Canadian economists believe a second term for Donald Trump could force Canada to address long-standing structural problems hindering its economic performance compared to the US. Despite the potential for trade tensions and economic instability, some argue that a Trump presidency would act as a necessary stress test, prompting Canada to realign its economic focus and prioritize productivity, growth, and wage competitiveness. Canada faces mounting challenges including rising unemployment, high household debt, and a widening income gap, reflected in record food bank visits.
Canadian economists believe there could be an unusual solution to the problems befalling the G7 economy: Donald Trump ’s return to the White House. The US president-elect might have already threatened a blanket 25 per cent tariff on all exports from its northern neighbour and played a role in the resignation this month of finance minister Chrystia Freeland.
“We need restrained government spending, widespread tax reform and an improved investment climate beginning with, among other policies, reversing the recent capital gains tax hike, for large profits on asset sales, and phaseout of accelerated depreciation,” he said. Productivity and innovation — the twin pillars that have helped the US economy race ahead of its G7 counterparts in recent years — have become a sore point for Canada.
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