Entrepreneurs will power the recovery, but they’ll need more than a little help from government
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Dodge, who is also a former deputy minister of finance, would focus policy on digitizing the economy, accelerating the adaptation of resource industries to the imperative of climate change, overhauling employment insurance and training, and making the delivery of government services more efficient.
Coaxing more growth out of the economy has gone from a major policy challenge to an absolute necessity
David Dodge, Public Policy Forum report
Those stepping stones make for a good way to think about a productivity agenda, which is the only way Canada will sustainably increase economic growth. Public money will be needed, but the big outlays that will be required — a public system of affordable childcare, say, or rural broadband — should more than pay for themselves over time. The federal government can borrow for 30 years at less than two per cent, terms at which even the most mediocre manager should be able to generate a rate of return.
But a productivity agenda needn’t be all about money. There are myriad policy tweaks that governments could do that would help make the recession more creative and less destructive.
Kim de Laat, a postdoctoral fellow at the Rotman School of Management’s Institute for Gender and the Economy, earlier this year proposed that the Canada Revenue Agency make it easier for the tens of thousands of employees suddenly working from home to deduct work-related expenses. It’s a good idea that could be extended to the newly self-employed who, like Poloz, realize that a recession brings opportunity.
Complying with Canada’s tax code is arduous enough for anyone who has to do more than submit a T-4; figuring out how to take full advantage of all the credits and benefits destroys countless productive hours every year. A bold government would make everything simpler for the new generation of entrepreneurs, especially since it so desperately needs the help.
Let’s keep this crisis in perspective. Beating a mysterious virus is the hard part. We know exactly to do when it comes to sorting out the economy.
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