The Ben Mulroney Show - Should we bring in more Foreign Students, given this economy?

Episode Date: February 27, 2025

Guests and Topics: -In this economy? It’s time to welcome foreign students again with Guest: Christopher Worswick, Chair of the economics department at Carleton University, Research fellow at the C.D. Howe Institute -Carney suggests he would aim for overall deficits below 1 per cent of GDP 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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If you have any questions or concerns about your gambling or someone close to you, please contact Connix Ontario at 1-866-531-2600 to speak to an advisor free of charge. BetMGM operates pursuant to an operating agreement with iGaming Ontario. One of the reasons I love doing this show is because I'm a consumer of news. I'll read articles, I'll read headlines, I'll watch, I'll watch anything. I can bring the people who are the authors of these stories onto the show to ask them questions about how why they wrote what they wrote. And there's a piece in the Globe and Mail that says,

in this economy, it's time to welcome foreign students again. And I have so many questions about the headline as well as the body of the work. So let's welcome to the show the author, Christopher Worswick, the chair of the economics department at Carleton University and research fellow at the C.D. Howe Institute. Thank you so much for being here, Christopher. Thanks for having me. So I think you'll understand that when people read that they're going to scratch their heads a little bit and say, you got to explain to us how it like we'll take it at face value

and appreciate that you have far more domain expertise in this than I, but what has changed on the ground is since we sort of reverse course on foreign students that would make it that we can we can welcome them back today. Sure. And it's a it's a completely reasonable question. I think the main thing is the tariff threats from the US. So I was following the debates in the media and the policy circles about, if we can't count on the Americans to have free trade

or reasonably free trade with us, we have to start looking at alternatives and people are talking about building pipelines, which probably is a good idea. But it just struck me that we sometimes forget that international students can be thought of as a form of international trade. And it's a very lucrative area for us. And I think the problems, I do think that the foreign student program grew too quickly in the last couple of years, but it was predominantly

at the community college level. And so the opinion piece I published in the Globe was really about trying to say, let's shift this back towards universities where tuition is higher, students have higher earnings when they graduate, they're more likely to be skilled immigrants, and there's other benefits that I can elaborate on if you want. Oh, we will. But the first thing that came to mind when you said that was a story that we covered last week, where we talk, we talk generally in Canada about a housing shortage, but there's equally a housing shortage on university campuses where we discovered that I believe only 10% of university students across this country have access to on-campus housing.

And so there's a shortage even today. If we were to open, and maybe I'm using the wrong word, but the floodgates to international students back into the fold, that number, there would be increased pressure on university and college campus housing, even more so than we have today. And housing is central to so many crises that we're experiencing in this country.

It seems to me it would be putting the cart before the horse by bringing people in before we have a place to house them. Sure. Traditionally, universities and colleges have not provided much housing to their students. So the statistic you say is quite reasonable. But I think we have to be realistic that if Trump goes ahead and imposes these tariffs, we could see major reductions in employment in Canada. I think we're going to be looking for sources of demand to hire workers. And so, you know, I think having demand for housing and health care is not necessarily a bad thing in that context. And so I think international students at the university level makes sense. I do think we have to ratchet back community college levels pretty dramatically.

But what I do argue in the piece, the exceptions are probably international students going to building trades type programs at colleges and to healthcare programs at colleges, because I think that would help with the challenges we're facing. number of available slots at these universities to account for additional students? Or is it to keep the number the same and simply bring in foreign students who pay more tuition, but that would be at the expense of possibly educating Canadian born students? I don't think we should change the number of Canadian born students in our programs. I think that's a separate issue. So I'm not talking about that kind of substitution. Okay.

I would support substituting community college international students or university or national students. And I also make the point in the paper that, you know we should probably very quickly ramp down our lower skill temporary foreign worker program. And those numbers could be, you know, we should probably very quickly ramp down our lower skill temporary foreign worker program. And those numbers could be, you know, that could be replaced with more international university students. And, but in order to do that, so essentially what you're asking for or suggesting is that we grow the student bodies by adding more, more, more foreign born students. That would require, I am assuming,

a massive investment in these universities, but we've been hearing tale that their budgets are stretched thin to begin with. So that would require a commitment from the provinces to work, I guess, in conjunction with the federal government who is in charge of allowing these students to come in to ensure that the proper funding was there to allow for this expanded student body.

I don't think it needs to. I mean, one of the things that's going on in Ontario right now is that the provincial government is cutting international student places at universities as well as community colleges due to the federal cap on the total number of international students. We're seeing a decline in international students at universities. I can't speak for every university in Ontario, but certainly at Carleton, we're well within our capacity. We could take many more international students just going back to where we were two years ago. I don't think it would be

an cost on government and it would certainly help the bottom line of the universities having the international tuition. And remind our listeners, what is the difference in tuition for a Canadian born student, or someone living in Ontario, who sends their kid to Carleton, and the cost to a foreign born student?

I mean, in the piece I quote numbers for Ottawa. So Algonquin talks about international student tuition full-time and including books costs of 16 to 22,000 a year, which is a lot of money admittedly, but Carleton's international tuition ranges from 34,000 to 53,000. I'm not, you know, I can't say that it's the same everywhere, but my sense is that's right. Like I think if you look at a business student, undergraduate student

at University of Toronto, it might be $60,000 they're paying tuition. $60,000 a year. I did not know it got that high. I really did. Yeah, I think that's right. I did look at that. And, you know, some of these students are incredibly talented, right? So, you know, my co author, Michael Scooter, University of Waterloo has studies looking at the students who go through Waterloo and doing computer science and engineering, and they get fantastic jobs at the end of it. And I think this would have knock on effects. These international students on our immigration program. Well, that was going to be my next question, because, you know, if we take everything that you say as, as I said, I defer to you as the expert. So my sense is if you are a foreign born

university student in Canada, you're probably more likely to be to seek out a job in Canada than if you get a degree at a community college, you'll probably get that and then head back to wherever you came from. Well, I think a lot I mean, to be fair, I think a lot of the community college international students would like to stay, but it's not clear to me, like if they're doing a two year business program at a community college, it's not clear that that's going to give you much of a leg up in the Canadian labor

market. And increasingly, it's going to be hard for them to get permanent residence. Whereas if you're doing like a science, technology, engineering type undergraduate degree, let's say at a university, and you successfully graduate, you're going to have very good job options. And I think the benefits to Canada are quite large from students like that. Well, I want to thank you Christopher Worswick, the Chair of Economics Department at Carleton University. I thank you for for your think piece. And it's definitely made me think I appreciate it.

My pleasure. Thanks for having me. All right, I want to welcome to the show somebody but who by the way, I will be if you're in Ontario, I will be a part of the Ontario election coverage tonight with this next guest. He always says what he thinks, much like me, except he's smarter than I am. Dr. Eric Kam, economics professor at Toronto Metropolitan University. Thank you so much for being here, Doc. I don't think I'm smarter than you, but thank you for the shout out.

Listen, I want to start with Mark Carney because Listen, I want to start with Mark Carney because he keeps talking about two different budgets. He talks about this operational budget that he claims he's going to balance in three years. I think a lot of Canadians would be forgiven if they don't know, they just thought the budget was the budget was the budget. Break it down for me. What's he talking about? Well, let's put this number one. Why would he not say that when we know he has a bit of an issue with credibility?

And number two, the person who precedes him and is currently in the job he wants, famously said budgets balance themselves. And that's baloney too. So this is just an innocuous statement. It doesn't mean anything. What he's saying is that what most people would do running up to an election or a vote to be the leader is saying, don't worry about the details. I can handle this. And he can't. Or he can't do it any better than any other liberal leader has ever done. There is only one budget. There is only

one way to look at a federal government. There is the money coming in and the money going out. And our government has way more money going out than coming in. And that is going to take a team of people working for decades to fix. I read what he said, Ben, and it is a bag of air. Well, you know, it reminds me a little bit of the sort of the, the threading a little bit of the sort of the threading of the needle and the sort of the word salads that we came to expect from the liberals, especially Christia Freeland talked about it a lot.

Justin Trudeau talked a lot. As our deficit and our debt were exploding, they kept saying that everything, the debt as a function of the GDP still put us in the best fiscal position in the G7. I didn't even have to think about it because I heard them say it so many times. As we kept saying, hey, the debt's going up, the debt's going up. They said, no, no, no, as a function of the GDP, it's great.

We are in a great position. And they kept coming up with these new devices by which to tell us the crippling of the economy wasn't happening. Yeah, well, okay, so let's break that down for a second. You know, I always tell my students, I can call it a convex combination or I can call it a line. You know, there are really ways to try to impress the population, but at the end of the day, it just, it falls flat. And I think that's really what Mr. Carney is trying to do here, is he's trying to out-finesse people. And I really think that's number one, a bad omen for somebody who wants to lead a party. I mean, I just, like you said, I don't have to say it any better

than you did, that this is just somebody using word salad to try to convince people that he knows more about the budget than they do. Now, he was the governor of two central banks. He may know a little bit more about what a debt is and what a deficit is, but does he know how to actually battle it and help? Maybe. But does he know how to do it really fast or instantly, like snap a finger? He's just being a fool. That's not how economics works. We're not physics, Ben. You don't get to

go in a lab and pull a lever. He has no better tools at his disposal than any government has before him. So he's just trying to win an election and win a race for leader. That's it. Sometimes Twitter is unsatisfying because you can't say in a short amount of time what requires more time, but sometimes the exact opposite is true because you can distill something down to its essence and give people an unvarnished version of the truth. And Mark Levesque, who is a nonpartisan economist, wrote, so if I get this right, Carney will cut income tax for the middle class, cut the GST on new homes, keep all of Trudeau's new programs, no other cuts, but magically balance

the operational budget, not clearly yet defined, by increasing productivity. Sorry, I don't buy it. Eric, do you share in this pessimism of Mark Carney's plan? I like the way he offers a dictionary of economic terms, and I hope that my students read it and read up on what those are. But no, again, it says everything and it says nothing, and I hate any policy proposal that does that. It's just wide ranging encompassing nothing.

And it's really frustrating really for anybody who can read because people aren't stupid in this country, and I don't know why so many leaders think we are we can see through this and we know there are no magic bullets he's offering a magic bullet and I hope people put it away with the rest of the bullets under not needed in Canada but thanks. Well we can we can technically you know from an academic perspective see through this stuff but the polls are suggesting that people don't want to see through this stuff they want to see what they want to see and they want to see in Mark Carney a savior.

They want to see in a Mark Carney somebody who can beat Donald Trump at his own game and and and I've been saying time and time again if people want to forget that the nine past years happened and if they want to forget who is responsible for them that's on that's on the voter I can't change their minds I can I can lead a horse to water. But if they don't wanna drink it, and instead if they wanna shower Mark Carney with praise, that's on them.

I wanna move on actually by moving backwards and talk to you about the segment that we just had where I had an expert talk to us about an article that he wrote in the Globe and Mail about maybe in this economy, it's time to welcome foreign students again. And he suggested that it's a $37 billion boon that we probably need in the face of Donald Trump's tariffs.

I wondered what your thoughts were. Okay, I have a lot of thoughts. First of all, let me preface this. I like Chris, he's smart, he's a good guy. I've met him and I like him, but he's wrong. First of all, universities have to have room. Like I heard him say, well, we can welcome people at our university. That must be nice because at schools like Toronto Metropolitan University that are almost at a hundred percent capacity, where the heck are you gonna put them? And moreover, where are they gonna live?

Are you gonna bring more international students here, let them live on sidewalks and shelters. You cannot subsidize universities any longer with international money. We need to increase tuition. What that is is just, he said it's not a substitution effect, it's absolutely a substitution effect from domestic students to foreign students. But it doesn't fix anything real. If you want to fix universities, and I wish the Premier understood this, even though I'm going to vote for him, you've got to fix the funding formula. You have to allow tuition to raise and let students handle more of the investment of their education. But he's talking about bringing in all of these people. And I just say, we just dealt with an immigration crisis. You're going to make it work. And so I would say to Chris, respectfully,

where are you going to put them? Not every university has space. My university doesn't have space. And where are they going to live once they get here, Ben? Lastly, and I only have about 90 seconds left for you, but Warren Buffett, apparently right now is sitting on more cash than he's ever sat on before, rather, this company, Berkshire Hathaway. Now, this is the guy that people believe is the greatest investor in the history of America. So what does he say? What does it say that the greatest investor has taken so much of the money of Berkshire Hathaway

out of the market and sitting on $334 billion in cash? You know, I think this is honestly the biggest waste of paper since the invitations to my first wedding, Ben. This is somebody, yeah, he's a brilliant man. Yeah, it's true. But honestly, you know what? He has so much wealth that he's been preaching for 25, 30 years, equity, equities, equities,

hold things that are going to go up in the long run. But at some point you have to cash out. Everybody cashes out to some extent. So this is him cashing out some of his holdings. But I think this means nothing to the world markets, nothing to the average investor. He's not an average investor. He can do things that most of us can't do. No, sure. Sure, Eric, but people look to him for being the canary in the coal mine. He's the tip of the sword. He sees around the corner and people have gotten rich over emulating him and following

his lead. And so the fact that he's taken so much out of the market, if I'm the average investor, I'm asking myself, what does he know that I don't know? And you should ask that question, but the average investor isn't in probably the last piece of his life sitting on the type of wealth that he's sitting. If people want to believe in Buffett, go back to what he's preached. Equities, things that go up in the long run, not the short run. And for most investors, leave your money where it is. It will grow over the long run. Don't pull out

the cash unless you need it. Eric Kam, I'll see you tonight. I'll see you tonight. The biggest stories of the day with analysis from award-winning global news journalists. New episodes drop every day, so take this as your personal invitation to join us on the Global National Podcast. You can find it on Apple Podcasts, Spotify, Amazon Music, and wherever you find your favorite podcasts.