On May 2, 2013, almost exactly seven years ago to the day he was announced as the 10th Governor of the Bank of Canada, Tiff Macklem must have wondered what he had done wrong. Quebec roots, a PhD in economics, increasingly more senior roles over two decades at the Bank of Canada, and crisis experience at the Department of Finance. Pretty heady stuff. But like the previous two front-runners for Governor, he was passed over for an outsider. This past Friday, however, now himself the outsider, Mr. Macklem was chosen over the latest front runner to become the Bank’s newest Governor. Carolyn Wilkins, the current senior deputy governor at the central bank, had been viewed as a perceived successor – as an aside, there has never been a woman Governor. And just like that, Mr. Macklem became the most consequential Governor since Graham Towers, the Bank’s inaugural leader.
Coincidentally, the two men have much in common. Both were born in Montreal and both spent time at one of Canada’s Big Six Banks. But perhaps the most striking similarity between the two men is that both were installed in times of crisis. In 1934, when Mr. Towers took the role, the global economy was still reeling from the Great Depression. It took a further five years for it to fully recover. Today, Mr. Macklem takes the reins at the start of another global crisis, whose only comparator may be the Great Depression.
The global economy did eventually end up recovering after the Great Depression, ushering in the golden age of capitalism, though not before suffering through the horror of a second world war. Mr. Towers was also made a Companion of the Order of Canada, partly for the role he played in shepherding Canada through arguably its most challenging period as a nation.
How will Mr. Macklem and Canada fare during this crisis? Will the similarities continue? Regardless of the outcome, Mr. Macklem will be judged based on how Canada bounces back from this latest global crisis. And just as Canada was rooting for Mr. Towers to succeed, there’s little doubt the same support exists for Mr. Macklem.