My 2012 wish list for Canada and the global economy

This time last year, I set out my three-point wish list for Canada in 2011.

Wish No. 1 was that decisive action be taken to transform the inefficient health-care system that's devouring an ever-increasing portion of government spending while leaving large numbers of patients to suffer on waiting lists. Unfortunately, 2011 was another year of rearranging the proverbial deck chairs on this deteriorating, bureaucratic monopoly.

My wish for the year ahead is that Canada finally joins every other OECD country in giving patients and health-care providers freedom of choice between government-run megahospitals and independent, patient-friendly clinics.

The second wish for 2011 was that Canadian universities would refocus limited taxpayer funds toward fields critical to the country's economic future. Unfortunately, universities continue to turn away a large portion of qualified students applying for in-demand fields such as engineering, applied mathematics, systems analysis and medicine. Meanwhile, they graduate huge numbers of arts, education and social-science students who face high unemployment rates and low-paying careers.

For 2012, my wish is that provincial education ministers will finally force long-overdue change in the self-serving culture of "academic independence" that is doing both the students and the country such a disservice.

My third wish last year was that the provinces would take concrete steps to get their finances under control. Unfortunately, every province but Saskatchewan continued to incur substantial deficits, with Ontario and Quebec leading the perilous parade.

Ontario's debt grew to a staggering $238-billion, prompting Moody's Investor Services to place the province on credit watch and downgrade its credit rating from "stable" to "negative." Quebec's $3.8-billion deficit over the past fiscal year added 11 per cent to the province's debt, which now stands at more than 50 per cent of gross domestic product, by far the highest of any province.

Rather than reducing their spending, these and other provinces continue to depend upon rosy economic growth forecasts to save them. The euro-zone debt crisis and U.S. economic doldrums pose very serious risks to Canada's economy, making those rosy growth forecasts akin to fairy tales. My wish for 2012 is that provinces face the stark truth that tax revenues will more likely decline than grow.

Such discouraging lack of progress on my 2011 list might have deterred me from adding new wishes, but hope springs eternal. My hopes for 2012 concern two issues beyond our borders.

First, I hope euro-zone leaders will finally recognize that, as former British prime minister Maggie Thatcher once wrote, "the European single currency is bound to fail, economically, politically and, indeed, socially." Two basic flaws doomed the euro concept from the outset: the unsustainable arrangement requiring financially prudent countries to support the irresponsible ones; and the fact that adopting the euro removed the shock absorber that allows markets to adjust the value of a country's currency to its financial position and productivity. After wasting hundreds of billions of borrowed euros trying to save the euro zone in 2011, the new year finds the crisis dramatically worse. Attempting to sustain any fundamentally flawed arrangement makes its failure an even more catastrophic event.

My second hope for 2012 is that implementing the democratic aspirations of the Arab Spring in the Middle East doesn't unleash a tyranny of the majority, wherein the rights of ethnic and religious minorities are undefended. That would not only encourage tragic internal conflicts and human rights abuses, but further destabilize a region of crucial importance to the global energy supply.

The world economy enters 2012 facing issues far more intractable than those present after the 2008 financial meltdown. For Europe and the U.S., navigating the many dangerous global shoals ahead will require political wisdom notably absent in 2011. Canada, too, faces important issues that demand attention. But compared with almost anywhere else on the planet, Canadians are blessed with a wonderful country.