The budget takes baby steps in the right direction—but more is needed

As published in The Hub

It’s a serious budget, focused on the right priorities, with credible measures to bolster productivity, innovation, and industrial capacity. There’s a lot to like, particularly since it’s been a while since we’ve had one of these. The last investment-focused budget was the 2017 fiscal plan under Bill Morneau.

And yet, as I read the document in the media lock-up room on Tuesday, the overriding sense I felt was that I wanted more. Only two weeks before the budget, Prime Minister Mark Carney talked about swinging for the fences. This is not that.

Instead, we get a fine-tuning budget that will move the needle, no doubt, but that will likely struggle to meet the government’s own lofty targets for private investment, at least immediately.

The expenditure review appears to be real but constrained. The infrastructure spending, while positive, also happens to be the kind of infrastructure spending you can build an election campaign around. Roads, hospitals, and YMCAs. The signaling on regulatory reform is genuinely encouraging, but remains mostly signaling for now.

It’s a first and important pivot for federal economic policymaking, but a careful one. At least, the government is finally thinking about the economy and productivity.

Perhaps it was the former journalist in me craving for the really big story. I was hoping swinging for the fences meant a real, risk-taking fiscal reset that would shift expectations about Canada as a place to invest. Something front-loaded, decisive, and transformational. I had even convinced myself the country may have been primed for it.

Maybe this is what bold looks like in Canada. One can argue that, in a moment of uncertainty about where things are headed, a measure of caution could be warranted. We can calibrate as the dust settles on the emerging global economic order.

My concern is that the major policy mistakes of the past half century have come when governments tried to confront structural change with incremental adjustments. When the challenge is to change the country’s economic trajectory, fine tuning is rarely enough.