Despite the mounting challenges facing the economy – inflation, supply chain bottlenecks, labour shortages and high government deficits – Vancouver magnate Jim Pattison is keeping a positive perspective.
Pattison, one of the most decorated business officials in Canada (with appointments to the Order of Canada and British Columbia, as well as the founding of the Jim Pattison Group as just a few of his accomplishments), spoke at BIV’s Business Excellence Series event on Living Legends Thursday afternoon at the Terminal City Club.
Appearing with former B.C. finance minister and veteran public affairs broadcasting stalwart Carole Taylor, Pattison addressed a number of questions from BIV Publisher/Editor-in-Chief Kirk LaPointe – including whether Pattison was worried about the record levels of debt at the federal government level as COVID-related support funding and other spending initiatives pushed debt levels beyond $1 trillion last year.
“The answer is no,” Pattison said, crediting the western democratic system as an automatic check-and-balance against poor fiscal policy. “Because the people - if they go too far - they'll get thrown out. And it'll correct over time. That's a democracy. When the people do a bad job, they get thrown out of the job – and we get a new election.”
Pattison, speaking in front of a large crowd of Vancouver’s business leaders, noted he is aware of challenges posed by inflation and supply chain issues throughout the world. He said that auto sales – one of the pillars on which the Jim Pattison Group is built – were one area upon which the current economic upheaval has made a large detrimental impact.
But while he outlined the struggle of manufacturing sectors to produce and maintain supply-chain efficiencies, he also noted that people should not be myopic about other areas of the economy that – perhaps working away from the media spotlight – are doing very well.
Part of the reason? The very government spending that is creating governmental debt is also creating wealth and spending, especially in the United States upon which Canada is so dependent for its business vibrancy.
“On the other side of it, the U.S. government – I’m talking about the U.S. and, to a degree, Canada - but the government gave so much money to people during this pandemic that we have businesses in the States [where] we've never made more money,” Pattison said. “Because people that didn't have it had that money, and they went out and spent it with their children like Ripley's Believe It or Not.”
So the question, he said, is whether governments can maintain that balance. Even if fiscal policies lose that balance, the voice of the general public will bring it back in line – albeit not immediately.
“It takes time,” Pattison said. “It’s inefficient... but go back to Margaret Thatcher in the U.K. and Ronald Reagan in the [United] States in my lifetime. These are people that get it right, and the country benefits.”
Taylor, however, did note that one aspect of the ongoing inflation that worries her is the possible permanent effects it may have on people’s wage levels – especially those who are unionized. She noted that she was in charge of negotiating many public service sector unions’ contracts during her time in office, and the current situation – where many contracts are expired and awaiting renewal while inflation is rampant – is an unenviable one.
“I looked at the current NDP government and I got a lot of sympathy for them, now during labour negotiations at a time of inflation,” she said. “... Everybody’s feeling it, and they come to government for the wage increases. And we'll have to hope that this inflation doesn’t stay high for too long, but it probably will for some time, and the government’s just going to have an awful time trying to get contracts signed without building that base.
“It’s just not easy to crawl out of it. For instance, when I was in finance, I used to do all the labour negotiations... and we just had to stick to a number or else - if you added to that base [cost] - then forever that base is higher.”
Pattison agreed that labour is one issue that also concerns him, as he noted the pandemic has changed people’s views on work. Whether those views can be balanced with the realistic needs of certain industries, he said, remains to be seen.
“We have people that used to come to work all the time, and now they don't want to come to work all the time,” he said. “They want to work half-time because they got used to work at home doing different things...
“Right now, in the car business, we are having difficulty getting cars because they can't get the cars built fast enough because they can't get parts or can’t do something else because they can’t get people back working like they have been used to... If you are in some other industries and manufacturing, you have a big problem.”
The only solution Pattison offered was to work harder. He noted his notorious work ethic – almost always working seven days a week to as late at 9 p.m. - as a key factor for the success of the Pattison Group.
He also called on banks to be more supportive of entrepreneurs and innovators, noting the fact that he himself had several loans called by banks in the midst of risky expansion plans.
“I wouldn’t be here today if I hadn’t keep pushing the envelope,” Pattison concluded. “... At present, Canada has very few banks, and the presence of those banks are very, very important to people in business.”