Outside the banker’s box
Bank of Canada Governor Mark Carney broke another hoary tradition this week. He participated in a labour convention.
The 47-year-old economist, who had already set precedents by speaking freely with members of the media, tangling with one of Wall Street’s most powerful financiers, ruffling feathers in Canada’s executive suites and eclipsing Finance Minister Jim Flaherty on occasion, addressed thousands of autoworkers at their annual convention Wednesday.
He didn’t say what they wanted to hear: that the high value of the dollar is making Canadian exports — motor vehicles in particular — uncompetitive. What he told them instead, with credible statistics to back him up, was that the strength of the loonie is responsible for just 20 per cent of Canada’s poor export performance. The bigger problem is our over-reliance on the U.S. market, which will take a while to fix.
Bottom line: he wasn’t prepared to cut the bankrate to provide relief. “We cannot devalue ourselves to prosperity,” he said. Yet despite their disappointment, autoworkers gave him a standing ovation. It was partly out of respect for him coming and partly because he treated them as intelligent partners in the national economic debate.
Canadian Auto Workers president Ken Lewenza, who invited Carney, told reporters afterward he didn’t disagree with the bank governor’s analysis, but it won’t help him save Canadian jobs or fend off pressure from Chrysler, General Motors and Ford for wage concessions. “What I talk about is touching workers on the ground and seeing workers lose their jobs,” he said.
Anyone who expected a meeting of minds should have known that Carney says what he thinks, whether audiences want to hear it or not. Lobbying him is pointless. But to his credit he has shattered another barrier in his quest to make the 77-year-old Bank of Canada more accessible, more willing to explain and defend its policies and more engaged in the economic life of the nation.