post-1995 success in terms of federal-deficit-taming, which Business Week has termed “the Maple Leaf Miracle,” has also had salutary effects on the debt/GDP ratio: from Canada ranking second only to Italy as the G7’s most indebted nation, eight consecutive federal budget surpluses have now made us the least-indebted G7 nation. In turn, this should mean that citizens will adopt a more benign view of their governments, since a lower debt/GDP ratio necessarily means that more of every tax dollar now finds its way into program spending.

But far and away the most exciting development on the socioeconomic front is that knowledge and human capital are now at the cutting edge of competitiveness and innovation. This means that social policy in its human-capital/knowledge dimensions is more or less indistinguishable from traditional competitiveness-related economic policy. As part of this transformation, the pre-KBE rhetoric that monies spent on social policy fell into the category of transfers or subsidies is also swept away: the KBE social policy rhetoric is about investment and human-capital accumulation, and soon about humancapital-investment tax credits and depreciation allowances, as befits a progressively knowledge era. Appropriately, many of the recent social policy initiatives involve human capital investment or equalizing the opportunities for such: early childhood development initiatives, Millennium Scholarships, Canada Research Chairs, the Canada Child Tax Benefit (CCTB), as well as aspects of health and equalization spending. This is part and parcel of the earlier observation that the citizens’ star is in the ascendancy, with obviously beneficial implications for the manner in which citizens themselves view the evolving citizen-state relationship.

There is a further important change in Canada’s social policy framework, this time due to the march of globalization, which may portend what the future of the nation-state and the citizen-state nexus could be about. This is the directional shift in social policy away from an income-security perspective and toward addressing inequality. In more familiar terms, social policy (other than health care) is moving away from universality and embracing targeting, as is exemplified by the change from universal family allowances to the income-tested CCTB, by the move toward taxing back Employment Insurance and Old Age Security at high income levels and by the shift from deductions to credits in the operations of the personal income tax system. Keith Banting’s research has shown that Canada’s shift to targeting, in contrast to the US decision to maintain universality, has kept our post-tax, post-transfer income inequality measures relatively stable while those in the US have deteriorated considerably. At least in the area of income support, targeting appears the preferable way of equalizing opportunities across the citizenry as well as of addressing the reality the market incomes in the KBE tend to be polarizing. As emphasized in my IRPP book, A State of Minds: Toward a Human Capital Future for Canadians, the key longer-term solution is to equalize the opportunities for all Canadians to increase their skills and human capital.

The final highlighted force operating on the citizen-state relationship, and one that provides a convenient bridge to the following discussion of Quebec and of Canada’s Aboriginal peoples, is the changing nature of Canadian federalism. One aspect of this has already been alluded to, namely the role of the KBE and globalization in privileging global city regions (GCRs) as the new drivers of the global economy. This follows from the dual reality that these GCRs are the principal repositories of dense nodes of knowledge and human capital and, relatedly, that they are the leading production and export platforms for spearheading NAFTA integration. Almost certainly, GCRs and cities generally will lever this new power into becoming more fully and more formally integrated into the operations of Canadian federalism, perhaps even to the point of converting traditional federal-provincial relations into federal-provincial-municipal relations. Part of this is that they will acquire greater revenue and expenditure autonomy. And as these cities shift their mentality from an administrative/rent-seeking mind set toward a more fiscal-autonomy and policy-aggressive mind set, citizens will follow by increasing their participation in city life thereby ensuring that cities will become progressively more democratic and accountable. This closerto-the-people (and subsidiarity-compatible) locus for the design and delivery of public goods will also mark an important step in the evolution of the citizen-state relationship because it will bring to citizens’ doorsteps, as it were, many of the key decisions relating to their daily lives.

On a more general note, the advent of free trade within North America served to highlight the lack of free trade within Canada. Toward addressing the defect, Ottawa and all the provinces signed on to the 1994 Agreement on Internal Trade (AIT), designed to ensure the free flow of goods, services, labour and capital across provincial boundaries. The AIT is a “work in process,” the latest (and very significant) development of which is a commitment to eliminate provincial government purchasing preferences. Relatedly, the 1999 social union framework agreement (SUFA) is designed to secure and promote the internal social union. Among other provisions, SUFA embodies a series of principles designed to underpin social Canada, allows Ottawa to exercise the federal spending power in areas of exclusive provincial jurisdiction subject to substantial provincial flexibility in design and delivery, and promotes the internal human capital union by having the provinces mutually recognize credentials and qualifications earned in other provinces. In effect, the AIT and SUFA serve to convert Canada into a uniform market by creating internal economic, social, and human capital unions, which in turn enhance the value of Canadian citizenship and of the citizens’ links to the state.

However, by so encouraging trade that all provinces except Manitoba (in 2001) now trade more with the US than with the rest of Canada, NAFTA has also introduced some centrifugal and decentralizing forces into the federation. Arguably, one of these has been the creation of what might be termed crossborder “region-states,” which have led to increased policy asymmetry as the various provinces legislate to privilege themselves and their citizens in these cross-border economic relationships. Indeed, the AIT and SUFA can also be viewed as securing the east-west socioeconomic unions as a bulwark against these emerging north-south trading unions. Moreover, NAFTA-induced provincial policy asymmetry also makes it much easier for the provinces to accept Quebec’s long-standing demands for formal recognition of its distinctiveness within Canada. This is a fitting entrée to (my interpretation of) the evolution of the citizen-state relationship as it relates to Quebec and Quebecers.

For the majority of non-Quebec Canadians, Canada is both their nation and their state, although they may have conflicting preferences relating to where the federation should be located on the centralization/decentralization spectrum. For the majority of Quebecers, however, Quebec is their nation and Canada is their state. This may not be a permanent equilibrium since twice now Quebecers have voted “no” to a proposal to separate from Canada and to convert Quebec into a nation-state, with the 1995 referendum “winning” by less than a percentage point. And in the 2004 federal election the fact that the Bloc Québécois won 54 of Quebec’s 75 seats has many Canadians deeply concerned over the national unity issue once again. There may be some good news here however. The tandem of globalization and the KBE has fundamentally altered the nature of sovereignty in the 21st century and, arguably, has altered the underlying nature of the sovereignty issue in Quebec. This is so because with many of the former paradigm’s nation-building levers having been circumscribed either by international agreements (e.g., tariffs, trade policy, and NAFTA) or by international best practices (e.g., inflation targeting by the Bank of Canada and regulatory/competition policy), this means that emerging keys to 21st century or KBE nation-building relate to education, training, early childhood development, income support, health, and citizen issues more generally. But all of these areas fall either wholly or largely under provincial jurisdiction. Accordingly, my hypothesis (elaborated in the November 2004 issue of Policy Options) is that Quebec federalists/ nationalists are shifting their focus away from desiring more and more powers and toward ensuring that Quebec has adequate fiscal revenues to be able to fully exercise its existing constitutional powers. This perspective is consistent with Jean Charest’s successful proposal for an all-province Council of the Federation (COF), with its principal priority being the restoration of fiscal balance in the federation.

Given that the new global order provides promise for Quebec to achieve its long-standing nationhood objectives within the framework of the Canadian state, it is surely timely and appropriate that Quebec’s partners in the federation have signalled their intention to recognize Quebec’s specificity and distinctiveness within the Canadian family. As part of the July 2004 Niagara-on-theLake COF proposal to transfer pharmacare to Ottawa, the nine other provinces recognized that Quebec would maintain, and be compensated for, its own pharmacare program. And as part of the ten-year, $41 billion First Ministers’ agreement on health care in September of 2004, Ottawa and Quebec signed the addendum “Asymmetric Federalism that Respects Quebec’s Jurisdiction,” which asserts that Quebec’s policies related to the Health Accord will be determined “in accordance with the objectives, standards and criteria established by the relevant Quebec authorities.” While this falls short of constitutional recognition, it is nonetheless explicit, formal and symbolic and, as important, almost surely to be repeated in other areas (cities, day care) in the near future. The exciting news in all of this is that the possibility now exists for Quebec to achieve substantive advances in its nationhood agenda within the parameters of the Canadian state, with beneficial implications for Quebecers’ citizen-nation and citizen-state relationships.

As is the case for Quebecers, the relevant nation for the first peoples is their Aboriginal nation (Inuit or Métis) or their First Nation. Unlike some Quebecers, however, Canada’s Aboriginal peoples have no desire to opt out of the Canadian state (except perhaps for one or two of the 600-plus First Nations). While the formal claims to Aboriginal rights date back to the various treaties and to the 1763 Royal Proclamation, there is no question that the Charter (as amended to include the Constitutional Amendment Proclamation of 1983) has played a pivotal role in the recent constitutional, legal and political achievements of Aboriginal peoples.

At the constitutional level, the Charter has recognized and affirmed existing Aboriginal and treaty rights, where these treaty rights include rights that now exist by way of land claims agreements or may be so acquired by future agreements (s.35 (1 and 3)); defined Aboriginal peoples to include Indian, Inuit and Métis peoples (s.35(2)), which is an unquestionable and perhaps unexpected victory for the Métis; and guaranteed the above rights equally to male and female persons (s. 35 (4)). At the legal/legislative level there are now several far-reaching and high-profile land claims and self-government agreements that are serving to inform the hundreds of others in various stages of negotiation. Moreover, the courts have provided the First Nations with several landmark decisions, the most recent of which is Haida Nation v. British Columbia (Minister of Forests), 2004, which asserts that the Crown has a duty to consult and accommodate Aboriginal Peoples prior to making a decision that might adversely affect their as yet unproven Aboriginal rights and title claims. At the political level, the Assembly of First Nations (AFN) is comprised of the chiefs of those First Nations who exercise their right to be members of the AFN. The national chief of the AFN, elected for a three-year term, is the national spokesperson for the AFN and is sometimes recognized as a “first minister” and takes part in federal-provincial first ministers’ meetings. It should be noted that, formally, the AFN is in the nature of a confederal body since the relevant Aboriginal rights apply to the 630 or so First Nations communities, and not to the AFN.

All of the above relate to recognizing, securing and extending the collective rights of Aboriginal peoples. However, there has also been remarkable progress in terms of the constitutional, legal, and political rights of individual Aboriginal persons. Far and away the most important initiative here is Bill C-31, enacted as an amendment to the Indian Act in 1985, which allows persons who lost their registered status under the Indian Act to reclaim their status. The most common case relates to the Indian Act provision that deprived a registered Indian woman and her subsequent offspring of status if she married a non-Indian. And among the other reasons was that until 1960 (when the franchise was extended to Indians) First Nations citizens lost their status if they voted in a federal election. On the occasion of the passage of Bill C31 estimates were that as many as 20,000 persons might be enticed to reclaim their status and heritage. The impressive reality, and a clear measure of pride as Canada’s first peoples, is that over 100,000 persons regained their Registered Indian status under Bill C-31, or one in seven of existing status Indians (and this figure does not include the children born to these C-31 Indians).

These significant achievements on the constitutional, legal/ legislative and political front at both the collective and individual level have ushered in similarly significant and positive developments in the First Nations’ citizennation and citizen-state relationship.

There is, however, an unfortunate other side to the Aboriginal  relationship to and with Canada, which for present purposes will be termed the socio-economic relationship. Everywhere on this front the by-word is “disadvantaged,” if not “marginalized”— income, employment, education, health status, equality of opportunity, etc. Even the “Lands reserved for the Indians,” as the Constitution puts it, have been described by the late Chief Dave Courchene of the Manitoba Indian Brotherhood as often little more than “muskeg, rock and sand.” This is wholly unacceptable and especially so since Canada is often held up as a model for accommodating the aspirations of indigenous peoples— apparently the rest of the world learns about the constitutional, legal and political advances but not about the socio-economic realities.

Yet there is room for optimism because the underlying challenges do not relate to the level of funding or to the good intentions of Canadians. Among the challenges that relate closely to the Aboriginals’ citizen-nation and citizen-state relationships are the following three. First, while s.91(24) of the exclusive legislative powers of the federal Parliament reads “Indians and Lands reserved for the Indians,” Ottawa effectively interprets the associated fiduciary responsibility as “Indians on lands reserved for the Indians,” thereby creating both federal vs. provincial and, more importantly, off-reserve (urban) vs. on-reserve divisions to the obvious detriment of First Nations’ citizens. The second is that the courts have tended to privilege the collective rights of First Nations relative to the individual rights of First-Nation citizens. This may be necessary to a degree in order to assert the First Nations’ rights and roles as a third order of government in Canada, but it often appears to come at the expense of effectively eroding the “Canadian” rights and opportunities of First Nations’ citizens. Finally, and relatedly, the increasingly important roles played by civil society institutions are often absent on reserves, which leads to the observation that it is the citizennation component (i.e., socio-economic component) of the overall citizen-state relationship that needs most and immediate attention. Surely there is the will to do this. What is needed in terms of finding the way is to put the needs and aspirations of individual First Nation citizens at the centre of any and all approaches.

While forecasting is fraught with problems, it is probably a safe guess to assert that the citizens’ star is still in its ascendancy so that citizen power and influence will likewise continue to increase. Much more difficult to forecast is the likely evolution of the state. Philip Bobbitt in The Shield of Achilles foresees a shift from the nation-state (where the state acts to enhance the welfare of the nation) to a 21st century “market state” (where the state acts to maximize the opportunities of its citizens). Underpinning this market-state is the reality that the increasingly multi-ethnic and/or multinational nature of countries will make equality of outcomes as a policy goal more controversial and will tilt the pendulum toward increasing opportunities for all, and perhaps pursuing equality of opportunity. This appears to resonate well with the dilemma facing some European countries, where the pursuit of multiculturalism is seen as undermining the welfare state, so that a focus on opportunities rather than outcomes may be the way forward. However, because Canada has successfully married multiculturalism and the welfare state and because we have been more successful than most in putting our fiscal house in order, we have gained considerable flexibility in terms of addressing these challenges of the market-state, were it ever to become a reality.

By way of a concluding note, globalization and the information revolution ensure that Canadians will have access to state-of-the-art tradable goods and services. But we have no such assurance when it comes to the key information-era public goods and services (education, training, health, early child development, etc.) because these are inherently non-tradable. Hence, we have no choice but to be the architects of our own information-era social infrastructure, that is, the architects of key aspects of our emerging citizen-state relationship. It is not an overstatement that how we design and deliver this social infrastructure will define who we will be as Canadians in the 21st century.