In the past decade, Canada experienced its lowest run of economic growth since the 1930s. Gross domestic product grew at an average of only 1.9 per cent a year.
In interviews, many economists said they expect the gloomy trend, despite a jump to 2.4 per cent last year, to continue. They see the low-growth run – no matter who is in power in Ottawa – extending for another five or 10 years. If they are right we could be in the midst of the longest stretch of economic lethargy this country has ever endured.
Unless some unforeseen remedy appears, jobs will be harder to find, living standards will languish, Canada will lose global standing.
But with a federal budget set to be delivered next week, no one seems too jacked up about it. The bleak economic predicament hasn't received much attention. Seems we're living under an illusion that we're doing reasonably well, the reason being that until the recent oil price plunge the Conservatives pushed out a lot of feel-good messaging about Canada faring better in the wake of the global financial crisis than other major economies. But doing better than some rivals doesn't necessarily mean you're doing well yourself.
Over and above the energy price fall, experts cite a range of causes for the inertia. A major one is productivity. "On that, we're doing terribly relative to our own historic rate," said economist Don Drummond, "and we're doing terrible relative to the rate of almost every developed country."
Our business class, he added, is neither aggressive nor entrepreneurial, consumer demand is inhibited by high household debt and we have an aging labour force that is only going to grow at about 1 per cent a year. The small increase will come from immigrants, who make lower wages.
"I don't look for growth to be above 2 per cent on an average basis, I'd say, for the next 10 years," Mr. Drummond said.
Paul Boothe of Western University's Ivey Business School warns that if you have another decade of slow growth at such a low rate "a whole bunch of economies, including emerging economies, will catch up and pass us by."
Making our slow-growth trap more depressing is that there is no obvious way out. You can criticize the government, said Mr. Drummond, "but I'm not sure there is any silver bullet to change the status quo." There's this obtuse notion, said Mr. Boothe, that the federal government is the major economic actor. "In the grand scheme of things, it is only a small player."
Criticism has centred around the Conservatives having no big economic vision or plan beyond exploiting the resource economy, a blueprint that failed to take into account the cyclical nature of resource prices.
Some lament the lack of an industrial strategy. But as Mr. Drummond noted, industrial strategies, which run counter to conservative economic philosophy to begin with, have been tried in the past, particularly by Liberal governments, and they haven't worked out well.
For those who think the fix lies with great heaps of public investment, the Conservatives have made such a possibility less likely. Via their tax-cutting initiatives they have substantially shrunk the federal revenue base.
McGill University's Christopher Ragan, who has written extensively on the slow growth quandary, says the problem is that "fiscal policy makers basically want to ignore it. They don't want to admit it." They're fixated on balancing the budget but "whether the budget is a billion in surplus or four billion in deficit is frankly immaterial. It's a political argument."
He too sees little hope for getting to a respectable annual GDP growth rate of more than 3 per cent in the coming years.
The pick-up of the U.S. economy will help, the low dollar will come to the aid of the long-ailing manufacturing sector, and new trade agreements offer some promise.
But there's not enough to offset the negative forces that are putting this country, by comparison to its expansion rates of the past, in an era of stagnation – a slow-growth trap that is not being addressed.