How seriously are we to take Pierre Poilievre’s anti-business rhetoric?
It commands attention, coming from the leader of a Conservative party that has traditionally offered itself as a pro-business alternative to the Liberal party.
“Politicians protect big oligopolies against competition and those oligopolies use their media arms to give politicians glowing coverage,” Poilievre wrote in a March 28 social-media post on X.
In a May newspaper opinion piece, Poilievre criticized a cosiness he identifies between Big Business and the Liberals. Their relationship has borne “the rotten fruit of undue handouts, privileges and protections by the state,” said Poilievre.
Poilievre doesn’t stop at calling out “overpaid” CEOs, he also despairs of groups that represent business.
Poilievre ridicules the “pointless” gatherings of the Canadian Chamber of Commerce, the Canadian Federation of Independent Business (CFIB) and others.
“I refuse to meet with the aforementioned groups,” Poilievre wrote in his opinion piece. “They tell me what I already know.”
Inveighing against what Poilievre calls the “gutless executives” who haven’t fought objectionable policies of the Trudeau government is a Tory campaign strategy to appeal to Canadians distrustful of business and the media.
And “it’s working,” says Bloomberg in a recent report that attributes Poilievre’s lead in the polls over Prime Minister Justin Trudeau in part to the Tory leader’s antagonistic regard for business.
But that’s most unlikely. After nine years as PM, Trudeau has worn out his welcome. That and the Liberals’ loathed carbon tax and botched immigration policies have nothing to do with the state of Canadian business.
That said, the world’s 10th-largest economy could use a business overhaul.
Canada is one of the biggest of branch-plant economies, where everything from cellphones to construction equipment to breakfast cereals usually comes from somewhere else.
Many of the biggest decisions in Canadian business are made elsewhere — at head offices in Chicago, Silicon Valley, Stuttgart and Toyota City.
That’s also where most of the R&D money is spent and the new-product development and creation of intellectual property takes place — activities that employ the highest-paid workers.
But Poilievre is silent on Canada’s status as an absentee-owner economy. If he has a foreign investment policy, he’s yet to hint at one.
Canada does have more than its share of oligopolies — in banking, grocery retailing, wireless services, oil and gas production, railways, and airlines, to name a few.
Oligopolies are protected from the competition that forces innovation and higher productivity.
That’s why the U.S. is pursuing antitrust actions against its oligopolies, including Apple, Amazon, Google, and Live Nation/Ticketmaster. Some of those actions were launched by the first Trump administration.
But here again, Poilievre has had nothing to say about taming the oligopolies, such as breaking them up into rival firms.
Poilievre hasn’t even proposed an investigation into their pricing practices.
Finally, there’s Canadian business’ pitifully low investment in modern equipment, employee skills training, and creating and commercializing more intellectual property.
Compared with their advanced-economy peers, Canadian workers are starved of productivity-enhancing resources, as Carolyn Rogers, the senior deputy governor of the Bank of Canada, warned in March when she declared that Canada’s laggard productivity growth is an “emergency.”
The C.D. Howe Institute calculates that Canadian workers receive about 55 cents of investment capital for every dollar their American counterparts are provided.
“We are really losing the race to equip our workers,” says William Robson, CEO of the C.D. Howe Institute.
And Canadian spending on R&D amounts to just 1.6 per cent of GDP, far behind leaders Israel (5.7 per cent), South Korea (4.9 per cent) and the U.S. (3.5 per cent).
The result is a yawning gap in per capita income between Canada and the U.S.
In the past decade, Canadian per capita income has grown by 22.7 per cent. But in that period, the U.S. figure, which was higher to begin with, has soared by 52.7 per cent.
That explains the current $32,700 difference in per capita income between the two countries, according to the International Monetary Fund (IMF).
It’s interesting to consider how much more productive Canadian workers would be if provided the proper resources by their employers.
Ottawa could tax away the bonuses and stock-option windfalls of CEOs of firms that markedly underspend on modern equipment and R&D.
The chief executives can afford the hit, with Canada’s 100 highest-paid CEOs averaging pay of 246 times the average worker pay in 2022, according to the Canadian Centre for Policy Alternatives.
The needed shakeup of Corporate Canada would be disruptive. There would be squeals of outrage from CEOs forced to do business differently.
Breaking up oligopolies and withholding government corporate welfare from companies that underinvest in their people, and this country, would require no small amount of resolve.
Poilievre’s studied indifference to the real causes of an underperforming Canadian economy begs the question of who’s really gutless, the business CEOs or the PM in waiting?
