It’s not a stretch to come to the conclusion that Canada has essentially become a zombie economy over the last nine years.
“Very simply, for 30 years, Canada has been using outdated thinking in its economic and security strategies, and this is what’s caused the erosion of our prosperity and security,” Balsillie said. “What Donald Trump has done is laid bare the inattention by our economic policy community in that time.”
“A responsible nation would have built a house of bricks, and we built a house of sticks,” Balsillie said. “The big bad wolf has shown up, and everybody’s running around freelancing, saying, ‘What do we do now’?”
This from a man who drove his company into the ground with an eternal search for a sports franchise to buy. The same company that had 15 different versions of the same model of phone and couldn’t understand why too many micro code modifications was a problem (I had that conversation with one of their engineers).
Yeah, thanks, Jim. I will take advice from other corners. You should have paid attention to business and not sports.
The problem with our country is overspending and then creating money ex nihilo through the selling of bonds just on reputation – the problem of all central banking schemes – which drives the value of the currency into the ground without an appropriate increase in productivity. In short, we got lazy, spent too much on too little, and let the government bloat like a dead pig – the same problem as RIM.
In addition to be an idiot in economics he’s apparently also an idiotic ‘economic nationalist’ as well.
https://nationalpost.com/opinion/we-are-all-economic-nationalists-now
No Jim, I’m not part of your stupid fad that has already cost Canada and the rest of the world so dearly and I never will be. Death to nationalism.
The problem is that the government had it’s hands in everything for so long, no one remembers how things worked.
Jim Balsillie: the man who destroyed one of the greatest Canadian companies through mismanagement and by building his business on a foundation of sticks from a foundation of bricks. Thanks for stating the obvious, now go back to irrelevancy, please, and STFU.
Interesting article and rings true, and we are locked into this until the next federal election when we can eject the idiots who put us there.
Wonder if Balsillie has any comments on the “outdated thinking” that took Blackberry from a best-in-class dominating world high tech lead to the ashcan of Canuck business history and endless Harvard Business Review case studies in a half-dozen years.
I’d like to read his thoughts on that, too.
mhb23re
I can agree with the criticisms of Balsillie, but that is shooting the messenger, he is not wrong. One single thing made most of the difference. Canada taxes the productive, and the means by which capital is accumulated to enhance productivity. The US does much less so.
Take lessons from history. Canada has the Irvings, the Sobeys, the McCains, Thomson, etc. Innovators that created true wealth. Where are they now? There are still Canadians doing these things, but they are doing them in California, in Texas, in New York. That is not an accident, it is a policy failure rooted in the Scottish beggar thy neighbour philosophy which would rather bring your neighbour down than lift yourself up. Smallness, cowardice, mediocrity and envy, Canada in spades.
Indeed, the tall poppy syndrome of small-mindedness and envy is rooted and promoted in this society to the country’s detriment.
I don’t disagree with your first paragraph. My criticisms of balsillie have zero to do with envy: the more people who can grow rich from an idea or product then more power to them. I begrudge private sector billionaires nothing: they aren’t extorting cash from me. Public sector and government employees do, however. I begrudge them plenty.
I’m disgusted that he and the top brass at RIM dominated their industry and decided a high tech company needed a top-down autocratic business model and collectively pïssed away everything. What happened to RIM was one the of biggest and most tragic losses in Canadian business history. And very likely needless, too, which makes it worse.
In the end Balsillie came out fine, and people I know uprooted their families to move to Waterloo and work for RIM, and lost homes and their livelihoods. All due to ego and “outdated thinking” that he’s condemning others for.
You can call that “envy” if you like, and I couldn’t care less. I also have no shïts to give for any pronouncements jim balsilie has on business, unless it’s to offer his own personal experience as a cautionary tale.
IMHO the -real- problem is socialism, and we’re going nowhere until we fix that.
Almost every manufacturing business of any kind has fled Ontario/Quebec. The only ones still left are the Big Boys that were founded two generations ago or more, when Canada was making stuff. They are too big to move, and have Special Deals with the Liberals keeping them afloat. Like Ford, to name one.
Smaller guys all left. Did y’all know that General Tool doesn’t sell made-in-Canada tablesaws and etc. anymore? Once upon a time, General made the -best- woodworking machines in the world, in Quebec. Best. I have one, it is amazing. But now they are all made to order in Taiwan, because even with bags-fulla-money changing hands with Friends in the government, and even with a complete, paid-for, already running factory with skilled guys and everything, General Tool HAS TO MAKE THEM IN TAIWAN. They have no choice. They can’t meet the price point in Canada. Can’t. And they can’t upgrade the factory to full automation like the Taiwanese guys did either. Because even if they upgrade and go full CNC like Taiwan, they still can’t make the price point.
This is to say nothing of the even cheaper machines coming out of China and Malaysia etc. which cost half what the Taiwan ones do, or less. They suck, but they are -cheap- and usually better than nothing.
Example, a mag-drill. How often does one need a mag-drill? Occasionally. You want the North American brand, $1800.00 give or take. $2K for the German one. Or you get the Vevor one off Amazon, and it is $299.00. Its crappy but more than good enough to drill a couple hundred holes for you.
Can a Canadian company make a similar crappy mag drill for $299.00? Yes they can! But because of everything that makes Canada suck, it will cost $2999.00 From whence comes all this suckage? Government. Taxes, obscenely costly regulations compliance, increased costs for everything from raw materials to labor to transport to garbage removal, glacial government action on permits etc. and an exceptionally hostile banking environment.
And Sherwood doesn’t make hockey sticks in Canada anymore. They f-ing well make ’em in Malasia, where nobody has ever seen ice except in a drink. Because same reason General left.
When you see the likes of Kevin O’Leary screaming on television that hundreds of billions of dollars of investment money is leaving Canada to be spent building stuff in the USA and elsewhere, he’s not talking about foreigners. He’s talking about Canadians moving their money out of Canada because they can’t find anything to invest in here. Because it is all dead. You do not invest money trying to jazz life back into a corpse.
In this vein, all of my investment dollars go to the US. Multiply this times one million investors and the doom loop is created.
Divert a few to Canadian bank puts for June or later, good bet, i think.
I’m not smart enough to understand puts and call options let alone make the investment. The only investment in Canadian banks that I have made in the last ten years that has really been a success was in Royal bank.
From what I understand you are saying that the Canadian banks will go down in or by June if you are recommending put options?
Yes, I am saying banks will decline by June, I believe. A put option allows you to sell a certain security at a fixed price by a certain date. For example, I can sell CIBC symbol CM, at $86 regardless of their price at that time. If it does not go below $86, I will likely have them expire worthless, so a total loss. Need to know that going in. It cost me $4,500 for 10 contracts a couple weeks ago, which lets me control 1,000 shares.
Yeah you’re going to want to change that. America is about to become uninvestable.
I needed a SDS drill for a job, it was cheaper for me to buy a chinese one off amazon, which did the job, than to rent one from Stevensons for a couple hours. Government gets in the way of everything.
Even if Canada were well run and had good economic policy we would rationally outsource that stuff to where it could be done cheaper so Canada could put capital to use building really serious Stuff Of The Future. There is no reason to want these trivial items manufactured here.
Spoken like a true government worker who probably is on disability or retired and does not care a whit about the people who can’t get a job or buy a house or afford to put food on the table.
Communists are always so selfish under the guise of “caring”.
….what? It’s not my obligation to ‘care’, that’s why I’m a capitalist while people like you pretend to be.
In what alternate universe have you ever presented yourself as “capitalist”? I’d wager you sleep with Das Kapital and Mao’s Little Red Book under your pillow.
“Canada should put capital to use building really serious Stuff of the Future?”
What stuff?
Don’t know, I’m not a clairvoyant. The point is that I let the market decide. Maybe it’s nuclear or extremely capital-intensive high-end manufacturing. Maybe it’s flying cars or lab-grown meats.
Please feel free to invest your money in nuclear, flying cars, and lab grown meats.
But please do it without government money.
You’ll undoubtedly make lots of money.
I read an article where Apple (not only outsourcing production to China) is outsourcing their R&D to China, roughly 70% according to the article. When you’re paying people to think for you … they will pass you.
Here, here Phantom. Excellent post.
mhb23re
I still try to buy stuff made in Canada, but shit its difficult.
My 20+ year old PSB T4 speakers were. They don’t make them here anymore so I’ve been eyeballing some Paradigms.
My 20+ year old steel garbage cans were, lol, I think in Winterpeg.
We’ve got some expensive, but quite well-built furniture in the house.
Canadian governments foster a reliant people, and distrust resilience.
It’s become a can’t-do and won’t-do country
Buddy, the un one represents the Canadian attitude towards reality. I no longer recognize the idiocy that passes for thought in Canada.
Paradigm. I’ve bought speakers from them since 1990s. Never been disappointed. I believe they still make them in Canada. Get good reviews too.
Still here big time.
https://www.paradigm.com/en/paradigm-history
Where everything was lost was our education system. When government controls schools it controls the masses. If you go back and look 40 or 50 years this is where things started going wrong. To many teachers with socialist views and building our education around girls more and leaving boys behind. Now we have a society of boys who sit in basements and do nothing ! A society of unproductive boys and men is a society doomed to fail.
The only way to fix our country is to start focusing on education and start focusing on our youth and start raising our boys to be men. When this changes and only when it changes we will see our society change and our economy.
The mistake we make is in thinking the government can run the economy. All they can do is take our money and redistribute it. If you think the government is better at handling your money, have at it.
The people who run businesses have moved offshore because it’s easier to make money there. No environmental laws, no labor laws, and a sea of people wanting cheap imports. It’s a game of teeter-totter where you tip your standard of living toward the people you are handing your jobs to.