News that Canada’s inflation rate fell in January has prompted fresh debate about cuts in the Bank of Canada’s policy interest rate, which has been at five per cent since last July. Though the year-over-year increase in the CPI was just 2.9 per cent in January, which is getting nearer the two per cent target, many observers expect the Bank will keep interest rates where they are at its next announcement in April. Why the caution?

Partly because we’ve been here before: the CPI dropped below three per cent last spring, then sprang back up. And also because, despite January’s encouraging headline number, measures of core inflation are still well above three per cent.

There is a straightforward reason for…

The 2023 fall economic statement projected large deficits through 2028-29 and a net debt-to-GDP ratio that rises in 2024-25 and then declines only slightly, remaining well above the prepandemic level through 2028-29. Interest payments eat up almost 14 per cent of revenue. The 2024 budget must correct this imprudent treatment of risk.

Debt’s risk is lost opportunity. When servicing costs rise, more tax dollars have to go toward financing the debt, leaving less room for more meaningful expenditure.

The federal government justified the deficits and debt by showing the net debt-to-GDP ratio declining through 2055-56. This is not credible.

First, high debt produces economic costs, even if sustainable under the narrow…

The World Trade Organization, the multilateral body that oversees the global trading system, is not top of mind for the business community. But it should be. The WTO’s current diminished state affects international commerce generally. Without universally respected rules, uncertainty prevails, and uncertainty raises businesses’ costs. Without the multilateral disciplines the WTO provides, a quilt of different agreements will impose a bewildering set of differing commercial requirements in different nations.

The collapse of the Doha Round negotiations in 2011 was a dire setback for the WTO. Since then it has been unable to play a meaningful role in meeting today’s challenging trade issues, including carbon-free goods, the…