When economic nationalism harms the nation

Protective trade-oriented measures, especially in favor of Lion Electric, harm other companies in this sector. (Photo: Courtesy)

Guest blog. With the rise of protected trade principles around the world, consider especially Marine Le Pen’s program and President Biden’s policies. The Quebec government seems to be actively participating in the parade.

Quebec’s protectionism, hidden under the guise of economic nationalism, is widespread through subsidies paid to certain “pet” companies, fear of international competition, and the desire to produce everything in the state. However, the resulting measures are damaging Quebec’s economic prosperity, bankrupting businesses and delaying the emergence of innovation. If you’ve become a favorite in elementary class and it’s fun to have a chicken parent, it’s a completely different story when talking about the state’s economy!

Specific case … and sorry!

Last year, I wrote in a text that the current government’s protective trade-oriented measures in favor of electric bus producers would drive competitors into bankruptcy. Unfortunately, I was right. The CEO of Autobus Thomas in Drummondville, on several passionate and understanding outings, screamed from the government this week and called on him to stop the financial backing to bankrupt him by the end of the year.

Recall that in July 2021, a $ 250.7 million Quebec program was implemented to subsidize the purchase of electric buses. Problem: These electric buses had to be produced entirely here, so the field was almost exclusively open to Electric Lion. Autobus Thomas’ purchase orders have dropped from 300 buses a year to zero since the summer, and the number of employees has dropped from about 50 to about 30.

Whether these electric buses are produced in Quebec or North Carolina, it doesn’t matter if the government’s desire is to contribute to the fight against climate change. However, it is the vision of protected trade principles that these programs are designed to favor companies more than their competitors and sacrifice more work in the region.

I do not believe that Lion is not an innovative company that serves Quebec people. And certainly, I believe in their products, and if the government is as confident as I am, it will establish a regulatory and financial framework in favor of the entire Quebec electric bus production sector and be the most efficient. Company would have prospered. .. Instead, the state artificially chose winners and losers, undermining competition and emerging market innovation.

Make the job of every entrepreneur easy

Canada currently has the worst record for private investment among all member countries of the Organization for Economic Co-operation and Development, and Quebec is rarely exempt. Too often, by promoting inappropriate state intervention in the economy, our government crushes private investment and replaces it with public funds. Putting investor risk on the shoulders of Quebec’s family is not a long-term economic plan.

If the government really wants to promote economic prosperity, attract private investment, and promote Quebec’s business, it must promote the work of entrepreneurs, not one of them. Indeed, the state should not be a bank or business leader. That’s why there are Quebec entrepreneurs.

Quebec could become a land that leads to business and wealth creation, but it has stopped designing our programs with a vision of protected trade principles where successive governments prioritize some businesses over others. It only happens if. Let our entrepreneurs focus on areas of comparative advantage and stop playing Central Planner. Sustainable economic growth must become a priority again, and governments must adopt a longer-term vision.