Canada's Economy Needs a Complete Reorientation

by Maj (ret'd) CORNELIU. CHISU, CD, PMSC, FEC, CET, P. Eng. Former Member of Parliament Pickering-Scarborough East In my humble opinion, Canada needs to make fundamental structural changes to its economy to remain a competitive country. I see that other countries are doing quite well. China for example, has become a hunting ground for election interference in Canada, instead of being considered a shining example of how to achieve a flourishing economy and build great infrastructure for the benefit of the country’s citizens. Instead of concentrating on important issues such as how to improve our economy, our politicians are losing taxpayers’ money on many futile projects. I look in wonder at what China has achieved in the last 30 years; building cities and important infrastructure in record time, to develop their country. In contrast, what have we done in Canada in terms of infrastructure in the last 30 years? That should be the main preoccupation of our politicians rather than dealing with ivory tower projects and wordsmithing useless legislation. It is time for Canada to wake up and become an engine of the world economy once again. We need to rethink our approach to the economy with a view to making the most of our natural resources, and undertaking a complete overhaul of our society. Lately, too much of the economy appears to be concentrated in the hands of a few, who have our politicians in their pockets. In order to benefit the people, it is important for strategic industries of the country to remain in the hands of the government, because the government represents the people and their interests. Two prime examples of strategic industries are energy and steel. There are others as well, but the LCBO is certainly not one of them. Our steel industry is gone. It was subject to foreign takeovers, following the sale of steel giants Alcan, Dofasco and Inco. The current practice of the government farming out expertise to private consultants is detrimental to our economic welfare. The government needs to have expertise in-house. We have a huge public service. Wouldn’t you think that it would include knowledgeable people? I am suggesting, that as a government, you cannot rely on self-interested others to decide on your nation’s future, and you need in-house expertise to be able to ask the right questions when experts advise you. As a responsible government, you need to have the power to outline the future of the country with no interference from interest groups. This also means a complete restructuring of our thinking about combining private enterprise with state owned enterprises. This might be a new way of thinking about capitalism; let’s call it “sociocapitalism”. Considering our daily issues in Canada, we have seen that the Ontario 2024 spring budget forecasts a big deficit. We can probably expect the federal budget to be equally depressing. These budgets tend to bring forth a torrent of words without saying anything meaningful. 200 pages, 400 pages etc. and the result is basically a big nothing. Canada’s major issue today is waning productivity. On this item the federal government’s performance has been lacklustre at best, and clueless about solutions for the future. Productivity has fallen in six consecutive quarters and is now on a par with where it was seven years ago. Add a lack of business investment to this lack of productivity, probably due to many restrictions and non-business friendly legislations enacted, and the national economy faces serious problems. Government incentives and regulatory approaches that change year to year do not inspire confidence. The government’s most recent contribution to the competitiveness file is a case in point. Bill C-56, which made a number of competition-related changes, was aimed at cracking down on “abusive practices” in the grocery industry. Accusations that no one, including the Bank of Canada in its own study, has been able to substantiate. Rather than encouraging investment, it added a political actor — the minister of industry — to the market review process. The Business Council of Canada called the move “capricious”. While blatant price-fixing is rare, the lack of investment is a result of the paucity of competition in many sectors, where Canadian companies protected from foreign competition are sitting on fat profit margins and do not feel compelled to invest to make their operations more efficient. In every sector, monopolies and oligopolies reign supreme, resulting in lower investment, lower productivity, higher prices, worse service, lower wages and more wealth inequality. The cost of cell phones and phone service pricing is a prime example. Canadians pay among the highest prices for their cell phone services, and Rogers, Telus and Bell are the priciest carriers in the world. Would not it make sense for the government to take over the administration of this area? After all, communications is a strategic field. The airline industry is another example. Two airlines in this country control 80 per cent of the market, even though Air Canada was ranked dead last of all North American airlines for timeliness. Finally, six banks control 87 per cent of Canada’s mortgage market, while five grocery franchises — Sobeys, Metro, Loblaw, Walmart and Costco — command a similar dominance of the grocery market. In fixing the economy, we do not need government intervention; we need government ownership in strategic industries. To achieve this, we need revised capitalistic thinking, “sociocapitalistic” thinking to take place and be implemented; innovative, forward-looking and out-of-the-box thinking. In conclusion, we need to act now and we need to act fast, to maintain our standard of living, and that of future generations. Think about it. Get involved