Economic policy

Over the last couple of years, there have been countless articles warning of Canada’s poor economic performance. The mic drop has increasingly been Canada’s poor performance relative to peer countries on “GDP per capita,” with growth rankings used to draw a variety of sweeping, negative conclusions about Canada’s economy. SCP CEO Matthew Mendelsohn and Policy Director Dan Skilleter draw on economist and SCP Fellow Dr. Gillian Petit's new research to explain why GDP per capita is a deeply flawed measurement for evaluating rich countries - and is easily influenced by a variety of factors having little to do with economic performance or economic well-being.

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. She also estimates the expected impact on GDP per capita in the coming years due strictly to planned reductions in Canada's intake of non-permanent residents. Among key findings: Canada’s GDP per capita is misleading and should not be used as if it were the sole indicator of economic well-being. Plus, if we had maintained our temporary resident numbers at two percent of the population in recent years, Canada’s GDP per capita would look much more like our peer countries: a little bit ahead of countries like Germany, the United Kingdom and Australia and a little bit lower than countries like Belgium, Sweden and France.

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. She also estimates the expected impact on GDP per capita in the coming years due strictly to planned reductions in Canada's intake of non-permanent residents. Among key findings: Canada’s GDP per capita is misleading and should not be used as if it were the sole indicator of economic well-being. Plus, if we had maintained our temporary resident numbers at two percent of the population in recent years, Canada’s GDP per capita would look much more like our peer countries: a little bit ahead of countries like Germany, the United Kingdom and Australia and a little bit lower than countries like Belgium, Sweden and France.

What happens when a Canadian toy company, a global trade war and the unraveling of American stability collide? Charting in the top 10 on Apple Podcasts, the new Gloves Off podcast talks to Zita Cobb of Fogo Island Inn and Jon Shell of Social Capital Partners about what comes after the collapse of business as usual. Listen for bold ideas on how Canada can prevent getting stuck playing America’s game—and losing.

Trade-war chaos and confusion are creating a perfect storm for sellers' inflation—when companies with market control choose to hike prices to gouge consumers and grow their profits when they have the chance. As SCP Fellow Kaylie Tiessen writes, this profit-led inflation often hides behind other drivers and can blindside us if we’re not watching closely. There are good reasons to accept some tariff-related price increases—elbows up, right? But she outlines three ways we can stop opportunistic sellers from using this trade chaos to mask their profiteering. We can stop powerful companies from exploiting confusion and weak oversight so working people don't pay the price while profits soar.

Canada should lead the world’s middle powers in a collective and overdue weaning from American primacy by establishing a grand new security and economic alliance. As SCP Chair Jon Shell argues in The Hill Times, ten countries including Canada, Australia, France, Germany, Italy, the U.K., Spain, Japan, South Korea and the Netherlands, or the “Core 10," would amount to about the same GDP as the U.S., with significant natural resources, massive buying power - and significant leverage against American economic aggression.

The wrecking ball that Donald Trump has taken to international trade has wounded relations between Hamilton businesses and their American suppliers and customers, reports Eugene Ellman in Hamilton City Magazine. Now, they’re looking east and west to replace traditional links to the south and pushing back. When Trump started pontificating about how Canada should become the 51st state and claiming the United States was subsidizing its northern neighbour, SCP Founder Bill Young and the team responded with Always Canada. Never 51 - part economic populism mixed with methodical policy-making, the series is devoted to the issues of wealth inequality and Canadian sovereignty.

As our new government pursues growth and a nation-building agenda, we should remember this lesson from history: too often, we build and invest, only to sell off our assets and resources to the highest foreign bidder, leaving us economically vulnerable. In this moment of extreme peril, SCP CEO Matthew Mendelsohn asks how we should “build, baby, build” in a way that doesn’t merely accelerate the trends towards consolidation of wealth and deeper economic dependence. Canada has everything we need to emerge stronger from this period of geopolitical disruption if we put economic sovereignty and broad access to wealth-building at the heart of our agenda.

Canadian businesses are immensely profitable, but businesses simply haven't been reinvesting in them. As Tom Goldsmith writes in Orbit Policy's Deep Dives, the financialization of Canada’s economy and the high levels of rent extraction that accompany it are barriers to innovation. We are impoverishing ourselves over the long term to support short-term financial gains. If we care about innovation and productivity, then we need to focus far more critical attention on corporate Canada.

We predicted that American investors would be looking to buy up Canadian businesses and assets, and that this would threaten our national security and economic sovereignty. Now Canada has to make a call on whether to kill Texas-based energy giant Sunoco's takeover of Parkland Corporation. In the Toronto Star, SCP CEO Matthew Mendelsohn and Chair Jon Shell ask: do we want to be owned by American billionaires, to work for them and have our wealth stripped away to pad bank accounts in New York and Dallas? If we really want Canada to remain ours, they argue, then we need to think and act like it.