Editorial - 15-8

The disturbing downward trend in the high-tech sector hasn’t slowed down the efforts of government to stimulate growth of the knowledge-based economy. Not yet. In the short term at least, there’s no need to connect the two, but if shrinkage in the New Economy sectors continues apace, governments may be tempted to rebuff new initiatives, particularly within their own departments and ministries. Such a reaction would be tragically misguided.

The last time the federal government attacked the deficit through Program Review, departmental spending on S&T was frozen or reduced and the resulting turmoil is still with us today. Now that innovation is a central policy plank of the current administration, those same departments and agencies are coming forward with a hefty list of proposals (see page 3). Those proposals should be considered on their own merits rather than the temporary fluctuations of the high-tech sector.

An impressive level of grass roots activity across Canada indicates how many people believe in the power of the knowledge-based economy to transform existing economic and social systems.

The ambitious targets for R&D spending laid out by Finance minister Paul Martin require considerable front-end public investment before the private sector can do its part. This isn’t about stock valuations and over-jealous borrowing for purchases of telecommunications equipment. Building the New Economy requires sustained effort and commitment, and today’s high-tech meltdown is a mere bump in a long but ultimately rewarding road that must be travelled.