Canada's economy could use some of that Olympic attention...
By Andre Carrel
February, dominated by Canada’s performance in the Winter Olympics, was a busy news month. However, the second half of February featured two other news stories on the subject of a performance we ought not overlook: the federal and provincial budgets. Although these budgets will guide our performance as a society, their press coverage was trivial compared to the attention the media focused on the Olympics.
How are we doing and where are we going as a nation, as a society?Our governments insist that we are a world-class nation with a powerful economy, less affected by the US sub-prime boondoggle than virtually any other nation. We are Number One they tell us. How does a country, a society, determine how well it is doing relative to the rest of the world? PricewaterhouseCoopers (PwC), arguably the world’s leading professional services firm, offers a reasonable answer to that question with its ESCAPE Index.
This index evaluates 42 countries, measuring their performance in 20 areas. “We weight each [area] equally at 5% to avoid a single variable having undue influence to the overall result.” The 20 variables are consolidated into five sectors: Economic (8 areas for 40% of the total), Social (4 for 20%), Political (4 for 20%), Environmental (2 for 10%) and Communication (2 for 10%). Canada holds position #11 among the 42 countries assessed. Canada ranked #10 in 2000 and drifted to #11 by 2007, a position we still hold today.
The economic sector’s eight areas include annual inflation, general government gross debt, total investment, and the unemployment rate. The social sector’s four areas include life expectancy at birth and average years of total schooling. The political sector’s four areas include political stability, the rule of law, and control of corruption. The environmental sector’s two areas are access to improved water source and CO2 emissions. The communication sector’s two areas are internet users and mobile cellular subscriptions.
Ireland ranked higher than Canada did in 2000, but Ireland today is behind Canada in position #13. On the other hand, in the year 2000 Canada was positioned ahead of both Germany and Australia. Germany has since advanced to position #9 and Australia to position #7. In 2000 Canada’s rating was more than nine points behind the leading country; today we lag by nearly 11 points. To appreciate what this spread suggests in terms of a nation’s standards and quality of life, consider that the difference between the Index’s leading country and Canada is about equal to that between Canada and Romania (in position #24).
Governments seek to reassure us that our economy is strong and healthy, and that we have survived the Wall Street fiasco better than other countries have. If this is so, would it not be reasonable to expect Canada’s ranking to have improved rather than declined? If indeed we are in better economic shape than other countries, which sectors are dragging us down? Where, why and how are we falling behind? Do we have problems in the social or political areas which, together, have the same weight as the economic area?
Comparing our ranking to that of the United States (#18), the United Kingdom (#19), France (#20), or Russia (#25) we are indeed doing well. Rather than resting on our laurels and congratulating ourselves, why not take a close look at the PwC ESCAPE Index leaders and, setting aside those areas were we do better than they do, focus our attention and a public debate on those areas that drag us down? From Finland (#5) to New Zealand (#8), there is great diversity and a multitude of differences among and between the ten nations ahead of us on the Index. Surely there must be something we can learn from those countries that rank higher than we do to improve the ways in which we conduct and govern ourselves. With the Olympics behind us, why not focus our attention on other issues of importance to our future generations?
Andre Carrel is a retired City Administrator, journalist, author, and full-time grandpal.
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