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Archive for September, 2009

L-Shaped Recovery?

Flat Gross Domestic Product (GDP) figures for July provide a sobering reminder that the technical end of a recession may not imply a rapid recovery. Output appears to have stopped shrinking, but this morning’s release suggests stabilization rather than growth. Rounding to the nearest billion, all-industry GDP has been $1,184 billion for three months. It […]

Canada’s Dirty Old Deal

Last week the United Nations Environment Programme (UNEP) published an update for the G20 Summit on its call from earlier this year for a Global Green New Deal.  This update showed that Canada is close to the bottom in the stimulus funds it is committing to green economic areas. According to the UNEP, only 8% […]

Harper’s Mystery Chart

The first chart in today’s Third Report on the Economic Action Plan (Chart 1.1, page 8 ) appears to show that Canada is tied with Japan for the largest stimulus package in the G-7. Exactly the same bar graph appeared in the Second Report back in June (Chart 1.2, page 12). While this seemingly impressive […]

EI Benefits by City

UPDATE (September 29): Quoted by The Globe and Mail, National Post, Toronto Star, and Canadian Press . . . A recent inquiry for a NOW Magazine article has inspired me to use the July Employment Insurance (EI) figures, released this morning, to examine how this program serves Canadian cities. However, I begin with a national […]

What Happened at Pittsburgh?

Summary The main result of the Pittsburgh summit was to institutionalize and modestly extend the global economic governance role of the G-20 which arose as a necessary response to the global economic crisis. There is talk of medium-term co-ordination of national macro-economic policies, and a “re-balancing” of the global economy. However, while this is welcome, […]

The Opposite of a Buy Canadian Policy

Last week, the Minister of Finance announced his aspiration to unilaterally eliminate Canada’s few remaining tariffs on imported machinery and equipment. Saturday’s Globe and Mail quoted me doubting this proposal given the severity of Canada’s offshore trade deficit in that area. I elaborate my case in the following op-ed, which is printed in today’s Financial […]

Affordability Gap

The Canadian Centre for Policy Alternatives released a new study today comparing the expenditures of rich and poor Canadians. This approach is interesting because inequality is typically measured in terms of income or wealth. Conservatives sometimes claim that, while temporary fluctuations in income or asset values create the appearance of massive inequality at any given […]

Droppin’ some HST

The province-wide revolt over BC’s looming Harmonized Sales Tax is reminiscent of protests a generation ago when the HST’s federal parent, the Goods and Services Tax, was born. The rationale for that shift was similar to that of the HST: to switch from an invisible tax paid by producers (the Manufacturers’ Sales Tax) that was […]

Taxing Tim Hortons

Yesterday, the Prime Minister’s office put out a press release trumpeting Tim Hortons’ reorganization as a Canadian company as validation of deep federal corporate tax cuts. There was no real news: shareholders predictably ratified a decision that had been extensively reported back in June, when Tim Hortons management described it as “a pretty bland corporate announcement.” […]

Neoclassical economics fighting back from “the Ropes”?

In 2003 the the heterodox economics faculty at Notre Dame University were removed from the Economics Department. Now I gather their new home, The Department of Economics and Policy Studies, will be eliminated as well.  The story can be found in The Chronicle of Higher Education An interesting analysis appeared today in the Chronicle titled […]

Canada Breaks Rank on Banker Bonuses

Canada likes to think of itself as the country that emerged from the financial crisis squeaky clean. Too bad it is abdicating a leadership role in creating a safer financial system going forward. The issue is bonuses paid to top executives in the financial sector. It looks like the Europeans and Americans have hammered out […]

Jack Layton on Employment Insurance

Some pundits have blasted the NDP for voting with the Conservatives in exchange for “a bone,” “crumbs” or “a peanut” on Employment Insurance (EI).  Others have convincingly countered that forcing an election right now would not advance EI reform or other progressive causes. Nevertheless, the decision to temporarily support the government deserves further analysis in […]

The Good Ol’ Days

My two kids are still far too young to be farmed out to earn their keep in the labour market, but when they are (in about a decade), I really hope that the value of minimum wages in Canada improves.  If not, not only are they going to have to work harder and harder to get by along […]

Janice MacKinnon on EI

Janice MacKinnon’s op-ed on Employment Insurance (EI) in Monday’s National Post read almost as if it had been written before the economic crisis. There was no mention of mass layoffs or rising unemployment, let alone proposals to enhance EI in response to these trends. Instead, she sees the biggest problem with EI as being the […]

EI Woes

The latest changes to EI to be introduced by the Conservatives do almost nothing for the shock troops of the labour market, those who were first felled when the recession hit last year. Bill C-50 will pass – whether or not it is fast-tracked today or “well-considered” in committee depends on how the procedural tactics […]

Financial Boom and Bust … In Cartoons!

I want to share with everyone a new CAW resource that was produced for our Constitutional Convention (which took place last month in Quebec City). It’s a 4-page cartoon book explaining the core dynamics of financial cycles, that was illustrated and deesigned by Tony Biddle — the awesome Toronto political cartoonist who also illustrated Economics […]

Recovery? What Recovery? Whose Recovery?

            This week marks the one-year anniversary of the collapse of Lehman Brothers: the darkest moment of the global financial crisis, when those in charge genuinely feared for the survival of their system.            This somber anniversary has sparked a modest flurry of retrospection in the media.  But the dominant tone (Michael Moore’s new movie […]

Deflation Continues

This morning’s consumer price figures for August are reminiscent of July. The annual Consumer Price Index decline was 0.8% (compared to 0.9% last month.) With the exception of July, August was the sharpest drop in consumer prices since 1953. In both July and August, eight of ten provinces posted negative inflation rates. The only province […]

The Canadian Jobs Crisis

The OECD released an interesting short report today on how Canada compares to other countries in terms of the job impacts of the crisis. http://www.oecd.org/dataoecd/62/10/43707194.pdf They project that our unemployment rate will increase by more than in any previous recession to about 10% in 2010 and will likely take a long time to fall. They […]

That sinking feeling: BC’s forests and CO2 emissions

As everyone knows, BC has a lot of trees. From a climate change perspective the nice thing about trees (forests, really) is that they suck carbon dioxide out of the atmosphere. In the jargon, forests are a “sink”, reducing CO2 emissions, rather than a “source” that contributes them. At least, that used to be the […]

Mounting costs of climate change

Models are often invoked when talking about climate change. Skeptics argue that the models are not sophisticated enough and are therefore wrong, which is technically true about any model, but other scientists argue that what has not been included in the models would make the outcomes in the future much worse. Still, the debate often […]

Capitalism: A Love Story

Last night, I saw the North American premiere of Michael Moore’s latest movie at the Toronto International Film Festival. Ironically, it was held in the Visa Screening Room, which grants preferential access to bearers of Visa Gold, Platinum or Infinite credit cards. (The unwashed masses who use MasterCard, AMEX or lower grades of Visa waited […]

EI Reforms – Unfinished Business of the Recession

With their backs once again to the wall, the Conservatives today announced that they will, at long last, propose additional measures to help the unemployed, something almost everyone inside and outside Parliament has been asking them to do for the better part of a year. They will extend employment insurance benefits by another 5 to […]

Deficit and Debt Phobia: An Addendum

Further to my post of last week, I note that the Department of Finance Update of Economic and Fiscal Projections shows that the federal debt to GDP ratio will start falling after the next fiscal year … ie from 2011-12…. even though we will be running quite significant fiscal deficits — eg $27.4 Billion in […]

Tax Competitiveness 2009: Flogging a Dead Horse

Should we care that the marginal effective tax rate on capital is higher in Prince Edward Island than in Serbia? Of course, this question is a joke. But the C. D. Howe Institute actually did put out a press release (PDF) last week singling out PEI for its allegedly high business taxes compared to an […]

Deficit and Debt Phobia

We seem set to go into the next election – which could be in a matter of  days -  with both the Conservatives and Liberals firmly committed to bringing the federal Budget back into balance in a relatively short time frame, with no tax increases.  There appears to be no sign of a break in […]

Who Called the Crisis?

An interesting piece in the FT yesterday re how those economists who followed the financial flow circuits called the crisis, as opposed to the general equilibrium types who did not.  Complementary to the analysis of Tom Palley on the macro roots of the crisis, who rightly insists that the “no one saw it coming” crowd […]

Global Unions and the G20

Global Unions ‘Pittsburgh Declaration’ Global Unions’ Statement to the Pittsburgh G20 Summit (24-25 September 2009) I. EXECUTIVE SUMMARY 1. The G20 leaders are meeting in Pittsburgh amidst reports that the global recession is bottoming out, with the massive decline in output in most major economies slowing, and that governments are preparing their strategies for exiting from […]

It’s a small world after all

As someone deeply focused on climate change and the vast potential for bad things to happen in the future, the idea of peak oil strikes me a blessing. For the most part I have paid little attention to the nuances of peak oil arguments on the grounds that there is still so much of the […]

What’s in Play at Pittsburgh?

The London G-20 summit last fall may go down history as the meeting that saved the world. That’s a huge exaggeration of course, but leaders did agree to a program of co-ordinated monetary and fiscal stimulus which may have arrested an economic free-fall, and they agreed to an agenda for financial re-regulation with a view […]