There’s a federal budget coming later today.  I know, it’s hard to remember what one of those is like: it’s been 25 months and several hundred billion in unscheduled expenditures since we last had one.  As usual here at HESA Towers (well – virtual HESA Towers, or maybe HESA Towers-in-exile) will be bringing you analysis of what the budget means for post-secondary education.  But this morning, I thought I would give a sense of what I think is heading down the pike.

The themes you are probably going to hear about most will be “stimulus” and “inequality”.  The stimulus part is probably not going to be controversial right away (because really, who would refuse any kind of sugar high right now). It might look like a terrible decision a few months from now if the economy does fully recover from the virus, since there might not be enough spare capacity in the system to absorb the extra demand.  This might be a significant issue particularly if a lot of the stimulus occurs in the construction sector.

As for inequality, it seems like a lot it the issue is going to be addressed through some kind of national childcare effort.  While I am a fan of more funding for early childhood education, I have my doubts about it either as an answer to a “she-cession” or to inequality.  Childcare burdens have undoubtedly fallen harder on women than men in the pandemic, but in strict employment terms, job losses among women have been concentrated heavily in the under-24 age group, who are less likely to have children and hence less likely to benefit from childcare.  Similarly, nearly all the childcare proposals I’ve seen are going to focus on full-day childcare, which is fine for people with 9-5 jobs (i.e. the middle class), but not so good for working class mothers with more variable shift times.  So, to be clear, investments in this area are not a bad idea, but perhaps not for the reasons used to support it.

Still, the childcare file has relevance to PSE.  Firstly, it will give us some idea of the state of federalism and the Trudeau government’s attitude to it.  There is no national childcare program without a whole bunch of provincial involvement (and variation).  And as far as anyone knows, there has not been much in the way of deep fed-prov consultation clearing the way for this budget, so the more detailed the announcement you hear tonight, the less you can assume anyone cares about the provinces.  Also, an announcement which makes a specific promise about the price of childcare – e.g. a flat $10/day – should be treated as a) more regressive than it needs to be and b) an actual precedent that the federal government might someday choose to involve itself in tuition fee discussions (fwiw, I think this outcome is not impossible but unlikely).

The Liberals have yet to make good on their 2019 promises on student aid, so it’s likely we’ll see something on that front.  We’ll see something on youth employment, though it’s not clear what kind of program will make most sense given that we don’t know when the parts of the economy in which youth typically work will shift from being mostly closed to mostly open.  It’s also going to take some finessing to do something big in this space without reminding everyone of last summer’s debacle with WE and the Canada Student Summer Grant, but that’s another story.

There is also going to be some big spending on “green” initiatives, some of which will be about infrastructure.  Universities and colleges will almost certainly share in some of this money, even if there is no Knowledge Infrastructure Program Mark III.  The question is how much, if any, of the “green” money ends up in research of some sort, either basic or applied.  I’d guess we’re a lot more likely to see some bespoke research investment vehicles rather than running it through the granting councils (because the Naylor report was almost four years ago and who remembers anything that far back anyway?)

There are also probably going to be some “innovation” spends because I think over the past four months or so the government has been hearing complaints that the budget is too heavy on recurrent spending commitments and too light on growth measures.  But nothing has happened in the past four months to make me think that the federal government has come up with any new theory of growth or done any background work to think of new vectors for sensible investment.  The good news is that probably means that the deeply problematic DARPA idea isn’t getting funded.  The bad news is that means they’re going to stick with existing vehicles which may well mean more money in Superclusters.

(The timing of a very positive “analysis” of Superclusters, written by the former Deputy Minister of Industry John Knubley and published last week by the Brookfield Institute was pretty convenient.  Almost like it was specifically timed.  Not that it’s uninteresting: it’s basically what the sales pitch for Superclusters would be like if it was delivered by public servants rather than Navdeep Bains, one of the least-subtle retail politicians alive.  It’s not an overly convincing report: in reiterating the literature on clusters, it passes over in science the many, many ways in which subordinating the Superclusters to regional development policy made a farce of much of the lessons from this literature.  But it’s as good a defense as you’re likely to get.  And as I say, a conveniently-timed one).

As you can tell, I’m not optimistic.  We could do so much better on innovation.  And it’s not as though success is a big mystery.  As Dan Breznitz argues in his outstanding new book Innovation in Real Places, it’s absolutely not about developing “Made In Canada Silicon Valleys” (Navdeep Bains, February 2018), but rather about maintaining focus on three key fundamentals: i) expanding flows of knowledge, demand and inputs between the local and global level, ii) increasing the supply of public and semi-public goods which fuel innovation (mainly: high-quality education/training facilities and community facilities), iii) building local ecosystems that reinforce firm-level benefits of the first two fundamentals. 

This shouldn’t be beyond the Government of Canada.  And maybe one day it won’t be.  Today is probably not that day.  We’ll know for sure at 4 PM.