Scott Clark and Peter DeVries write that the economy is not in good shape. It hasn't been healthy for the last seven years:
The economy has been seriously underperforming for the past seven years and there’s little to suggest this will change over the next five.
Business fixed investment, as a share of GDP, is virtually unchanged since 2008. The unemployment rate remains stuck around 7 per cent, and both the labour force participation rate and the employment rate are below 2008 levels. These trends are dragging down the growth potential of the Canadian economy, which is estimated at around 2 per cent a year, down from 3 per cent.
Unfortunately, when it comes to economic policy, all three of the major parties are entangled in the web of neo-liberalism:
The Conservatives’ growth strategy has always been clear — cut taxes, cut spending, balance the budget, cut the size of government, hope the U.S economy recovers, and pray for higher oil prices. The entire April budget is based on this failed strategy and on projections that are pure fantasy.
What is strange is that the Liberals and NDP are twisting themselves into knots to put together growth strategies that are supposed to be different from that of the Conservatives, while at the same time adopting the Tory orthodoxy that all deficits are bad, all debt is bad, and small government is good.
Wise economic strategy requires federal-provincial cooperation -- something which has been totally absent during the Harper years:
A credible long-term growth strategy should focus on strengthening the economic efficiency of the economy. This would require renewed federal-provincial trust and co-operation, with strong federal leadership — something that has been painfully lacking for years.
It would require, too, an acknowledgement that the tax system has become a serious impediment to economic growth and must be simplified. But it will take real political courage to remove inefficient and unjustifiable tax entitlements.
If we can negotiate international free trade agreements, then why is it so difficult to create a real economic union in Canada, with free movement of goods and services among provinces? Our infrastructure at all levels of government (especially municipal) is collapsing and a national financing strategy is needed to begin rebuilding it. We need a national environmental and energy strategy that includes developing new energy-saving technologies.
Canada is -- or used to be -- a federation. Until we return to that notion, our economic future is bleak.