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Could Montreal Benefit from Being a Sovereign City-State?

All one has to do is note Montreal's diversity, bilingualism, and authentic Chinese food to see how markedly different the city is from the rest of Quebec. The difference is so vast that some citizens have created a grassroots campaign to make Montreal...

Flag of Montreal, via Wikimedia Commons.

Geographic location aside, it’s sometimes hard to believe Montreal is really part of Quebec. Diversity, bilingualism and authentic Chinese food aren’t stuff you’re likely to find in the rest of the province, and living in Canada’s second largest city is a completely different experience than settling anywhere else in Quebec. So different, some may say, that Montreal should no longer be part of La Belle Province. That’s right, the Montreal: City-State Foundation is currently advocating for a model similar to that of Hong Kong, which would make Montreal its own administrative region. With the provincial elections coming up, the once ridiculed idea is back on the table and to some, more appealing than ever. To get a full picture of what the movement is about, I called up Michel David, the foundation’s president to talk about why Montreal would need this kind of emancipation.

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VICE: What’s going on right now?
Michel David: Basically, Montreal and Quebec are both economic underperformers. This was already well documented, but a couple of weeks ago BMO and the Boston Consulting Group put forward a really well done study with alarming results. They found Montreal performs at about half the rate of other similar Canadian cities, both in terms of population growth and wealth, GDP per capita. Another study compared the GDP per capita of the top 25 largest cities in North America and lo and behold, Montreal is dead last.

And why is that?
In our view, the most important cause is that in terms of attracting or retaining people or companies that produce value, we have more factors that are repulsive than attractive. These repulsive factors are basically a number of laws that are particular to the province of Quebec: the language laws and the way they are applied, the recent debate around the charter and Bill 14—which is totally promised if the PQ wins a majority. So these laws may be good in a certain way, but their current application and their effect on Montreal’s economy is toxic. That being said, you somehow have to create a situation, a city-state, where those laws don’t apply. It doesn’t mean we’d walk away completely from protecting the French language; I think one of the key assets of Montreal is its bilingualism, but you don’t need Pastagate to protect and nurture the French language. The problem is that we’re being managed under language laws that emphasize negative aspects and that are applied with a lack of intelligence or judgement. In our view this won’t change. The city-state would make its own laws and apply them, thus creating an environment that’s positive for its citizens, and also for businesses and economic growth.

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So that’s why we’d need a city-state?
To paraphrase Einstein, if you think using the same system will give you a different result in the future, you’ve gotta be kidding. The way out of this is to create a new system that will probably give you a different result.

Could you elaborate about the model you propose?
The city-state, in our view, should comprise the island(s) of Montreal, 514 and 438 area codes. Quebec would devolve powers to Montreal, very similar to the powers a province has.

To create the environment I’m talking about, we’d run our own taxes, and our tax regime would be quite different than the one in Quebec. Quebec’s regime is very social. They hit the high earners, whereas we would have a different system. More people would pay a little bit, but if you come here and work 24/7 for ten years and create a beautiful company, enjoy your money! So, in other words, you let the people who create wealth enjoy the rewards of their work. So the fiscal regime would be different.

The second thing is you’d have to redo the schools, the health system, the labour laws, everything—because our main goal is economic growth. You’d have to align policies with economic growth. If you want to attract either companies or entrepreneurs to come and do their projects here, as opposed to elsewhere in North America, you have to have a product offering that’s attractive to them. You have to be able to offer the best conditions to them, not only money. Keep in mind that our rates would be reasonable, but low enough to make a difference. It’s really about making yourself attractive to the people who will create wealth and jobs.

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What makes Montreal so different that it would need its own system?
The cause of all these issues, in our view, is that Montreal and the rest of Quebec are two totally different things. By segmenting the population, as we do in marketing, you’d take Montreal as a specific entity and the rest of Quebec separately. If you look at their economies, they don’t produce the same thing. In terms of society, Quebec is the old stock French Canadians and Montreal is cosmopolitan, 50/50 and the Anglophone and allophone part comprises 80 ethnicities. That’s fantastic in terms of diversity. The Quebec laws aren’t cosmopolitan. They’re for “everybody’s the same and they’re all Québécois,” as opposed to “do your thing and we’re glad to have you here, or to be all together in this project.” The Montreal city-state’s purpose is to answer what we think is our most basic problem.

Wouldn’t that make Montreal more dependent on the Federal government than it is at the moment?
Not necessarily, if Quebec stays in Canada, Montreal would remain part of Quebec and part of Canada. Otherwise, it would be like Hong Kong in China; they are two different systems in the same country. In Montreal, one thing you want to put an end to is any discussion of separation and referendums. That kills businesses. Chinese entrepreneurs, for example, can always keep in mind the threat posed by a separatist government. It’s a killer in every shape or form, in terms of economic growth. If ever Quebec [separates], we’re not going with them.

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Would it be like creating immunity?
With immunity from separation, you create a predictable environment. The two laws of economic growth, as we say in our paper, are clear rules and stable rules. This has been documented by economists worldwide for a really long time. Separation is like a dark cloud ahead for the economy, and as long as there’s a threat you can’t move forward.

Have you totally given up on the idea of Montreal’s cultural diversity ever being embraced by the rest of Quebec?
Yes. In my view, they are different and they will stay different. And that’s not necessarily bad. The Québécois are Francophone, of course. They are a small group trying to preserve a culture. The French culture is one of the key assets of Montreal, so in my view this should be a win-win type thing.

How would you proceed?
The first step was to make this part of the public discourse. 12 months ago it was a big step. But now, look: you’re calling me to talk about it! I started this five years ago after getting mad on Sunday night dinners with my daughters, complaining about everything. I came to the idea of the city-state, which I discovered this year other people had also come to in 1996. Anyways, it’s a logical conclusion for somebody who studies the problem objectively.

From there, I reached out to 400 people, starting with the Prime Minister and the premier of Quebec and basically there was close to zero acknowledgement of anything. Of course in the last 12 months the situation has changed. All of this came back up with the new government and Bill 14. The next step of course, and this turns political but we’re not political, is to get political leaders aware.

When important players start focusing on the problem and making propositions, eventually somebody will find it to their advantage in the political process to say, Montreal [should be a city state]. They’re saying it now, but it’s very timid; even the PQ announced a strategy for Montreal. Eventually, somebody will find it in his or her interest to push the idea. I don’t have more answers than that at this point, we have ideas but they’re still being processed.

On a provincial level, which party do you think would be most likely to support your project?
I don’t know. The one thing I do know is that the separatist parties are toxic to Montreal, because of the idea of separation is an economic destroyer. They don’t say that, they don’t admit to that, but in my view, it is. That leaves you with the Liberals and the CAQ, basically. So you know, if you put your “Montréalais” glasses on, and say, “what I need is stability at the Quebec level and at the federal level,” the next question remains who of these people would support Montreal in becoming an adult jurisdiction, as opposed to being treated like it is now, which is a young child. I don’t have an answer to that. You could make an argument that the government of Quebec has purposefully, regardless of the party, kept Montreal as weak as possible for as long as possible, because if Montreal ever achieves its full potential it would be more powerful than the Quebec government.

Do you have any predictions as to what Montreal’s future holds if the PQ wins with a majority vote?
Either they get their way, and you know, we keep going down. Or else, they get their way and the Montrealers decide that a city-state is absolutely essential, and they do what’s required to get it.

@martcte