Op-Ed: The Little Engine that Could

Op-Ed article published in The Gazette
Prof. Heather Munroe-Blum
April 14, 2009

The global meltdown has become a near-obsession, and with good reason. Shrinking revenue streams and bleak investment statements have triggered gut-wrenching anxiety. Yet the biggest crisis Canada faces is our stubbornly poor performance in innovation. Facing these looming challenges, Canada seems like the “Little Engine that Could,” puffing its way up a mountain, and our old “I think I can” optimism will no longer be enough.

How is Canada performing? We have many assets: a quality system of higher education, vibrant regional economic clusters, a good track record in creating new-to-market products, and a highly entrepreneurial spirit. On the downside, the proportion of university degree-holders lags 10 percentage points behind the U.S. The Conference Board of Canada ranks us second-last among 17 peers in PhD graduates, and gives Canada a “D” in innovation, placing us 13th out of 17 countries.

The hill that the little engine of Canada faces isn't just the rubble from the global economic crisis. We've got one mountain of an innovation problem, and we've had it since long before Freddie Mac hit the skids.

So how do we fix this? Let's start thinking of innovation as a single system - one formed by the interconnected yet unique contributions of businesses, universities and governments. Take the problem of Canada's troublingly low (and declining) rate of business expenditure in R&D (BERD), which sits at about half the U.S. rate. It's a private sector problem, right? No, it's a government, university, community and business problem.

If we view low BERD as a big-picture “system” problem, we see why the government's attempt to boost private investment with R&D tax credits yields disappointing results. Direct government investment in BERD, rather than indirect tax credits, would allow governments to align their industry investments with their strategic university investments - and the governments' overall economic strategy. This shared platform would provide a sense of common purpose for industry-university-government partnerships, building the clusters needed to drive our Innovation Economy.

To innovate, we must integrate. One country, 10 provinces and three territories acting in isolation is a recipe for failure. We need a co-ordinated critical mass of quality and innovation to make a difference at home and abroad - and here are my top three priorities to help achieve that.

First, following the welcome stimulus investments in infrastructure, we need to increase investment in basic research. This will help companies and society as well as universities, because the seedbed of innovation lies in curiosity-driven fundamental research. To create a new vaccine, you have to know how the virus's defences work - that's basic research.

Secondly, we have to act strategically and in systems, not as individuals, to connect Canada to the most innovative regions of the world. The future of international partnerships, I believe, lies in a new model: one where high performers in industry, government and universities from Canada and our peer countries all work together, sharing knowledge and resources across sectors in targeted partnerships. These new partnerships can connect our fragmented clusters into golden mega-regions - Canada-California, or Boston-Montreal-Toronto - and create the critical mass needed to complete globally.

Finally, we must have the courage to invest in highly successful businesses, cities, and institutions. Regional equity is not a substitute for innovation excellence - as the main event, equalization is a recipe for disaster.

I love the optimism of the “ Little Engine that Could,” but maybe it's time for us as a country to set our sights higher. Trains were the foundation of another defining moment in our nation's history: the creation of the transcontinental railway, that 19th-century symbol of prosperity and promise. At the birth of our nation, Canada faced a jumble of unco-ordinated regional railways, run by a patchwork of companies using different gauges of track. Yet somehow, the players saw the vision of what Canada could become. The building of the transcontinental railway wasn't pretty, marred by corruption and the shameful treatment of labourers. But the new railway heralded Canada as a nation in the making. Its builders didn't let short-term greed get in the way of long-term greed.

Our current innovation system is the 21st-century equivalent of Canada's railways just before the great transcontinental railroad. It's fragmented, regional and not effectively connected to the world. Often, we seem to be running on different gauges. But Canada holds incredible promise. We need a new nationwide innovation system to usher in a bold new age of enlightenment. And, like Canada's first “national dream,” we need a strategy to carry it out, and a broad, distributed leadership with the will to act on it. Canada is filled with talented, skilled, entrepreneurial people. A pioneering spirit formed us into a great nation, and working together, we can meet the new challenge.

Whether we like it or not, the train is leaving the station. We can miss it - or, we can climb aboard.

Heather Munroe-Blum is Principal and Vice-Chancellor of McGill University. This article is drawn from a speech she delivered to the Canadian Club of Toronto on March 30.

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