Carney and the Calgary School: or, Passive Revolution and Canada’s Social State in the Neoliberal Era

Introduction: Passive Revolution in 2025

In the spring of 2025, when Canada narrowly avoided being swept up in a global wave of electoral successes for the (far) right, it was a puzzling moment. After years in which it appeared to be all but inevitable that Pierre Poilievre’s federal Conservative Party of Canada would form the first government of the post-Justin Trudeau era, the election of another minority Liberal Party government, led by Prime Minister Mark Carney, could seem an occasion for relief. An apparently ascendant right-wing in Canada was not so ascendant after all. However, notwithstanding the contingency of the minority Parliament and the initiation of US trade war upon the inauguration of the second Trump administration, it may be wrong to think that Canada has rejected or been spared the rise of the right. For the time being, at least, Canada’s Liberals have succeeded in a classic passive-revolutionary exercise: metabolizing and re-presenting elements of a threatening movement to ensure political survival and, as much as possible, re-establish electoral and policy dominance. 

This latest passive revolutionary episode was classic in the sense that, as historian Ian McKay has described, passive revolution was arguably the defining dynamic in the historical formation and development of the Canadian state. (McKay, 2010) The concept is Gramscian in origin, and in McKay’s reading (which applies to the period from 1840-1950) it indicates the contradictions inherent in the development of capitalist liberal order in Canada, where, “although immensely active in achieving certain political and economic objectives, [the Canadian state] was in another sense merely a passive reflection of global patterns.” Canada continues to be a peripheral player in the global capitalist system, and in that sense only “semi-autonomous.” Recent experience demonstrates just how vulnerable Canada is to global trends that induce a particularly limited, reactive mode of governance that is familiar to the federal Liberal Party. As McKay argues, passive revolutionary development has influenced Canadian political life through, “an unwritten but effective philosophy of rule: if you wish to govern Canada, identify the opposing poles on any question and triangulate them.” This triangulation then proceeds, “through the highly selective conscription of [adversarial] themes and arguments, which are then, in their edited form, made over to be those which all sane and sensible people believed all along.” Repeat over centuries, et voila: Canada. 

McKay cautions that, applied recklessly to quotidian instances of, “a ruling group buttering up opponents and recruiting former oppositionists into its ranks,” passive revolution can lose analytical utility and specificity. Prime Minister Carney’s early overtures to capital and appeals to moderate conservatives, for example, do not themselves constitute passive revolution, but a far more ordinary kind of politics all-but-permanently integral to Liberal methodology. Zoomed out and historicized, however, Carney’s initial policy agenda indicated a broader passive revolutionary process, which should demonstrate “hegemony in a different key,” to use McKay’s phrasing. From such a vantage, the 2025 federal election marks an occasion to consider how an alert ruling class has managed to confront a moment of crisis in the “international regime” of neoliberalism and to make the domestic containment of that crisis its foremost prerogative (Anderson, 2025). In other words, with the far-right ascendant or triumphant both nationally and internationally, Canada’s ruling Liberals have managed to forge a path for a politics of containment that fends off the right by incorporating some of its demands and making those demands more widely palatable.

Carney, a lifelong banker (in the financial investment sector, then the monetary central banking sector), thus stands quite appropriately as an heir to North American neoliberalism. But to secure his troubled inheritance with impressive stealth, he has become the new political face of an ideological orientation that shares his western-Canadian background, but none of his partisan identifications. Strange and contradictory as it seems, Carney arguably represents the “common-sensification” of a conservative tradition identified with the Calgary School, a now multi-generational group of conservative intellectuals of which none would appreciate the association with a Liberal government. But such is the nature of passive revolutionary Canada, “a country whose underlying political and cultural contradictions remain explosively unresolved.” (McKay, 2010)

Origins: The Antisocial Statism of the Calgary School

The Calgary School was an informal grouping of conservative academics that played an active and significant role in Canadian politics during the 1990s and 2000s. The core group of five consisted of four political scientists — Barry Cooper, Tom Flanagan, Rainer Knopff, and Ted Morton — along with the historian David Bercuson. The work of the members of this group centred around the University of Calgary. 

The Calgary Schoolers did not all emerge from the same intellectual tradition; they studied at different universities, in different fields, and with different teachers. They claimed, as intellectual identification and inspiration, a diverse set of thinkers and philosophical lodestars. This has troubled accounts of the Calgary School, even imperiling the notion that such a school properly existed, and opening up the question that it may have been a mere creation, propagated by critics and followers alike. Was the Calgary School a neoliberal formation, as some suggest, or a neoconservative formation, as it has been more often described? Was it, perhaps, a thinly veiled political school, in the sense that its existence was owed mainly to shared policy views and party affiliations among its members? The openness of these questions is testament to an uncertainty regarding Calgarian ideology: beyond the contending labels, what, exactly, was it? 

Underlying their various intellectual approaches and political sensibilities, thus uniting the Calgary School at a fundamental ideological level, was a skeptical orientation towards the intentional state. The intentional state, broadly, is the state that believes it can purposely direct civil society towards acknowledged goals and outcomes. Intentional states are, of course, not identical, and so criticisms of them can vary to a degree. However, the crucial argument is that when states permit themselves the hubris to believe that they can direct civil society towards (particularly ambitious) an ends, disaster awaits.

In 1992 when the journalist Jeffrey Simpson observed in The Globe & Mail that, “What links the members of the ‘Calgary mafia’ is their fiscal conservatism, their annoyance at the West’s bad treatment in Confederation, their belief that Quebec receives disproportionate attention in Ottawa and, in a few cases, their questioning of feminism, pay equity and the use made by interest groups of the Charter of Rights and Freedoms,” what he failed to note was that this was no coincidence. (Simpson, 1992) The Calgary Schoolers were not a group of right-wing academics who came together because they happened to agree on these things. Instead, they generally agreed on these things because they shared in a fundamental view of the state and its appropriate role. 

The intentional state has been referred to variously, especially since the mid-twentieth century, by a range of thinkers. Among the direct influences of the Calgary School, Friedrich Hayek railed against the “constructivist” state, Eric Voegelin criticized the ideology of “gnosticism,” and Leo Strauss lamented the quest to implement a “simply rational society.” Hayek made the best-known version of this critique in the twentieth century thanks to the popularity of his 1944 book, The Road to Serfdom. (Hayek, 1944) Writing amid the horrors of the Second World War, Hayek worried that there was “more than a superficial similarity between the trend of thought in Germany during and after the last war and the present current of ideas in the democracies.” He connected the rise of socialism to the eventual rise of Nazism, worrying that socialism had become a kind of “common sense” even in Britain and the United States. According to Hayek, “if it is no longer fashionable to emphasize that ‘we are all socialists now,’ this is so merely because the fact is too obvious.” Hayek suggested that contemporary democracies were perhaps fifteen to twenty-five years behind Germany, on the way to tyranny. With a particular focus on economic planning, he warned of an imminent descent into totalitarianism. Instead, he insisted, it was imperative to promote the virtues of the market and attending “traditional values.” Then, Hayek thought, people could live in the necessary freedom to make “their own little worlds.”

Beyond Hayek’s critique of economic planning, there have been related critiques of utopianism, idealism, and voluntarism. Maybe the best-known among these, published a year after The Road to Serfdom, was Karl Popper’s 1945 book, The Open Society and Its Enemies. (Popper, 1945) Originally published in two volumes, the book was addressed most of all to a study of “historicism” which, for Popper, was a malign intellectual tradition that stretched from Plato to Marx and beyond, engaging erroneously in “historical prophecy.” Popper associated historicism with utopianism and totalitarianism, arguing that attempts to take control of history were bound to be anathematic to the open society that he valued. At the helm of state power, historicists were inclined, Popper thought, to a particular kind of “social engineering;” a term of which the Calgary Schoolers themselves would make frequent use. Popper was permissive of some social engineering, so long as it was “piecemeal” rather than utopian. The key distinction between the two was that piecemeal engineering was negative, undertaken against “suffering and injustice and war,” rather than in positive search “for the establishment of some ideal” on which people were unlikely to agree. 

Unlike Hayek, Popper was not claimed as a lodestar by the Calgary Schoolers, even if traces of his influence might be found in Calgary School critiques of social engineering. Still, his version of the critique of the intentional state is instructive regarding the Calgary School for the purposes of contextualization and for its broad negativity. Like Popper, the Calgary Schoolers took their view principally, if not wholly, in terms of critique. To describe their outlook as a critique of the intentional state is to consciously avoid an alternative, positive framing, that might invoke a defense of “liberal neutrality” or a related cognate. While the Calgary Schoolers could indeed operate as “defenders,” they were clearest about what they opposed and about who their enemies were. It was apt for Jeffrey Simpson to notice that the Calgary School seemed to share enemies, including feminists, Quebec nationalists, and “special interest groups.” He might have added Marxists, and leftists of any stripe, to the list. Ultimately, while they came to their positions in distinct ways, the Calgary School held together because its members shared a critique of the intentional state and, accordingly, they shared enemies too. 

Those enemies, in the broadest sense, were those who would defend and/or benefit from what could be called the social state. Describing a different mode of antisocial statism in the present-day United States, the historical sociologist Melinda Cooper has described an attempt to “incapacitate the redistributive and social protective arms of the state.” (M. Cooper, 2025) The Calgary Schoolers perhaps never sought total incapacitation, but the thrust of their ideology was similar: any state committed to seeking pre-conceived outcomes—economic, social, or otherwise—was out of bounds. Any effort to increase economic equality and to promote gender parity, for example, or policies of race-based affirmative action, would be anathema on this view. Generally, the state’s role should be limited to rulemaking and enforcement, principally to develop and protect a well-functioning market. The market, not the state, would then be the arbiter of outcomes in civil society. The Calgary School’s critique of the intentional state was an antisocial statism in this sense. 

Point of Entry: The Conservative Crack-Up

The late-1980s and early-1990s provided an opportune moment for the Calgary School to begin pushing this ideology into Canadian politics. Whereas conservatives in the United States and Britain were distinguished by the abandon with which they greeted and shaped the neoliberal era in the 1980s, during which the governments of Ronald Reagan and Margaret Thatcher engaged in capacious programs of social state retrenchment, Canada’s conservatives at the same time were distinguished contrarily by their reticence. When Prime Minister Brian Mulroney was elected in 1984, despite rhetoric that suggested he might govern as a keen neoliberal, his government was, “slow to act on policy initiatives that appealed to those with strong neoliberal ideological orientations,” as the political scientist Steve Patten puts it. (Patten, 2013)

The Progressive Conservative government under Prime Minister Brian Mulroney instead linked their political fate to the “sacred trust” – a commitment to cautiously maintaining the universality of existing social programs. Most tellingly, when Finance Minister Michael Wilson came out in 1985 in favour of a program of deficit reduction, privatization, and deregulation, Mulroney balked at public pressure and doubled down on the sacred trust. The political results were existentially poor. Not only were the PCs outflanked on the right by Liberal governments of the 1990s, keen as those governments were to practice an intense form of austerity politics, but they also prompted a conservative crack-up that realigned the Canadian right. (Patten, 2013) Thanks most of all to the rise of the Reform Party in the late-1980s, Canadian conservatism was cast into disarray for more than a decade as factions and parties struggled for control of a movement that seemed to have lost its way. Importantly, such confusion and chaos presented opportunities to the right of the PC Party, and the Calgary Schoolers were leaders among those who sought to take those opportunities.

 The most acute crisis moment of the crack-up came with the federal election of 1993. The Progressive Conservatives, who had been in power for almost a decade, saw their numbers in Parliament obliterated in the electoral aftermath with just two seats in the House of Commons. The rise of the Reform Party to the right of the Tories had now effectively split Canada’s conservatives. Reform, for its part, won 52 seats in 1993, while ensuring that “neither Canadian party of the right could realistically challenge the federal Liberals,” due to the disunity. (Farney, 2013) For Canadian conservatives this was disastrous, and over the following decade the schism was gradually repaired. In 2000, Reform became the Canadian Alliance, and in 2003 a “united right” re-emerged after the Alliance and the federal Progressive Conservatives merged to become the contemporary Conservative Party of Canada under the leadership of Stephen Harper. The fingerprints of the Calgary School were all over this process.  

The Reform Party stepped into the political vacuum that had appeared on the right. Founded in 1987, almost immediately during the 1988 federal election the party managed a significant fifteen percent share of the popular vote in Alberta, and seven percent in British Columbia. Though failing to win a single seat during that election, the Reform Party was well-established in the western Canadian right-wing movement from the beginning. From that base, Reform began to expand in the early-1990s, polling ahead of the Progressive Conservatives by 1991. Again, by the election of 1993 Reform had become the conservative voice in parliament. However, as Trevor Harrison has pointed out, the political consequence of Reform’s rise cannot be reduced to numbers. As he puts it, “By 1993 the Reform party had already had a major influence on Canadian politics, altering the terms of discourse and shifting the ideological terrain on which Canada’s political battles are fought.” Harrison notes immigration policy and multiculturalism, austerity, rights, and welfare politics, along with the public rejection of the constitutional accords, as the key areas in which the rise of Reform was most consequential. (Harrison, 1995) In other words, Reform marked the appearance of a Canadian conservatism that was unambiguously against the social state. 

But with the Progressive Conservatives and Reform both continuing to take up space on the right-wing of the political spectrum, there were too many cooks in the proverbial kitchen for Canada’s Westminster-style Parliamentary system where coalition governance is rare and the electoral system favours hegemonic dominance. In May 1996 the Canadian-American conservative columnist David Frum and Calgary School protégé Ezra Levant had convened a conference of about 100 pundits, writers, and activists to discuss the possibility that Reform and the Progressive Conservatives might settle their differences cooperatively and move forward as a united front. They called it the “Winds of Change” conference, hosted in Calgary and the Calgary School was represented by Bercuson, Cooper, and Flanagan. The conference’s draft manifesto showed strong Calgary School influence. The manifesto described Canada in Calgarian terms: “crushed under debt and taxes, demoralized by perverse social policies, its very existence in question.” The conference manifesto demanded a united right to un-make what it saw as Canada’s intentional social state, which took, “convictions as superstitions to be remodelled by Ottawa social engineers.” (Winds of Change, 1996)

The efforts of the “Winds of Change” conference were “doomed,” as Flanagan put it, because the federal Progressive Conservatives had boycotted the meeting (Flanagan, 2007). However, the 1997 election proved to conservatives that something had to change. In October, a few months after the election, Flanagan argued in a column that one change option was for Reform to enter provincial politics, which would have the effect of subordinating federal Reform Party leader Preston Manning’s method, usually described as “populism,” to his ideology. “Crossing this Rubicon will be a huge step for Reform,” Flanagan wrote, “signalling the final transition from a temporary populist movement guided by a single, indispensable leader to a mature political party capable of reconciling disparate forces across the country.” (Flanagan, 1997) Reconciliation of that sort was increasingly the order of the day and, naturally enough, a party merger was one route towards such a goal, even as efforts toward that end were thwarted. 

Following the “Winds of Change” conference in 1996, Flanagan and Stephen Harper launched an extended analysis of the prospects for unity. First, assessing that the conference “had no impact whatsoever” on the prospects for reconciliation between the PC Party and Reform Party, they published a relatively brief article shortly before the election of 1997 in which they argued that the disarray among conservatives meant that the governing Liberals helmed something of a “benign dictatorship” or a “one-party-plus system,” where across, “a hundred years since 1896, Liberal government has been the rule, their opposition habitually weak, and alternative governments short-lived.” (Harper and Flanagan, 1997) A more united and organized Canadian conservatism could challenge the established pattern. 

Given the results of 1997, Preston Manning reconsidered things alongside Flanagan and Harper. In May 1998, Manning came out with a plan to upend the existing structure of the Reform Party and assembled a committee comprised of Reform representatives and representatives from other conservative parties to consider the idea. These efforts led to the convening of a “United Alternative” assembly in February 1999, where delegates voted to establish an entirely new party and, perhaps most importantly, to hold a leadership race that would elect a new leader. In January 2000, a second United Alternative assembly voted to form a new party that would be called the Canadian Reform Conservative Alliance and Stockwell Day was elected as the nascent party’s first leader. The Progressive Conservatives, for their part, were not enthused, and early relations between the Alliance and PCs were rocky. (Flanagan, 2001) If there was now a party called “The Alliance,” there was still not a genuine alliance among Canadian conservatives. 

Shortly after the federal election in November 2000, a mutiny against Day’s leadership emerged and, from this point, the Calgary School jumped unambiguously into the unity camp. Both Bercuson and Cooper, who in the late-1990s had insisted on the near-impossibility of a merger between Reform and the PCs, were now advocating that the Alliance join forces with those same Tories. (Duffy, 2001; B. Cooper, 2002) For Flangan, who had worked for Manning and the Reform Party in the early-1990s before his termination as an advisor, it was a return to politics from the academic world of the Calgary School. From November 2001, Flanagan worked alongside Stephen Harper to make him Alliance leader by 2002. (Flanagan, 2007)

With Harper at the helm of the Alliance, merger momentum increased, and in 2003 Harper and the new PC leader, Peter MacKay, at last negotiated a merger of the Alliance with the Progressive Conservatives, effectively stitching Canadian conservatism back together again after a decade in the electoral wilderness. The same period of turmoil that launched the Calgary School into the public and political spotlight had, for the Tories, been an existential crisis. Failing to meet the crisis by failing to sufficiently embrace the antisocial statism that the neoliberal era demanded, the PCs had suffered a slow and agonizing demise, but it was not merely a matter of institutional shuffling. Within a decade, antisocial statism had become the operative ideology of the Canadian right, and the Calgary School had led its proliferation. Under Stephen Harper’s Conservative governments from 2006 to 2015, its status was further cemented. As Donald Gutstein writes, the Calgary School “dominated the thinking of Stephen Harper.” (Gutstein, 2014) For more than two decades, the social functions of the Canadian state have been up not just for questioning but, at turns, for dismantling. 

Commonsense? Carney and the Social State

The crisis of the social state cannot be demonstrated by a quick glance at the ideological orientation of the party in power due to the nature of passive revolutionary governance. In the 1990s, one outcome of the broad conservative disarray was that it fell first to the Liberal Party of Canada to properly embrace neoliberalism. After the Liberals were elected in 1993, on a platform that promised a repudiation of trends toward free trade, fiscal austerity, and welfare reform, Finance Minister Paul Martin promulgated a 1995 budget that embraced such policies instead. In the name of balanced budgets and debt reduction, subsequent Liberal governments cut spending on healthcare, education, welfare, and social services. It was, as Steve Patten has written, “a defining moment in the process of neoliberalization.” (Patten, 2013)

Thirty years later, the Liberal grip on power is not as firm as it was in the mid-1990s, and the global neoliberal regime is in tatters, having been radicalized from within thanks to the “new fusionism” of radical neoliberals from the United States and all over the world. (Slobodian, 2025) Meanwhile in Canada, the Liberal Party under Prime Minister Mark Carney has again sought to derive political legitimacy from its ability to govern by triangulation, taking up the ideological mantle of apparent conversative enemies to undercut their appeal. As of late 2025, it is far too soon to pronounce an absolute ruling on the Carney government, but early policy moves suggest that the plan is to find a path between the Trump administration on the one hand, and the Poilievre Conservatives on the other, by presenting capitulation as pragmatism. Early indicators demonstrating capitulation to conservative ideals have included the abandonment of the Digital Services Tax and the billions in revenue that it would have generated annually from US tech companies, a move undertaken to appease Trump and his Big Tech allies; increased defense spending in response to Trump administration demands; and the introduction of Bill C-5, the One Canadian Economy Act, to speed along infrastructure projects in the “national interest,” criticized for its alignment with fossil fuel interests against the rights of Indigenous Peoples. The Conservatives, without a leader in the House of Commons during the early agenda of the Carney government, voted unanimously with the minority Liberal government on their common policy program.

In the era of the social state’s retrenchment, the ideological direction of Canadian passive revolution has changed. In Ian McKay’s account of the passive revolution from 1840 to 1950, governments consistently moved to undermine movements of the radical democratic left, which was testament to the reach and power of those movements. (McKay, 2010) Despite the setbacks for left-wing social movements throughout that century, the struggle still led to some real gains. At the end of McKay’s passive revolutionary period in 1950, Canada was far from a social democratic paradise, but at minimum the Canadian state took an active social role. In ensuing decades since the 1950s, as the Canadian left became increasingly marginalized, it ceased to be a source of threatening pressure. Why make even self-interested overtures to no longer threatening movements? 

Since the 1980s, the most successful protest movements in Canadian politics have been right-wing movements. Accordingly, the ruling elite, often if not always based in the Liberal Party, has targeted those movements for passive revolutionary pillaging. With some exceptions, the political-economic trend in Canada has shifted toward the further hollowing of the social state. While the likes of the Calgary School enjoyed direct political influence among conservatives, the logic of passive revolution indirectly brought their outlook into mainstream Canadian policymaking, even among superficially progressive administrators. To borrow further from Ian McKay, the Canadian state still “lacks both the structural and ideological resources of many of its bourgeois counterparts in the world.” (McKay, 2010) Limited and reactive governance remains the norm. Understanding these weaknesses is a prerequisite to exploiting them in the broad social interest, which has too long been denounced, attacked, and undermined.

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