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Winnipeg Free Press - PRINT EDITION

From Davos with some tough love

By: Editorial

Posted: 01/27/2012 1:00 AM | Comments: 0 (including replies)

Prime Minister Stephen Harper delivered the keynote address to the World Economic Forum in Davos, Switzerland, on Thursday, a tribute by the world's "movers and shakers" to Canada's performance during the recession that began in 2008 and lingers still today.

Mr. Harper was expected to give the rest of the industrialized world -- particularly Europe -- a scolding for its poor performance up to and during the recession. With the eurozone on the verge of collapse, as British Prime Minister David Cameron had previously and somewhat smugly pointed out -- Britain is a member of the European Union but not the eurozone -- Mr. Harper had some hard and sensible advice for European leaders. No matter how hard it is, deal with it, was the essence of what he told them.

German Chancellor Angela Merkel, however, made clear in Davos Germany will no longer be Europe's cash cow; the so-called PIGS -- the nearly bankrupt nations of Portugal, Italy, Greece and Spain -- may well go broke very quickly. That might mean the end of the euro -- not necessarily a bad thing -- and the beginning of a new and deeper worldwide recession even Canada will have a hard time coping with.

But while Mr. Harper was scolding Europeans, he was also scaring the pants off many Canadians in a part of his speech that was not so widely expected -- the "reforms" his government plans to make to solve Canada's own problems as they evolve from economic doldrums and drastically changing demographics.

The prime minister offered few details, but he served warning that "reform" -- read "change" if you are not a Conservative politician -- is necessary in several areas to sustain and promote economic security, job creation and prosperity.

The changes he suggests fall in several areas: a revision of immigration laws; a reassessment of trade markets and trade policy; a reallocation of priorities in scientific and technological research grants among others.

The most controversial is likely to be a re-evaluation of the old age security pension provisions. As baby boomers get older and refuse to die, old-age pension payments are expected to rise from $36.5 billion in 2010 to $108 billion by 2030, and that pension, if it is not reduced or eligibility for it narrowed, will come out of tax revenues funded by a diminishing workforce.

Mr. Harper offered little information about how his government intends to do any of these things, but the wake-up call he delivered in Davos was not just aimed at Europeans -- Canadians got it loud and clear as well.

Republished from the Winnipeg Free Press print edition January 27, 2012 A10

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