By David Leis, Frontier Centre for Public Policy
Red tape, capital flight and anti-growth policies are draining Canada’s economy. Our prosperity is at risk if leaders don’t act now
Canada is slowly dismantling the foundations of its own prosperity. Instead of unleashing our strengths, we’ve layered on regulation, red tape and ideology that repel investment and weaken our economy—one policy at a time.
This isn’t hyperbole. For over a decade, Canada’s per capita gross domestic product (GDP) has stagnated. Our productivity has fallen behind global peers. Young people are leaving the country, investment is drying up and even our own entrepreneurs are taking their capital—and their ideas—elsewhere.
We’re not failing because of a lack of resources. Quite the opposite. We have everything: land, minerals, oil, gas, water, agriculture and human talent. But whether it’s energy infrastructure, mining projects or manufacturing capacity, the answer from Ottawa is almost always “no”—thanks to layers of red tape, regulation and risk-averse policy.
Bloated bureaucracy, regulatory overreach and ideologically driven legislation—such as Bill C-69, which made it far harder to approve major energy and infrastructure projects, and Bill C-5, which gives Ottawa sweeping veto power in the name of reconciliation—have created an environment so hostile to investment that many firms no longer even try.
One example illustrates this clearly. The Trans Mountain pipeline—a major oil pipeline intended to carry Alberta crude to Pacific markets—was crippled by government takeover and quintupled in cost. We’re now told it might expand further—if regulators allow it.
Meanwhile, 15 per cent of the pipeline sits idle. This portion, set aside for short-term or on-demand shipments—known as spot capacity—is burdened by toll rates so high that shippers can’t justify using it. These prohibitively high fees, meant to recover the ballooning construction costs, have effectively priced out would-be users, leaving critical infrastructure underused and investment returns diminished.
This isn’t just bad economics. It directly weakens the very foundation of Canadian life—good jobs, innovation and upward mobility. Without strong investment in productive sectors like energy, mining and agriculture, we lose the wealth and opportunity that support our way of life.
Yet we continue to subsidize politically fashionable projects such as pumping billions into electric vehicle plants while punishing the industries that pay the bills.
And the message to innovators is just as bleak: new companies are staying private, avoiding public markets like the Toronto Stock Exchange, where new listings—known as IPOs—have all but disappeared. Bloomberg has reported just one large IPO in Canada so far this year. That’s unthinkable in a country that once marketed itself as a global financial hub. It’s part of a deeper problem: productivity is flatlining, and capital is fleeing, with hundreds of billions of dollars quietly leaving Canada in recent years.
This is why the average Canadian feels poorer—at the grocery store, in job prospects and when trying to save for a home. When investment dries up, so does the future. Our middle class, once the backbone of this country, is being squeezed from all sides: by inflation, stagnating wages, rising taxes and the shrinking availability of meaningful work.
Even our national identity is eroding. What kind of country punishes its wealth creators? What kind of government claims to support Indigenous partnerships while vetoing resource projects that offer Indigenous communities real economic independence? What kind of democracy penalizes companies for speaking openly about their environmental performance?
Canadians are starting to feel it. Young graduates are leaving. Parents are unsure how their kids will afford homes—or futures. We’re told this is the cost of progress. But the truth is simpler: we’re managing our decline.
There is another way. Open internal trade. Restore industrial freedom. Reform taxation to reward innovation and risk. End the obsession with slogans and deliver real-world results.
Canada still has every advantage for renewal. But it will take leadership willing to act. Canadians are ready. It’s time for our policies to catch up.
Renewal begins with the conviction that this country can thrive again—not in theory, not one day, but now. It begins with a government willing to say “yes” to building, producing, investing and competing. It begins with citizens who understand that prosperity is not permanent—it must be earned, protected and made possible by policy.
Without a vibrant economy, there is no middle class. And without a middle class, there is no Canada.
David Leis is President and CEO of the Frontier Centre for Public Policy and host of the Leaders on the Frontier podcast.