In the 21st century there is great pressure to renew old ideas, processes and structures based on the needs of a global, knowledge-based economy. However, reformers appear to have underestimated the ability of the old system of governance to defend itself. Through an analysis of the politic struggle to effect structural change in Newfoundland and Labrador during the Wells and Tobin years, this article employs a neo-institutional approach to challenge the long-established view that political change is inevitable when economic circumstances change. It examines the political battles for restructuring in Newfoundland and Labrador to make the case that institutions still matter and continue to determine political and policy outcomes in a global era.
Au 21e siecle, on s'efforce beaucoup de renouveler les vieilles idees, les anciens processus et les vieilles structures en invoquant la necessite de repondre aux besoins d'une economie mondiale fondee sur le savoir. Les reformistes semblent avoir toutefois sous-estime les capacites de l'ancien systeme de gouvernance A se defendre. En procedant A une analyse de la lutte politique qui a eu lieu A Terre-Neuve et au Labrador sous les gouvernements Wells et Tobin pour realiser un changement structural, l'auteur de cet article utilise une approche neo-institutionnelle pour contester l'opinion bien etablie selon laquelle un changement politique est inevitable lorsque les circonstances economiques changent. Il examine les luttes politiques relatives A la restructuration A Terre-Neuve et au Labrador pour soutenir que les institutions restent importantes et qu'elles continuent a determiner les resultats tant sur la scene politique qu'en matiere de politiques A une epoque de mondialisation.
During the past decade, one of Newfoundland's greatest challenges has been how best to deal with the new realities of a global, knowledge-based economy. Since the diffusionist, urban-biased, global-determinist models pushed by economic reformers in their demands for structural changes naturally threaten citizens' expectations and the old policy regime, there is much at stake in this contestation between external forces and inherited governance structures. This contest is playing out in other parts of the country as other rural communities try to adjust to pressures from reformers seeking fundamental changes. It is a salient issue and there is much we can learn by examining the following case study, which is really about state capacity and autonomy and whether political and policy changes are inevitable when economic circumstances change.
One approach would be to continue to rely upon existing governance structures and processes with the hope that these are flexible and innovative. Another approach would involve changing visions and their embedded social and political practices. To be successful, changing governance might involve a struggle to create new ideas, institutions and values appropriate for a new era. It might also require a strong leader capable of mobilizing a new coalition of interests in support of a new policy paradigm. Leadership by itself is insufficient to determine the pace and extent of reform; governance structures, embedded values and institutional traditions are also important determinants of reform. The analysis presented in this paper uses a neo-institutional framework, and the paper suggests a cautious and reflective understanding of political-policy change (or lack of) that is often ignored in more economic-centred critiques. There is a clear need for further debate on the political outcomes associated with rapid economic and technological change.
The paper is organized around the theme of effecting political change in Newfoundland in an era of a knowledge-based economy. Even when external economic and technological changes occur, effecting internal changes and replacing embedded societal and state institutions (and associated interests and values) is easier said than done, especially when there is no crisis to threaten the power of the old regime. Change is never neutral, and it creates winners and losers. These two facts shape the battle between those who support the status quo and those who oppose it. The new economy debate has not focused enough attention on the challenge of effecting political change. One goal of this paper is to offer a different scholarly approach to this issue.
At the core of the debate is whether external economic and technological changes affect all societies the same way. We must recognize that despite similar lines of economic arguments in the past, this has proven not to be the case. In Canada, one of the great mysteries that unleashed a whole series of debates among political scientists centred on the question of why province building survived - despite modernization and homogenization (Cairns 144). In a similar vein, despite the predictions of modernization theorists, federalism did not become obsolete in Canada or elsewhere. In the new era of globalization, we need to be careful before concluding that economic changes will necessarily affect political practices in the way predicted by today's economic forecasters. Paradigm shifts and technological changes do not happen on their own: they are products of overlapping state-societal struggle and are influenced by existing governance structures and processes. Understandably, unless there is political incentive and opportunity to build support for some new vision, it is unlikely that fundamental changes will occur on their own. Nor should we assume that new models of change would benefit all societies.
The New Governing Policy Paradigm
In Newfoundland and other provinces, there are new pressures to bring about structural changes and adopt new "best practices" for a new era. There has been a long history of attempts to rearrange cultural, institutional and policy traditions in Newfoundland based on new political compromises and popular theories. These debates were highly divisive, and continuing underdevelopment has made people here highly skeptical about externally constructed urban-biased visions and outside experts who seem to care more about economic efficiencies than health of communities. Those committed to new ideas for policy change have found it difficult to alter techniques of governance and associated political behaviour.
Paradigm shifts are the product of political struggle, and even though external factors do create pressure and opportunities for establishing new intellectual processes, ideas, processes and institutions, in the end, the direction and pace of change depend on various contextual factors, including the strength and autonomy of the old regime and the kind of political resources and incentives available to those involved in the struggle. Changing economic conditions alone do not determine policy and political outcomes.
Peter Hall's framework on economic ideas and policy innovation can be applied to produce new critical insights on the struggle to effect change in Newfoundland! Hall deals with the process of contestation and what is required to replace embedded ideas, established interests and institutions. It is an approach that offers critical insights on how the political system impedes or facilitates change.
Hall argues that dominant paradigmatic discourses exist in all policy-making, and that they continue unless policy failures occur. When failure occurs, there is more pressure to alter the political discourse and build support for political change, but according to Hall, adjacent governing structures and decision-making processes are inhibitors or facilitators of reform. Whether change occurs is thought to depend on various economic, cultural and political factors. From an institutional perspective, policy actors and mechanisms still matter in efforts to bring about structural change. Economists who favour a regime change have not often been concerned with these kinds of reform issues. Hall's more institutional approach offers different critical insights for understanding the political battles for restructuring in Newfoundland. It also offers counter-arguments that better explain why it has not always been easy for all societies to embrace change.
New Problems or Puzzles
It is quite remarkable the amount of interest there has been at the provincial level, in renewing governance and in encouraging new policy experiments and debates since the 1990s. Even though the experiments have often been legitimized as attempts to encourage civic engagement and new approaches to community development, for the most part, provincial governments across the country have continued to play a major role in designing citizen engagement processes. Or they have used their resources to encourage debates and build partnerships in support of a supposedly new model of governance and management system.
