The Ben Mulroney Show - Global economy on track for worst decade since 1960s, World Bank warns

Episode Date: June 12, 2025

Guests and Topics: -Global economy on track for worst decade since 1960s, World Bank warns with Guest: Dr. Eric Kam, Economics Professor at Toronto Metropolitan University 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

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and look, the issues that face this country as it relates to our economy growing it Is it shrinking? How do we make it better? They are myriad and so to break down those questions from so many different angles Focusing on so many different stories were joined by a great friend of the show. Dr. Eric Kam Economics professor at Toronto Metropolitan University Eric, thank you so much for joining us Benedict it's always a pleasure, but that sounds like a big task to break down. Well, there's lots to get to. Donald Trump says he's got a deal with China

done on rare earth minerals that helps them with their semiconductor business and helps them with all sorts of things. And as of right now, China seems to have a stranglehold on that market. And so the United States really does need this deal. However, Canada has an opportunity to sort of horn in on that by developing the Ring of Fire. And I've got to wonder how you see those dynamics playing out. Well, let's hope that a deal comes soon. I know that the party in Ottawa is very busy bragging

about their elbows up. But while they're busy bragging, they don't realize that they're playing with fire. Forget the ring of fire. The United States, Ben, it's our largest trading partner. You're talking about over a trillion dollars a year going back and forth. You can't even pretend to untangle that economic integration and supply chain level of job creation based on that level of international trade, energy security, stable market access, and we can go on and on forgetting even about the border. The reality is that while everybody can talk tough against Trump and the United States,

a small open economy like Canada can't exist without a large open economy like the United States when its proximity is so close. I mean, you know that 90% of Canadians live within an hour and a half from the American border. So all of this talk talking tough is wonderful, but it's meaningless at the end of the day if we don't get a deal done and China, as Donald Trump once said, eats our lunch. Uh, the world bank has released its data and it's signaling that the global economy is on track for its weakest decade since the 1960s. And the story that I'm reading is blaming a lot of this on Donald Trump's unnecessary

trade war. However, he's only been in office for six months. So I have to think that there are other there are other factors that have contributed to the weakness of the global economy. Yeah, I'm getting a little tired of everybody pointing to Donald Trump and his tariffs. You know, it's getting ridiculous. That's one factor. Yeah, he's not helping things, but he didn't. He's not.

He's not. There's no way in six months he could be leading to the weakest economy in 10. We just got over the course of 10 years. No, you're right. You're right. The reality is that our slumping economic growth is because of many, many things, tariffs being one of them. But when you talk about things like our slowdown in productivity, the demographic headwinds in this country, thanks to immigration, the massively high levels of debt, both at the government level and at

the personal personal level household level, persistent inflation that now they're getting control but it was out of control during COVID energy supply shocks, declining investment, declining trade volume. The reality has been we could do hours of this topic and our economy is stagnant. Our macro indicators are stagnant. And nobody seems to want to address the fact that all of our big problems are bigger than we can handle if all we think we can do is lower interest rates because they don't do anything but stimulate short term consumption. And none of our problems on the table are because of consumption.

Well, I have to assume, Eric, that a lot of our problems would improve if the Canadian economy and the Canadian worker became more productive. I remember months ago, I guess it was last summer, when Pierre Polly of was riding very high in the polls, he put out a video on Twitter, which was seen over a million times, demonstrating that upon the election of Justin Trudeau, the Canadian economy decoupled itself from the American economy, where we used to keep pace with them on productivity, and all of a sudden a chasm grew and became increasingly wide over the course of the 10 years under Justin Trudeau. Now the CEO of CIBC, Victor Dodig, was at a conference hosted by the

Globe and Mail where he says that Canada needs to be on a wartime footing to attack that problem of productivity. Well, and he's exactly right. The reality is that this country is woeful in its recent record in things like technology and innovation. We don't invest in automation. We're not investing in AI or modern machinery, research and development just isn't happening right now. We should be promoting digital transformation across sectors,

and we're not. And by the way, again, where Carney promised things like improved access to quality education, vocational training, retraining for people that have had sectoral shifts in their jobs, and I haven't seen any of it then. So to be fair, he's been there six weeks. Yeah. And he has, he's had a lot of fun. Yeah. No, I get it. Listen, you know, listen, you know, I'm critical. You know, I'm critical. I, you know, I'm critical, but there's only so much a government can do in a 24 hour period. And, and what I've been reporting on, on this show is he's been busy. I completely agree that this is something that needs to be tackled.

But I am going to give him a little more time on that file. Well, I'm glad that you think he's busy. I'm glad that he has things that are keeping him occupied. But I think there should be nothing more occupying for the leader of this nation than our infrastructure and our business efficiency are so recessed and so heading downward that our productivity level is off the scale.

We are, no matter what number you put after G, Ben, G7, G20, I don't care. We are last in productivity growth. That means we're last in supply side growth and last in economic growth. This is the same party, nine and a half years. It's time to put up or shut up. Well, Eric, I will say one thing. I have been surprised given given what we know about how if Canada could finally stop making pronouncements about AI and actually start taking a lead on on investing in AI and incorporating it into all aspects of all sectors of the economy,

then then then things would change rather quickly. And we have for the very first time, a federal minister of artificial intelligence in Evan Solomon. And to be fair, I haven't heard a lot from him yet. So it may be time for him. And he's a communicator like no other, given his time in media. You would think that, given what you just said about AI, maybe it's time for the government to show us what they're doing on that front by putting him front and center. Well, just another minister

that has nothing to say. I think he's an artificial minister with an artificial portfolio, to be honest with you. And you know, it's incredible, Ben, that this AI was effectively started by Jeffrey Hinton at the University of Toronto. And yet we've managed to parlay that into nothing other than giving that technology to the rest of the world to run we've managed to parlay that into nothing other than giving that technology to the rest of the world to run with it. And isn't that what Canada does best? It takes what it has, even in our ground, and says, sorry, we're not open for business right now.

We'll be a buyer instead of a seller. It makes my head spin. Well, I hate to end on another sort of downer, but you gotta take the world as it is, not as you want it to be. And the numbers out of Ontario housing starts are dismal. We the fact that it's we're at our lowest level of housing starts in the first quarter of this year, since 2009. Why can't we get this right?

This country has bungled this for a long time and they seem to not understand what the key drivers are of the decline. We have incredibly high construction costs when it comes to labor and materials. We have crazy affordability issues. I said that housing affordability is one of the top three problems in this country, but they keep lowering rates and making it worse. Again, you can look at the negativity of trade, but I don't think it affects this that much, but I do think you have to go back to supply chain delays and global uncertainty that started in the pandemic

and continue today. And beside the fact, let's go back to what we said about where Canadians want to live. I hear people saying there's lots of land in Canada, but you know, Ben, are you really gonna start going on a housing building? Mode three four hours away from urban centers. How are people expected to get to work every day? We are caught between high demand for housing and low supply of housing and really low drivers when it comes to assisting the housing industry and our housing industry as I

Did a lecture last week on this topic and they asked is the housing crisis in Canada going to get better? And my answer was, no, not for a very long time. So when you say not for a very long time, what do you mean? Like, are we talking two years, three years, five years? No, 10 or 15 years, we just don't have the availability of land. I keep hearing people say, you know, they looked at this new Carney had a number. He said, well, we're going to push housing starts to, I forget the exact number, but it was like 10 or 20 houses less than the previous prime minister said. And we weren't a third from that number. So they're dreaming in technicolor about all these new builds on land that doesn't exist.

All right, Eric Kam, well, maybe next week what we'll do is we'll find some happy stories. We'll find some, there's got to be some happy economic news out there and we'll wade into those waters with you. But in the meantime, have a great week, my friend. Ben long was I out? Close airlock seven! Rick! Seth, please let me out. Rick put you in there for a reason, speed. Mom, just... RICK! Get back here! This is for your own good! Rick and Morty.

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