Here, in the shadow of the western world’s setting sun, we are languishing in a near-permanent state of decay – both victims and authors of our decidedly unenlightened self-interest.
This, at least, has been the received and incontrovertible wisdom, and there’s no longer any point in trying to save ourselves.
First, came the financial crisis of 2008, which effectively wrecked private savings, public accounts, the manufacturing sector, and the housing market. Then came the government bailouts (“stimulus” spending, if you prefer), which saddled states, provinces and cities across North America with spiraling deficits and structural debts.
Finally, came the language of the resignedly defeated: No growth is the new normal; quit your jobs and plant your gardens, for the end of our global, capitalist hegemon draws nigh.
But a funny thing happened on the way to the economic abattoir. Suddenly, with no portents or premonitions, everything got just a little bit better. How? Why? Economists, bankers, politicians are still scratching their heads.
“It’s been a long time coming,” Nariman Behravesh, the chief economist of IHS Global Insight, told The New York Times recently. “There is more optimism about the U.S. and in particular about the second half of this year and 2014. Three months ago, we wouldn’t have come to that same conclusion.”
Three months ago, no one, it seems, was ruminating on the efficacious effects of certain economic outliers, such as advancing technology, growing energy independence and the resurgence of what can only be described as a sort of gritty self-determination.
Referring to the future, George Mason University economist Tyler Cowen told The Times, “It’s better than it looked. Technological progress comes in batches and it’s just a little more rapid than it looked two years ago,” adding somewhat circumspectly: “The great stagnation will end for a lot of people but not everyone. I think there will be great breakthroughs but the distribution of those gains will go to owners of capital and intellectual property.”
Still, some economists predict the U.S. economy will outperform its average of two per cent per year growth rate by as much 1.5 percentage points over the next eight quarters, which would effectively close the doomsday chronicle of recent times.
A similar phenomenon is occurring in Canada. May was an astonishing month for employment in this country. The economy generated 95,000 new positions, most of which were full-time, private sector jobs. That was the single, largest monthly surge in more than a decade.
Again, in interviews with the Financial Post, the experts were gob-smacked. “Canada’s job gain. . .is simply stunning on the headline and most of the details,” said Derek Holt of Scotiabank Economics. It is equivalent to the U.S. adding over 1 million jobs in a single month.” Indeed, noted Douglas Porter of BMO Capital Markets, “Even outside of construction, which is definitely the eye-popping stat here. . . (May’s data) was still a mammoth number for employment.”
Naturally, Finance Minister Jim Flaherty prefers to take the long view. To the Post, he declared, “What’s more important is the positive long-trend when it comes to employment in Canada. . .We can’t be complainant. We are still facing a very volatile global economy. We recently saw European unemployment hit a record high. Canada is not immune to these challenges from beyond our border and we will be impacted.”
He is correct, of course. Canada is joined at the hip with the international community, and our national prosperity depends on the degree to which we diversify our goods and services and, crucially, our trading relationships.
And yet, the recent numbers suggest that rugged, defiant entrepreneurialism – inventiveness, creativity, opportunism – is not as easily squashed as the prophets of calamity (in whose company, I must admit, I have found myself) would have us think.
That’s worth remembering here, on the East Coast, as we gnash our teeth and wring our hands over the high cost of government, the seemingly endless string of failed economic development schemes and the hollowing out of our productive population.
The heart of true enterprise still beats. We can feel it if we try.