Blogs » Politcs Plus » Canada might have the answer


The best thing about a routine doctor visit is the long wait. I use this time to catch up on my reading. I came across an interesting Newsweek article by Fareed Zakaria titled “Worthwhile Canadian Initiative.”

With the risk of being told to go live in Canada or receiving a link to a fringe website denouncing Canada, I will summarize some interesting points Mr. Zakaria wrote about.

Canada is the lone industrial country that has not faced a single bank failure, bailout, or had government intervention in their financial or mortgage sector. What are they doing right; and why are we not following? Why should we listen to a country that had 12 budget surpluses? I guess that one soldier they sent to Iraq did not cost $10-$12 billion a month.

Over the last fifteen years the United States and Europe loosened regulations on their financial systems and we all know what happened. Guess who did not? If you guessed Canada, you were right. Canada allows leverage (assets versus equity) of 18-1, by comparison ours is 26-1 and Europe is 60-1. Canada is still applying old-fashion fiscal responsibility.

Canada’s housing prices have not fluctuated as wildly as ours. Their home prices are down about 12.5% and ours is at 25%.

We haven’t even discussed the elephant in the room yet, health care cost. American car companies have moved many jobs to Canada to take advantage of the lower health care cost. Ontario is North America’s largest car producing region. I bet you thought it was Michigan. Imagine how low our trade imbalance would be without health care costs being factored in.

Last but not least is our broken immigration policy and its effect on our economy. Canada has a Skilled Workers Visa program which allows those who have the education level, work experience, age, and language abilities, to go to the head of the line to obtain a legal permanent residence. A prospect has to have at least 67 points of a total of 100. A PhD is worth 25 points. By contrast our country only issues a small number of those type of visas and we  let a lot of talent get away. Microsoft could not hire enough foreign workers under our current system, so it opened a research center in Vancouver and staffed it with “highly skilled people who had visa problems in our country.”Guess where the brightest Chinese and Indian software engineers are headed?

I will have to agree once again with Tom Friedman and Fareed Zaharia when they say “Lets move on to the 21st century.”If I would have written the stimulus bill, I would have front loaded it with tax incentives for the next green jobs innovators. The country that is the first to lay claim to that title will be the next world economic leader.