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Jack Mintz: Best way to keep Canadians from leaving? Make Canada better

Blocking Canadians from leaving or taxing them when they do are not how a free and democratic society should address economic discontent

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I want to link two issues that are troubling Canadians these days: the brain drain and Alberta’s referendum on separating from Canada. Both are about people exiting a country.

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In the case of the brain drain, it’s mainly the young and old who decide to move elsewhere so they can improve their standard of living. With separation, a majority of voters decide they need to secede to be successful, which happened with Singapore separating from Malaysia, Norway from Sweden and the Czech Republic from Slovakia.

Jack Mintz: Best way to keep Canadians from leaving? Make Canada better Back to video

Whether it’s a person or a jurisdiction that’s exiting, the source is often dissatisfaction with opportunities offered by staying put. I think of my own case when my wife and I trotted off to the United Kingdom for my doctoral education. We thoroughly enjoyed mid-1970s Britain and even considered staying. But with labour relations ruinous, strikes frequent and crippling, salaries low and the pound plunging, it took about a nano-second to decide we should return to Canada.

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Since 2021 almost half a million Canadians have left the country. According to Statistics Canada’s review of the most recent census data, two-thirds of emigrants are between 20 and 44 years of age and almost 70 per cent have university degrees. A majority are immigrants who decide to move again in search of greener pastures. Today almost 1.3 million Canadians live abroad, three-fifths of them in the United States.  

Not since the 1990s has the “brain drain” been a policy concern. But after a lost decade of high taxes, a failing health-care system and stagnant per capita incomes running at Alabama levels, it’s not surprising more people are leaving. 

How do we keep them from going? Not by copying the Soviet Union, East Germany or North Korea and forcing them to stay. Nor by imposing an exit fee of $500,000 to compensate taxpayers for emigrants’ subsidized education, as former Google executive, Patrick Pichette, suggested at last weekend’s Liberal party convention. That this quirky, illiberal proposal elicited strong applause from the delegates says a lot about modern Liberalism.

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An exit fee would be wrong on several counts. Most importantly, it’s an attack on the freedom we value in a democratic society — liberals and Liberals more than anyone, supposedly. Parents pay for their children’s education through property, income and school taxes, and via various fees and levies. Why shouldn’t they want their children to pursue the best available opportunities, even if they are outside Canada? Under Pichette’s proposal, do families that paid more in taxes than their children cost to educate get a credit for their surplus contributions if their child moves abroad?

It’s bad ideas like these that contribute to support for separation in Alberta. The province’s entrepreneurial culture and emphasis on individual freedom rather than heavy-handed government intervention is clearly out of step with Liberal central Canada.

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Long treated as central Canada’s colony, Alberta has been weakened since 2015 by federal policies that undermine economic growth. Though per capita incomes are down from 2014, when commodity prices crashed, the province still transfers close to $20 billion a year to other provinces by paying more federal taxes than Ottawa spends in Alberta. That net tax burden — close to a tenth of household income — would be more acceptable if Albertans felt they had influence over federal decision-making. But they don’t, which is why even those who don’t want outright separation generally favour greater provincial autonomy.

As a Canadian who has benefited from living in both Alberta and Ontario, it is sad for me to hear people say Canada is broken. If we want people and provinces to stay, the best way is not to block or tax their exit but instead to make Canada a better place to live.  

For decades, Canadians took pride in schools and universities that graduated top-notch professionals, business leaders and skilled workers. But in recent years standards have fallen as institutions have focused more on identity issues and less on learning. Some provinces are beginning to address this problem by revamping their curricula. A more dramatic reform would be a voucher system to encourage competition among schools.

Governments also spend too much — 44 per cent of GDP — which requires high taxes that hurt Canada’s competitiveness. Greater productivity in public services will take greater competition for public monopolies (such as provincial power companies) and privatized delivery of services on a competitive basis. Wasteful spending and frivolous subsidies directed at historically slow-growth industries or ego-massaging projects will not improve Canada’s productivity.

Mark Carney understands Canada’s economy is underperforming but he’s still a long way from undoing all the wasteful practices that have hurt it. Even his nation-building plans have yielded little construction so far. Now that he has a majority, let’s see if he shifts from governments picking politically popular projects to the private sector deciding where capital can be used most effectively.

If we want to keep people and provinces in Canada, we should be making the country better, not putting up exit barriers or taxing emigrants. Desperate autocrats do that sort to thing, not free and democratic Canadians.

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