Canadians could get the wrong idea about the cost of prescription drugs in this country, now that U.S. President Donald Trump is encouraging Americans to raid the medicine cabinets of the Great White North for medications unaffordable in the Lower 48.

Then again, Trump’s “safe importation action plan,” unveiled last week, might usefully get Canadians talking about deficiencies in our own drug pricing.

Canada pays some of the world’s highest prices for generic drugs. We are the only country with universal medicare that doesn’t also provide universal drug coverage. And the $34 billion that Canadians spent on prescription drugs last year is the third-highest in the world on a per-capita basis.

Universal drug coverage, or pharmacare, will be an issue in the October federal election campaign — a major one, if anything comes of Trump’s importation plan.

Trump is poised to authorize pilot projects by U.S. states, pharmacists and wholesalers to import from Canada medications approved by the U.S. Food and Drug Administration (FDA).

Seldom has the U.S. so quickly united Canadians in opposition to an American idea.

It took about a minute for the Canadian Medical Association (CMA), the Canadian Pharmacists Association and 14 other groups to formally protest the latest peculiar Trump notion to Ottawa.

“Pharmacies in Canada are resourced to serve the Canadian public,” the CMA said. Canada is “not equipped to support the needs of a country 10 times its size” without running short of medications for ourselves.

What’s required in the U.S. is a counterpart to the Canadian and European systems of federal price regulation of patented drugs. And what’s required in Canada is a similar tribunal for generic medications.

The U.S. Fed has Canada’s back

Canada benefits from the recent easing in U.S. monetary policy.

With its modest 0.25 per cent cut to its key lending rate, the U.S. Federal Reserve Board has helped ensure a soft landing in the event of a recession next year.

The Fed is also signalling, with its restraint in easing, that the North American economy remains healthy.

Outside the energy sector, U.S. corporate spending has been weak throughout the presidency of Donald Trump, despite his massive 2017 cut to corporate taxes. The Fed’s rate cut last week will be more effective in spurring business investment than tax policy.

The Fed’s action to protect the U.S. economy benefits a Canadian economy thoroughly integrated with that of its southern neighbour.

The Bank of Canada will not be cutting rates, since Canadian GDP growth is trending toward 3 per cent for 2019, rather than the 2.3 per cent forecast by the bank.

By contrast, U.S. GDP growth slipped to a below-forecast 2.1 per cent annual rate in the second quarter, down from 3.1 per cent in the previous quarter.

Recession fears are based on the extraordinary length of the current upswing in the economic cycle, which dates from the end of the Great Recession.

But there is a tremendous upside on the horizon. A U.S.-China trade war that has slowed global growth to everyone’s detriment is unlikely to continue beyond next year’s U.S. presidential election. And the uncertainty around Brexit should end soon after the October deadline for resolving that issue.

We might just get through the next two years without a recession. As is said of the gloomiest economic forecasters: “They have predicted seven of the last three recessions.”

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A body-positive path to profits

It might be an exaggeration to say that Aerie is reinventing the business of marketing women’s apparel. But that’s only because Aerie, a division of Pittsburgh-based American Eagle Outfitters Inc., is not alone.

Abercrombie & Fitch dropped its highly sexualized marketing of women’s apparel after it became offensive to mall shoppers. And hot designers like Becca McCharen-Tran and Christian Siriano have added plus-size garments to their lines.

But Aerie is in the forefront of teen-focused apparel that celebrates the “body-positive” movement. Aerie’s models of all shapes and sizes, presented in unretouched photographs for in-store displays and advertising, are in the vanguard of a new category of “relatable” fashion.

That is an encouraging cultural shift, and it’s also good for business.

Aerie stands out in the slow-growth apparel sector, with 14 per cent same-store sales growth in American Eagle’s fiscal first quarter — the brand’s 18th consecutive quarter of double-digit growth.

American Eagle’s profits have climbed 23 per cent in four years, while those of lingerie-industry leader L Brands Inc., owner of Victoria’s Secret, have dropped by 50 per cent in the same period. The 42-year-old Victoria’s Secret has become the Hooters of women’s apparel marketing, clinging to its eye-candy-for-males regard for female beauty. L Brands has lost about $20 billion (U.S.) in shareholder value in the past four years as a result.

Aerie plans to open about 70 new stores in 2019. “We are opening stores as fast as we can,” Jennifer Foyle, Aerie’s global brand president, said in an investor call.

Some discipline will be required at Aerie to keep from overexpanding as Gap Inc. did. But Aerie can do better than the paltry three stores it has in the GTA.

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