The Current - A call to boost Canada's productivity — and prosperity

Episode Date: February 13, 2025

Some tech and business leaders are calling for radical change in Canada's economy to protect against Trump’s tariffs and other future threats. Matt Galloway talks to entrepreneur and former Shopify executive Daniel Debow, who is part of a new group called Build Canada; and Benjamin Bergen, president of the Council of Canadian Innovators.

When a body is discovered 10 miles out to sea, it sparks a mind-blowing police investigation. There's a man living in this address in the name of a deceased. He's one of the most wanted men in the world. This isn't really happening. Officers are finding large sums of money. It's a tale of murder, skullduggery and international intrigue. So who really is he? I'm Sam Mullins and this is Sea of Lies from CBC's Uncovered, available now.

This is a CBC Podcast. Hello, it's Matt here. Thanks for listening to The Current wherever you're getting this podcast. Before we get to today's show, wonder if I might ask a favor of you if you could hit the follow button on whatever app you're using. There is a lot of news that's out there these days. We're trying to help you make sense of it all and give you a bit of a break from some

of that news too. So if you already follow the program, thank you. And if you have done that, maybe you could leave us a rating or review as well. The whole point of this is to let more listeners find our show and perhaps find some of that information that's so important in these really tricky times. So thanks for all of that, appreciate it. And onto today's show. For 30 years, Canada has been using outdated thinking

in its economic and security strategies. And this is what's caused the erosion of our prosperity and security. We built a house of sticks and a big bad wolf has shown up. What do we want to build towards? What's the house of bricks look like? And that's what we need to do as a nation. We have to have strategies to be sovereign and resilient. Sovereignty and resiliency, two things the Canadians are thinking a lot about these days. That was Blackberry co-founder Jim Balsillie talking about Canada's productivity problem in the face of US tariffs.

And now with threats to the Canadian economy, a group of business leaders is coming together to try to boost Canada's productivity and prosperity. Daniel Debeau is an entrepreneur, former executive with Shopify and part of a new group called Build Canada. Daniel, good morning. Morning, Matt. Thanks for having me. Thank you for being here.

Canada should be the world's richest country. That is the first line in a letter to Canadians on the website for Build Canada. Why aren't we the world's richest country? Well, I think there's lots of answers to that question. Probably won't be able to get to all of it in 10 minutes, but I think there's a few things I'd love to focus on. I think as a country, we have to wake up to a changing world and we have to be able to adapt to it.

I think that historically we have opted for stability and that's worked extremely well, but we're living in a more dynamic world. I think as a country, we've made it very easy to say no, no to new ideas, no because of this, no because of that, but we're gonna have to learn how to say yes and try new things, be open to it. I think we have to become a very dynamic,

trade-oriented country. I think those are some of the things that we just have not really focused on as much as we could over the past 25 years. You heard Jim say it. I think we've made some choices that have put us where we are, but there's no reason we can't reverse those choices

and get us back on track. Let's pick through some of those things. One of the things that it says right at the top of the Build Canada website is a bolder, richer, freer country. What does that mean? I mean, a freer country in particular. Well, I think I started to get to some of those things. I mean, freedom means a lots of things, but one of them is to express and follow your

dreams. And in particular, I think it means to build new things. I mean, freedom means lots of things, but one of them is to express and follow your dreams. And in particular, I think it means to build new things. And that doesn't just mean build a tech company, it means open a landscape firm, it means, you know, build your farm and grow, it means build a fisheries business, build any kind of business. And I think we have to remember that economic growth, GDP, you can make it sound fancy and mysterious, but it's actually just business people, businesses selling more products and services. That's what growth is, other than the government employing more people,

which we know how to do, but I don't think is sustainable. We have to figure out how to help our businesses grow and help them sell more products, both to each other and abroad. And I think we have to ask ourselves, what stops that from happening? And I think in the case of the freedom to build,

I think that's a real issue. I think there's innumerable barriers, both in terms of interprovincial trade, in terms of our attitudes and approaches, in terms of regulatory thicket, that get in the way of helping people try new things and build. And some of it's attitude, some of it's regulatory, but I think that's what I think we're getting at when we're trying to be a free country, an even more free country. Is this a partisan effort?

No, not at all. It's explicitly and avowedly nonpartisan. In the way that we've set this up, it's not a lobby group. We are not trying to advocate for one particular industry. We don't have one particular policy that, oh, this thing is gonna really help our constituents. Instead, it's a platform to allow builders, I think the people who do every day that thing of selling and growing companies, hiring employees, it gives them a chance to take their public policy idea.

And what we do is translate it into something that's useful for policy policymakers, which is a policy memo. It's detailed, it's specific, it's actionable. But we don't ask, you know, what party are you for and which party is the support. What we're trying to do is be pro-growth. And I think the good news is that we have people who've worked for definitely liberals and conservatives

who have stepped up and said, hey, we want to help this. And we've had feedback from all sorts of people on all sides of the political spectrum who say, we like this idea and we want to get behind it. I guess I ask in part because some of the members of the group have taken meetings or a meeting at the very least with Pierre Pauli, the leader of the conservatives,

but also John Ruffalo, who is also involved in this, has said that many of the policies we were trying to get done, we were promised, but at the end of the day, we were kind of hoodwinked. And there is the sense that perhaps some people in the sectors that are represented by Build Canada felt let down, if that's the right phrase, by the Liberal government.

Do you think that's fair? Well, first of all, I'd say I don't speak for all entrepreneurs, and I certainly don't speak for people who are helping out or volunteering in this basically website that we set up. But yeah, I think that's for all entrepreneurs. And I certainly don't speak for people who are helping out or volunteering in this basically website that we set up. But yeah, I think that's a fair sentiment. People had high hopes. I had high hopes.

I presented to many liberal growth committees. I presented ideas and earnestly tried to say the same thing I'm saying now, that Canada has to become a paradise for entrepreneurs. It has to be the best place in the world to grow and build a business. And if we do that, so many of the other issues that face us are going to be easier to solve. If you have economic growth at 4 to 5%, it's a dramatically different country than at 2% where we are right now.

And so yeah, it's a shame that we didn't get there. Why do you think we didn't get there? I mean, if you had those hopes from the Liberal government that spoke so much about how we could build these super clusters, we could be a tech leader, what happened to those hopes? Well, I'll tell you something, Matt. I'm not in government, so I can't tell you exactly how it went. The super cluster thing is a good example where I think there was a germ of a good idea where you would take a single area where we would focus in one supercluster.

And somehow that idea turned into a regional cash distribution system across the country. Special interest said, hey, we can't double down on a single winner. We have to make sure everybody gets it. And unfortunately, that is a good strategy for getting elected. It might not be the best strategy for economic growth. And sometimes I think that is at a meta level, one of the biggest challenges we face. I think that we have not in general engaged in pro-growth policies in this country.

I think we have been very focused on priorities that are other than how do we grow the businesses in the country? And I think you can add up thousands of those decisions, literally millions of them across the board, across the way the government works, and think you can add up thousands of those decisions, literally millions of them across the board, across the way the government works. And in aggregate, they add up to, we are not growing as quickly as we could.

And that's an issue. And I think we should be optimistic though. I think we can turn this around. There's a series of choices that we can make that get us back on track. So you don't believe for example, that this country is broken. Do I think the country's broken?

I think there are systems that are broken. I think there are attitudes that we have that are not productive. They're maladaptive. There are things that are hurting us. There are mindsets that are making us less able to say, here's the problem, let's just solve it, let's get on with it.

But I don't think that's unfixable at all. And I mean, I think, candidly, I know lots of people who do. It's a real shame, it's a real problem that the country has had many, many successful people leave. And I'm not just talking about super successful entrepreneurs, although we've had that. I'm talking about tens of thousands of our breast and brightest young students, in my case, in the tech industry, graduating from schools like Waterloo, U of T in Queens, and they're leaving. I think that we have to turn that around and make them want to stay here,

but I don't think it's impossible. I wouldn't be here. I wouldn't be doing this if I didn't think it was very possible. You talked about that idea of the default, and you've said this on social media as well, that the default in this country can be no, that you can't build something until we say so.

Is there something that's ingrained in the Canadian way of thinking that would stall us from innovating, do you think? Well, I mean, I think you're heading on it. I think that, well, I think there's maybe two ideas. One is, let's say AI. We invented much of modern AI technology in Canada,

and yet, and the Liberal government noticed that and talked a lot about it. And yet in the ensuing 10 years or nine years, we have seen other countries just dramatically overtake us in the commercial application of these products. And look, there's lots of reasons, but I'll give you one summary answer is that they just start to build.

They believe that the way you figure out problems is you start to build those solutions and you learn them along the way. You iterate. Yes, you will make mistakes. Yes, there will be problems. But through that process of iteration and just trying things and building things, you come to a right solution. There's another approach which says we have to analyze and study and worry about every problem that we could possibly face with a new thing before we embark on that journey. First of all, I don't think it's effective in a

world where we have a competition. The world didn't say, well, we'll wait we embark on that journey. First of all, I don't think it's effective in a world where we have a competition. The world didn't say, well, we'll wait till you figure that out. No, they just kept going. And number two, I actually don't think you really figure things out that way. I think a pro-builder approach would be, we just, a memo from Ben Allery,

one of the top tax professors in the country, one of the top entrepreneurs in AI. He says, hey, why don't we, instead of worrying about this, why don't we, instead of worrying about this, why don't we just start building? Why don't we take this Canadian technology and build a Canadian first government, AI first government? Estonia 20 years ago said,

we're gonna become a digital first country and it's been massive and transformative. We too could say, let's stop worrying. I mean, it doesn't mean that there aren't real issues, but the way to solve those issues is to just start building things. And I think that attitude, that prevalence of let's go do things, by the way, is very Canadian. If you've ever been out trying to get a car out of a snowmelt today, it's a

giant snow day, you get a bunch of Canadians. They're gonna say, give her, and the car is gonna go. I think we need more give her in Canada. I don't think that's foreign to us, but I think we've forgotten giver in Canada. I don't think that's foreign to us, but I think we've forgotten that. It's a bit of a significant risk aversion. And I also do think that part of that no is we have allowed interest groups of all sorts to get a veto, right?

Whether it's regional interests, linguistic interests, like all sorts of groups have been able to say, no, you can't build. And it doesn't mean we shouldn't listen to people, but we can't, we can't stop the growth of our society, uh, and, and in a situation where we, we have a globally competitive world. Like Canada doesn't get to put walls up and

we're seeing that in real time play out right now. Just before I let you go, I mean, one of those interest groups is the tech sector. And we're seeing in the United States, um, folks in Silicon Valley who are exercising an enormous deal of influence on the administration of Donald Trump that has alarmed people because you have unelected people with extraordinary power treating government like a business, not like a government. Do you think something similar, I'm not talking

about specifics, but do you think something similar in terms of that influence of the tech sector should happen here in this country? Well, I'm not in favor of everything that's happening in the United States. I think that's wrong. But do you think that people in your sector should have that kind of influence on government? I think that the Canadian government should not engage in ad hominem, meaning just because of what you do, you shouldn't get a say. We shouldn't do that for people who work for unions,

we shouldn't do that for indigenous people, and we shouldn't do that for successful business people. Really? I think we should say, hey, if you're a successful technology entrepreneur and you wanna help and you can help us, we should listen to you. And I think the tech sector has to do it

in a way that's careful. You have to either be, you know, registered lobbyists be open, or you do what we're doing, which is we're being transparent. We're putting these ideas out. We're saying debate them, discuss them, and they're in a format that's not a soundbite, but actually a detailed policy paper. Some of those ideas will alarm people. Some of them will be bold. Some of them will be things people disagree with. That's okay. And so, you know, do I think technology people should be involved? Yes, I actually think, and I'd say this,

it's a significant era for Canada. And we're behind the times, seriously, Canadian reporters ask this all the time. The Canadian media has this narrative. There's a tech industry and every other industry. That's false. Every industry is gonna be and is impacted by the advances in technology,

whether it's AI, whether it's the internet, whether it's robotics, everybody's gonna the internet, whether it's robotics, everybody's gonna have to embrace it. Just like everybody embraced email and embraced the wheel, technology just means new tools. There are new tools coming on, and I think government absolutely has to use the best new tools available,

because the old ways of doing things are not cutting it anymore. And I think that's a hopeful message. I'd love us to build this country positively. I hope we have the chance to talk again about this. There are a bunch of specifics on the website in terms of policies and ideas that are being presented that I think are worth digging into. So I hope you'll come back in the meantime, Daniel,

thank you very much for this. No problem. Thanks, Matt. And you should have the entrepreneurs who put those ideas forward on. I'd love to come with them as well. Also a good idea. Thank you very much.

Daniel Dubois is an entrepreneur and a former executive of Shopify. He's part of this new group called Build Canada. I'm Dena Temple-Reston, the host of the Click Here podcast from Record of Future News. Twice a week, we tell true stories about the people making and breaking our digital world. And these days, our digital world is being overrun by hackers. I was just targeted by a nation state.

And they range from reflective. It's a crime, bro. And I live with that every day. To ruthless. Do you feel guilty about it? No, not really. Click here from Recorded Future News. You can find us wherever you get your podcasts. Benjamin Bergen is president of the Council of

Canadian Innovators, also a board member of the Canadian Shield Institute, backed by a donation from Jim Balsillie, who we heard from earlier. Benjamin, good morning to you. Good morning. Thanks, Matt, for having me. Thanks for being here. The Canadian Shield Institute says it is an

economic nationalism think tank. What does that mean? So it's trying to solve one of the biggest problems that we as Canadians have been facing for the last 30 years. You teed it up beautifully with Jim's comments about the fact that we in Canada have had a misalignment of understanding how wealth and

prosperity is created in the 21st century. And the Canadian shield looks at how do we solve this problem? How do we increase productivity and prosperity for all Canadians so that we can have a quality of life that we cherish and hold dear? You've said that innovation is not Canada's problem. It's what we do with our innovations. I mean, in some ways, Daniel has echoed that as well. What do you mean by that?

What aren't we doing with the innovations that we have here in this country? So the challenge that I think we have here in Canada is that we're really good at invention. So the creation of ideas, we help to invent AI with folks like Jeffrey Hinton and Yasho Bengio. But where we fall down is really at the commercialization or at the invention or at the innovation piece, where you actually commercialize that idea and sell it to the world.

And so as a country, we've been really good at sort of that basic research. But where we've really struggled is how do you take that idea and then sell it around the world? And in a 21st century economy, the way that you capture wealth and prosperity is through the selling of ideas. Lots of open small economies like Canada are really good at this. Think of Denmark, think of the Nordics, think of Korea. They've successfully been able to capture a part of a market, sell those ideas to the world and become wealthy and prosperous.

Ozempic, in that example, for example. Do you know where Ozempic in that example, for example. You know where Ozempic was, was actually originally created. Yeah, right. Which has essentially floated the economy or at least boosted the economy of Denmark. Correct. But the actual invention of it was in Toronto at U of T.

Right. So there we, there we have an idea that was created in a Canadian institution funded by us as taxpayers, as citizens, and then ultimately commercialized by a Danish company that is so successful that they actually have to count it with the GDP per capita and without to show how much of a large mover it is. And GDP per capita, you know, it sounds, you know, sort of foreign and distant and, you know, hard to sort of be tangible. But Canadians are now 25% poorer than the Americans, where 20% poorer than the Danes.

And that adds up to close to $25,000 or $20,000. That's a lot of money. And that's also a lot of economic growth that could be directed towards building the type of society that we want. And at the Council of Canadian Innovators, we've been really trying to solve this productivity crisis for the last 10 years. You know, we had Carolyn Rogers, the Deputy Governor of the Bank of Canada come out March of last year and say, we've got to break glass because we're in a serious situation where we're no longer as productive as some of our pure nations.

And that's going to have real consequences. And I often think of Paul Krugman's quote, productivity isn't everything, but in the long run, it's almost everything. And that's where we find ourselves now after 30 years of not understanding where the economy has moved and how to capture the wealth and prosperity that comes from it. 30 years but also and I ask this to Daniel there is great frustration and you've voiced this with the current leadership suggesting that perhaps at least in the last year but beyond that that the liberals and Justin Trudeau have dropped the ball

on in your words the economic chaos that's been unfolding right now. What do you want to see from government in terms of fostering innovation and productivity? Yeah, so the way forward is actually by building domestic capacity for Canadians and for Canadian firms. Now that sounds sort of heavy and kind of confusing, but think about it this way. and kind of confusing. But think about it this way. When we as Canadians invest in basic research

like we did with AI, but then our own governments won't actually purchase technology solutions to solve some of the problems, it's not creating the market that's necessary for those goods to exist. So it becomes a lot harder. So we have to really reform our procurement system. So our governments are purchasing solutions right across the board. And some tangible examples of that right now would be things like cyber security, right? Right

now we're experiencing potentially mimetic warfare coming in from social media and from other accounts. Our government could deploy billions of dollars to make sure that we as Canadians are kept safe, that we could solve real problems that we're experiencing here, and then turn around and sell those goods to other governments around the world that are also experiencing them.

The other idea is something like sovereign cloud, right? Think of sovereign cloud a little bit like the railroad when we built this country. Imagine if we give up our capacity to a foreign actor. Imagine if the Americans had the ability to have determined what we put on our railroad when we were founding this country, right? What goods could go, could not go. It's a little bit like that in the digital world as well, where our ability to be able to control what does or does not happen really needs to be part of our sovereignty strategy as

well as part of our economic strategy. And Jim alluded to that in the clip that you brought forward. I have to let you go, but just very, very briefly in a word or two, are you confident, this is a moment, are you confident that we'll seize on this moment? Yes. That's pretty declarative. We will leave it there, but we will talk more about it. Well, I was going to drop a profane word as well behind that, but I was told that this is a family program. So I've got to be kind, Matt. We'll leave that to the imagination. Benjamin, it's good to speak with you about this, and I do hope we have the chance to talk again. Thank you.

Thank you so much, Matt. Take care. Benjamin Bergen is the president of the Council of Canadian Innovators, also a board member of the Canadian Shield Initiative. For more CBC podcasts, go to cbc.ca slash podcasts.