Why did the Senior Deputy Governor of the Bank of Canada give a speech on productivity that could have been given in the 1990s?

I just read the speech from the senior deputy governor of the Bank of Canada that says that Canada’s long-standing poor performance on productivity is an “emergency.” As far as I can tell, there was not one real idea in that speech, and almost nothing that hasn’t been said for 30 years.

And then the Public Policy Forum, which is about to do its annual Growth Summit, re-posted the speech claiming that their summit would focus on “fixing productivity once and for all.”

The narrowness and orthodoxy of the Bank and our public discourse on these issues is a problem.

I hope the PPF panels will have new insights. The presence of Indigenous leaders is great. Labour and climate perspectives add value. Global perspectives are important. But it seems a lot is missing.

Reading the speech, and looking at the topics of the panels, I have a few questions:

Where is childcare? Where is housing? And particularly, will there be a critique of investor activity in residential real estate that absorbs so much Canadian capital and I would assume impacts our productivity numbers? (I would guess that some of the panelists have personally contributed to this problem). Where is public transit and the impact of gridlock and commutes on productivity?

Where is a reflection on how the structure of capitalism has changed dramatically and is dominated by a few American-based platforms that generate huge profits from surveillance, data, IP, scale, GAI, and anti-competitive behaviour? How much of our productivity gap with the US is explained by these tech giants? Where is a reflection on the role of private equity, which is transforming many sectors?

“And what about wealth distribution? I don’t want to live in a country where our productivity goes up marginally but ¾ of our grandchildren are serfs. I really don’t want my grandkids to be serfs.”

And why do so many of our firms innovate on skimming fees from consumers, rather than doing real innovation on products, processes or price?

And what about wealth distribution? I don’t want to live in a country where our productivity goes up marginally but ¾ of our grandchildren are serfs. I really don’t want my grandkids to be serfs.

These issues were absent from the speech and, to my friends at PPF, prove me wrong! I hope you can orchestrate discussions that don’t sound like the ones I listened to in the 1990s (and participated in during the 00’s)!

At least no one seems to be talking about the importance of lowering corporate taxes to increase productivity anymore, because that was clearly BS. So I guess that’s good!

These are not my areas of professional expertise (although I did do a paper for a federal task force on productivity in 1999 I think!), but it strikes me that we need to come at these issues with fresh ideas, fresh voices and fresh questions.


Share with a friend

Related reading

woman types on calculator with papers and laptop open in front of her

How Canada’s tax system puts the wealthy above workers

Rather than using the tax system to prevent wealth concentration, our current tax system promotes it. Those who earn income from their investments have more income left over after taxes, allowing them to accumulate wealth more quickly than others. SCP Fellow Silas Xuereb explains how, south of the border, we are witnessing the consequences of runaway wealth inequality – billionaires use their media conglomerates to get political favours, exploit the instruments of the state to enrich themselves and, increasingly, secure political office. All of these trends are leading to the erosion of democracy and public policy that advances the interests of the wealthy at the expense of everyone else. If Canada does not rebalance our tax system to prioritize work over wealth, we may soon find ourselves on the same path.

Screenshot of Rachel Wasserman and James Li in conversation

Trump pumps private equity with 401k changes | Breaking Points podcast

Breaking Points podcast correspondent James Li sits down with corporate lawyer, economic analyst and SCP Fellow Rachel Wasserman to discuss Trump's executive order opening up 401k plans to private equity. Trends show that with rising interest rates and frozen exit markets, the private equity investment model could be under serious stress. So, what are the implications of making this type of investment available to retail investors and their retirement plans? Rachel walks James through how private equity works, what's so dangerous about the buyout-PE model and who might get left holding the bag. 

West of Centre A political podcast with Kathleen Petty

The problem with GDP per capita | West of Centre on CBC

New research by economist and SCP Fellow Gillian Petit estimates what Canada’s GDP per capita would have been over the past decade if Canada had kept our temporary resident numbers stable. On CBC political podcast West of Centre, host Rob Brown asks Petit to dissect the metric politicians love to wield. GDP measures total output, while GDP per capita divides that sum by the population. She explains that the simple math offers an easy snapshot, but can mislead when used alone. For a true read on prosperity, Petit argues Canada needs a broader economic dashboard that weighs productivity, fairness and long term well being.

Skip to content