Back in April, I wrote Killing the Golden Goose. I argued that Canada appeared to be making itself progressively less competitive while people with large pools of mobile capital were well positioned to profit from the resulting decline. I used “shorting” as an analogy: weaken something of value, then benefit from the lower value that follows.Four months later, some new information has appeared.In July, speculative net short positions against the Canadian dollar reached about $12.5 billion USD, making the loonie the most heavily shorted major currency for a second consecutive week. Traders were literally betting that Canada's currency would weaken.Then there is Brookfield.Its 2024 annual report shows that the proportion of common equity invested in US dollars increased from 52% at the end of 2023 to 64% at the end of 2024, while Canadian dollar exposure fell from 5% to 2%. Brookfield also reported billions of dollars in currency hedges. Hedging is not the same as speculative shorting, but the direction is worth noting.Mark Carney was Chair of Brookfield Asset Management and Head of Transition Investing during this period. He later left Brookfield, entered politics, and became prime minister. Yet his official disclosure shows that his blind trust contained Brookfield options, deferred share units, and a long-term incentive interest connected with the Brookfield Global Transition Fund..None of that proves corruption. It does add information to the interpretation I made in April.As an exploration geologist, I spent decades working with incomplete information. You rarely see the whole mineral deposit. You see an outcrop, a drill hole, a geochemical anomaly, or a structural trend and build the interpretation that best explains what is visible. Then you test it. When new information fits the model, confidence increases. When it does not, you change the model.So far, the new information has not forced me to abandon mine.Canada's economy remains weak. More troubling is our relationship with the United States, the market that still buys about 70% of Canadian exports. Rather than making Canadian industry more competitive in that market, Ottawa has let the relationship deteriorate into a trade war and has chosen retaliatory tariffs on American goods.That means Canadians are taxing themselves in response to American tariffs. The American exporter does not send Ottawa the tariff payment. The Canadian importer pays it, with much of the cost ultimately falling on Canadian businesses and consumers.American complaints should not be dismissed. Dairy is a useful example. Canada can claim that US producers have access through tariff-rate quotas, but access on paper and practical access are not the same thing when the quota allocation system itself restricts who can use it..Protection can preserve an industry. It can also insulate it from the competitive pressure that forces businesses to become more efficient, develop new products, and find new markets. Western wheat and barley growers provide an example. Since 2012, they have no longer been forced to market through the Canadian Wheat Board. They can choose their own buyers and negotiate whatever price the market will bear. While some opposition to that change remains, there has been little broad public clamour to restore the old monopoly. More importantly, recent research found measurable productivity gains after the single desk ended.Meanwhile, the government continues to increase the cost of doing business in Canada. We cannot keep driving away productive investment and expect the tax base to survive. The government cannot tax income that no longer exists. It cannot collect corporate taxes from companies that have left.That brings me back to the golden goose.If you continuously increase the cost of producing the egg, restrict where the goose can sell it, tax the proceeds, protect some producers from competition, and then engage your overwhelmingly largest customer in a trade war, eventually fewer golden eggs are produced.At some point, incompetence and intent begin producing results that look remarkably similar.If the objective were to make Canadian workers poorer, Canadian industry less competitive, our largest trading relationship weaker, and Canadian assets more attractive to global capital at lower prices, I increasingly struggle to identify what would be done differently..So what is the way out?Voting is supposed to provide it. Yet many Canadians no longer vote, and many who do see little meaningful difference among the choices presented to them. If existing political institutions no longer protect regional interests, pressure for greater provincial autonomy will inevitably grow.For Alberta, independence is looking like a viable lifeboat. If a majority of Albertans eventually conclude that federal policies are doing more harm than good, they are entitled to ask whether remaining in Confederation still serves their interests. Alberta has the resources, productive capacity, and economic base to consider that question seriously. Independence would carry substantial risks, but so does remaining tied to national policies that increasingly weaken the industries upon which the province depends.In April, I asked whether Canada was killing the golden goose.Four months later, the question is becoming harder: Is the goose already cooked?
