In an updated study of Canadian Prime Ministers since the end of World War II, two McGill University professors conclude that Brian Mulroney has the best economic record in the last half century.
In the original 1993 study, economist Tom Velk and historian A.R. Riggs concluded that Mulroneys numbers were the best since Louis St. Laurent presided over the post-war economic boom, and "the difference between St. Laurent and Mulroney is small."
The new study includes the Chrétien years, and according to its authors, "While Mr. Chrétien is still in office and his record still incomplete, when all the numbers are examined, Mr. Chrétiens accomplishments arent enough. Mr. Mulroney remains the man to beat."
The researchers based their conclusions on a composite score of 18 components of the "misery index," as devised by economist Arthur Oakun and later elaborated by economist Robert Barro. In its classic form, the misery index is the sum of two outcome rates, inflation and unemployment. Barro, Velk and Riggs add more variables, such as interest and exchange rates, taxes and deficits, income distribution, growth and productivity.
The two studies compare the economic records of six prime ministers in the post-war period: St. Laurent, John Diefenbaker, Lester B. Pearson, Pierre Trudeau, Mulroney and Chrétien. The studies do not include the prime ministerships of Joe Clark, John Turner and Kim Campbell, all of whom were in office for a period of months rather than years, and left no economic footprints, say Velk and Riggs.
In commenting on their work, the authors claim that their methodology "may explain why Jean Chrétien comes up short, in spite of the disappearing deficit and shrinking unemployment. Our benchmarking is based, in part, on how a prime minister does given a situation he inherited, on the direction of change during his term, how well he does in comparison with contemporaneous American leaders, and whether his successful policies mark a lasting departure from those of the past."
Mr. Chrétien, they contend, "inherited an economy whose fundamentals were sound -- low inflation, low interest rates, a shrinking government share of the overall economy, a relatively strong dollar and expanding trade."
One of the tests of economic leadership, Velk and Riggs write, is whether "a leader improves the situation he inherited from the previous government, and outperforms contemporaries in other nations."
When the study is updated to include the Chrétien years, and taking into account the inherited situation, the McGill professors conclude: "Mulroneys rank is unchanged -- Chrétien comes in a full order of magnitude behind him, dead last in the ranking, behind even Trudeau."