What must we do? Building a country

Que devons-nous faire ? Construire un pays

Image from Canadian Centre for Policy Alternatives

Addition on March 16, 2025:

We are adding to this “What must we do?” post as well as to that in Business for Canada’s Future this opinion piece in the Toronto Star by Angella MacEwen. It argues that investing in badly needed infrastructure, rather than dropping trade barriers, is key to making Canada more resilient.

Opinion | Canada’s response to Trump’s tariffs has been short-sighted. This is what we need to do instead

March 14, 2025

Investing in badly needed infrastructure, rather than dropping trade barriers, is key to making Canada more resilient, argues economist Angella MacEwen.

By Angella MacEwen, Contributor

Angella MacEwen is the senior economist for CUPE, and a policy fellow with the Broadbent Institute.

Canada has an opportunity to counter the economic crisis presented by Donald Trump’s tariffs and come out the other side stronger and more resilient. What we need is a bold nation building project centred on strategic public investment that connects us from coast-to-coast-to-coast.

Over three decades of free trade with the United States has made our economy heavily reliant on our next-door neighbour both as a source of business investment within Canada, and as a destination for our exports. Donald Trump’s tariffs threaten both of these, possibly altering our economy permanently.

None of the short-term solutions being floated are up to the challenge of the moment. The economic benefit of eliminating interprovincial trade barriers has been overstated. In some cases removing so-called barriers could even be counterproductive to fostering a healthy, independent economy. For example, some of the federal government’s changes to the interprovincial trade deal could limit their ability to invest in and regulate much needed East-West infrastructure.

In the mean time, employment insurance is necessary to help affected workers weather the crisis. But it doesn’t build new industries or save the ones that could disappear if we don’t take action.

We need something bigger, bolder, and very different from what we’ve been used to . We need the public sector to invest directly in the infrastructure and key assets needed to support the economy.

First, we need an industrial strategy that engages the imaginations of Canadians and protects the Canadian social and economic model. That model is one in which governments support domestic industries through public research, strategic procurement policies, and critical investment in infrastructure.

Rather than simply dropping trade barriers, building publicly owned and low-cost transportation, communications, and energy infrastructure between provinces and territories recognizes the biggest barrier to interprovincial trade is our vast geography.

We need to consider public ownership to support investment in key sectors such as agriculture, resource extraction, pharmaceutical production, and auto manufacturing, so we can drive investment. Canada should also ensure domestic control over strategic assets where the exit of US investment has left gaps in the supply chain within these key sectors, such as midstream refining capacity.

A bold Canadian program would also embrace Canada’s rich diversity and embrace reconciliation through Indigenous Peoples’ right to meaningful engagement over policies that impact their land, territories, languages, cultures and way of life — something we haven’t done in previous nation-building exercises.

Instead, the federal government response so far has been on incentivizing market actors, for example through eliminating so-called interprovincial barriers to trade. On Feb. 21, the federal government announced that they were removing 20 exceptions from the Canadian Free Trade Agreement (CFTA). This approach is short-sighted and counterproductive.

One of the existing policy measures removed was related to limiting foreign ownership and control of facilities-based telecommunications service providers, such as Telus, Bell, Rogers, and Videotron. It strains the imagination how this measure could have presented any kind of barrier to interprovincial trade, and there is no logic to removing protections for a key domestic industry just as Canada needs to be thinking about building and supporting national infrastructure.

The federal government also removed Canada Post’s right to have a monopoly on delivering letter mail from the CFTA. Canada Post has an established delivery network throughout Canada, delivering mail and goods to parts of Canada untouched by private delivery services. We should be looking to take advantage of Canada Post’s logistics infrastructure, instead of further undermining it.

Future policy measures also on the chopping block included the federal government’s ability to direct infrastructure investments based on national and regional needs, their ability to approve transportation and transmission on pipelines and power lines, and their ability to advance a general framework of regional economic development — exactly at the moment that the most effective counter-tariff strategy would be to do exactly those things.

Rather than these piecemeal measures that may end up doing as much harm as good, Canada instead needs to think bigger and reimagine the role of the public sector in shaping our economy. Big public investments strategically directed toward our broader long-term interests have shaped Canada in the past, and are exactly what we need to foster an independent and vibrant economy today.

Common introduction to each post in the “CANADA’S FUTURE” - “What must we do?” series of posts

On March 8, the Pledge emailed via Substack its first newsletter (called “Canada’s Future”) to the full list of supporters of the Pledge who also opted in to email updates (70,000 of you in total, at present). That newsletter is simultaneously a “post” (or, “article”) also called “Canada’s Future,” located on this Pledge website on Substack.

The “Canada’s Future” newsletter-article set out some observations and arguments about this historical moment in which we find ourselves and then asks Pledge supporters to engage on the Pledge’s Substack platform about what we must do to secure our future, to secure a Canada we want:

Make no mistake, Canadians will build a better Canada. There’s no shortage of ideas. What’s needed is a grand and diverse coalition of Canadians ready to do their part and to push their governments to work together and rise to the challenge.

We are including for your consideration several articles that try to sketch out an agenda for a less dependent, more resilient and just Canada. There is some overlap, some disagreement, some gaps [amongst theme].

Clicking on any given link [found in the “Canada’s Future” article] takes you to a post on the Pledge’s website…. From there, you can link to further information. The purpose is to launch a conversation amongst Pledge supporters.

You can comment/reply to posts by clicking on an icon that resembles a cartoon speech bubble at both the top and bottom of the post. You may choose to comment, and thereby participate in online dialogue, on any or all of the linked posts below.

This is one of six posts that connect back to the “Canada’s Future” newsletter/article.

Please consider participating!

As explained in the “Canada’s Future” post, clicking on the speech bubble icon at the top and bottom of the post is how you can make a comment. You can then reply to others’ comments. Please try to abide by two principles as expressed in Substack’s community guidelines for publications like the Pledge. They are expressed as applying to “writers” but the Pledge extends that notion to everyone commenting in threads on Pledge articles/posts.

1. Be kind to each other. Substack is founded on the belief that writers and their work deserve respect. Keep conversations civil in the comments of this publication and other Substack community spaces, such as events. Respect one other’s perspectives and life experiences in your conversations, and refrain from cruel or derogatory language.

2. Stay on-topic. We want this publication to support thoughtful discussion around writers’ work. It is not a place for irrelevant rants or off-topic digressions. That includes spam and repetitive self-promotion.

Building a country: an invitation to discuss this post’s themes with other Pledge supporters

The pieces we are including in this post present a variety of perspectives on building — both physically and more metaphorically — a Canada of the future.

Is Canada entering a new era of country building? Should we even think in these terms?

What directions must we take?

What major (even grand) policies and projects should we prioritize?

Are some ideas desirable in an ideal sense but unrealistic to think are possible, and is wishful thinking and a failure to come to grips with hard choices a real danger going forward?

Can we muster and sustain the necessary degree of solidarity, resolve, and equity in burden sharing?

The first piece to consider — “Canada needs a new National Policy: In the face of Trump’s tariff threats, Canada can emerge stronger than ever,” February 3, 2025 — is by economist Jim Stanford and the Centre for Future Work. We reproduce the bulk of the article:

…

Is there any method to Trump’s to-and-fro madness? The optimistic view is that he’s creating leverage to bargain on other issues: border security, defense spending, our Digital Services Tax (hated by the tech billionaires hogging the front row at inauguration).

The pessimistic view is that Trump has bigger, nefarious ambitions: to go down in history as the first President in 65 years to enlarge the USA.

Either way, Canada is in big trouble.

Even in the optimistic scenario, and we avoid the tariff through concessions on other issues, we’ve learned where we stand. More importantly, global businesses have also learned where we stand. The long-standing sales pitch that Canada offers low-cost guaranteed access to U.S. markets is no longer credible.

Indeed, the flight of business investment following Trump’s threat (even if he doesn’t follow through) will likely be the worst consequence of this chaos. And that is probably his main goal: to show companies if they want to sell in America, they need to be in America.

If Trump’s strategy works, he will use it again. The idea of a rules-based trading system (whether in North America, or globally) is out the window. We are back to an era in which brute force rules. And Canada needs to get ready.

Bluntly, Canada once again confronts the fundamental challenge of preserving a viable economic and democratic entity that is more than the northern hinterland of an integrated continental behemoth.

The border is not an “artificial line,” as Trump claims. And it is not just a ‘friction’ interfering with efficient trade.

Modern trade theorists understand that borders can foster investment, development, and prosperity in places where they wouldn’t have occurred otherwise. Of course, that’s on top of the even more important dimensions of sovereignty that borders facilitate.

To preserve our viability as a going concern in the face of Trump’s aggression, Canada needs an emergency national response. This should include:

• Emergency aid for export industries while they retool and reorient marketing to both other countries and domestic consumers.

• Expanded access to Employment Insurance and other supports to help workers survive a disruption that will likely destroy one million direct jobs (and many more spillover impacts).

• Redirect the main thrust of our economic development strategy away from trade, and toward doing things by Canadians for Canadians. There’s lots to do in that regard. An emergency plan to build affordable housing, infrastructure, renewable energy, and domestically-oriented manufacturing could more than replace the jobs destroyed by Trump.

The content and context for this emergency strategy are both reminiscent of the original National Policy, implemented by John A. MacDonald’s Conservative government in 1878. That plan included high tariffs on manufactured imports, tariff reductions on imports of raw materials and unfinished goods, and extensive financial and other assistance to develop Canadian industry.

A modern National Policy would likely use different tools (with more focus on innovation, capital investment, and sustainability). But the overarching goal – to develop a diversified, self-reliant national economy with critical mass to exist independently from the U.S. – is identical.

Moreover, the original National Policy followed a failed attempt by Alexander Mackenzie’s Liberals to negotiate free trade with the U.S. It was fundamentally motivated to resist America’s 19^th-Century expansion.

Fast forward to 2025, and it’s déjà vu all over again. Yes, we had a trade deal with the U.S., but it was useless (Trump unabashedly ignores it). And expansionism is clearly on the agenda again: Trump’s inauguration speech pledged to “expand our territory,” days after he proclaimed using “economic force” to absorb Canada.

The threat is existential, the coming debates will be fierce, and the burden of adjustment will be high. But if we stand up as we did at other defining moments in our history, Canada could emerge as a more independent country than we have recently imagined.

Our second piece — called “Ten Trump-proof nation-building projects for a strong, independent Canada: Canada needs bold ideas for a strong, independent, and decarbonized economy. Here are some starting points” — is by Hadrian Mertins-Kirkwood and published by the Canadian Centre for Policy Alternatives on February 25, 2025. You can read the whole piece by clicking on the link, but the following provides a sense. The ten ideas are only reproduced by their heading and not the discussion that follows each heading:

….Canada-U.S. integration is, after all, the product of a half-century of free trade, deregulation and privatization. By giving capital free rein, unhindered by borders and emboldened by the erosion of taxation and regulatory regimes, governments have facilitated the concentration of economic power into the hands of multinational corporations with no loyalty to Canada or concern for the public interest.

Yet the big ideas currently being floated by Canadian politicians and business lobbyists would do more of the same. Calls to lower corporate taxes even further, build new oil pipelines on the public dime and eliminate interprovincial trade barriers are at best misguided and at worst counterproductive. Rather than set the Canadian economy on a path of resilience, sovereignty and sustainability, these initiatives would merely entrench the profitability of the corporate sector—including for U.S. investors and owners of Canadian assets—with no guarantee of public benefit.

We need better ideas for addressing the present crisis. Ideas that break from a failing model and actually build a stronger, more independent Canada. Here are 10 such possibilities.

Build an all-Canadian electric transportation industry. ….

Build an east-west electricity grid. ….

Unleash Indigenous-owned renewable energy projects. …

Build a publicly-owned, coast-to-coast high-speed rail system. …

Build one million non-market homes. …

Launch a public bank for the public good. …

Build a flourishing Canadian arts and culture industry. …

Plan a world exhibition to rally Canada and its allies. …

Establish a youth climate corps. ….

This list is hardly exhaustive. There is no shortage of good ideas for disentangling Canada from the U.S. and investing in more resilient alternatives. They should all be on the table as Canada embarks on a radical economic transition.

What all of these ideas have in common, however, is a foundational belief in and commitment to the public interest. They describe an economy that puts public control ahead of U.S. dependence; one that puts well-being, resilience and sustainability above private profits.

And, almost as important, they are nation-building projects—ideas that can strengthen the social, economic and cultural fabric of Canada in the face of an increasingly belligerent neighbour.

The third piece is a statement published on January 17, ahead of the Trump inauguration, by the Council of Canadians, calling for Canadians to “Unite for the Canada we want:”

The crisis created by Donald Trump will have a serious impact on everyone in Canada. His threats to punish our jobs and our communities are designed to turn people against each other and extract concessions that nobody wants. The only way to deal with a bully is to unite and face him with the power of true solidarity.

Canada is far from perfect, but it’s not going to get better by allowing our economy to become even more oriented around corporate greed, anxiety, and scapegoating. The Canada we want – for all of us who live on this land, no matter how long or where our families hail from – is based on inclusion, community and investing in our common good.

Powerful business interests will try to use this crisis to further their own agenda. The leaders of corporate Canada have made it clear that they want to accommodate the Trump regime by cutting corporate taxes, increasing arms spending, gutting environmental standards and shrinking government. We should reject their bad advice.

It’s not that we don’t want change – we don’t want their version of change. We want Canada, and the world, to have a sustainable future which ensures shared prosperity and a decent quality of life for all.

✓STAND UNITED

Donald Trump’s threats of economic or military bullying should be condemned and opposed by every leader in this country. No premier should be undercutting our national interest in their attempts to serve the interests of wealthy corporations.

✓PUT NEW RULES IN PLACE

We need an immediate safety net created for those whose jobs and incomes will be affected by Trump’s aggression. There should be export taxes imposed to help cover the cost and to create a bargaining lever against unfair tariffs. Canada needs to become more self-reliant at the same time as forging stronger economic and political ties with other countries. We need a national strategy to build domestically focused industries (including affordable housing, sustainable energy, and caring services) to fill the void left by a downturn in export, while re-instating procurement policies to support Canadian-made products and upholding labour rights.

✓SAY NO TO FALSE SOLUTIONS

Instead of weakening our environmental laws, they should be strengthened to address the climate crisis fueling the fires, floods and the droughts that threaten agriculture and hydro-electricity supply across the country. We cannot allow the further commodification and export of our water. Trump’s demands to alter our immigration, refugee and border policies must be rejected, while social programs and public health care must be protected.

✓DEFEND DEMOCRACY

American billionaires are blatantly using their wealth to interfere in elections and spread disinformation – not just in the United States but across the world. We cannot allow the American-style politics of division, fueled by business interests, to become a dominant feature of our country. Defending our ability to have reliable news and information, including public broadcasters, is crucial to our democracy.

✓WORK HARD TO BUILD SOCIAL SOLIDARITY

Workers in other countries didn’t create the crisis – it was a flawed trade agenda that saw giant corporations shifting production from North America to low-wage countries. We need to extend a hand of solidarity to workers across our continent and beyond and to ensure that trade is based on mutual gain, worker rights, environmental protections and cultural sovereignty, while recognizing the rights of Indigenous peoples.

✓ASK TOUGH QUESTIONS ABOUT “THE BIG PICTURE”

When the wealthy tell us there is no alternative to their agenda, they are not being honest. Choices are made every day – like making corporate tax cuts instead of investing in public services, or failing to commit to reconciliation. Deregulation, privatization and free trade deals were all part of the corporate agenda – along with weakening workers rights.

✓STAND TOGETHER FOR WHAT WE BELIEVE IN!

Generations before us sacrificed to build a better life. Powerful voices often told them not to. The progressive movement in Canada has a solid vision for the kind of future we want. We don’t just want to defend what we have. We want an economy and a society that provides good jobs, respect and a decent quality of life for all. To get there, we need to unite for what we believe in.

Finally, our fourth piece is the Assembly of First Nation’s National Climate Strategy The Strategy was framed by an AFN General Assembly resolution, which reads as follows:

At the July 2023 Annual General Assembly, the First Nations-in-Assembly furthered this commitment to urgent and transformative climate action in Resolution 36/2023, Urgent and Transformative Action through the AFN National Climate Strategy, resolving to:

1. Reaffirm the declaration of a First Nations Climate Emergency, calling for:

a. A recognition that the climate crisis constitutes a state of emergency for our lands, waters, air, ice, animals, and peoples;

b. Local, national, and international communities, governments, organizations, and movements to safeguard the inherent, Treaty and constitutionally protected rights of First Nations, respect First Nations knowledge systems, and uphold Treaties and other constructive arrangements between First Nations and the Crown; and

c. Federal, provincial, and territorial governments to take urgent and transformative climate action that meets the requirements outlined in the reports by the Intergovernmental Panel on Climate Change and Canada’s Changing Climate Report (2019) to reduce emissions in Canada by 60% below 2010 levels by 2030 and reach net-zero emissions by 2050.

2. Fully endorse the Assembly of First Nations (AFN) National Climate Strategy and its seven key priority areas of action:

a. Prioritize First Nation Knowledge Systems, health, languages, cultures, and spiritualities.

b. Recognize, respect, and position First Nations inherent jurisdiction and inherent right to self-determination as central to decision-making at all levels.

c. Address capacity needs to support First Nations governance and their role as climate leaders.

d. Ensure First Nations self-sufficiency in food, water, and energy.

e. Close the natural and built infrastructure gap.

f. Ensure First Nations are equipped to mitigate, prevent, respond, and recover to all emergencies.

g. Leverage the First Nations Climate Lens to reform federal, provincial, and territorial legislation, regulation, policy, and programs.

3. Call on the federal, provincial, and territorial governments to work directly, and in full partnership with, First Nations rights and title holders to implement self-determined First Nations climate priorities, including, but not limited to, those outlined in the AFN National Climate Strategy.

4. Direct the AFN to work with First Nations rights and title holders to advocate to the federal, provincial, and territorial governments for sufficient and sustainable funding to First Nations to implement their own strategies in a manner consistent with Article 39 of the United Nations Declaration on the Rights of Indigenous Peoples.

5. Call on the federal government to compensate First Nations with new or additional land for any land that First Nations may lose due to climate change.

6. Direct the AFN to use the AFN National Climate Strategy in national and international contexts as an advocacy tool, including with the United Nations Framework Convention on Climate Change and the Intergovernmental Panel on Climate Change.