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Business

Canada’s productivity and prosperity slump

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7 minute read

From Resource Works

“The U.S. is on track to produce nearly 50 percent more per person than Canada will. This stunning divergence is unprecedented in modern history.”

National productivity is key to our personal prosperity and standard of living—and we’re in trouble.

Canada’s productivity, a measure of our efficiency in producing goods and services, has been seriously slumping for years, and we are now one of the least productive G7 nations.

Now, business leaders say part of the solution could, and should, lie in producing natural resources and supercharging the resource sector.

The Royal Bank of Canada reports: “The Canadian economy has continued to underperform global peers. Declines in per-capita output in seven of the last eight quarters have left average income per person back at decade-ago levels, and the unemployment rate has risen more than in other advanced economies.

“Canada is not ‘officially’ in a recession… but per-capita gross domestic product and the unemployment rate are more representative of what individual households and workers are experiencing in the current economy, and on that basis, it certainly feels like one.”

Now, a new report by the Canadian Chamber of Commerce says a comprehensive national strategy is needed to promote resource investments.

“We really need to lean into our strengths as a country,” says report author Andrew DiCapua. “We are lucky to live in a country where we have abundant natural resources… We should be trying to find ways to attract investment to supercharge the sector.”

Senior economist DiCapua notes: “With Canada facing significant economic challenges—below-trend growth, declining living standards, regulatory uncertainty, and weak business investment—the Canadian economy is not keeping pace.

“The main recommendation here is to create regulations and policies that provide regulatory certainty—or rather clarity—so that investment can be attracted into this crucial (natural-resource) sector.”

The national business group says the new approach should include streamlining government regulations, recognizing the need for timely approval of major projects, and ensuring policy stability.

It also recommends speeding up the delivery of investment tax credits for projects that cut emissions and adopting a trade infrastructure plan to ensure the country has sufficient roads, ports, and energy transmission lines for accessing resources in remote areas.

The Chamber notes that the natural-resources sector is the second-largest in Canada, paying compensation last year that was $25,000 more than the national average.

“The sector can do this because of its productivity prowess, which is closely linked to the country’s prosperity and long-term standard of living. This is why increasing investment in high-productivity sectors, particularly within natural resources, is an obvious remedy to our productivity challenges.”

And it adds: “Given the natural resources sector’s higher-than-average Indigenous workforce participation, higher wage opportunities can help increase Indigenous employment and economic participation, furthering economic reconciliation efforts by supporting Indigenous-owned businesses, equity partnerships, and employment.”

Economists, business leaders, and the Bank of Canada have highlighted the country’s productivity woes for years—and the level of concern is growing.

As TD Economics pointed out in a worrisome report: “Canadians’ standard of living, as measured by real GDP per person, was lower in 2023 than in 2014.

“Without improved productivity growth, workers will face stagnating wages, and government revenues will not keep pace with spending commitments, requiring higher taxes or reduced public services.”

And: “Over the decade prior to the pandemic, business sector productivity grew at a respectable rate of 1.2% annually. Since 2019, it has ceased to expand at all, setting Canada apart as one of the worst-performing advanced economies, not to mention in stark contrast to the United States…

“The woes are widespread. Relative to growth in the decade prior to the pandemic, only a few service industries have managed to improve their performance… To get the same output, it now requires more hours from workers. Hard to believe this could occur in a digital age.”

Economist Trevor Tombe of the University of Calgary states: “The gap between the Canadian and American economies has now reached its widest point in nearly a century.

“If this continues, we’ll not have persistently seen this wide of a gap since the days of John A. Macdonald… Taking bolder action to address this growing prosperity gap is needed. And fast.

“The U.S. is on track to produce nearly 50 percent more per person than Canada will. This stunning divergence is unprecedented in modern history.”

Earlier this year, Carolyn Rogers, senior deputy governor of the Bank of Canada, gave this warning on our productivity: “You’ve seen those signs that say, ‘In emergency, break glass.’ Well, it’s time to break the glass.”

Rogers said in a Halifax speech: “An economy with low productivity can grow only so quickly before inflation sets in. But an economy with strong productivity can have faster growth, more jobs, and higher wages with less risk of inflation…

“We thought productivity would improve coming out of the pandemic as firms found their footing and workers trained back up. We’ve seen that happen in the US economy, but it hasn’t happened here. In fact, the level of productivity in Canada’s business sector is more or less unchanged from where it was seven years ago.”

It’s beyond time for our federal and provincial governments to get in gear and take steps to help get our productivity back on track.

The Chamber of Commerce’s recommendations would be a good place to start: adopt sensible regulations and stable policies that encourage investment in our natural resources, and speed up the approval of major projects.

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Carbon Tax

The book the carbon taxers don’t want you to read

Published on

By Franco Terrazzano

Prime Minister Mark Carney wrote a 500-page book praising carbon taxes.

Well, I just wrote a book smashing through the government’s carbon tax propaganda.

It tells the inside story of the fight against the carbon tax. And it’s THE book the carbon taxers don’t want you to read.

My book is called Axing the Tax: The Rise and Fall of Canada’s Carbon Tax.


 
Axing the Tax: The Rise and Fall of Canada’s Carbon Tax 

Every now and then, the underdog wins one.

And it looks like that’s happening in the fight against the carbon tax.

It’s not over yet, but support for the carbon tax is crumbling. Some politicians vow to scrap it. Others hide behind vague plans to repackage it. But virtually everyone recognizes support for the current carbon tax has collapsed.

It wasn’t always this way.

For about a decade now, powerful politicians, government bureaucrats, academics, media elites and even big business have been pushing carbon taxes on the people.

But most of the time, politicians never asked the people if they supported carbon taxes. In other words, carbon taxes, and the resulting higher gas prices and heating bills, were forced on us.

We were told it was good for us. We were told carbon taxes were inevitable. We were told politicians couldn’t win elections without carbon taxes, even though the politicians that imposed them didn’t openly run on them. We were told that we needed to pay carbon taxes if we wanted to leave a healthy environment for our kids and grandkids. We were told we needed to pay carbon taxes if we wanted to be respected in the international community.

In this decade-long fight, it would have been understandable if the people had given up and given in to these claims. It would have been easier to accept what the elites wanted and just pay the damn bill. But against all odds, ordinary Canadians didn’t give up.

Canadians knew you could care about the environment and oppose carbon taxes. Canadians saw what they were paying at the gas station and on their heating bills, and they knew they were worse off, regardless of how many politicians, bureaucrats, journalists and academics tried to convince them otherwise. Canadians didn’t need advanced degrees in economics, climate science or politics to understand they were being sold a false bill of goods.

Making it more expensive for a mom in Port Hope to get to work, or grandparents in Toronto to pay their heating bill, or a student in Coquitlam to afford food won’t reduce emissions in China, Russia, India or the United States. It just leaves these Canadians, and many like them, with less money to afford everything else.

Ordinary Canadians understood carbon taxes amount to little more than a way for governments to take more money from us and dictate how we should live our lives. Ordinary Canadians also saw through the unfairness of the carbon tax.

Many of the elites pushing the carbon tax—the media, politicians, taxpayer-funded professors, laptop activists and corporate lobbyists—were well off and wouldn’t feel the brunt of carbon taxes. After all, living in a downtown condo and clamouring for higher carbon taxes doesn’t require much gas, diesel or propane.

But running a business, working in a shop, getting kids to soccer and growing food on the farm does. These are the Canadians the political class forgot about when pushing carbon taxes. These are the Canadians who never gave up. These are the Canadians who took time out of their busy lives to sign petitions, organize and attend rallies, share posts on social media, email politicians and hand out bumper stickers.

Because of these Canadians, the carbon tax could soon be swept onto the ash heap of history. I wrote this book for two reasons.

The first is because these ordinary Canadians deserve it. They worked really hard for a really long time against the odds. When all the power brokers in government told them, “Do what we say—or pay,” they didn’t give up. They deserve to know the time and effort they spent fighting the carbon tax mattered. They deserve all the credit.

Thank you for everything you did.

The second reason I wrote this book is so people know the real story of the carbon tax. The carbon tax was bad from the start and we fought it from the start. By reading this book, you will get the real story about the carbon tax, a story you won’t find anywhere else.

This book is important because if the federal Liberals’ carbon tax is killed, the carbon taxers will try to lay blame for their defeat on Prime Minister Justin Trudeau. They will try to say that carbon taxes are a good idea, but Trudeau bungled the policy or wasn’t a good enough salesman. They will try to revive the carbon tax and once again make you pay more for gas, groceries, and home heating.

Just like with any failed five-year plan, there is a lingering whiff among the laptop class and the taxpayer-funded desk rulers that this was all a communication problem, that the ideal carbon tax hasn’t been tried yet. I can smell it outside my office building in Ottawa, where I write these words. We can’t let those embers smoulder and start a fire again.

This book shows why the carbon tax is and always will be bad policy for ordinary Canadians.

Franco’s note: You can pre-order a copy of my new book, Axing the Tax: The Rise and Fall of Canada’s Carbon Tax, here: https://www.amazon.ca/Axing-Tax-Rise-Canadas-Carbon

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2025 Federal Election

Poilievre To Create ‘Canada First’ National Energy Corridor

Published on

From Conservative Party Communications

Poilievre will create the ‘Canada First’ National Energy Corridor to rapidly approve & build the infrastructure we need to end our energy dependence on America so we can stand up to Trump from a position of strength.

Conservative Leader Pierre Poilievre announced today he will create a ‘Canada First’ National Energy Corridor to fast-track approvals for transmission lines, railways, pipelines, and other critical infrastructure across Canada in a pre-approved transport corridor entirely within Canada, transporting our resources within Canada and to the world while bypassing the United States. It will bring billions of dollars of new investment into Canada’s economy, create powerful paycheques for Canadian workers, and restore our economic independence.

“After the Lost Liberal decade, Canada is poorer, weaker, and more dependent on the United States than ever before,” said Poilievre. “My ‘Canada First National Energy Corridor’ will enable us to quickly build the infrastructure we need to strengthen our country so we can stand on our own two feet and stand up to the Americans.”

In the corridor, all levels of government will provide legally binding commitments to approve projects. This means investors will no longer face the endless regulatory limbo that has made Canadians poorer.  First Nations will be involved from the outset, ensuring that economic benefits flow directly to them and that their approval is secured before any money is spent.

Between 2015 and 2020, Canada cancelled 16 major energy projects, resulting in a $176 billion hit to our economy. The Liberals killed the Energy East pipeline and passed Bill C-69, the “No-New-Pipelines” law, which makes it all but impossible to build the pipelines and energy infrastructure we need to strengthen the Canadian economy. And now, the PBO projects that the ‘Carney cap’ on Canadian energy will reduce oil and gas production by nearly 5%, slash GDP by $20.5 billion annually, and eliminate 54,400 full-time jobs by 2032. An average mine opening lead time is now nearly 18 years—23% longer than Australia and 38% longer than the US. As a result of the Lost Liberal Decade, Canada now ranks 23rd in the World Bank’s Ease of Doing Business Index for 2024, a seven-place drop since 2015.

“In 2024, Canada exported 98% of its crude oil to the United States. This leaves us too dependent on the Americans,” said Poilievre. “Our Canada First National Energy Corridor will get us out from under America’s thumb and enable us to build the infrastructure we need to sell our natural resources to new markets, bring home jobs and dollars, and make us sovereign and self-reliant to stand up to Trump from a position of strength.”

Mark Carney’s economic advice to Justin Trudeau made Canada weaker while he and his rich friends made out like bandits. While he advised Trudeau to cancel Canadian energy projects, his own company spent billions on pipelines in South America and the Middle East. And unlike our competitors Australia and America, which work with builders to get projects approved, Mark Carney and Steven Guilbeault’s radical “keep-it-in-the-ground” ideology has blocked development, killed jobs, and left Canada dependent on foreign imports.

“The choice is clear: a fourth Liberal term that will keep our resources in the ground and keep us weak and vulnerable to Trump’s threats, or a strong new Conservative government that will approve projects, build an economic fortress, bring jobs and dollars home, and put Canada First—For a Change.”

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