Not much good can come out of a recession. For myself, however, there is one small benefit: for the first time in almost 20 years, Ontario – and to a lesser extent other “have” provinces, such as Alberta and British Columbia – is finally beginning to understand what it feels like to be Atlantic Canadian. With the exception of the offshore oil industry in Newfoundland and Labrador, Atlantic Canada never really fully recovered from the last recession that hit the early '90s. Yet in the time between our last recession and this one, Canada has had the longest period of sustained economic growth in its history.

Since 1991, Ontario added an amazing 2.2 million to its population while the collective population of Atlantic Canada declined. While the federal government and the “have” provinces continued to rack up record budget surpluses, both New Brunswick and Prince Edward Island were requiring ever-increasing levels of fiscal equalization in order to pay the bills and unemployment rates stubbornly persisted well above the national level. Despite these lows, Atlantic Canadian politicians and community leaders were pilloried by the national media and considered ungrateful by government officials in Ottawa when they dared raise the issue of economic development. After all, with Ottawa generously providing billions in equalization and other transfer payments, how dare Atlantic Canadians complain.

But how times have changed.

Now that Ontario’s unemployment rate is starting to look like Atlantic Canada’s, it is portrayed as an unprecedented emergency. The Employment Insurance program – which was skewed to benefit “poor” regions of the country like most of Atlantic Canada – is now considered grossly unfair to Ontario and is ordered to change immediately. And how about the Atlantic Canada Opportunities Agency (ACOA), which has been universally criticized from all sides (including, in a well publicized diatribe, from our Prime Minister)? Now, Southern Ontario is getting its very own ACOA. Politicians and economic developers in Atlantic Canada can’t help but allow themselves a little quiet satisfaction.

What Ontario and most of Canada has never really understood is that chronic economic under-performance in Atlantic Canada is like a cancer – it doesn’t kill you right away, but it slowly sucks the life out of you. Equalization and other federal transfers have been used to ensure that the governments over here keep the lights on, but over 75 per cent of communities are shedding their populations, foundational industries that have shored up the economy for generations are in decline, and new economic industries are too slow to take root. To this, the flippant response from most pundits and think tanks in Ontario is: just move here. Now the same pundits and politicians, finally feeling like Atlantic Canadians, can start to realize that economic development really does matter and that governments have an obligation to their citizens to take it seriously.

I am confident that Ontario will rebound – it has a long history of economic adaptation and has been leading Canada in economic growth and wealth creation since Confederation. Alberta will also come back the minute oil and gas prices return to pre-recession levels. However, the outlook for Atlantic Canada is not that rosy. So what to do to move economic development forward?

Atlantic Canada will need new industries to emerge. The forestry industry will likely never be the engine it once was. The fishery sector is also not as dominant. The mining industry, with the exception of offshore oil in Newfoundland and Labrador, is uncertain. Governments played a critical role in the growth of the auto manufacturing sector in Ontario, the pharmaceutical and aerospace sectors in Quebec, and the oil and gas industry in Alberta. In Atlantic Canada, all levels of government, along with industry and community leaders, will need to seriously support the creation of 21st -century, technology-based industries. The federal government has an important role to play.

Until now, the vast majority of the federal government’s economic development activities have been focused almost exclusively in Ontario and Quebec. Almost every national funding program designed to foster economic development has been biased toward those two provinces. Consider the multi-billion dollar Technology Partnerships Canada program (which benefited Ontario and Quebec almost exclusively), or the Sustainable Technologies funding almost completely given to companies in the GTA. Of the billions of dollars spend by the Federal government on research and development, New Brunswick has the dubious distinction of being last in Canada to receive support.

There are some 90 Canadian embassy and consulate facilities around the world, all supposedly working to increase exports from Canada and investment into this country. I routinely asked economic development officials in Atlantic Canada how many investment leads they receive from federal government sources (these are international companies looking to set up facilities abroad). The usual answer is none. In fact, one person recently told me that he had never seen a lead from a foreign consulate or embassy in all of his 10 years in economic development. Contrast that with Ontario. In 2004, the Greater Toronto Marketing Alliance reported that 74 per cent of its investment prospects come from government sources (either consulates or the Canadian High Commission).

Provincial governments in Atlantic Canada need to step up and take control of their destiny. It has been too easy to take the equalization and run. It has been more convenient to demand better employment insurance benefits for workers than to demand a serious emphasis on economic development. Hopefully the recession will level us all, and economic development strategies and programs that truly benefit Canada, as a whole, will emerge.