The Keys to Aboriginal Prosperity

Aboriginal Futures, Commentary

The most important recent research on aboriginal policy has been assembled by the Harvard University’s Project on American Indian Economic Development. The old guard that occupies band offices and the government system currently in place in Canada should take heed of its findings, if our First Nations are to have any chance for economic progress.

Ten years in the making, the findings of one important policy paper should be nothing new in Canada’s Indian Country. The necessary conditions it lays out for positive change are familiar to those who struggle to make a living on our reservations, if only by their absence. Titled Sovereignty and Nation Building: The Development Challenge in Indian Country Today, the study is the summation of years of on-the-ground investigation by field workers who looked at what works and what does not for aboriginal economies. The successes and failures of many tribes located in the United States are mirrored north of the border and the paper’s findings should be a “must read” for all aboriginal leaders and First Nations senior staff everywhere.

Will they change for the sake of their people’s progress? Many will probably not, for the simple reason that they enjoy total control of every aspect of their respective reserves. This very human problem – that absolute power corrupts absolutely – hampers any chance for real self-determination. Since the mid-1970s, partly in response to the demands of Indians themselves, federal policy has shifted toward the idea of sovereignty, the belief that Indian nations should determine their own their own futures.

An identical shift in the U.S. allowed those nations that have been willing to do so to engage in genuine self-governance. The distinction the Harvard research makes is between legal sovereignty and “de facto” sovereignty, independence in fact and practice. American tribes still face many constraints, not least the power of the courts and of the United States Congress. But since 1975, a significant number of Indian tribes have become the effective decision-makers in their own affairs, often with strikingly positive results.

Sovereignty, nation-building and economic development go hand in hand. Without the first two, the last is likely to remain a frustratingly elusive dream. The tasks tribes face today is to use the power they have to build viable nations before the opportunity slips away. It is also the key to solving intractable problem of reservation poverty.

Not all reserves have stayed in the cycle of poverty. Many have taken advantage of self-determination and are prospering today. Nor did they accomplish it with the stereotypical resort to gambling casinos as the main source of revenue and employment. A few examples:

  • The Mississippi Choctaws are one of the largest employers in the State of Mississippi. Several thousand non-Indians migrate onto the reservation every day to work in the their manufacturing, service, and public sector enterprises. The Choctaws are importing labor because there aren’t enough Choctaws to fill all the jobs they’ve created.
  • Similarly, the White Apaches’ enterprises in forest products, skiing and recreation have made their reserve the economic anchor of the economy of east central Arizona, the motive force that pulls the whole region through the winter. Their timber operation is one of the most productive in the western United States, regularly outperforming private operators like Weyerhaeuser.
  • In Montana, the Salish and Kootenai Tribes of the Flathead Reservation have built a successful private sector economy based on tourism, agriculture and retail services. Unemployment rates are often lower than the rest of rural Montana. The tribal college now receives many non-Indian applicants who want the quality of education Flathead provides.
  • At Chochiti Pueblo in New Mexico, effective unemployment is close to single digits, one of the lowest rates among western reservations. That is due to the tribe’s ability to employ most of the people who want on-reservation jobs in its many enterprises.
  • The long history of warfare, imported disease, land loss, cultural suppression, racism and paternalistic federal control of reservations has had a lasting impact on Indian Nations, one that continues to handicap them today. But the decisions tribes make now and the capabilities they bring to the tasks of self-governance are crucial determinants of tribal futures.

    The key is the institutions through which they tribes govern, the ways they organize themselves to accomplish collective tasks. One of the unfortunate consequences of a century of federal control of Indian nations is a legacy of institutional dependency, a situation in which tribes have had to rely on else’s institutions, someone else’s rules, someone else’s models, to get things done. On many reservations, tribal government has become little more than a grants-and programs funnel attached to the federal apparatus. On others, tribes have simply adopted the institutions of the larger society without considering whether those institutions, in fact, are appropriate to their situations and traditons. Such dependency and blind imitation are the antithesis of self-determination.

    For sovereignty to have practical effects in Indian country, tribes have to develop effective governing institutions of their own. To succeed, the Harvard Project research indicates such structures will have to provide the following:

    1. Stable institutions and policies. The institutions of governance are the formal mechanisms by which societies organize themselves to achieve their goals. Through formal constitutions, charters, laws, codes and procedures, and through informal but established practices and norms, a society establishes relationships among its members and between society and outsiders, distributes rights and powers, and sets the rules by which programs, businesses and even individuals operate. If they are subject to abrupt and frequent changes, then the rules of the game become uncertain. That means that both tribal members and potential outside investors, uncertain what role politics will play in their efforts, are much less likely to put their energy and skills into reserve employment or capital into reserve enterprises.

    Governing institutions at many reservations in Canada lack this stability. In many instances, rules are unclear to begin with or are set on an ad hoc basis, which makes it impossible for anyone to know what to expect in dealings with band governments. Far too many times, newly elected officials change the rules to serve their own interests or those of their supporters.

    2. Fair and effective mechanisms for resolving disputes. To reduce long-term unemployment on a reservation, their leaders must establish a strong, genuinely independent judiciary that can fairly settle disputes and adjudicate claims. Outside investment is impossible without the enforcement of contracts.

    This problem is especially acute in Canada because outside courts here have consistently ruled that they have no power to enforce contracts or arbitrate asset claims on nominally sovereign reserve lands. Instead, they default to the political decisions of tribal leaders and councils. This kills any chances for investment from outside and enervates internal development, because neither outsiders nor members of the tribe can expect any security of possession.

    3. Separation of politics from business management. Far too many tribes are unwilling to let go of the total, communistic control of reservations they have inherited from the previous regime of federal paternalism. This style of governance plagues Indian reserves. Most societies don’t choose leaders on the basis of their ability to read market conditions, manage a labour force or negotiate purchasing agreements with suppliers. Ideally, they choose leaders on the basis of leadership, vision, integrity and the ability to make wise long-term decisions. When it comes to running a business, what societies typically need is to find the best business people available, people who know how to make a business succeed and become a sustainable source of income, jobs, and productive livelihoods.

    These are not political matters, they are business matters. When politics gets involved in business operations, businesses typically either fail or become a drain on tribal resources, preventing them from being used to the full advantage of the tribe. What many First Nations fail to learn is that businesses cannot compete successfully when decisions are made according to political instead of business criteria.

    4. A competent bureaucracy. As Indian nations increasingly take over the management of social programs and natural resources on reservations, and as they undertake ambitious development programs, their governing tasks become more essential to their overall success. Attracting and developing skilled personnel, establishing effective civil service systems that protect employees from politics, putting in place robust personnel grievance systems, establishing regularized bureaucratic practices so that decisions are implemented and recorded effectively and reliably – all of these are crucial to a tribe’s ability to govern effectively and thereby to initiate and sustain a successful program of economic development.

    To achieve this, the offices of many band councils and regional offices in Canada will require a complete overhaul of people. They are now occupied by people who have grown attached to a system that benefits them, but not necessarily the people they are supposed to be looking out for. In too many instances, the ranks of government are filled with political appointees who have neither the education nor the training to do their jobs effectively.

    Those who live on reservations already know much of these findings from the Harvard research paper. They are held back by a system that is far too corrupt, and by total political control over every aspect of institutions that have hampered progress. As we assume more and more control over programs from the government, one would think that things would improve greatly for reserves; sadly the opposite has happened. Instead, funds for services are directed to paying off bank loans and other liabilities created as a direct result of mismanagement.

    On the positive side, the value of this research is that it points our leaders in an entirely different direction. Aboriginals can attain the levels of prosperity and employment enjoyed by their fellow Canadians. The necessary conditions for prosperity on our Indian reservations have been discovered and have been successfully implemented elsewhere.