Not exactly an economic gold medal
TheGlobeandMail.com – news/commentary/opinion
Published Wednesday, Mar. 30, 2011. Jim Stanford
The Conservatives’ drive for a majority is premised on positioning themselves as the best economic managers. After all, they say, Canada got through the recession much better than other countries. The government accepts no responsibility for the recession itself – which, they remind us, was “global.” But they happily take credit for Canada’s performance since. They’re trying to rekindle in the economic arena the same national pride unleashed in the hockey arena by our gold-medal victories in Vancouver.
In reality, however, the claim that things may be tough here, but they’re better than anywhere else, has never been statistically valid. And it’s getting increasingly inaccurate, the more it is regurgitated on the hustings.
Among the more than 30 industrial countries that make up the Organization for Economic Co-operation and Development, Canada’s performance has been middling at best. In real GDP growth, Canada tied for 10th in 2009, falling to 13th in 2010. As for the unemployment rate, Canada ranked a gloomy 21st in 2009, tying for 18th by 2010.
Since OECD countries account for a declining share of total world output, let’s consider a truly global sample. The International Monetary Fund reports annual real GDP growth rates for 107 countries, and quarterly data for about half of those. In 2009, Canada ranked 61st of 107. Over the first three-quarters of 2010 (year-end figures aren’t ready yet), we ranked 25th out of 53 countries reporting.
In labour-market terms, Canada’s relative performance is no better. TheInternational Labour Organization reports unemployment data for about 70 countries. In 2009, Canada’s unemployment rate jumped 2.2 percentage points. That ranked us 56th (of 72) that year. Over the first three quarters of 2010, Canada ranked 28th by the same measure.
That’s not exactly a gold-medal performance. In fact, it sounds more like our ranking in international soccer (84th in the world, according to FIFA), than our glorious domination of world hockey. No one’s ever run for office on the basis of Canadian success in international soccer.
Other claims of Canadian leadership are equally dubious. For example, we often hear that Canada has replaced all the jobs lost since the recession began. But that was almost three years ago; the working-age population has since grown by almost one million. In this context, simply getting back to where we were three years ago is a failure, not a success.
Other countries don’t have this problem, thanks to much slower population growth. For this reason, it’s better to measure employment relative to population (a measure called the employment rate). On that score, some countries (like Germany and Japan) have truly recovered from the recession – but Canada ranks well back.
No wonder 59 per cent of Canadians, according to a recent Harris-Decima poll, believe Canada is actually still in recession. To them, it genuinely feels like a recession. Will they vote on the basis of their leaders’ proclamations of Canada’s supposed economic leadership? Or on the basis of their real experience? That will determine whether the Conservatives get their majority.
Here is what can reasonably be said about Canada’s experience since 2008. Canada avoided bank failures and a generalized financial meltdown – primarily thanks to banking rules and practices in place for many years. Countries that did experience bank failures and financial crises endured massive economic consequences. Countries that didn’t performed much better; Canada, thankfully, is in that group. Yet among the countries that avoided bank failures, Canada’s performance has actually been subpar.
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