The Weekly Wrap: Return of the Tory Syndrome

That omission isn’t accidental. Productivity has become the word that dare not speak its name in Canadian politics. It’s too dry, too revealing, too disruptive to the comforting illusion that we can subsidize or spend our way to prosperity. Yet productivity—the value we create for every hour worked—is the single most important determinant of long-term output and wealth. And by that measure, Canada’s performance has been dismal, as two Hub articles set out this week. Lakehead University economist Livio Di Matteo reminded us that, since 2015, real GDP per capita has grown by just 2 percent—an annual average of one-fifth of 1 percent. It’s a lost decade for living standards. In practical terms, the typical Canadian is barely better off today than 10 years ago. Meanwhile, Business Council of Alberta economist Alicia Planincic showed that business dynamism—the churn of firms that drives innovation and job creation—has collapsed. In the United States, firm turnover has fallen by 23 percent since the mid-1980s. In Canada, it’s down 38 percent, driven by a plunge in new business formation. Fewer entrepreneurs are starting companies, and fewer companies are scaling into global players. These aren’t cyclical fluctuations or the outcomes of Trump’s unjustified attacks. They’re the symptoms of a deeper sclerosis: too little competition, too much regulation, and too much faith in government intervention. The political debate still treats the economy as a series of short-term problems to be managed rather than long-term conditions to be transformed. When Carney talks about “building” and “Buy Canadian,” he’s channelling that same instinct. Government remains at the fulcrum of how we think and talk about the economy. He’s not drilling down into the underlying market conditions or ask why productivity growth has been so elusive. Canada’s secular challenge is not that we’re too small to compete, but that we’ve become too complacent to change. Our economy isn’t producing enough new ideas, new firms, or new wealth. The policy conversation, meanwhile, has become unmoored from this reality. We talk about redistribution and resilience. No one is talking about how to make Canadians richer. The upshot is that we need to re-politicize productivity. It’s not a technical curiosity or a wonky obsession. It’s the moral measure of whether we’re expanding opportunity or rationing it. The politics of genuine growth would require humility about what governments can do and confidence in what the ruthless discipline of markets must do. Until then, Canada will continue to misread its economic story. The real hinge moment isn’t coming in next month’s budget. It’s the one we’ve been avoiding for years: whether Canada can once again build an economy that creates wealth and opportunity rather than redistributes it. We’ve already learned the lessons on the follies of industrial policy—let’s remember them Recent weeks mark the 50th anniversary of a key moment in the modern history of Canadian industrial policy: the failure of the Bricklin, the short-lived attempt by the New Brunswick government to build a “great Canadian car.” The sleek, gull-winged SV-1 was supposed to prove that government could not only support industry but create it, even in improbable market conditions. Instead, it stands as a monument to the enduring folly of economic nationalism—the belief that governments can engineer domestic industries or technologies through the brute force of protections and subsidies. The Bricklin project was conceived in the 1970s as an expression of economic nationalism and state planning driven by the twin forces of protectionism abroad and anti-Americanism at home. New Brunswick Premier Richard Hatfield envisioned his province playing a role in automobile manufacturing. The province poured millions into the venture. By 1975, fewer than 3,000 cars had rolled off the line before the company collapsed under the weight of cost overruns, mechanical failures, and political interference. The dream of a homegrown Canadian automobile dissolved into a collector’s curiosity. That story should feel uncomfortably familiar. Fifty years later, Canadian policymakers are once again seduced by the promise of government-led industrial revival. Under pressure from Donald Trump’s trade threats and a rising chorus of protectionist sentiment, we’re seeing renewed calls for Ottawa and the provinces to protect and subsidize domestic industries—including, remarkably, another “made-in-Canada” car. But the lesson of the Bricklin is clear: Government cannot create sustainable industries through interventionist force. Protection and subsidies may generate headlines and temporary jobs, but they also produce massive costs and lasting distortions. They overestimate the capacity of government to overcome market fundamentals. And they leave taxpayers holding the bag when the economics predictably don’t add up. As we mark the half-century since the Bricklin’s demise, Canadians would do well to remember that the proper response to Trump’s autarky isn’t our own state-sponsored vanity projects. It lies instead in creating the conditions for industries and technologies to succeed on their own merits. The Bricklin failed because it tried to substitute political ambition for market reality. It’s a costly lesson we can’t afford to relearn.