I have read two very interesting things in the past couple of weeks. One is Justin Ling’s excellent piece in the Toronto Star about the inner workings of the Carney PMO and what the government thinks it’s accomplishing (tl;dr: as efficient and business-like as the new PMO is, it isn’t actually trying to fix what’s broken in Ottawa because it often doesn’t know what the actual problem is). And the second is Jeffrey Ding’s excellent new book Technology and the Rise of the Great Powers. Stick with me for a couple of paragraphs and see how I segue between the two.
So, the Ding book is peripherally a book about international relations (y’all will have noted the Paul Kennedy reference embedded in the title), concerned with how national performance in periods of technological change affect the ascendence or decline of great powers. The “great powers” bit isn’t accidental. It isn’t a story about how Singapore or Israel or Finland or whoever has managed to climb the industrial value change (if you want that, I recommend Zach Taylor’s The Politics of Innovation, which I reviewed many years ago here). It’s very specifically about asking how technology translated into Global Leadership. The implied focus all the way through is US-China and leadership in AI, but substantively, in order to do this, it looks at UK vs. France in the first industrial revolution, United States vs. UK and Germany in the second industrial revolution, and Japan v United States with respect to electronics in the late 20th Century.
The question Ding is trying to answer is basically, what constitutes “leadership” in a technology. Is it that discoveries are made in a particular place or that a country owns the leading “IP” or possesses the leading firms in a given “frontier technology”? Or is it a question of skills, that a country has the ability to apply a technology to many different products across the economy? In Canada, we’re obsessed with the idea that tech leadership is about the former (see all the breast beating about how “Canada invented AI”), but as Ding shows, there is basically no historical evidence to suggest that this is the case. In an impressive review of the historical record, Ding is quite convincing in making the case that the issue is whether or not a country has the institutions to be able to speed up skills development/use and hence speed up technological diffusion.
Now, we should be careful here, because Ding uses the term “skills” in a way that may not be familiar to many. When he says skills, he isn’t just talking about a general rise in education levels. Rather, he is talking about whether the country has a small number of people with very specific talents to spread technology – tinkerers and experimenters, basically. In the first industrial revolution, the UK beat France because it has lots of mechanic’s clubs in which people traded ideas about the steam engine and cotton manufacturing. In the second and third, the American emerged victorious largely because it led the world in mass-producing Engineering graduates of various types. That’s different from saying “the answer is throw money at higher education” because a) there’s no guarantee the next technological revolution will look like the last one, b) even if it does, the key is spending heavily to improve quality and capacity in a very few areas rather than spending widely across all fields of study, and c) it’s not just the content of the degree that matters but the ability to turn that knowledge into products.
It’s complicated, for sure.
So now, let me bring all this back to Ling article and the question of why the Carney regime, which does not really understand Ottawa and will not be able to bring growth to Canada. And the answer, simply, is that the Government of Canada is not institutionally geared to thinking about, or promoting, talent in the way that would promote growth.
Broadly speaking, when the Government of Canada thinks about achieving technological leadership, its first instinct is to think about how to create “national champions” by writing cheques to companies. Which is not crazy in the sense that governments are really good at writing cheques, but is crazy in the sense that, as Ding points out, it doesn’t actually promote national technological leadership. The Government has been getting a bit better at this lately; the AI strategy published this summer at least contained a “skills” component as well as a “writing cheques to techbros” component. But its idea on skill building was pretty weak, amounting to not much more than “let’s put a few free courses online”.
There are three departments that could, conceivably, work on the skills issue, but none of them do so in a way that addresses the key areas that Ding highlights. There is Employment and Social Development Canada (ESDC) which broadly cares about “skills”; Innovation, Science and Economic Development Canada (ISED) which broadly cares and Innovation and Science; and Immigration, Refugees and Citizenship Canada (IRCC) which broadly thinks about new Canadians and the skills/talents they might bring to the country.
For about 30 years now, ISED and ESDC have been concerned, respectively, with high-end skills and low-end skills. When ESDC talks about skills, it’s talking about the kind of skills that people at the bottom of the labour market need to stay employed – important to be sure, but not relevant to growth in the sense that Ding uses it. ISED talks about innovation rather than skills, but it doesn’t really think about individuals in the labour market. It mainly writes cheques to companies (either directly or through organizations like the former superclusters). It does give money to individuals in the sense that SSHRC and NSERC disburse grants to individual scholars, but even then, ISED tends to think of its clients as institutions rather than individual scholars (who, in any event, are not really engaged with the labour market in the sense that Ding ‘s logic requires). IRCC does think about skills – hence our famous point-based immigration scheme – but it defines skills mostly in terms of degree levels rather than specific skills gaps (the recent curbs on post-graduate visas for college graduates based on field of study is a small move in the right direction, but we’ve got a ways to go).
Occasionally, the government – when pushed by the Prime Minister’s Office – does put an eye on “talent”; this was, for instance, the rationale behind the recent Eddie Goldenberg research chairs. But even here, the government misses the mark. First of all, it imagines talent to be something exclusively related to academia rather something that powers the private sector, and second, the government’s messaging implies that “talent” exclusively resides outside of Canda and needs to be imported. Carney’s people seem oblivious to the fact that this characterization is offensive eight ways from Sunday.
Anyways, here’s some advice to the Carney team. As the machinery of government is currently set up, nobody is responsible for thinking about how to build up talent in our society. If the government really wanted to create the conditions for rapid economic growth, the government would benefit from creating a Ministry of Talent. Basically: slam ESDC and IRCC together and make them think about how to make Canada the most talented country in the world, across every field, either by importing it or developing it here. And by talented, here, I mean not just talented scholars. Scholars are a part of the equation but not the whole ball of wax. What we need are the most talented people in the labour force, making private industry more productive. And yes, that probably means that governments (provincial ones included), universities, and colleges start thinking about graduates in terms of quality rather than quantity.
It’s a shift in thinking, certainly. But it’s what the evidence is telling us to do. Hopefully, our theoretically results-oriented Prime Minister will pay attention. But I don’t hold out a lot of hope.
