Category: Chairman’s Desk

This article originally appeared in the Toronto Star on April 19, 2020.

Of all the things underpinning our pre-COVID19 lives that we paid little mind to, supply chains would have been at the top of the list.

And for good reason. Parts were seamlessly delivered on a just-in-time basis to our factories. Shops were filled to the rafters with the latest fashions. Shelves were loaded with asparagus and fresh berries, even in the dead of winter.

But as the song goes, “you don’t know what you’ve got till it’s gone,” and the past few weeks have shown how little time it takes for, if not it all to be gone, at least for the cupboard to be bare.

Initially, it was our reliance on Chinese goods that proved problematic as that country’s economy shut down. Since then, China has rebounded but at a cost. By leveraging its position as a vital supplier to the Western world, China has systemically strengthened its state power through commercial networks that manufacture and transport essential goods like medicines and personal protective equipment.

It’s no surprise that President Xi has taken advantage of this crisis to manoeuvre China toward greater dominance. It is also no surprise just how successful China has been in disrupting supply chains and isolating countries like Canada along the way.

To make matters worse, these moves come while our closest ally, the United States, seems intent on leaving us further isolated.

Two weeks ago, in a move Premier Ford declared “totally unacceptable,” U.S. officials halted the shipment to Ontario of 500,000 medical masks from manufacturer 3M.

The situation was resolved but the episode underscored the frightening reality that Canada, with zero domestic capacity to produce N95 masks, is wholly dependent on a supply chain built on trust.

So, amidst this never-before-contemplated disruption, maybe it’s time for a return to “made in Canada.”

Canada’s manufacturing sector has been shrinking for decades as trade deals like NAFTA have taken effect and production has moved overseas. For a long time, this decline has been characterized as the inevitable cost of globalization. But now, when Canada needs quick, reliable access to goods that we find more difficult than ever to acquire, we need to reconsider those assumptions.

We must recognize that, even setting aside COVID-19, the world has changed. Exhibit A? The 3M issue. It is simply inconceivable that Presidents Bush or Obama, or any other former president for that matter, would pressure an American company to withhold life-saving equipment from Canada.

So too, the nature of Chinese power has changed the world. This week, the EU’s competition commissioner, Margrethe Vestager, explicitly urged member governments to consider ownership stakes in European companies whose tumbling stock market values may leave them susceptible to Chinese takeover during or after this pandemic. Canada’s industries are equally susceptible to anti-competitive efforts by China.

Conservative leadership candidate Erin O’Toole has leapt on these trends. In a campaign video released this week, O’Toole called out “corrupt foreign governments” and “incompetent global institutions,” like China and the World Health Organization, which have left Canada to fend for itself. O’Toole’s solution? “Buy, build, and grow Canadian.”

In the latter half of the 20th century, Canada’s economy was denationalized — through the sale of Crown corporations like Petro Canada, CN Rail and Air Canada — in the belief that the same public policy outcomes, previously pursued through ownership, could be achieved through regulation. At that time, both citizens and governments felt confident in the effectiveness of those regulatory policy tools.

As our leaders plan their long-term response to our latest economic catastrophe, already christened “the Great Lockdown,” it is worth asking whether they continue to have the same confidence in those same policy tools.

It’s possible that Canada’s response to the long-term problems this crisis has exposed will rely on not only a new role for the private sector but also a new relationship between public and private sector. As the last recession taught us, government bailouts alone will not bring back Canadian manufacturing. Nor will they bring us a supply chain we can trust.

That’s something that will take all of us — government, business and all Canadians — to do. As the prime minister says, “we are all in this together.”

This article originally appeared in the Toronto Star on April 12, 2020.

Among the more concerning broader societal consequences of the coronavirus — economic collapse, fear-mongering, widespread distrust — is a stunningly rapid deterioration of democracy.

To exploit popular anxiety as a pretence to seize power is a tactic as old as plague itself. When William Cecil, chief minister to Queen Elizabeth I, was battling the Black Death, he won the ability to shut the sick inside their homes for up to six weeks (likely reasonable enough) but then went on to pass the Plague Act of 1604, which banned any criticism of this unprecedented power.

Dealing effectively with pandemics can reasonably support the suspension of some norms and freedoms, but a careful balance must be struck.

We have already seen the virus extinguish popular protest movements from Iran to Hong Kong. Now, in some places, we are seeing how it threatens democracy itself.

To be clear, this is not about the lockdowns, quarantines, and mandatory physical distancing measures imposed by almost every responsible government in response to COVID-19. But even these sensible rules, in most cases guided by the advice of public health authorities, have resulted in penalties that can be unduly heavy-handed. Steep fines, such as the $300,000 one levelled against a Brampton-area man who hosted a backyard party for 20 friends, are an example. Surely there are reasonable limits to such sanctions.

What does concern me are the ominous cases of democratic rollbacks, like the ones we are now witnessing in Hungary. Earlier this month, Prime Minister Viktor Orban pushed through a draconian law that allows the prime minister to rule by decree, suspend Parliament and repeal any existing law and do so indefinitely.

The state will now impose years-long jail terms for sharing nebulously defined “fake news,” or acting to impede the response to the virus, giving the authorities wide latitude to imprison political dissidents. While these measures firmly tip the EU member state from democracy to dictatorship, the rest of the Union, mired as they are in their own COVID-19 response problems, hardly seem to have noticed.

Hungary is not walking this dangerous path alone. In Thailand, the prime minister has used his new powers to impose harsh curfews and expand censorship of the news media. In Chile, the military patrol the streets and public squares, having conveniently crushed protestors who had disrupted the country for months before the virus arrived.

And the list goes on. Amid the panic of the pandemic, it can be difficult to detect where, exactly, the line falls between justified response and anti-democratic exploitation. Some of the countries that have been most successful at flattening the curve have deployed aggressive contact tracing techniques that, on their face, would violate civil rights.

Israeli Prime Minister Benjamin Netanyahu authorized the use of invasive cellphone location tracking, intended for counterterrorism, to track those who test positive for the virus and monitor others with whom they may have come into contact. The South Korean government’s policy of releasing detailed information including the names and movements of newly diagnosed cases has inadvertently revealed sexual affairs and other embarrassing personal information.

What’s more, even well-established democracies are flirting with injustice. Despite pleas from the Democratic governor of Wisconsin, the Republican-dominated legislature, abetted by the state Supreme Court, has used the crisis to play partisan politics. In recent voting, it refused to extend the window for mail-in ballots and reduced the number of polling stations in the state from 180 to five, all of which were conveniently located in areas that lean Republican.

As the curve is flattened and the threat of the virus recedes, it remains to be seen how many of these unjust measures will be repealed. The last time Orban awarded himself extraordinary powers under the guise of an emergency — powers he has yet to relinquish — it was the 2011 migrant crisis.

What every strongman has understood, from Cecil to Orban, is that a frightened public is also a compliant public. For the sake of our democracy, our leaders must understand that while we are willing to be compliant, to do our duty, to surrender some of our individual rights and liberties for the collective good, we are not frightened. Not in the least.

This article originally appeared in the Toronto Star on April 5, 2020.

The COVID-19 humanitarian crisis is compounded in its severity by an economic crisis that, like the virus, is worsening exponentially. Nowhere is this more pronounced than Alberta where, this week, the price of Western Canadian Select oil plummeted below $5 a barrel — equivalent to the price of a pint of beer.

We are facing the prospect of a depression that will leave no Canadian untouched. Every industry is experiencing the sharpest downturn in living memory as the economy has gone into deep freeze. But in a country where the energy sector accounts for more than a tenth of GDP, and a region where hundreds of thousands rely on that industry for their livelihood, the wholly politically engineered disaster of dirt-cheap oil is tragedy upon tragedy, akin to kicking someone already down.

In early March, when talks stalled between Russia and OPEC, the price of crude oil plunged by a third, thanks to deliberate decisions to flood supply in the market made by Moscow and Riyadh. What’s worse, the repercussions of the OPEC price war have been compounded by massive declines in demand as the world’s two largest oil consumers — China and the United States — moved toward total lockdown in response to the pandemic.

Just as Alberta and Canada’s economy were bolting down for the impact of COVID-19, the OPEC issue has brought challenges for the energy sector in general to the fore. While the impact may look different for conventional versus renewable energy companies, the reality is that both are united in their reliance on access to capital. Across the entire economy, that capital will now be much more difficult to attain than it has been for a long time.

The result? A crisis of unprecedented magnitude.

The falling price of oil means not only is the energy sector hurting but Albertans are seriously hurting right now as well.

And that’s bad news for every Canadian. For all the talk of economic recovery in Canada, we need to face the reality that we won’t have a recovery in this country without the energy sector. It plays a central role in our economy. It is critical for the effective functioning of almost every other industry as well.

And importantly the energy sector goes well beyond Alberta, too. One need look no further than the dire state of affairs in Newfoundland and Labrador, where the combined impact of COVID-19 and the oil crash has left the province in financial ruin.

It may be that the Trudeau Liberals are reluctant to take action to benefit the oilpatch while other sectors, the ones whose impact is more personal to many Canadians, are still reeling. But as our government moves forward with bailout plans for strategic sectors and looks at options to quickly restart the economy, it would be unconscionable — foolhardy to boot — to leave the energy sector behind.

Whether it is conventional or renewable, energy is one industry that can have a direct and immediate impact on jobs, stimulate investment and create benefits for communities small and large, including Indigenous communities.

That said, no matter how well calibrated the response, the impact will be devastating. There will be significant consolidation in the sector.

In the long run, though, this will provide a pivotal opportunity for innovators to come out on top and, in doing so, transform Canadian energy. It is a movie we have seen before: some of the current oilpatch leaders were born out of a previous downturn. Newer companies will be doing things better, with more efficient and sustainable methods.

The key to a successful government response will be not to shy away from traditional oil and gas producers but rather, partly out of economic necessity, to embrace them. And, at the same time, embrace the kind of technology and solutions needed to help the industry achieve a lower carbon footprint. That is where the opportunity lies. Ottawa cannot afford to miss out on it. Canadians certainly can’t.

Especially now that, just when we were facing the greatest challenge of our lifetimes, Saudi Arabia, Russia and others were content to effectively destroy our own energy industry.

Perhaps now, we will all listen more intently to Premier Jason Kenney’s long-standing pleas for North American energy independence.

This article originally appeared in the Toronto Star on March 29, 2020.

Responding to the events of the past few weeks, Canadians have proven their remarkable capacity for compassion, understanding and sacrifice. As the impact of COVID-19 has set in around the world, here at home our governments, businesses and fellow citizens have, for the most part, set out in earnest to do the right, Canadian thing.

In Ottawa, that’s meant an $112-billion bailout package passed with multi-party co-operation, albeit with a few tactical hiccups along the way. For provincial and territorial governments, it has meant ramping up expert medical briefings and passing legislative relief of their own. For each of us, doing the right thing has meant self-isolation, staying at home and appreciating the very real sacrifices made by health-care professionals and front-line workers.

As I wrote in this column last week, Canadians can rightfully take some comfort in the serious and responsible approach of their political leaders, who continue to demonstrate their resolve to bolster our capacity for recovery: medical and economic.

But the reality is, the upheaval caused by COVID-19 will go well beyond its medical and economic impact. Comparable more to the events of 1918 than the 2008 recession, this pandemic will upend the status quo for every country, every sector and every walk of life. So, while we, of course, need to focus on our near-term response to the quakes and tremors of this crisis, we are damned if we ignore the various tectonic-like shifts that are taking place well beneath our feet.

Before this outbreak, the past decade was marked by a transformative redefinition of issues like income inequality, tax fairness, political freedom and the purpose of the corporation.

Consider the Occupy movement, which followed the financial bailouts of the 2008 recession. While it has faded, its underlying principles and impulses live on in movements like France’s gilets jaunes and the wave of populism that has since swept Western politics.

Similarly unprecedented protests for democracy in places like Hong Kong, Lebanon and India have abated in recent months as now 10 per cent of the world has been ushered into quarantine.

As for discussions of the role of the corporation and ESG (environment, social and governance) considerations, these will no doubt take a back seat to companies’ bottom lines as COVID-19 wreaks havoc on the global economy.

But to think of these phenomena as trends that will simply “pause” while this crisis plays out, only to resume after the fact in the same form and with the same velocity, is simply incorrect. Each of these issues is a log in a fire on which this pandemic has been poured like an accelerant. Rather, what is correct is that they will return more disruptive and ferocious than ever.

On an individual level, this health crisis is not equally trying on every household, as exemplified by social media outrage over wealthy individuals’ ability to seemingly jump the queue for testing kits. Even the embrace of crucial work and study from home initiatives belies the tragic reality that for many employees and students, home is not a safe or comfortable work environment.

COVID-19 has not only revealed and exacerbated these inequities, it has ensured there will be real and lasting fissures in civil society as well. It has become impossible for us to return to the norms and social order we have enjoyed for so long.

The fact is, once this is done, major corporations and wealthy people will be viewed very differently. Just as we saw in 2008, that mistrust and sense of inequality will be compounded by the very responses that governments now deem essential to our recovery.

And so, governments and business must realize the playing field has changed. Entirely. With that change must come a response that acknowledges the world looks very different. That means not just fiddling around the edges or making incremental improvements but an entirely new response.

And there is more. Government and business leaders must understand they will be judged by how they acted in this time of crisis.

If we don’t address the fault lines exposed by this pandemic, the aftershocks will prove even more damaging than the quake.

This article first appeared in the Toronto Star on March 22, 2020.

As the spread of COVID-19 has utterly transformed life as we know it, it has also emerged as the most profound test of political leadership in a generation or more.

Of course, the pandemic is, first and foremost, a health crisis. In the global response, doctors and public health authorities have been foregrounded, and rightfully so. But it is also a crisis of public confidence and so it is appropriate to look at the crisis through the lens of the political leadership as well.

In the United Kingdom, Prime Minister Boris Johnson, having gotten Brexit done, now faces an even greater challenge. He has been forced to pivot from an initial anachronistic approach of herd immunity (i.e., letting the virus run amok) to proper suppression and mitigation efforts as in the rest of the world.

Meanwhile, in Ireland, Taoiseach Leo Varadkar was voted out of office last month, but while a new government has been unable to form, the former doctor-turned-politician has, quite literally, risen to the role of caretaker government. On St. Patrick’s Day, he delivered a national address that marked the high watermark of his premiership.

The pandemic has forced Angela Merkel, long averse to televised displays of leadership, into doing precisely that. And in so doing proving why she continues to be primus inter pares among world leaders.

As for Donald Trump, there is only one word: disaster.

Here at home, Canadian leaders, at all orders of government, have acted on the advice of scientists, doctors and public health experts, as they bloody well should. And for that we can, as a people, be grateful.

From Prime Minister Trudeau to our premiers and mayors, the performances of our leaders have been commendable.

But perhaps the biggest success has been the commanding performance of Ontario Premier Doug Ford. It was not even two weeks ago that Ford was embroiled in a kerfuffle over manufacturing defects with new provincial licence plates; today, it seems hard to imagine a scandal with smaller stakes. And a protracted dispute with the teacher’s unions had dragged his government’s approval rating underwater. Now, in his daily briefings about the province’s response to COVID-19, he is modelling leadership in real time.

As the crisis has deepened, Ford is exemplifying the tenets of good crisis communication. He has been transparent and forthcoming, hosting daily briefings which may seem routine, but are in fact distinguished by attention to small details.

The premier begins promptly on time, wearing a suit and tie. He has been honest and plainspoken about the scale and severity of the challenge before us. He has delegated and empowered his bench of ministers, including Deputy Premier and Health Minister Christine Elliott and Finance Minister Rod Phillips. He has put aside partisan considerations.

He is working hand in hand with his federal counterparts. And, for a man whose political career has been defined by animosity towards the mainstream media, this week’s explicit recognition of their essential role marked a turning point.

The premier has consistently struck the right tone in these briefings and in his other public comments, tempering the flow of essential information with genuine compassion. If there has been one misstep, it was his comment that families should go away for March Break and “have a good time.”

But as even his predecessor and opponent Kathleen Wynne noted, this rare, off-message comment can be chalked up to a surplus of empathy. “He was trying to do that out of the goodnesss of his heart,” the former premier told Newstalk 1010. “I could hear it in his voice, he was trying to calm the waters.”

In the past, Ontarians have been quick to recognize and reward leadership during a crisis. Former premier Ernie Eves’ approval jumped after he confronted the SARS epidemic in 2003. Premier Ford might come to enjoy the same.

There are uncertain times ahead, to be sure. Scientists tell us that no one knows how long this crisis may last or how severe its consequences might be. But, today, Ontarians can take solace in the actions and behaviour they have seen to date from the premier.

Such leadership has saved lives.