The Vassal State


The past week has seen the unfolding of a familiar saga: another Canadian corporate gutting. This time it was Bombardier; lackluster management and US protectionism led it to concede defeat in its C-series aspirations and hand control of the program over to Airbus. Stock market watchers cheered the move: “Better half a loaf than none”.

This, unfortunately, is our pattern. We sell ourselves a fiction, claiming that as Canadians we punch above our weight. Reality, however, is bleaker: we think small, and stay small. Over the past 30 years we’ve seen the gutting (charitably, the slimming) of corporate Canada as our largest companies have been sold to US, European or Chinese concerns. The ones that remain are lightweights: mostly low-value-add operations whose highest aspiration is simply to be included in the US supply chain. For Canadian businesses, “making it” is equated with exporting to our southern neighbor or, if you dream big – being bought by a deep-pocketed competitor.

Minimalism and this “follower mentality” play out in our collective mindset, with untold opportunity costs. We spend billions educating the next generation, only to watch them emigrate in droves to hungrier, more dynamic economies. Our immigration and tax policies have left us with too small and too fragmented a population. Failure is anathema, and we snipe bitterly at those who achieve more than the median. We’re more concerned with angling for Amazon’s HQ2 or another GM assembly plant than with creating the next Amazon or GM.

In truth, we’re a farm team to other countries: educating our youth, and then watching them leave because we’re too provincial for them to realize their dreams.

It’s a prescient time to question this attitude. With Canada 150, the forced “renegotiation” of NAFTA, and Bombardier’s troubles, we have the opportunity to ask ourselves: what do we want for our future? Should we stay the course? Allow risk-aversion and fear to guide our resource-heavy economy, and so, fall further behind the innovators of the world? If we do, we will lose the ability to control our future. We’ll be nothing more than a vassal state. Yes, we’ll likely grow, but only as fast as our partner to the south deems it: both protectionism and the draw of its larger, more dynamic economy will ultimately constrain us.

Unfortunately, these concerns have not yet entered our collective consciousness. We’re more concerned with how to carve up our stagnant tax revenues than in growing our economy. An overly-protective state and the collective fear of failure have made both risk-taking and starting businesses unattractive. Aspiration, ambition – these words have not entered our ethos. No one looks at Canada and says: “That’s the land of opportunity.”

If we ever want to fulfill Laurier’s dream of “Canada’s century” – even if it’s a century late – then this attitude has to change. We have to change. To dream. To think big – and be big. To be pace-setters, not followers.

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