Specialists

We have constructed a world that functions on specialization. The complexities of our society require it: from baristas to barristers, from construction workers to cardiologists, we each know how to do one thing that defines our function in society, and we must all rely on other specialists to know their own work, because we cannot know everything.

Most of us, for example, are not economists. So when economists study the markets, create forecasts and make recommendations to governments and businesses, we accept what we don’t necessarily understand.

Of course, there’s no harm in a second opinion, or a third. But as those opinions pile up, we might come to a tooth-gritting conclusion: economists just don’t know what to do.

Or, as Derek Holt, an economist for the Bank of Nova Scotia, wrote in a report about Canada’s current economic outlook, “consensus is divided.”

Granted, Mr. Holt’s specialization is not in writing. But although there was no irony in his statement, he has a point. It looks as if economists have agreed to disagree when it comes to the Canadian economy.

When the markets tumbled in 2008, our government assured us Canada was well insulated from a free-fall. The Canada Mortgage and Housing Corporation (CMHC) has been recognized around the globe for its excellent mortgage investment and insurance, and its policies protected Canada from being pulled in to the American housing crisis.

But heavy investments in oil industry and infrastructure have, in the past year, put a drag on the Canadian economy.

Last year at this time economists were assuring Canadians not to worry—the falling oil prices wouldn’t last, and the boom in eastern Canada from low oil prices would offset the bust in the west. A year later tells a different story.

The unemployment rate is up from 6.6 per cent last year to 7.1 per cent this year. The interest rate from the Bank of Canada continues to be downgraded. The value of the Canadian dollar has fallen almost 15 cents relative to its American counterpart.

While the Loonie’s value might mean more to Canadian businesses trading internationally, it affects Canadians in the import markets—most notably at the grocery store, where much of our food comes from elsewhere. This is especially concerning in a community dealing with food insecurity.

This is just the kind of situation in which we rely on specialists. Many of us aren’t that clued in to what these economic tidings mean. Or where they’ll take us. In our investments, in our future career opportunities, and even in our ability to afford food.

And that makes the phrase “the consensus is divided” kind of scary.

But there’s something we overlook in a society of specialization, and that is our ability to do research, to question and to look further. And the truth is, no one can predict the future, and economists, like doctors, are just interpreting the data they have.

So worry. Or don’t. Invest, or pull back. And maybe look for a third opinion.

mihal@mihalzada.com