Skip to main content

Finally, amid the pervasive gloom, comes an exuberant expression of optimism - nay, faith - in Canada's future. Remarkably, it comes from three economists, practitioners of the famously dismal science. The 20th century, they say, wasn't destined to belong to Canada, as turn-of-the-century prime minister Sir Wilfrid Laurier once asserted it would be. But Laurier, wasn't really wrong, they say - he was merely premature. Make it the 21st century instead.

What went wrong? What caused a 100-year postponement of Canada's manifest destiny? Laurier put everything in place for a century of stupendous advance, these economists say - but the country discarded Laurier's precepts for decades. "We abandoned almost every tenet of Laurier's plan," they say, "and we paid a heavy price for it."

But, bit by bit, Canada has tentatively restored, or begun to restore, Laurier's lost tenets - a restoration successively accomplished by Conservative governments (notably, Brian Mulroney's free trade agreement with the United States in the late 1980s and early 1990s), NDP governments (notably Saskatchewan premier Roy Romanow's principled return to balanced budgets in the 1990s) and Liberal governments (notably Paul Martin's paying down of the national debt in the late 1990s and early 2000s).

Entrench this emergent consensus, recognize that it constitutes an economic "redemption" of a country previously hell-bent on self-destruction - and you get The Canadian Century: Moving Out of America's Shadow, a visionary work from economist Brian Lee Crowley's new Ottawa-based think tank, The Macdonald-Laurier Institute. Mr. Crowley's partners in The Canadian Century are Niels Veldhuis, senior economist at the Vancouver-based Fraser Institute, and Jason Clemens, director of research at the San Francisco-based Pacific Research Institute.

After a century of revolutions and world wars, recessions, global depressions and ceaseless social and technological change, it's hard now - probably impossible - to understand Laurier's profound faith in Canada's capacity to lead the world. Yes, he served as prime minister for 15 extraordinary years (1896-1911) but his affirmation of Canada's destiny went far beyond a merely political expression of good times.

By 1901, Canada's population had reached 5.3 million people; by 1911, it had reached 7.2 million, an increase of 36 per cent in a decade. Across the border, the U.S. population had reached 90 million. Yet, looking ahead, Laurier could discern a Canada that would lead North America - and, indeed, the world.

A century later, the U.S. has faltered - and Canada has already test-driven the economic tenets that will ensure this country's superior economic performance in otherwise difficult years ahead.

"What was Laurier's plan, his vision for a Canada that would be the best the New World could offer the Old - a plan that [by 1911]had already unleashed the greatest growth in our prosperity ever seen and which Laurier expected would fuel our development for decades to come?" Canadian Century asks. It lists four principles:

The first principle was the protection of "British liberty" - the rule of law, freedom of speech, parliamentary democracy and, equally important, minimal state interference in the lives of ordinary people. For Laurier, "British liberty" meant that people were responsible for themselves and for their families; an expansive welfare state (as the alternative would be subsequently styled) would lead to stagnation and inexorable decline.

The second principle was limited government, and the fiscal discipline it implies. Laurier held this principle sacred, partly for pragmatic reasons. Canada, he insisted, should never permit Canadian taxes to exceed American taxes. Canada could forever ensure a competitive advantage simply by keeping its taxes low and keeping its books balanced.

The third principle was self-confident, competitive Canadian engagement with the United States. Although he was a strict nationalist, Laurier held that Canada could prevail against its dynamic neighbour provided (in the words of Canadian Century) "it play[ed]cleverly and well the few cards that it had been dealt."

The fourth principle was a corollary of the third: free trade - with the U.S. for sure but with as many other countries as possible. ("Our policy will be to seek markets," Laurier said, "wherever markets are to be found.")

These principles were not by any means exclusively 19th-century liberal tenets. Sir John A. Macdonald himself turned to protectionism only as a last resort. In the 1911 federal election, Laurier defended his reciprocity agreement with the U.S. by citing speeches that Sir John had made in the old days. ("It is only by closing the door," Sir John had said, "that we will [open]their door to us.")

Canadian Century celebrates the good beginning that the "redemptive decade," with its tentative return to Laurier's lost tenets, provided - apparently, given the great global recession, just in the nick of time. It laments the retreat from these tenets that the recession produced. Now, the economists say, is the time to finish the job - now that Canada's opportunity has been doubled "by America's confusion and loss of direction" - and by its own loss of the tenets that produce enduring prosperity.