If I was Prime Minister...

….I would want to know why real GDP growth has been the lowest of any PM going back decades.

I realize not all PMs are as interested in economic development but in the tradition of McKenna, Chretien, et. al. there have been Liberals who believed in a strong economy to support social programs and infrastructure investment without running up big deficits. BTW, according to RBC Economics, the federal debt to GDP ratio is now up to 47% from a low of 28% in 2008.

If I was PM, I would assemble my team of economic development government leaders - ISED, ACOA, FEDDEV, Finance, CIB, BDC, EDC, etc. and ask them why real GDP growth is the lowest in two generations and how can we improve?

Then I would write down a list of all the big economic development initiatives the government launched with great fanfare from 2 billion trees, to critical minerals strategy and others and ask how much progress have we made? How come all that effort hasn’t moved the GDP needle?

I think I know the problem (I being the author not the hypothetical PM). There is always room to pass the buck when it comes to economic growth. When I joined GNB in 2015 I asked the folks at ACOA why the regional economy had been stagnant for over a decade and the response I got was “the firms we support are doing fine”. I asked the folks at GNB why the provincial economy had been stagnant and was told “we can be expected to influence an entire economy”.

When everyone sees their little piece of the pie, someone else can be blamed when we get bad system-wide results.

Take the Ambition 2035 initiative to grow the ocean economy in Canada 5X by 2035. This even as they are cracking down on aquaculture, lukewarm on offshore oil and gas and don’t even get me started on seabed mining. Even offshore wind, which has seen good progress, might not see any turbines spinning by mid to late 2030s (if ever).

If I was PM and I read Ambition 2035, I would say “there is no passing the buck on this”. I want my departments (ISED, ACOA, etc.) to lead the file and work with the provinces to address all the big opportunities. I would want a monthly report on updates and a clear indication we are making progress each year.

It has become easier to equate doling out cash to attract companies as synonymous with economic development. This is not the case. At best you attract some investment but not necessarily incremental growth (take the example of EV investment, that will not be accretive - it will just replace existing ICE vehicle production - it will not grow the GDP) and at worst you are just replacing private investment with taxpayer investment.

What we need is a clear plan for economic growth. Growing the ocean economy 5X is a very ambitious plan and would actually move the needle on economic growth. It is just not clear to me how that will happen without unprecedented inter-government cooperation, private sector engagement and global company investment.

Everything gets confused. Some people equate a surge of temporary residents - mostly attending university and college (and their spouses/families) as economic development. It provides some economic benefit to be sure but you can’t replace mining, oil and gas, energy infrastructure investment, etc. with more college education and expect sustained GDP growth.

We need to look at the underlying factors - a growing trade deficit, a growing international investment deficit, a lack of CAPEX in natural resource industries - and figure out how to fix them without ignoring other issues like housing.

If I was PM, I would put the pedal to the metal on export-focused economic development with an eye to getting our real GDP growth back up to the top quartile among the OECD which is where we have been in the past.