John Robson: Low-Hanging Fruit Canada Can Tackle to Boost Prosperity

The Canada Revenue Agency’s headquarters in Ottawa is seen in a file photo. The Canadian Press/Sean Kilpatrick

Commentary

Following Donald Trump’s musings on absorbing Canada into the United Sates, tariff threats, and actual trade restrictions, Canada’s political class suddenly realized we should adopt policies that make us rich and resilient, not poor and brittle. Um, duh. As with Europeans on security, it’s weird that it takes a U.S. president saying and doing ill-advised things on economics to make us say and do sensible ones. But whatever the cause, let’s see what low-hanging fruit we were leaving to rot until Trump suggested eating pinecones.

First and foremost is removing interprovincial trade barriers. And here I must complain that it’s been 15 years since Brian Lee Crowley, the late Robert Knox, and I published a Macdonald-Laurier Institute paper, “Citizen of One, Citizen of the Whole,” explaining that internal free trade was part of our Founding Fathers’ economic and national vision and offering a clear, workable, dramatic plan for instituting it.

Our proposal created immediate, coast-to-coast, top-to-bottom lack of interest, partly because of the national slogan “yes we can’t” and partly because everyone praises free trade in theory but defends protectionism in practice. But desperation might make us do the right thing, having exhausted the alternatives.

For instance, in response to Trump, B.C. Premier David Eby suddenly cancelled a thousand-dollar “grocery rebate” and hiring even more bureaucrats. “We can’t afford not to!” suddenly became “Whoa nelly, we can’t afford that!” almost as if they always knew in their hearts.

Or not, since Mark Carney just said Americans need our health-care system. But as the National Post’s Carson Jerema wrote, “In 2021, median income in Canada was about US$50,000 (C$70,000), compared to US$70,000 (C$99,000) down south…. median employment income in every province is lower than every American state, even the poorest ones. Maybe instead of lecturing about social safety nets, Carney could explain what policies he could bring that would let Canadians enjoy similar wage growth to the Americans.”

If he won’t, I will. For starters, abolish our massive agricultural marketing protectionist scheme, which harms the poor, the economy, and national unity and thus has enjoyed the militant support of our chattering classes for decades. Oh, and the rules that protect our airlines, banks, and telecom providers from foreign competition, and our consumers from good service at lower prices.

Moving right along, how about that tax code? Hundreds of pages of gooblahoy. Depreciation schedules for different classes of capital assets. Grossing up eligible dividends by 38 percent, then claiming a deduction. Decades ago, I asked the then-chair of the Commons Finance Committee whether it wasn’t too complicated given that not even he did his own taxes. He replied that he did his mother’s, and my retort that it wasn’t a defence of its simplicity that she couldn’t do her own either eluded him. So it has just gotten worse since, under Tories and Grits alike.

I think lower tax rates are also a no-brainer. But even if you believe punishing success while spewing envious diatribes is the ticket to prosperity, surely nobody thinks a simpler tax system would hurt anyone but accountants. (Indeed, since the government collects all our information anyway, from a baffling array of T4s, T4as, T5s etc., why at least doesn’t it do our taxes and ask if we agree?)

Here someone may holler “Cut red tape and wage a ruthless war on waste.” To which I reply that such clichés have been a feeble alternative to real spending cuts for 50 risibly disastrous years. As Milton Friedman once said, there’s no such thing as government waste, just the characteristic way government operates. But the other problem with reducing “bureaucracy,” both personnel and endless regulations, is that as with free trade we can’t do it so long as our lips praise markets but our hearts say everything important must be done by the state because of its superior charity and clarity.

Absurd, I know. But until Trump blundered into the shop, all politicians’ plans to make us healthy, wealthy, and wise involved more government. And ideas have consequences. So we can’t restore common-law mechanisms for safety or repeal the Canada Health Act until we break the reflex habit of praising God while rendering everything unto Caesar.

Likewise, I consider doubling defence spending also a no-brainer, especially among those venting hysterically about the United States going from “an ally” to a “non-democracy” and an “adversary to be contained.” But it’s not low-hanging fruit because our budget, like theirs, is a dumpster fire of borrowed overspending so we’d have to (gasp) cut something that wasn’t working.

We can’t afford to ignore the hard stuff. But we can improve our immediate situation, and build momentum, by doing the easy things first. So sweep away our internal trade barriers, abandon our massive protectionism from agriculture to telecommunications, and cut the tax code to 40 pages.

Delicious. And so easy to reach.

Views expressed in this article are opinions of the author and do not necessarily reflect the views of The Epoch Times.