23 votes

Canada cannot afford another lost economic decade

18 comments

  1. [10]
    Wafik
    Link
    Our current political leadership options do not present much hope in, my opinion, of starting that economic turn around any time soon. If we accept the premise of the article, which is hard to...

    Our current political leadership options do not present much hope in, my opinion, of starting that economic turn around any time soon.

    If we accept the premise of the article, which is hard to argue against, then most of the lost decade happened under Trudeau. I voted for him initially for his promise of electoral reform, which he abandoned. Then I continued to vote Liberal mostly as an ABC voter. At this point it is hard to argue to keep him around. Hopefully his government can avoid additional scandals long enough to make a case for why people should re-elect them, but at this point the legitimate discontent combined with the convoy crazies are likely enough to throw him and most Liberal MPs out.

    That means we will almost certainly get stuck with Poilievre as PM. Many would argue the PCs are the party you want to fix the economy, but I have heard nothing from Poilievre to suggest he has any ideas that will actually improve our economy. He seems entirely content to dwell only in culture wars.

    No one takes the NDP seriously and I don't know that Singh can say that he got enough out of his agreement with the Liberals to justify the negativity it got his party for propping up an unpopular government. I don't know that we will see the NDP picking up many seats.

    Regardless, it's a depressing time for Canadian politics. I thought Trudeau was going to be our inspirational leader and I have been thoroughly disappointed with the results.

    21 votes
    1. [3]
      chocobean
      Link Parent
      I have been voting NDP since I was old enough to. Their platform has always appealed to me as an environmental issue voter. I like that they got dental care out of Trudeau, and they're working on...

      I have been voting NDP since I was old enough to. Their platform has always appealed to me as an environmental issue voter. I like that they got dental care out of Trudeau, and they're working on childcare. I hope Jagmeet jettisons the alliance and make a serious run. We have three parties for a reason and it's time we make it count, especially if we don't want to end up with two party state

      14 votes
      1. Thales
        Link Parent
        Not to mention the beginnings of a national pharmacare program. Currently it will only cover diabetes medication and birth control, but it's a start. Pharmacare is the sort of common sense policy...

        I like that they got dental care out of Trudeau, and they're working on childcare

        Not to mention the beginnings of a national pharmacare program.

        Currently it will only cover diabetes medication and birth control, but it's a start.

        Pharmacare is the sort of common sense policy that I am pleased to see the government taking action on.

        • Unlike dental or eye care, it doesn't require buy-in from providers (drug companies will gladly bid for the opportunity to be the national provider of pharmaceuticals).

        • It improves QoL (by enabling people to get the medication they need) and thereby likely has hidden benefits for productivity.

        • It is also likely to reduce some strain/spending in the healthcare system because people are less likely to skip medications to save money.

        • AND, on top of all that, it will actually reduce the amount Canadians are currently spending on medications (on average) because a single-payer system has enormous negotiation power to demand lower drug prices:

        The PBO estimates cost savings on drug expenditures of $1.4 billion in 2024-25, with that figure increasing to $2.2 billion by 2027-28.

        CTV News.

        This is the sort of no-brainer public policy I would love to see more of in Canada.

        It's frustrating that the Liberals had to be pressured into this (and dental care) by the NDP, and that they're rushing it out at the 11th hour, but it's something.

        16 votes
      2. Wafik
        Link Parent
        I'm sure the Green party loves hearing you say that. At this point, ever since the Conservative and Reform parties merged it leaves NDP and Liberal severely disadvantaged. Yet another reason I...

        We have three parties for a reason and it's time we make it count, especially if we don't want to end up with two party state

        I'm sure the Green party loves hearing you say that.

        At this point, ever since the Conservative and Reform parties merged it leaves NDP and Liberal severely disadvantaged. Yet another reason I really wanted Trudeau to reform our electoral system.

        3 votes
    2. [6]
      gowestyoungman
      (edited )
      Link Parent
      Im not sure why youre worried about Poilievre as our new (almost guaranteed) PM. The Conservatives are the party that pushes investment in business and corporate development harder than any of the...

      Im not sure why youre worried about Poilievre as our new (almost guaranteed) PM. The Conservatives are the party that pushes investment in business and corporate development harder than any of the other parties. And the one province firmly entrenched with Conservative leadership, good ol' Alberta, is a per capita economic powerhouse compared to all others, eg. 101k GDP per person vs Ontario at 69k per person or Quebec at 63k. The east has the population but the productivity comes from out west - even Conservative Saskatchewan is at 97k GDP per person.

      If anything, Canada NEEDS a Conservative government to get the economy moving again and get us out of this multi trillion dollar national debt hole that Trudeau has dug us in. Turns out that you can't spend your way to prosperity by putting it on a credit card and hiring more government employees while flooding the nation with low skill immigrants. Not surprising results from a guy who figures the budget balances itself and a Minister of Finance with a degree in Russian literature.

      3 votes
      1. [3]
        Wafik
        Link Parent
        Jim Flaherty had a degree in sociology so what's your point? Even Conservatives have Ministers of Finance that don't have a finance background. The thing about statistics is that it's very easy to...

        and a Minister of Finance with a degree in Russian literature.

        Jim Flaherty had a degree in sociology so what's your point? Even Conservatives have Ministers of Finance that don't have a finance background.

        The thing about statistics is that it's very easy to use them to prove your point. By your logic, we should look to NWT and Nunavut since theirs is $124k and $117k compared to Alberta's $103k.

        Have you looked at PPs platform? I have. I see nothing new or revolutionary that is going to help turn around the Canadian economy. Destroying our environment further by pushing the oil and gas industry in Alberta is not Canada's path forward.

        Don't get me wrong, the Trudeau government has failed horribly and deserves to be given the boot. But don't confuse the myth of the Conservative party being good for the economy with reality.

        13 votes
        1. [2]
          Loire
          Link Parent
          It's not particularly a myth if you actually look at the historical record. I think it's best at times like these to remember to that the Conservatives aren't the Republicans, and that truths...

          Don't get me wrong, the Trudeau government has failed horribly and deserves to be given the boot. But don't confuse the myth of the Conservative party being good for the economy with reality.

          It's not particularly a myth if you actually look at the historical record.

          I think it's best at times like these to remember to that the Conservatives aren't the Republicans, and that truths found in the American political system don't necessarily apply to us.

          1 vote
          1. Wafik
            Link Parent
            How far back are we going? I'm 40, so the only Conservative government I can really look at in my lifetime when I was old enough is Harper's. Going back further than that probably isn't necessary....

            How far back are we going? I'm 40, so the only Conservative government I can really look at in my lifetime when I was old enough is Harper's. Going back further than that probably isn't necessary.
            I would argue the 2008-2009 recession scared the Harper government from making economic investment. The world wide recovery had a bigger impact on Canada than any policies of his government.

            I think this article does a good job of going over it in detail.

            I am not conflating the PCs with the Republicans, especially not under Harper.

            6 votes
      2. TheJorro
        (edited )
        Link Parent
        His statements and voting record on LGBT matters, and his statements in and around trans matters should give a lot of pause. Also all the openly racist and neo-Nazi adjacent groups he's taken...

        Im not sure why youre worried about Poilievre as our new (almost guaranteed) PM.

        His statements and voting record on LGBT matters, and his statements in and around trans matters should give a lot of pause. Also all the openly racist and neo-Nazi adjacent groups he's taken meetings and photo-ops with. As much as others in this thread are saying "The Conservatives are not US Republicans", Pierre Polievre is acting and sounding like a MAGA type Republican when it comes to speaking about people he doesn't "approve" of and that should not be ignored, especially when he's also speaking out of the other side of his mouth about making Canada "the most free country" while actively working to limit the freedoms of marginalized groups. This alone should give everyone some deep distrust in his ability to lead Canada unless anti-LGBT policies, anti-trans policies, and open racism is the goal.

        Then there are the outright lies and pointed language he has employed when speaking about the CBC to tarnish its reputation, all because it is the only remaining major news publication not owned by a Conservative-backing conglomerate. This particular politicking is lifted wholesale from Steve Bannon's playbook.

        And yes, I know there's a recent article about him going against a CPC caucus member openly saying they'll introduce a bill to repeal same-sex marriage and restrict abortion, but then there's also videos of him promoting "gay people are groomers" arguments just last year. Forgive me if I don't take a populist at their (most recent) word.

        Ignoring Pierre Polievere and the current makeup of the Conservative Party of Canada and pointing to historical performance is disingenuous. It's basically the same argumentation applied to the incoming Trump administration in 2016; that the political party is much bigger than the head and they won't change direction all that much. Except all those acclaimed elder statesmen are gone, replaced by a new generation of populists who rule by sentiment and edict rather than foresight and information. The Conservatives of today are not the Conservatives of yesteryear, just as the Republicans of today are not the Republicans of yesteryear. Of course, the CPCs aren't nearly as bad as the Tea Party cum MAGA infested Republicans but it's not a different enough situation either.

        Look no further than Ontario for proof. We've been under a populist Conservative government who have not had a policy plan for over 6 years and everything has gotten much worse much faster than ever before. In fact, a lot of your data contrasting Alberta with the "east" is a direct consequence of our Conservative government. The Ontario Progressive Conservative party is not the party of Davis or even Harris anymore. And our Minister of Finance has an MBA. So did the one before him. And the one before that one also studied in business. It clearly did not help since Ontario is now in worse financial trouble than ever before, despite all the kowtowing to corporate and business interests.

        7 votes
      3. Loire
        Link Parent
        We seem to have the same "Both sides" problem in Canadian politics as the U.S., however it has been reversed such that it's used by the Liberals as a propaganda wedge against the Conservatives....

        We seem to have the same "Both sides" problem in Canadian politics as the U.S., however it has been reversed such that it's used by the Liberals as a propaganda wedge against the Conservatives. Sure Trudeau has been pretty terrible for the country but Poilievre, who has no power, never had power, and currently has no control over our direction will be just as bad or worse.

        But why do we believe that?

        In my lifetime the last two conservative PM's we have had have been improvements on their predecessors/successors in terms of economics and quality of life. Brian Mulroney inherited a terrible mess from his Liberal predecessor and, by the time he left, had left the country in a much better position than he received it. Harper, for all his faults towards the end of his reign, did the very same (with a significantly smaller mess, credit to Chrétien), only for the current iteration of the Liberals to run it into the ground once again.

        There is no "both sides" argument to be had here but it persists nonetheless because successful propaganda is always more persistent than the truth.

        Chances are likely there will be an improvement during the Conservatives' next reign, although we have no way of knowing how Poilievre will actually fare, but by the end of their decade in power we will be seeing the same words from the same people pushing the same defeatist narrative, because it works.

        These successful propaganda points, guns, marriage equality, etc. will continue to be used despite the evidence that they aren't factual.

        3 votes
  2. [2]
    skybrian
    Link
    I don’t know economic conditions in Canada very well at all, but population growth seems like important context? More workers means more economic activity, but per-capita growth isn’t going up....

    I don’t know economic conditions in Canada very well at all, but population growth seems like important context? More workers means more economic activity, but per-capita growth isn’t going up. It’s still more people living fairly well, voting with their feet to move somewhere better, so it seems like that ought to count for something?

    Macroeconomic summary statistics hide a lot of important detail. It might be more informative to look at productivity growth in different industries. If Canada is short on infrastructure, what needs to be built?

    9 votes
    1. Loire
      (edited )
      Link Parent
      I don't believe immigration is an indication of economic or national quality in this particular context. There's a number of problems with the hypothesis, for one: declining quality of life for...

      I don't believe immigration is an indication of economic or national quality in this particular context. There's a number of problems with the hypothesis, for one: declining quality of life for Canadians is still an improvement on the quality of life for immigrants from third world countries. Canada's increased immigration is largely from India, distally followed by China. It's not like Western Europeans or Americans are choosing to move here.

      Second: Immigration is not a perfect information scenario. Those coming here from other countries may not know about the lack of available housing, declining economic prospects or cost of living crisis. Thus they come for the "idea" of Canada moreso than the reality of Canada.

      12 votes
  3. Loire
    Link
    As Canada approaches a 6.4% unemployment rate (Comparables: U.S. 4%, U.K. 4.4%, AUS 4%, Germany 6%, France 7.4%) and deepening standard of living crisis it's important to consider the possible...

    As Canada approaches a 6.4% unemployment rate (Comparables: U.S. 4%, U.K. 4.4%, AUS 4%, Germany 6%, France 7.4%) and deepening standard of living crisis it's important to consider the possible causes that brought us here.

    Last month’s release of GDP numbers for the fourth quarter of 2023 showed Canada’s real GDP per capita (a measure commonly used to as a proxy for living standards) declined once again. It’s now effectively at the same level as it was in the fourth quarter of 2014.

    There’s reason to believe that this period of stagnation, and even declining economic conditions, will persist. Unlike most of our peers, Canada isn’t expected to recover its pandemic losses until 2027. Thereafter the OECD projects that among its nearly 40 members, Canada will experience the slowest real GDP per capita growth out to 2060.

    At the heart of Canada’s economic malaise is low productivity growth. Productivity is a fundamental driver of growth in incomes and living standards. The interrelationship between productivity and living standards is axiomatic: the more an economy can produce with less, the better off that society will be materially.

    Canada’s long-standing productivity challenges are well documented. What is less well-known however is that they’ve gotten worse in the past several years. From 2015 to 2022, Canada’s real labour productivity grew by only 4 percent compared to growth of 7.5 percent between 2006 to 2014.

    Canada’s poor record on investment extends to total spending on research and development. It’s the only G7 country that spent less on research and development as a share of GDP in 2021 compared to what it spent in 2000. We’re now the second lowest spender on R&D in the G7 besides Italy.

    While immigration can have a positive long-term effect on a country’s economic growth trajectory, there are serious questions regarding the absorptive capacity of Canada’s economy to account for the extraordinary rate of growth that we’ve experienced in the past two years. Economists Stéfane Marion and Alexandra Ducharme of National Bank have gone as far as to say that Canada is now in a “population trap” in which the country lacks the infrastructure and capital stock to absorb current population growth and still improve living standards.

    7 votes
  4. [2]
    sdp
    Link
    The article lays out its case about Canada's "lost decade" based on a part of charts: GDP per capita and R&D spending as a percentage of GDP. Wealthsimple's tl;dr just this morning published an...

    The article lays out its case about Canada's "lost decade" based on a part of charts: GDP per capita and R&D spending as a percentage of GDP.

    Wealthsimple's tl;dr just this morning published an article asking if Canada's economy is broken, in which they discuss GDP per capita and R&D spending. This makes me think that their article is a rebuttal, though they don't link to the hub, they do link to an op-ed by Andrew Coyne in the Globe and Mail that makes a similar point, though notably without mentioning R&D.

    Wealthsimple's argument about Canada's GDP per capita seems to be well-reasoned. The chart in the original Hub article plots Canada's GDP per capita and nothing else to give context. Wealthsimple starts by plotting the GDP per capita of both the US and Canada, which certainly seems to support the hub article's point as it shows the US far surpassing Canada. That is until they plot the same again but with more countries for context; namely Australia, Germany, the UK, France, the EU, and Japan. In context, we see that every country follows roughly the same curve except for the US, which is the clear outlier pulling ahead of the rest.

    However, Wealthsimple's argument about Canada's R&D is much less convincing. They admit that Canada's R&D spending per capita is falling short of other countries, as the Hub article's bar charts show, but argues that Canada has more R&D researchers per capita. And that a third of the US' R&D spending is the result of a handful of tech giants. This just convinces me that Canada needs to spend more on R&D and foster an environment that encourages companies to make risky R&D investments.

    5 votes
    1. Loire
      Link Parent
      I agree with this point and don't think it necessarily contradicts the Hub or Wealthsimple. Canada's biggest problem economically is a lack of investment period. The Canadian economy is stagnating...

      However, Wealthsimple's argument about Canada's R&D is much less convincing. They admit that Canada's R&D spending per capita is falling short of other countries, as the Hub article's bar charts show, but argues that Canada has more R&D researchers per capita. And that a third of the US' R&D spending is the result of a handful of tech giants. This just convinces me that Canada needs to spend more on R&D and foster an environment that encourages companies to make risky R&D investments.

      I agree with this point and don't think it necessarily contradicts the Hub or Wealthsimple.

      Canada's biggest problem economically is a lack of investment period. The Canadian economy is stagnating because investment drives entrepreneurship as well development of new methods and technologies. Investment provides the capital to take risks which results in a dynamic and vibrant economy.

      While this could get a bump from the Canadian government investing in R&D, governmental expenditures have their own economic problems. Until we can reignite private investment in the Canadian economy (not including housing) we are going to suffer further stagnation.

      3 votes
  5. [3]
    kingofsnake
    Link
    I'm not at all thrilled about the other guy's party forming a majority government, but pointing at extenuating circumstances for the mess that we're in is getting old. Bring forth the old Canadian...

    I'm not at all thrilled about the other guy's party forming a majority government, but pointing at extenuating circumstances for the mess that we're in is getting old.

    Bring forth the old Canadian tradition of "Throwing the bums out!"

    4 votes
    1. [2]
      Loire
      (edited )
      Link Parent
      There's no indication the other guys will be an improvement, but there's every indication the same people are currently causing the problem. We can only vote for change, whether that's the...

      There's no indication the other guys will be an improvement, but there's every indication the same people are currently causing the problem. We can only vote for change, whether that's the Conservatives or the NDP, and hope for the best.

      4 votes
      1. kingofsnake
        Link Parent
        I'm just thankful that we're not in the battle to the death that the US finds itself in now. Of course there are echoes up here, but it's not nearly as dire feeling.

        I'm just thankful that we're not in the battle to the death that the US finds itself in now. Of course there are echoes up here, but it's not nearly as dire feeling.

        6 votes