WILSON LEAVES HIS MARK AS ECONOMIC SUPERHERO FOR CANADA
Former Finance Minister Michael Wilson deserves much of the credit for the fiscal and economic success of Canada over the past three decades. Sadly, that credit often gets overlooked and misplaced.
Wilson died on Sunday from cancer. He was 81.
Wilson served in several portfolios in the Progressive Conservative governments of Prime Minister Joe Clark’s short-lived minority government in 1979 and from 1984 to 1993 in Prime Minister Brian Mulroney’s government.
Mulroney says he spoke to Wilson a week ago and knew that his friend of many years did not have much longer to live.
“He was a great friend,” said Mulroney, who was reached in Florida Monday. “I told him how much I admired him and loved him and that what he had done for Canada would live on forever.”
When one looks at Wilson’s legacy, those words are not hyperbole. “The economy of modern Canada — much of it was laid by the vision of Michael Wilson,” said Mulroney.
One of the first things the Mulroney government did upon coming to power in 1984 was to scrap the disastrous National Energy Program brought in by former Liberal prime minister Pierre Trudeau, which had led to economic devastation for Alberta and contributed to western alienation. Wilson also dismantled the Foreign Investment Review Agency that hindered economic growth in Canada.
Then, Wilson helped negotiate the Canada-U.S. Free Trade Agreement. He also eliminated the Manufacturer’s Sales Tax — a tax buried in the cost of Canadian products, which therefore inhibited exports by making them uncompetitive with U.S. products — and replaced it with the necessary but hated Goods and Services Tax — an act of great political courage.
Wilson was also the chief negotiator of the North American Free Trade Agreement; he initiated the privatization of Air Canada, and Petro-Canada along with almost another two dozen companies and agencies; and, he ran a fiscally prudent government with the lowest per capita spending of any Canadian federal government in the modern era.
“The reason I rattle these off is they actually formed the basis of the economy of the new Canada. And every single one of those was either conceived in great part, negotiated and implemented by Michael Wilson,” said Mulroney.
“It’s very rare in history that one man made such an extraordinary contribution that will resonate loudly through history — 50 or 100 years from now,” he added.
Wilson not only turned Canada’s fiscal ship around; he hauled a rusting, broken economy from the bottom of a fiscal morass where the previous government of Trudeau and John Turner had left it. Even Jean Chretien — who was a finance minister under Pierre Trudeau — admitted that following 15 years in office, “We left the cupboard bare.”
That’s an understatement. By the time Trudeau and Turner were done, there was no cupboard.
In 1984, the Tories inherited a deficit of $38.5 billion, which was nearly nine per cent of the GDP — the largest deficit in Canadian history in terms of percentage of GDP.
The federal debt had increased an unconscionable 1,100 per cent under the Trudeau administration. Inflation was so great, interest rates peaked at 22.75 per cent. Program spending under the Liberals had skyrocketed to $1.23 for every dollar collected in taxes.
By comparison, the financial legacy then-prime minister Chretien and his finance minister Paul Martin inherited from Wilson and Mulroney in 1993 was a shiny, sleek ship sailing to a bright future.
When Wilson and Mulroney retired from office, the federal government had an operating surplus and the deficit as a percentage of GDP had been reduced by one-third, despite the worldwide recession of 1990-91.
Wilson slashed the rate of growth in program spending 70 per cent — reducing program spending to 97 cents for every dollar of revenues. Were it not for the cost of servicing the enormous debt left by their predecessors, Wilson would have been running surpluses.
The prime rate went from 22.75 per cent to six per cent, the lowest in 20 years, and the inflation rate was 1.5 per cent, the lowest in 30 years.
In 1991, after seven years as finance minister, Wilson became Minister of Industry and Minister of International Trade to play a key role in negotiating NAFTA, that has been so vital in ensuring Canada’s economic success.
After retiring from politics, Wilson lost his son Cameron to suicide in 1995.
At a time when few people spoke of depression and suicide, Wilson dedicated his skills and intellect to advocate for mental health, eventually becoming chair of the Mental Health Commission of Canada and the Centre for Addiction and Mental Health.
In February 2006, then prime minister Harper appointed Wilson as Canada’s Ambassador to the United States, where he quickly helped settle a festering softwood lumber dispute that had long plagued Chretien and Martin’s Liberal governments.
He was named Chancellor of the University of Toronto in July 2012, a role he kept until 2018.
In a written statement, the U of T’s president, Meric Gertler, said Wilson was “great Canadian”.
“He bore the title, ‘the Honourable,’ by virtue of the public offices he held. But the description came spontaneously to all who had the good fortune to know him” and his “comprehensive excellence, his unassuming generosity and his quiet compassion.”
On top of that, Wilson had a stellar business career. Mulroney called Wilson was a true Renaissance man.
“I don’t know very many people who have this kind of a record, all the while being a perfect gentleman and a great guy, admired by everybody.”
Mulroney chuckled as he recalled that his wife, Mila Mulroney, always thought Wilson looked like actor Christopher Reeve’s version of Clark Kent — the alter ego of Superman — “only better looking.”
It’s an apt comparison. Always somewhat low key, Wilson may not have received the credit he deserves for all that he’s done for Canada, but he truly was an economic superhero.