Don’t downplay the costs of the AI revolution: The Weekly Wrap

I still think such an outcome is unlikely, and we ought to be careful about overcorrecting in anticipation of a worst-case scenario. But neither should we take excessive comfort in historical analogies. It’s at least plausible that this wave of innovation differs not just in degree but in kind. That possibility alone warrants serious discussion rather than reflexive reassurance. The second, and more important, adjustment to Coyne’s thesis is that, while it’s true that past episodes of major technological disruption have eventually produced new economic equilibria, we shouldn’t underestimate the transition costs and their economic and social effects. Even in relatively recent memory, the decline of manufacturing employment in parts of the American Rust Belt shows how brutal these transitions can be. The so-called “deaths of despair”—drug overdoses, alcoholism, and suicide—rose sharply in regions that experienced sustained economic dislocation. And that was just a sectoral shift within an otherwise functioning advanced economy. If we look further back, the 19th- and 20th-century transition from an agrarian to an industrial economy ultimately worked out in generational terms. But in the moment, it was destabilizing and, at times, revolutionary. It contributed to radical ideologies, profound social upheaval, and even war. Economic transformation on that scale reshaped not just labour markets, but political systems and moral orders. The lesson isn’t that disruption should be resisted at all costs. It’s that we cannot underestimate the risks—especially if AI’s effects are faster, broader, and more cognitively disruptive than prior technological shifts. Historical equilibrium is cold comfort to those living through the dislocation. You do get the sense that we’re wholly unprepared. Our social welfare state was conceived for an industrial economy. Our education system has similarly been resistant to reform. Labour mobility itself is constrained by housing markets and regulatory barriers that make it harder for workers to move toward new opportunities. And I’m not sure we’ve fully reckoned with any of it. This isn’t a call for catastrophizing or overregulation or aiming to stop progress altogether. But if these claims are even half right, the AI revolution is going to be big and disruptive. And we’d better be ready. Cheer up: Canada still has some friends in Washington It’s been about three weeks since Prime Minister Carney’s “rupture” speech at the World Economic Forum, and we continue to debate the merits of his thesis. I’ve been more inclined to the view that anti-trade, anti-globalization, and anti-unipolar sentiments in the United States are now broad-based and likely to outlast President Trump. That the rupture Carney described is more institutional than aberrational. Yet this week’s vote in the U.S. House of Representatives to repeal President Trump’s tariffs on Canada is a powerful proof point for rupture skeptics. Members of Congress voted on bipartisan lines to terminate the national emergency designation that’s been the basis of Trump’s tariffs on Canadian goods. The measure now faces long odds in the Senate and an almost certain veto from the president. But the symbolism is significant. It’s a sign that Trump’s animus towards Canada isn’t the subject of a political consensus in Washington. The president retains considerable unilateral authority over trade policy. His erratic and unpredictable posture toward Canada continues to impose uncertainty on businesses, workers, and investors on both sides of the border. New reports that he’s contemplating withdrawal from the United States-Mexico-Canada Agreement underscore the stakes. A serious rupture would be costly and destabilizing. The House vote, however, demonstrates that Canada still has meaningful allies within the American political system. Many legislators understand that the Canada-U.S. relationship isn’t a zero-sum contest but a deeply integrated economic partnership that benefits both countries. For the Carney government, this development should prompt reflection. Thus far, Ottawa has largely concentrated its diplomatic efforts on engaging the administration in general and the president in particular. That focus is understandable given the outsized power of the executive branch in U.S. trade policy and Trump’s own idiosyncrasies. But the 2016-2018 experience also taught us the value of a more comprehensive strategy that engages Congress, state governments, governors, business associations, and trade unions. If anything, that lesson is more salient after this week’s vote. Canada needs every ally it can find in Washington. Congressional resistance to tariffs is evidence that the economic and institutional logic of continental integration still commands respect. It suggests that while economic nationalism is ascendant, it’s neither uniform nor uncontested. Or at least it doesn’t fully extend to Canada. The structural forces reshaping American politics are real. The risk of a rupture shouldn’t be underestimated. But the House vote stands out as a rare piece of good news. It affirms that the Canada-U.S. relationship still has defenders inside the American system and that a rupture may not yet be inevitable. Stéphane Dion isn’t helping matters Stéphane Dion has re-emerged in recent days as a vocal critic of Alberta separatism. In various interviews, the former Liberal leader and intergovernmental affairs minister has warned that any referendum on secession would have to comply with the federal Clarity Act—legislation he tabled in 2000 in the aftermath of Quebec’s near-miss referendum. Dion deserves credit for championing the Clarity Act. It was a serious and constitutionally grounded response to the ambiguities exposed by the 1995 Quebec vote and the Supreme Court’s subsequent secession reference. The law established that any future referendum would require a clear question and a clear majority before the federal government could enter into negotiations. It was a necessary affirmation that national unity would be governed by rules. But there are two problems with Dion’s latest media blitz. The first is historical. In recounting the origins of the Clarity Act, Dion has tended to cast himself as the lone architect of Canada’s post-referendum framework. Missing from that telling is the role played by Stephen Harper, who, as a Reform Party MP, sponsored a private member’s bill on referendum clarity three years earlier. Harper’s 1996 legislation was the intellectual and political precursor to Dion’s own bill. Omitting Harper’s groundwork from the story is a form of revisionism. It’s entirely plausible that without the earlier Reform initiative, the Chrétien government wouldn’t have moved as decisively as it did. A more generous accounting would acknowledge that the clarity regime was the product of cross-partisanship. The second, and more significant, problem is strategic. Dion’s intervention into Alberta’s separatist rumblings is unlikely to persuade anyone tempted by the cause. He isn’t an Albertan. And as Liberal leader, he won zero seats in the province. For many Western voters, he remains a symbol of a central Canadian political class that’s never fully grasped their grievances. If the goal is to lower the temperature and marginalize separatism, the messenger matters as much as the message. Sending Dion into the fray is a bit like dispatching former Reform MP Myron Thompson to campaign against sovereignty in Quebec. It may satisfy certain audiences elsewhere in the country, but it’s unlikely to move the voters who count. National unity is too important to become a vehicle for settling old scores or polishing personal legacies. If Ottawa wants to make the case for Canada in Alberta, it would be wise to find voices that can actually be heard there.