People Mentioned
Special Advisor, Ottawa
Along with the energy and trade shocks, Canada must keep an eye on the fiscal situation in the U.S., says Osler Special Advisor Stephen Poloz, in an interview with Matt Galloway on The Current.
“Their fiscal situation is truly off the charts,” says Stephen. “The U.S. has a level of debt far in excess of 100% of their economy. This debt is massive given where their economy is. That’s scary since the U.S. financial system is the basis for the global system.”
Stephen says high energy costs are having an ambiguous effect on our country’s economic outlook. “The shock is causing the economy to slow pretty well everywhere as consumers are paying more for things which means they have less to spend elsewhere,” he says.
“We could have a real slowdown, or perhaps even a recession, or we could be a beneficiary of the higher costs. This means possibly a slowdown in part of the economy and a boom in the energy part. At the same time, it does raise prices. This gives us an ambiguous policy environment where we really don’t have good choices.”
With the new tariff regime, Stephen says the global economy will have a lower rate of growth from now on. “The decline should be 2% this year, and then half a point for every year going forward,” he says. Approximately $40 trillion of global output will be lost over the next 10 years.
While the fourth industrial revolution with digitization and AI will have long-term benefits for our economy, Stephen says there will be some short-term challenges. “It will cause more income inequality, more political stress, polarization, off-the-chart policies and geopolitical misadventures,” he says. “You have all the shocks coming together and interacting with high debt levels.
“As economists, we don’t have a way of predicting how things will turn out. The situation is best described as volatility or even chaos.”
Watch the full interview with host Matt Galloway posted on April 15, 2026.
People Mentioned
Special Advisor, Ottawa
