Ontario's election is kind of a big deal

October 6th, 2011 will be election day in Ontario's 40th general election.  This is a big deal for Ontario obviously, but for Canada as a whole.

The point isn't made very often but Ontario is simply enormous in comparison to the rest of Canada.  Ontario is 39% of Canada's population.  In US terms, if there was a state that combined California, Texas, New York, Florida and Illinois (the five biggest states) it still wouldn't be proportionally as big as Ontario is to Canada (you'd still only be about 36% of the US population by my quick math). 

Obviously this isn't a popular point to raise in the rest of Canada.  There's a long and bitter history over the real or perceived ways in which Ontario dominates the political scene.   I get at least some of where this resentment comes from, but I really don't see how you can avoid it, short of somehow levelling the population between the provinces.  There's a thing called "Western Alienation" that refers to the feeling amoung many in the four western provinces that they're "left out" of the important decisions in Canada, but whatever truth may be behind this, the four western provinces combined are about 32% of the population (and this is up significantly in the past decade, the disparity used to be even larger) so there's really no way to give them equal say with the significantly larger group of people who live in Ontario. 

For Americans or any other non-Canadian trying to understand us, it's important to realize too that Canadian provinces are much more powerful within Canada than States are within the US.  In the US, the total spending of the Federal government dwarfs the 50 states, while in Canada, the provinces actually spend a bit more overall than Ottawa.  So, not only is Ontario far bigger within Canada than any state within the US, but also it has a more prominent and powerful role by virtue of our system.  You cannot adequately study Canada without looking at the provinces, and in particular there, Ontario. 

I think that point should be made a little more often when analyzing Canada's economic performance through the Lesser Depression.  Many conservatives up here of course like to attribute Canada's relatively better economic situation (unemployment peaked south of 9% in 2009 and is now at 7.2% nationally) to the Harper Conservatives, but I really don't think you can tell the story of Canada's economy without reference to the provinces, and in particular, Ontario. 

Paul Krugman regularly makes the point that the US stimulus bill really didn't end up providing very much net fiscal stimulus because it really ended up just barely managing to counteract the automatic fiscal contraction that the 49 State governments undertook in service to their ridiculous constitutional budget balancing clauses (and Vermont, the smart hold out is doing pretty well last I heard).  In Canada, our Federal government had to be forced under threat of a Coalition government to undertake fiscal stimulus back at the beginning of 2009, but they did eventually implement a modest stimulus package sized at 2.8% of 2008 GDP. 

What didn't happen in Canada is that the provinces did not implement austerity budgets, and some, like Ontario, implemented their own fiscal stimulus packages.  Even conservative Alberta started running deficits with its 2009 budget rather than cut back during weak economic times. 

Those wishing to tell a partisan story about Canada's success in so-far weathering the Lesser Depression have a difficult slog.   The Federal Conservatives did pass a stimulus, but had to be pushed by the opposition, who held a parliamentary majority.  Liberal governments in Ontario, BC, Quebec and a Progressive Conservative government in Alberta (comprising the four biggest provinces) did at least no harm, and some attempt at good through the period.  The net result has been, well, not great, 7.2% unemployment really isn't much to brag about, but certainly less terrible than it could have been. 

So the fate of political power in Canada's largest province is worth watching.  For Ontarians, it is worth voting over.  The debate over the effectiveness of stimulus in the US is clouded, but in Canada the case is far clearer that it worked, while governments in Europe are busy proving unambiguously how counterproductive "austerity" is, it is important for Canada that Ontario not elect a government prone to breaking out the tight belt while conditions are still quite dicey.