The Ben Mulroney Show - Economics Panel - How to jumpstart Canada's Economy

Episode Date: May 8, 2025

Economics Panel - How to jumpstart Canada's Economy Guest: Dr. Eric Kam, Economics Professor at Toronto Metropolitan University Guest: Moshe Lander, Concordia University Economic Professor If you enjoyed the podcast, tell a friend! For more of the Ben Mulroney Show, subscribe to the podcast! https://globalnews.ca/national/program/the-ben-mulroney-show Follow Ben on Twitter/X at https://x.com/BenMulroney Enjoy Learn more about your ad choices. Visit megaphone.fm/adchoices

From commutes that become learning sessions to dishwashing filled with laughs, podcasts can help you make the most out of your everyday. And when it comes to everyday spending, you can count on the PC Insider's World Elite MasterCard to help you earn the most PC optimum points everywhere you shop. The PC Insider's World Elite MasterCard, the card for living unlimited. Conditions apply to all benefits. Visit PCFinancial.ca for details. One of the reasons I would never run for office is because my knowledge of economics is in

the toilet. I'm terrible at all aspects of money and finance and everything. But that doesn't mean I don't like talking about those things. And fortunately, I've got a couple of guests here who are willing to walk my hand through – hold my hand as we walk through a number of very complex stories. And they're going to talk to me like I'm a child. Please welcome to the show Dr. Eric Kam, economics professor at TMU and Moshe Lander Concordia University economics professor to the both of you. I say welcome to the Ben Mulroney show.

Hello. Benedict, I have an issue. Why is this guy muscling in on our time? Hey, there's a lot of Ben to go around and sometimes it's good to get varying opinions. Let's start south of the border with the U.S. Fed. They held the rates despite what Donald Trump wanted. He wanted lower rates again. They held the rates where they are. Eric, make that make sense for me. I think it actually makes a lot of sense. First of all, I think there's two reasons. Number one

is that by keeping their rates a little bit higher than other parts of the world that have had a holy war on inflation, it's caused capital flight into their country. It's called monetary flows going into their country. And that's propped up their dollar, propped up their exchange rate, propped up their economy, number one. Number two, Jerome Powell also knows that if you just do nothing more than stimulate spending by dropping interest rates, that's great for the business cycle, but does nothing toward long run growth. And I think so, Powell is trying to look at a long run versus a short run scenario and say, you know what? We don't have to rush and push our rates so low if all that's gonna do is stimulate consumption, possibly inflation, and for sure, just the business cycle. So I like the move.

Moshe, you were nodding. I think you like it as well. I do. I think it's also for credibility. You can't have the president undermining the credibility and the independence of the central bank. That's where I was going to go next. Exactly. He really loves sticking his nose where he knows it doesn't belong.

The independence of the Fed is paramount, no? Absolutely. And it was one of the things that happened in Canada 30 years ago was that when the Bank of Canada was cut loose from government interference or when they were given a mandate and told, now you do whatever you need to, that helps to make things easier

in terms of the interest rate cycle, in terms of making sure that we don't have too big a boom, too big a bust. So, yeah, if nothing else, you just have to do it to make sure that I am not giving into political pressure because the next time around, it's that much easier to cave in. And the appearance of propriety

is as important as propriety itself. People have to feel that it's independent, not just that it acts independently. All right, let's move on to Mark Carney, because during the campaign, he sold everyone, he sold enough people on the fact that because he was an economist, he knew how, and he loved using this expression, to catalyze investment. Now let's afford him a little grace, and it's gonna take some time to implement things. He can't do a whole lot on day one. He doesn't have a... He's not in Parliament yet.

They haven't brought the House back. But what's one thing, mostly, he could do right now, right now, immediately, that could provide a boost to the economy? He can hand over money to the Competition Bureau and have them do a little more investigation as to what exactly is going on with competition in this country. So the biggest thing that's been holding Canada back for 40 years is an increasing lack of competition.

You and I could probably make an alphabet if we wanted airlines, banks, cell phone providers, food distributors. There's a lot of industry that's not competitive. When a merger takes place, the argument is not convince me business, why this is good for Canada, but it's tell me government, why this is good for Canada, but it's tell me government why this is bad for consumers. And you shouldn't put the onus on the government

to have to try and explain why a merger is bad. You should have the onus on the business for why this is a good thing. If you can pry open competition. Yep. All of a sudden you get lower prices, greater diversity, a better output, higher productivity, which means our standard of living rises, our

cost of living and affordability issues start to go away. But if you're seen to be doing something from the beginning, saying that this is something that we're going to attack head on, that can restore a certain amount of confidence to the economy that's been lacking. Eric, let's let's stick with Moshe's idea of competition in this country. One way to do that, and I don't know whether this is a radical idea or a bad idea, but one way to do that would be to open up the Canadian market to the foreign competition. If all of a sudden, in order to build out the next generation of, say, wireless technology in Canada,

Rogers, for example, could partner with Verizon, right? All of a sudden, those costs go down, and ultimately, the cost of the consumer will go down, no? Well, yeah, and it takes nothing more than opening up chapter two of any economics textbook to know that competition is a good thing and can reduce prices. The problem is, this country is hung on

to the idea of monopolies. And you hear people of my parents' generation say, things were so much better when Bell had the phone lines and Rogers had the TV lines. But that's baloney. They had a complete monopoly. They still have something of a monopoly. And they can just set their own prices. And that's why we have some of the highest communication prices in the world. My friends who live in Europe hear what we pay for our cell phones. And they laugh out loud. So I actually agree with you and I actually agree with Moish, that we've got to start bringing in real competition.

I don't mean two firms in an industry. I mean, every firms in an industry. If you can survive in this country, then you should be able to survive. And if you can't, you can't without government intervention to prop you up. So I'm all for competition. Yeah, I think we have to get off of this notion

that in order for us to be the fullest expression of a nation We have to have a proud National airline and a proud national this and a proud I would prefer like you want to build a strong country Make it so that I can fly from Ottawa to Vancouver for 250 bucks Make it that my my cell phone bill is a third of what it is. All of a sudden you're spurring business You're spurring tourism. You're having people have more disposable income. That's to me, a pretty easy step, but first we've got to get over this fear

that to do that means the foreign hordes are going to come and take us over. Well, let me say one more thing on that topic because I think you're exactly right, is everybody with their national pride that keeps costing us billions of dollars that has to get bailed out is ridiculous. And the number one example of that airlines is number two. Number one is our beloved national broadcaster, which takes billions of dollars a year and produces no quality. Why don't we start there?

I think we had that debate, Eric. Sadly, you and I came out on the losing end of that bargain. Moshe? Oh, I was just gonna say, you know, in the leaders' debates, especially in French, the idea that supply management was off the table in negotiations. I mean, go meet with Trump and say, all right, you win, you win,

we'll pry open the dairy industry. What are we gonna get in Canada? Lower prices for butter, cheese, milk, eggs? Like, who's gonna complain about that except for the dairy farmers, but they're a very powerful lobby. And so everybody's running scared from dairy farmers. That's an easy industry

that you could pry open within 10 minutes. Okay, let's look at the energy sector. The CEOs abound are calling on Mark Carney to take action to support the domestic energy sector. Now, during the campaign, he said some positive stuff. He said some confusing stuff. He said some negative stuff. I don't know where he's going to land on that.

So, Eric, is our energy sector the single best opportunity to spur economic growth in Canada? And if so, and I'm going to give you about 40 seconds to do this, what does the prime minister have to do? He doesn't know where he's going to land because he has no idea. The reality is he's got to throw up an energy to the same reasons that we just talked about. You can't have people knocking at your door to want to buy your energy, your natural resources,

your LNG, and you turn them away. Canada's productivity growth has stagnated to a level that people don't understand. Far too low business investment in technology, innovation, LNG. All that does is limit long-term growth. Start selling the things in which we have a comparative advantage, and natural gas is just one of them, Ben. All right, Moshe, you got the last word on this. So that sounds like chapter three of an economic textbook, comparative advantage. Look, the problem is that in order to get the oil to market, you have to build pipelines. So solution is very simple. You have to get the premiers together and you have to knock heads in whatever

way necessary, offer them whatever goods we need to get pipelines built, whether that's the energy corridor or just trampling people, but you got to get it built to coast to coast. And that's how you're going to find markets in Europe and in Asia. Yeah, well, I like some of the things that Mark Carney said, but every now and whenever he would go back to that line that was used under the Trudeau Liberals, that it was all about meaningful consultation with stakeholders like, oh, this is what this is why nothing got built because we had to make

cooks in the kitchen that was done by design. So if you can get away from that, and you're right if you can just just do one big national energy build, I think that'll go a long way to to giving him the resume he needs out West. Hey, Eric, I hope you saw that three people on a panel. Very good idea. Well, you and I were a tremendous idea. Voice can drop by too. Starting with Lee, he said some things I believed, so that was really something. All right. This has been the Cam Lander moment on the Ben Mulroney Show. We'll see you guys soon.