Look away sad days / Across this mighty land

From the eastern shore / To the western strand

I suppose it was only a matter of time. That didn’t make the news of Gordon Lightfoot’s death any easier. Gord was an unusual celebrity. I didn’t know him, but it’s hard not to feel like he was a distant acquaintance. He was a rare Canadian musician who made it abroad while telling distinctly Canadian stories. Stories about a country with limitless possibilities. I worry that vision of Canada is fading from view.

Gordon Lightfoot started out as the kind of guy who would play a set in some bar in Sudbury, and more or less ended that way—only with larger venues. He played over 60 shows in 2022, with stops in big cities like Minneapolis and Toronto, but also smaller towns like Troy, New York, and his hometown of Orillia, Ontario. His audience got bigger, but he kept touring places others might skip. 

As someone who grew up mostly in small cities that most people couldn’t name, it’s nice hearing songs about familiar places. Lightfoot sang about a country I recognize. A country tied together from coast to coast, on Indigenous lands that long predate Canada, by generations of railroad workers, loggers, miners. A young growin’ land. A complicated place, filled with imperfect people from all over the world. I hope that others see that same country when they look around. I’m not sure they always do. 

Gordon Lightfoot’s Canada is expansive. There’s no focal point. Some gravitate towards the Rocky Mountain sunset, others the skyline of Toronto. It’s a land of possibilities, not limited by one particular conception of the good or desirable. The verdant country he described holds limitless possibilities. We have opened up this soil, with our teardrops and our toil. Canada is an inexhaustible canvas.

I worry that our idea of Canada is shrinking. I was having coffee a few months ago with an economist at Commerce Court. From that vantage point, the country feels small. All of Canada’s largest bank headquarters are centered around the intersection of Bay & King. Occasionally we’d gesture towards one building or the other, referencing a report put out by this bank or that. People who work at those five banks have a lot of sway over Canada’s economy. I wondered how well they know the rest of the country. Things look a bit different from Medicine Hat or Thunder Bay than from Toronto.

I’m lucky to have lived across the country. I think it’s given me some perspective I wouldn’t get sitting here in Toronto. I’m in the minority. Most people don’t get to roam from city to city like me (or Gord). Highly mobile professionals who do get to choose their destination tend to choose Toronto, or in some cases Vancouver (or Montreal, if language isn’t an issue). I worry that our vision of Canada is constrained by the boundaries of Toronto. 

There’s nothing wrong with Toronto. Well, let me take that back. There’s plenty wrong with Toronto, but it has an understandable appeal. It’s English Canada’s one true global city. As much as I complain about it, I’m here for a reason. The trouble is when people in positions of power forget that there’s a whole big country north of Bloor, west of Pearson (and east of Vancouver). 

A lot of Torontonians seem to think that the Prairies are a few suburbs and a rodeo grafted onto some farmland. I was sitting in my old hometown of Winnipeg this winter, wondering if anyone in Toronto realizes that Winnipeg is an honest-to-God city, with people who own historic lofts and bike to work just like they might in Toronto. Or that Saskatoon has a lovely historic core, where couples hold hands while walking to cute little restaurants (on the down side of town). Or that there are Francophones in Edmonton, gay people in Calgary, and old commies in Regina. People defy generalizations.

I don’t think I’ll have much luck convincing people to spend their summer vacation in Swift Current or Brandon. If Gord couldn’t convince you that bumming around the country is a romantic notion, I sure can’t. There’s a lot of beauty throughout this country, I can assure you. Not just in nature, but in the smaller cities. The kinds of places Gordon Lightfoot passed through.

It’s easy to forget how big Canada is. The country looks a lot different when you’ve left the beaten path. Bigger, more varied, diverse. Not everywhere is a series of glass towers, farms, or cul-de-sacs. There’s a whole spectrum of cities, towns, villages. One isn’t better than the other. They all fit on this beautiful canvas. Gordon Lightfoot saw that. I hope that we can too.

Fears of recession have grown in the wake of two important bank failures in the United States. This has put central bankers and elected officials on alert and renewed calls for government action to avoid a possible downturn. 

Though many will urge the government to “do something,” we should remember two important patterns. First, recessions are less common and milder than they used to be. And second, we have economic freedom to thank for much of this change.  

Consider, first, the frequency and severity of recessions. Across Western countries, recessions are now further apart and shallower than they were in the past. Indeed, the length of time between recessions has increased by more than a year (on average) since the late 19^th century. Over time, recessions have also grown less severe. 

Based on the most recent revisions to Canada’s GDP numbers, between 1870 and 1900, inflation-adjusted GDP fell nearly once every four years and the average contraction was close to three percent of GDP. From 1900 to 1945, those proportions remained roughly similar. However, since 1945 inflation-adjusted GDP fell only once every 15 years and the average contraction was two percent. 

Before you conclude that this is because we have all become Keynesians now, consider the second important fact—this reduction in the size and frequency of recessions is due in large part to economic freedom. Citizens have economic freedom when they’re allowed to exchange with whomever they want on whatever terms they wish. For citizens to enjoy economic freedom, the government must protect and respect property rights, permit free trade, be limited in size and scope, and maintain the value of its currency. 

Economic freedom has permitted innovations in transportation, information, and financial technologies that have reduced the number and severity of recessions. Higher economic freedom makes it easier to develop and adopt these technologies. And makes it easier to adjust when shocks occur. 

In research with Jamie Bologna Pavlik and Rosolino Candela, I studied whether economically freer societies suffered less during pandemics, which are generally associated with economic contractions. Looking at data from the late-1850s onward, we found that contractions were smaller in economically freer economies because when governments let markets work, firms, consumers, and households can adjust their choices and decisions more easily. 

Other economists including Justin Callais and Christian Bjørnskov have generalized these findings to other economic threats such as natural disasters and financial crises. The lesson is clear. If Canadian governments (at all levels) were to deregulate, it would not only boost long-run growth, it would also limit the severity of the next recession, whenever it does come. 

One place to start would be policies that limit competition. These policies include limitations on foreign investment in banking, telecommunications, air transport, mining, broadcasting, and energy. They also include outright government monopolies on services such as urban transit and mail. Thanks to these policies, 30 percent of the Canadian economy is, to some degree, shielded from competition.

These barriers to competition limit the incentives of firms to innovate, cut costs, and expand their activities. The result is slower economic growth. These barriers also make it difficult for people to move between sectors of the economy, which makes it harder to adjust during recessions—something that increases the pain of a recession when one does occur. 

It’s impossible to know whether a recession is imminent. But you don’t need to be an oracle to realize that letting markets work might actually make things better, not worse.