Why Canadians Work Harder and Get Less
“We are the second biggest land mass in the world, 41 million brilliant people, the third biggest supply of oil fifth, biggest supply of natural gas, biggest, supply of uranium and potach we have the biggest supply of fresh water anywhere on Earth, the fifth biggest supply of Farmland… we should be the richest nation on Earth”
During the past Canadian federal Election, Conservative leader Pierre Poilievre went on stage and made this statement which struck accord amongst his supporters and adversaries alike. So how come we’re not? What exactly do resource-rich countries that have leveraged their resources into national wealth do that we don’t?
As someone who's worked with UAE and Saudi citizens I was struck by the privileges their state affords while all not having to contribute to the social system via taxes. Canada is the world’s second-largest country by area with the third-largest oil reserves and fifth-largest natural gas reserves. While Canada ranks above Saudi Arabia and the UAE in GDP per capita and indexes like the Human Development Index, those numbers fail to capture a critical reality: in Canada, even upper-middle-class earners struggle to afford homes, childcare, or a single-income household, while in the Gulf, citizens enjoy rent-free housing, free health care and education, tax-free incomes, and guaranteed public employment. The discrepancy lies not in how much wealth exists, but in how much of that wealth is retained by the state and reinvested in its citizens. This contrast raises a crucial question: with the right policies, could Canada translate its resource riches into comparable national wealth? As a political and policy advisor evaluating this challenge, the answer is yes but it would require a complete overhaul of how Canadian system surrounding natural wealth and the current rhetoric around climate change and population growth. Spoiler alert; it is not how by releasing the reins on private oil corporations as Poilievre would have suggested.
More Resources, More People, Less Wealth Per Capita
One fundamental reason Canadian citizens have a weaker purchasing power than the Gulf states or Norway is a matter of numbers. Canada’s 40 million people far outnumber Norway’s 5.5 million or the Emirati citizen population of around 1 million (in a country of 10 million) – and even Saudi Arabia’s roughly 36 million. Fewer people means each individual can enjoy a larger share of the resource wealth. In petro-states like the UAE and Saudi Arabia, a relatively small citizenry enjoys outsized benefits funded by oil exports, while millions of foreign workers (who have no claim on oil revenues) handle much of the labor. Canada, by contrast, is a diverse liberal democracy committed to broad-based prosperity, with a large population and high immigration. Immigrants also have the possibility to become citizens after sometime, which is exceptionally difficult if not impossible to do in the Gulf states. The liberal democratic model brings many advantages such as a diversified economy and skilled workforce without heavy reliance on any natural resources but it also means Canada cannot simply replicate the per capita windfalls of a sparsely populated petro-state without drastic changes.
Now the obvious obstacle to getting this resource haven wealth is our political state. In Norway and the Gulf, governments have a free hand to channel resource revenues as they see fit, either through democratic consensus in Norway’s case or top-down rule in autocratic regimes. Norway’s political culture forged a broad agreement to save oil revenues for the public good, and its government can act decisively on long-term resource strategy. In Saudi Arabia and the UAE, rulers face virtually no domestic opposition in directing oil profits into state coffers and ambitious projects. Canada’s federal structure and democratic cycle make such unilateral moves almost glacial. Any attempt to radically redirect resource wealth – for example, through new taxes or nationalization – must contend with provincial rights (natural resources are provincially owned in Canada) and political pushback from the industry and voters. Simply put, it is far more challenging in Canada’s system to swiftly concentrate resource profits in state hands, compared to a unitary state or monarchy that can cut through political resistance.
State Control vs. Private Industry
A key difference separating Canada from ultra-wealthy petro-states is ownership and control of the oil and gas sector. In Canada, resource development is largely run by private companies. While governments collect royalties and taxes, much of the profit remains with corporations and shareholders. By contrast, Norway and the Gulf states ensured the state a dominant stake in their oil industries from the start. Norway’s government owns a majority of Equinor (formerly Statoil) and imposed a special 78% petroleum tax on oil profits, channeling virtually all surplus into the national treasury. Saudi Arabia’s Aramco and the UAE’s ADNOC are state-owned giants, effectively making oil revenues an arm of the government’s income. This public ownership structure allowed those countries to capture enormous wealth from resource extraction and then redistribute it or invest it on behalf of their citizens.
Canada’s experience has been very different. During the oil booms of past decades, Canada (and Alberta in particular) chose relatively low royalty rates and privatized development, foregoing the kind of massive sovereign savings Norway accumulated. One striking comparison: in 2013 Norway’s government revenue worked out to about $88 per barrel of oil, whereas Alberta’s government realized only about $4 per barrel. Norway’s approach fed its now-mammoth sovereign wealth fund, worth about $1.8 trillion as of 2025 – whereas Alberta’s attempt at a heritage fund sputtered. Alberta established the Heritage Savings Trust Fund in 1976, but due to decades of withdrawing earnings and keeping royalties low, that fund’s value today is on the order of just $18 billion. In other words, a Norwegian-style strategy could have left Alberta (and by extension Canada) with hundreds of billions in the bank, but political choices prioritized short-term growth and low taxes over long-term wealth storage. Reversing this would require bold policy moves: significantly higher resource taxes or royalties, and disciplined saving of the proceeds in a national wealth fund akin to Norway’s.
It’s worth noting that Canada has, in the past, made transformative decisions to assert public control over key natural resources. A century ago, private investors were developing hydroelectric power at Niagara Falls, until Ontario’s government intervened. Premier Sir James Whitney declared that “the water‐power of Niagara should be as free as air” – not a source of private enrichment for a few, but a public asset. Under the leadership of Sir Adam Beck, Ontario created the world’s first publicly owned electric utility in 1906, expropriating private power companies at Niagara and delivering cheap electricity in the public interest (until it went back to partially private once again). That episode shows Canada can make radical changes to resource governance. Implementing a similar paradigm shift today - essentially, treating oil and gas as strategic public assets rather than primarily private enterprises, would be politically fraught, but it is conceivable with determined leadership and public support.
Using Oil for Public Good
What have countries like Norway, Saudi Arabia, and the UAE done with their resource wealth, and what might Canada emulate? Broadly, these states have used oil riches to massively boost the standard of living of their citizens – but via very different governance styles.
Norway’s approach has been to funnel petroleum revenues into a giant sovereign wealth fund (the Government Pension Fund Global) and invest it globally for long-term returns. By policy, nearly 100% of Norway’s oil revenue goes into the fund, and the government until recently could only spend at most 4% of the fund per year (now 3% to preserve capital). The result is that this fund now generates more income annually than Norway’s oil industry itself, providing a financial cushion for generous social programs well beyond the eventual depletion of oil. Thanks to oil, Norway, a country of about 5 million, enjoys one of the highest GDPs per capita in the world and a comprehensive welfare state. Universal healthcare, free university education, robust unemployment and parental benefits – all are supported by the wealth that oil built (combined with Norway’s high general taxation). Crucially, Norway decided that oil profits would benefit all Norwegians collectively, rather than primarily enriching private firms. That social contract required a high degree of trust in government and technocratic management; the oil fund is kept carefully non-political, and withdrawals are tightly controlled to avoid overheating the economy. In short, Norway treated oil like a public utility, much as Canada once treated Niagara’s hydropower, a resource to be managed for the people.
The Gulf monarchies’ approach, while also centered on state control, has translated oil wealth directly into lavish benefits for citizens. In Saudi Arabia and the UAE, governments use oil revenues to provide cradle-to-grave support to their nationals. Saudi Arabia’s government, for example, spends billions annually to subsidize free education and free healthcare to all Saudi citizens, along with a host of welfare programs – even free burials are covered. Saudi citizens traditionally paid no income tax at all, and until recent reforms, enjoyed heavy subsidies on fuel, electricity, and water. In the UAE, likewise, the state guarantees citizens free healthcare, free schooling (often including scholarships to study abroad), subsidized or free housing and land grants, government jobs, and ample social security benefits. This is a kind of resource-fueled social contract: the ruling families maintain power and social peace by ensuring that the local population lives in comfort, with the vast oil and gas revenues footing the bill. It helps that these countries have small citizen populations relative to their resource base – a built-in advantage discussed above – but the policy choice is clear: the wealth from oil is directly redistributed in generous social support. Citizens of Norway or Saudi Arabia today enjoy benefits and savings that are virtually unheard of in Canada, precisely because those governments captured more of the resource rent and deliberately allocated it to public purposes.
For Canada to match this, it would need to both capture more resource revenue and then decide how to invest or distribute it. Norway’s method emphasizes saving for the future and budgetary prudence, while the Gulf method emphasizes generous entitlements in the present. A Canadian approach could mix elements of both, for instance, building a national wealth fund for future generations (as Norway did), while also using a portion of resource income to enhance social programs or even provide dividends to citizens (somewhat like Alaska’s yearly oil dividend to residents, on a larger scale). Either path would mark a dramatic shift from the status quo.
The Path Forward
Canada doesn’t suffer from a shortage of wealth. It suffers from a shortage of political imagination that is present in all parties. The resource-rich countries that used oil to build sovereign wealth, world-class public services, and lasting economic power did so not by letting markets lead, but by having the state make deliberate, often uncomfortable choices.
Canada’s management of it’s natural fortunes have resulted in a nation rich on paper, yet full of working professionals who can’t afford homes, with governments that scramble to fund basic infrastructure, and energy wealth that slips through public hands like oil through a sieve.
We don’t need to become a petrostate to do better. But we do need to start treating our natural resources as national assets, not corporate windfalls.
In my next piece, I’ll tackle the question many ask next- Can Canada truly pursue this path while still hitting its climate targets while staying “green”? Stay tuned.