(Today's guest editorial comes from Robert Roach, director of strategic policy and research at the CANADA WEST FOUNDATION in Calgary.)
With all the hullabaloo about the sub-prime mortgage meltdown in the United States, there is a danger that Canadians will pay even less attention to what is really important when it comes to the economy. The same danger lurks when oil prices and the dollar rise and fall, when tech bubbles burst and when investors get jittery the day before the release of the latest short-term statistic.
We tend to forget about long-term trends and the long-term responses needed to address them. Canada's economy (and the U.S. economy) will weather the current sub-prime mortgage storm. But we may not do so well adjusting to the possible end of North American auto manufacturing in 20 years or the largest exodus of trained labour from the Canadian workforce in our history that will accompany the retirement of the Baby Boomers.
It is these examples of fundamental economic restructuring that should be the talk around the water cooler, grabbing headlines and driving public policy.
Canada is an economic powerhouse with a long list of advantages ranging from our rich natural resource base to our highly educated population and incredible quality of life. But these advantages are not permanent features; they are not the inevitable byproducts of life in Canada. There is, in fact, an entire world of competitors out there (not to mention potential partners) who won't look twice as they pull ahead past Canada.
Meanwhile, we remain preoccupied with day-to-day economic news and worry about getting a new poultry factory up and running when we should be taking the bold steps needed to reposition Canada in the global economy. I have nothing against chicken and keeping one eye on current economic conditions makes sense, but we need to put more effort into things like making Canada the world leader in post-secondary education and ramping up our productivity so we leave our competitors (both current and future) in the dust.
It's like a hockey game: yes, we need to make sure our skates are tied, but we also need to have the best players, the best coach, the best game plan, and the most heart.
Despite this, we continue to struggle on some pretty basic levels. We are, for example, still wresting with recognizing the foreign credentials and experience of immigrants. Let's get this done and move on.
Our universities are well-positioned to go to the next level and become the best in the world, but we can't quite seem to bring ourselves to jump into this with both feet. Dipping our toe in will not get the job done.
We still have an employment insurance program that rewards people for staying where there are no jobs, and we continue to stare at our health care system like it is a mythical beast that cannot be managed by mere mortals.
There are many areas of the economy we can, and should, address, but three top the list. First, we have to do better on the human capital front. The jobs of the future, and the ones we want for Canadians, demand a population that is educated and creative. As Peter Schwartz, the chairman of Global Business Network, has said, "A nation's capacity for innovation will determine whether it will be rich and powerful or poor and weak."
Second, we have to embrace the skills that immigrants bring to Canada and not lose years of productivity while they languish in red tape and are forced to fight old school attitudes about "foreign workers". And we have to let the world know that this is the case: Canada is the place to be as the global race for talent continues to heat up.
Third, we have to continue to embrace and champion an open global economy. Canada is a nation of traders, and our future economic success will depend on our ability to adjust to and expand global trading patterns. The protectionism we are seeing expressed south of the border is not the answer, but the problem.
It's not, however, all doom and gloom. On the contrary, it's time to move past Canadian modesty and embrace our advantages. Take China: many of us stand around in awe of this giant as it flexes its newfound economic muscles. But China's recent growth is rivalled by its human rights violations and environmental problems. Canada has major adjustments to make, but it is not facing revolution against a totalitarian government or environmental chaos.
What Canadians need to do is worry a bit less about the current level of the TSX and a lot more about how to build on our economic strengths to dominate in the global economic arena over the long-term. This economic race is an endless marathon of 100-metre dashes so it's important to focus on more than just the current sprint for the ribbon.
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The Canada West Foundation (www.CWF.ca) is in the midst of the "Going for Gold Project" examining how to ensure western Canada's, and by extension Canada's, long-term success in the global economy.
Robert Roach may be contacted at roach@cwf.ca.
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