Joe Clark's resignation signals the acme -- or is it the nadir? -- of the 10-year crisis in Canada's party system.

The 1993 election that swept the Liberals into power also marginalized the Tories and the NDP. The leadership races both parties now face amount to a final verdict on that political realignment. It's an outcome that will be determined by the role of economic issues in Canadian political life.

If you buy the "end of history" argument, then the economic climate that brought the Liberals to power reflected the end of the debate over the organization of the economy. Communism, socialism, and government economic management are dead; capitalism, economic liberalism, and free trade are here to stay.

In this view, government's uncontestable role is to grow the pie, not slice it up. Redistributing wealth just encourages government to mess around with -- and weaken -- the economy.

What does this mean for the would-be leaders of the Tories or NDP?

At first glance, it seems like the NDP has the toughest slog. To most Canadians, they're all about distributive politics: standing up for the little guy, taking on big business, fighting for a fairer distribution of wealth.

If the NDP can't campaign on how to divide the pie, it has to convince Canadians that it can grow it -- either by joining the neoliberal consensus, or hatching a new left economic formula that has eluded the rest of the world's social democrats. Alternatively, the party could redefine itself around non-economic issues -- perhaps the environment, international politics, or human rights. Either way, it's a double order of self-reinvention.

But the Tories are in pickle, too. They could argue for growing the pie faster by cutting taxes or spending, but the Alliance already has that position covered. Or the Tories could compete on non-economic issues, and define themselves as the socially conservative alternative - but again, the Alliance was there first.

What if we reject the idea of a consensus on Canada's economic management? What if we think that along with growing the pie, we still need to argue over how it's divided?

That sends the NDP back to familiar turf. But campaigning on distributive issues makes it harder for the NDP to convince Canadians that it will grow the economy instead of distorting it.

Once again, this scenario is even worse for the Tories. On the spectrum of distributive politics, just like on the spectrum of social conservatism, they're hemmed in on both sides.

There is a third scenario: a lapse into regionalism. Each party retreats to its current regional base, and battens down the hatches.
This is the path that both parties seem to be charting. It lets the Tories distinguish themselves from the Alliance and lets the NDP forsake the tough prospect of ideological reinvention in favour of a continued riding-by-riding strategy.

Good for those parties, perhaps, but abysmal news for Canadian federalism. Party systems that become factionalized by region are at best unstable, and at worst dangerously so.

Our long history of democratic stability offers little immunity to those dangers; just ten years ago, we could point to a long history of competitive national political parties.

Times change but what will these times change into? Our party system stands at a crucial juncture between dangerous regionalization, renewed distributive politics, or a re-envisioned, post-materialist political future.