Canada’s AI policy question has only one honest answer: Get out of the way

Canada has an opportunity to embrace innovation rather than quash it.

Canada continues to lag far behind the United States in per capita GDP, a gap that is not only an economic concern but also a national security concern, as it makes it more difficult to afford a robust national defence without other actions – like potential tax hikes – that slow growth.

This divergence has been brought about by many factors, but a key factor is Canada’s regulation-heavy approach, an approach that tilts the balance of power towards government rather than towards private industry. While such an approach can be defensible in areas related to food security and health, it puts Canada at a competitive disadvantage when broadly applied, a disadvantage that compounds as the global economy becomes more competitive and the pace of change accelerates.

When talented entrepreneurs and innovators can be less restrained and generate more wealth and value elsewhere, why wouldn’t they go elsewhere? And when we lose such talent, we also lose the possibility of having made-in-Canada businesses become market leaders, leaving us dependent on U.S. tech firms, a dependence that – assuming the U.S. continues on its corporatist, anti-free market path under Donald Trump and the centralizing right-wing populist movement – is an increasing risk.

The best AI regulation for Canada is for government to get out of the way

When it comes to AI, that raises the following question: What should the Canadian government do to regulate AI?

And the answer?

Get out of the way.

The best AI regulation approach for Canada is to avoid regulating it at all, aside from enforcing the criminal code for things like abusive fake images of individuals without their consent. When it comes to the companies themselves, however, and most importantly, when it comes to the deployment of AI in the workforce, there should be zero restrictions. The government should take no action to ‘protect jobs’ or ‘slow the use’ of AI. Such actions would represent the protection of economic inefficiency, sacrificing broader economic growth and innovation for the sake of specific industries – like those with the political pull to influence political leaders.

Instead, Canada should embrace AI to the fullest. We should seek to be the leader in the use of AI, and we should want Canadian entrepreneurs to build powerful companies without the government getting in their way. In fact, the best thing the government could do is set an example of AI adoption by incentivizing the use of AI in the public service, and raising the efficiency of service delivery by cutting the bureaucracy and increasingly using AI to deliver services.

Unleashing the productive power of Canadians

As AI use expands around the world, we are likely to increasingly hear voices in Canada calling for restrictions and government intervention. From the left, the argument will be made that AI is too exploitative and concentrates power in the hands of the rich, while from the right, we are likely to hear about AI being ‘soulless’ and ‘moving too fast.’ Heeding either concern would not make Canada better off, however, but would instead put us further behind countries that embrace AI at a more rapid pace.

For far too long, Canada has taken an overly cautious approach to innovation, preferring to regulate first and innovate second. The rise of AI allows us to reverse this trend. We already have a well-educated and innovative population, and we already have a level of social openness that – if translated to economic openness – can make Canada one of the freest places and best places in the world to start and grow a business. Instead of repeating the same errors that have led to years of stagnating productivity, let’s instead take a ‘less-is-more’ approach to AI regulation, get the government out of the way, and trust in the productive power of Canadians.

Spencer Fernando