Nobody wants a recession. We all want to maintain our level of living and maybe even improve it with better housing, holidays or health care. For this to happen, our gross national product (GNP), the total pile of goods and services Canada produces, has to grow.
GNP is measured in dollars but it’s not about money. Money is just a common denominator we use so we can combine Timbits and trucking, transport and take-out coffees – the things we want and need that make our lives better.
All of GNP can be divided into four categories and most of them aren’t doing very well:
Exports are important. Canada is an exporting country but most of our exports go to the United States, which is creating barriers against them. Oil is a major export that we can only sell to the U.S. because we have no means to deliver it to tidewater so it can reach other countries. As a result, we’re paid approximately $30 less than world price for every barrel we export.
Investment, or spending by business, is limited not only by the threats to our export markets but also by the high levels of uncertainty generated by unpredictable political actions, uncertainty with respect to the rights of First Nations and environmental standards that aren’t clearly defined. Also reducing investment is a serious lack of workers to staff new, expanding or even existing businesses.
Governments make a large contribution to GNP. But what they can do is constrained by the amount of taxes they collect and the money they can borrow, both finite amounts.
Consumption, the goods and services we buy because we need and want them, is the most important part of GNP. That’s because it’s about two-thirds of the total and because our economy exists so we can make a living. How much we can consume depends on our income and our credit, and Canadians are nearing the limits of both. Wages have been rising slowly, if at all, and we’re constantly being warned that we already have more debt than is wise.
One way to keep our economy buoyant is to increase the number of consumers. Since most of us aren’t into having large families, immigration is needed.
I challenge anyone to find an example of an economy enjoying healthy growth while its population is declining.
Low birth rates and an aging demographic mean that we can’t count on natural increase to maintain our numbers. We have to turn to those many people outside Canada who would really appreciate a chance to come here.
Immigrants don’t only contribute as consumers, although that’s important. They, like the rest of us, are also producers. They hold jobs that generate the goods and services that they consume and more. By being an available workforce, they encourage business startups and growth. In Vancouver, almost every business I enter has a ‘We’re hiring’ sign and I’ve even seen signs saying ‘Closed for lack of staff.’
Immigrants aren’t just a bunch of warm bodies. It takes courage and initiative to move to a new country or to escape a bad situation. Many immigrants have already used these abilities to acquire skills and professions that Canada can use.
Others will turn their focus to entrepreneurial actions, starting businesses to create their own jobs for themselves and their families, offering goods and services that the rest of us want. In some cases, these businesses will become big enough to provide many people with work and to generate investment, exports and tax revenue to help every component of our Canadian standard of living.
Canada prospers for the well-being of Canadians. This prosperity is generated by the efforts of our population – the Canadians and immigrants (future Canadians) who live and work here.
Canada isn’t just a country that exports goods and services. We’re also a country that imports people – we’re a nation of immigrants. Immigrants have made us strong in the past. If we welcome them, they’ll continue to do so in the future.
Troy Media columnist Roslyn Kunin is a consulting economist and speaker.