Dan Gardner is the New York Times best-selling author of Risk, Future Babble, Superforecasting (co-authored with Philip E. Tetlock), and How Big Things Get Done (co-authored with Bent Flyvbjerg). His books have been published in 26 countries and 20 languages. Prior to becoming an author, Gardner was an award-winning investigative journalist. More >

Credit the Prime Minister for the Economy? No.

In every speech, Stephen Harper describes Canada as a uniquely sunlit island of tranquillity in a storm-ravaged ocean of uncertainty. And he knows who's responsible for Canada's good fortune. He is. "Our plan is working," Harper said recently. And repeatedly. It's a key message of the Conservative campaign, usually paired with a warning that if the election produces anything but a Conservative majority a "reckless coalition" will take charge. And Hurricane Katrina will make landfall. As political marketing, this is smart and effective. Most Canadians believe the country has done uniquely well in the last few years and many are prepared to credit Stephen Harper's steady hand at the helm. Should they? No. In a liberal democracy like Canada, with an economy dominated by free markets and heavily reliant on foreign trade, political leaders do not steer the economy. Policies matter, of course, but they aren't central drivers and their effect is mostly felt in the longer term. Conservatives often acknowledged this basic reality a decade ago, when Jean Chr├ętien was prime minister, but today they do nothing but applaud when Stephen Harper, aping the president of Uzbekistan, takes credit for every bumper crop of watermelons. That's the general point. But there are more specific reasons why the Conservative claim fails. First, while it is true that Canada suffered less than many other countries during the recession, it is obvious that Harper's policies either did little or nothing to contribute to that happy outcome. Don't take my word for it. Look at the OECD report released last September. The Canadian economy "weathered the worldwide financial turmoil and the ensuing recession relatively well" thanks to a number of factors, including "a sounder banking system, a less leveraged corporate sector, and a relatively strong fiscal position." The Harper Conservatives were not responsible for any of that. In fact, Canada had "a relatively strong fiscal position" despite Harper's indefensible combination of big tax cuts and rapid spending growth, which took us from surplus to structural deficit. As for the stimulus package, the Conservatives only created it when pressed by the opposition and the international community. If the Conservatives wish to take credit for it now, Stephen Harper should first thank St├ęphane Dion for showing him the error of his ways. Second, and more basically, if Harper deserves credit for the economic recovery, shouldn't he also be blamed for the recession? The Liberals tried to make this argument but it never really stuck. And rightly so. The recession was obviously caused by forces beyond our borders. But the same is true of the recovery. "We don't have a lot of independent control over our economy, for good or for bad," Don Drummond, former TD chief economist told me last month. "The bad part of it is the rest of the world dragged us into this mess. But the flip side of it is that for Canada's economy to repair itself is largely dependent on what happens in the global economy." Much of the global economy is doing well. In particular, China and Germany are booming. Both are manufacturing giants. Both consume vast quantities of commodities, and so commodity prices have soared to record highs. And, happily for us, we own a mighty big pile of commodities. Look at Australia, our economic and political cousin. As one may guess, Australia's prime minister is not Stephen Harper. And yet, Australia survives. Indeed, it thrives. Thanks mainly to commodity prices, Australia's economy is booming. Australia also underscores a final, critical point. Canadians have an exaggerated sense of how well Canada is doing. Yes, as Conservatives like to note, the latest OECD report shows Canada's economic growth is among the best in the G7. We're doing relatively well, no question. But we're hardly leading the world, a fact evident in the statistic that people care the most about. Canada's unemployment rate was 7.8 per cent in January. That's better than the 8.4 per cent OECD average. It's better than Spain, Ireland, the U.S. and Italy. But it's about the same as the Czech Republic, Slovenia, Sweden, Finland, and even Belgium, which has been without a government for almost a year. And it's much higher than the unemployment rate in Austria, Germany, Japan, Korea, Luxembourg, and the Netherlands -where the rate is 4.3 per cent. In Australia, the unemployment rate is five per cent. A sudden increase to the Canadian level would be considered a national disaster. If there is indeed a uniquely sunlit island of tranquillity in the world, it's not us. And Stephen Harper cannot take the credit.