RCAP: Aboriginal people, living and working on their own land base, will become prosperous and self-sufficient by combining transfer payments, resource revenues, and local employment.
Flanagan states that the reserve system cannot accommodate the free market and the pro-capitalism market; mainly because of the lack of property rights of Aboriginal individuals. Generally, as a model, the reserve in the 1880s to 1930s was sustainable and required little or no federal transfer payments. As farming practices become less profitable, government food rationing become more prominent causing a dependency on external capital. Flanagan does not wish to glamorize ‘free-loaders’ since infant death rates were 3 times the average in 1950 among aboriginals. For Flanagan, segregation limits the horizons of aboriginal peoples much like African-Americans before Brown v Board of Education in 1954 and the Civil Rights Movement. Different but equal segregation does not work and is unjust. The rural isolation could not be sustained in the second half of the 20th century; 1) isolation failed as English TV beamed into Aboriginal communities undermining their languages, 2) mechanization of agriculture meant larger farms which reserves that could not provide and there was also less demand for farmhands 3) no room for hunting, trapping or fishing makes reserves unsustainable 4) there was massive growth of the aboriginal population post-1920s. Provinces became responsible for off-reserve welfare (some of the money comes through the CHST). Aboriginal self-government led to further problems and by 1992, 42% of on-reserve natives were on welfare entirely. Welfare utilization varies from BC’s 20% to Saskatchewan’s 80% average. Welfare dependency of off-reserve aboriginals is significantly less but still significantly higher than the average. Racism, discrimination, cultural differences and deficient education help perpetuate the welfare trap but this does not explain prosperity among other ethnic groups who fully participate in liberal democracy. As long as reserve members are not accountable by taxing their members on reserve, mismanagement will persist. The cost benefit of life off and on reserve is not significantly different because of off reserves competitive labour market. Building ‘aboriginal economies’ is the RCAP’s leading idea but the Hawthorn report is favourable to Flanagan’s sensibilities because it calls for participation in the general economy. The RCAP praises entrepreneurialism; it rejects government intervention on economic policy asserting that aboriginals can effectively compete in the market if they own and control capital and resources. For Flanagan, the RCAP recommendations are unlikely to succeed in practice and he feels that tough-minded welfare policies must be implemented simultaneously on and off-reserves. Flanagan reiterates that reserve resource wealth is not substantial and those reserves with large resource income are not inclined to share with less fortunate reserves: just like any federal system and/or the Arab League, as examples. Implementing RCAP would increase unemployment, welfare dependency and human misery, according to Flanagan. Tax-payers should not pay the bills: Ian Ross’s award winning play fareWel talks about this dependency. Aboriginals often blame the ‘White Man’ further exacerbating the racial tension between cultural groups.
The Flanagan Factor: Prosperity and self-sufficiency in the modern economy require a willingness to integrate into the economy, which means, among other things, a willingness to move to where jobs and investment opportunities exist. Heavy subsidies for reserve economies are producing two extremes in the reserve population – a well-to-do entrepreneurial and profession elite and increasing numbers of welfare-dependent Indians.