Herb Emery, the WEF and New Brunswick’s place in the world

It is kind of fun watching politicians such as Pierre Poilievre rail against the World Economic Forum.  I kind of like Pierre but the fact the WEF is such red meat these days makes me chuckle given that just a few years ago it was dismissed as a worthless talking shop where people went to rub elbows with the rich and famous.  Now it is positioned by some as a secret cabal controlling the global economy.  FYI, you should probably be more concerned about Jackson Hole than the WEF (JK!).

The larger issue here is the move in western countries against economic openness.  After 40-50 years where most experts (many?) thought that openness – trade, investment, ideas, people – would make the world a much better place.  An open world would allow jurisdictions to capitalize on their comparative advantages, would ease global poverty, provide a stronger rationale for collective action on global issues and, in large part driven by the Europeans, reduce the amount of wars because economies would be co-dependent on each other.

IMO, most of this has come to fruition.  China alone has lifted a billion people out of poverty – it is hard to imagine how if they had not become the manufacturing centre for low value goods. There are far less wars and death by country squabbles than in the past. 

But, as many, many experts argued, we were not as good as we could have been to the jurisdictions that were hit the hardest by the shift to openness.  Canada was probably better than many other countries although I would have preferred more focus on regional economic development to expanding government transfers.

What concerns me is the criticism is coming from the left and the right. 

Whether we like it or not, small places like New Brunswick (and Atlantic Canada) are beneficiaries of this openness. I have written about this many, many times before.  The vast majority of what we consume as households is imported (from the rest of Canada and the world) including food, entertainment and many services.

Most of our savings is invested elsewhere in the world.  I encourage you to look at your RRSPs and see where the money is invested.  If you are a provincial government employee take a look and see just how much of your pension is being put to work in New Brunswick.  I’ll give you a hint. Virtually zero.  Same for federal government workers.  Ironically, the Ontario Teachers have major investments in New Brunswick from agricultural land to commercial real estate.

Every year thousands of New Brunswickers move out of the province.  If you add up all the annual out-migrants from New Brunswick to the rest of Canada between 1971 and 2022, it comes to 675,000 people (there are only ~800,000 living here).  Some of these people have moved back but this just shows the enormity of the outward migration of our people. In recent years it has averaged around 10,000 per year.  In the past we saw as many as 15,000 out-migrants per year or more.

New Brunswickers spend far more on tourism outside the province than non NBers spend in the province. 

The list goes on and on.  Our universities are talent and research incubators for the larger provinces.  I can’t tell you how many crackerjack academics I knew personally who cut their teeth here and then got ‘promoted’ to a university outside the province.

So, what does a small province with highly porous borders across all fronts do?

To paraphrase an old acquaintance of mine, for every 1 out we need to attract 1.5 in.

For everyone young New Brunswicker looking for fame and fortune in the Big Smoke, we need to attract 1.5 looking for the quality of life and career opportunities here.

For every dollar of imports spent on TVs, cars and avocadoes, we need $1.50 of exports – fish, paper, blueberries, software and administrative service.

For every dollar of yours and my pension being put to work in Australia and Kentucky, we need $1.50 of inward investment in our economy.

For every New Brunswick tourist rushing off to Disney, Cuba and Atlantic City, we need 1.5 tourists coming to bask in our rolling hills, gentle ocean beaches and maple syrup. 

For every 1 ambitious academic looking to advance their careers anywhere but here we need to offer enticing and targeted opportunities for 1.5 top academics to move here.

This doesn’t mean we don’t spend time on retention – of dollars and people – it is just a recognition that small places like New Brunswick can’t build their own cars and TVs, grow their own mangoes, and provide the vast range of career opportunities that are appealing in the modern world.

So, coming full circle, places like here do not have the luxury of cutting ourselves off from the world.  We will be worse off for it.

On this week’s Insights podcast, Dr. Herb Emery helps break it all down for you.  Check it out here:

https://podcastaddict.com/podcast/insights-with-don-mills-and-david-campbell/3295884