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Archive for November, 2010

Worker Bargaining Power and the Crisis

Here is a keeper – an IMF study that argues that loss of working class bargaining power is an underlying cause of financial crises, and that retoration thereof is key to reducing debt. The abstract – “The paper studies how high leverage and crises can arise as a result of changes in the income distribution. […]

Memo to Energy Minister

Memo to Alberta Energy Minister Ron Liepert: Royalties are not taxes Already “under attack for allegedly being rude and dismissive when he was health minister,”[1] current Energy Minister Ron Liepert conceded he hadn’t read the Parkland Institute’s new report on vast oilpatch profits but that didn’t stop him from dismissing it: “This is a not […]

New report, old excuses

The Parkland Institute released its latest report yesterday morning, detailing the huge scale of oilpatch profits – Misplaced Generosity: Extraordinary profits in Alberta’s oil and gas industry. Many of the responses from government and industry were predictable – that’s why they were addressed in the report. Let’s run through the standard excuses offered for the […]

How About Capital Levies as an Alternative to Austerity?

Further to Marc’s post on alternatives to extreme fiscal austerity available to hard hit countries like Ireland and Greece,  it is manifestly unfair to attack the living standards of Irish workers to resolve a crisis that was not of their making, especially given that most of the fruits of the the debt financed housing  boom […]

Revenge of the Debt Zombies — or — “What are Banks for Anyway?”

What are banks for?  Typically, banks are described as intermediaries that take deposits and lend them out, earning what is called net interest margin on the gap between what is paid on the savings and what is earned on loans.  From where I stand, this description is wrong on three counts. First, it suggests that […]

CPP Expansion and Jobs

In a carefully timed intervention coming shortly before Finance Ministers meet to discuss retirement income reform, the Canadian Federation of Independent Business today released an econometric study by Peter Dungan of the University of Toronto on the economic impacts of the CLC proposal to double the Canada Pension Plan replacement rate, The CFIB regards CPP […]

Might the proposed new federal securities regulator weaken regulatory oversight?

The front page of today’s Globe and Mail reports the latest chapter in the federal attempt to create a national securities regulator. (Premiers push back against national securities regulator plan).   Part of the Harper government’s response to the financial crisis was to promise to remedy the patchwork of provincial securities regulators.  If securities regulators […]

What’s new pussycat (Celtic tiger edition)?

Back in May when Greece was in the process of getting its “bailout” I kept wondering why it had to be that Greece would accept such harsh conditions when it held an ace up its sleeve. The proposed package of austerity, which would make the economy worse, was only an issue as long as Greece […]

Luxury carbon

I was talking about carbon pricing and BC’s carbon tax recently and Michael Byers asked me about the prospects for a progressive carbon tax in terms of its rate structure. My first answer was that I liked the idea but was not sure how that could work in practice; that is, tax carbon and deal […]

Globe misses the mark on food

Today’s Globe and Mail features an article about the farming crisis in Canada. On close inspection the “crisis” is that Canada has not kept up its share of the global marketplace; that is, it is about our failure to increase exports. Low farm incomes are mentioned with nostalgiac dismay but nothing of the large transnational […]

Younger Workers, Older Workers and the Recession

Sylvain Schetagne and I have been looking at key changes in the job market over the past two years of recession and partial recovery using the Labour Force Survey data for October 2008 and October 2010. The full analysis will be in the next issue of the CLC’s “Recession Watch.” There have been some rather […]

The Ins and Outs of Foreign Investment

To provide a little context for our current national debate on foreign investment, I did a little digging recently in the FDI data. Some of my findings surprised me.  Yes, Canada exports slightly more FDI capital than we import (that is, the net investment position in FDI is slightly positive).  But most of what we […]

CAW Commentary on the GM IPO

GM’s $22 billion IPO got off to a roaring start last week. It’s ironic, needless to say, that it was underwritten by some of the same financiers (JP Morgan, Morgan Stanley, Citigroup, and Bank of America) who brought us the global financial crisis — the same crisis that pushed GM over the edge into bankruptcy […]

Debunking the Myth of the Lazy Student

Results of a major survey of post-secondary students were released on Thursday.  The 149-page report, entitled Sources et Modes de Financement des Etudiants the Premier Cycle 2009, was written by the Fédération étudiante universitaire du Québec (FEUQ).  It was done in collaboration with Léger Marketing, who suveyed almost 13,000 undergraduate students in Quebec, spanning 14 different post-secondary […]

Rejoice! Dividend Increases Await

An open letter to the world at large: “Bank shareholders rejoice.  Pension funds rebound.  Hark, the Globe and Mail comes bearing good news my brothers and sisters.   Yes, the drums beat steady.  The heart skips irregularly.  The palms sweat profusely.  Because soon, soon, the big banks will engage in our society’s number one passtime.  Well […]

Communities in Crisis

The full reports of the CLC Communities in Crisis project are now available  (links are at the end of each community summary.) Canada lost almost 500,000 full-time jobs between the Fall of 2008 and the Summer of 2009, with a particularly devastating impact upon industrial communities where a wave of layoffs and plant closures added to […]

Can Socialism be Revived?

Can socialism be revived? Does it have a chance to gain some traction ever again? Unfortunately, the two great experiments in socialism attempted during the last century – social democracy and the Stalinist model of state-controlled socialism – are now spent forces. In respect to sweeping capitalism into the dustbin of history, they both failed. […]

Past peak oil, no emission reductions in sight

The International Energy Agency released its World Energy Outlook the other day, and made some headlines by calling 2006 the year of peak oil production. People have different perspectives on the topic of peak oil – many see it as the point upon which civilization as we know it will collapse; with my climate change […]

Seoul Survivor

My thoughts on the Seoul G20 – from the Mark.

Confusion Over Monetary Policy

It’s always been my understanding that left-of-centre economists, on the whole, like it when real interest rates are low (but not negative).  Among other things, this encourages more companies to borrow (and hire more workers), reduces unemployment, reduces debt-servicing costs for government, and increases the power of labour. In July of this year, I blogged over my […]

Austerity Canadian-Style, Now in Britain? Pity

This appeared in the Globe and Mail yesterday. You can add your comments to the discussion here http://www.theglobeandmail.com/report-on-business/economy/economy-lab/the-economists/austerity-canadian-style-now-in-britain-pity/article1796379/ Budget plans in the UK drove 50,000 students into the streets this week. They were protesting proposed public spending cuts that could double or triple university tuitions. We’ve seen this movie, and it does not end well […]

The Bicycle Metaphor

A propos of the launch of the Canada – India trade talks, Bill Robson resorted to the tired old bicycle metaphor on CBCs Power and Politics. He is not alone. This cliche gets voiced all the time. Like a cyclist who will topple if she or he slows down, the momentum of trade liberalization must be […]

Another EI Absurdity

Well under one half of Canada’s 1.5 million unemployed workers are collecting EI benefits today, even though the national unemployment rate is still almost 8%. Special EI measures introduced as part of the 2009 Budget, notably an extra 5 weeks of benefits for all claimants,  expired this fall, long before a real labour market recovery […]

QE2

The Economist  judges that it is working . Long term interest rates have fallen since Bernanke announced the Fed was going to restart the printing press, usefully making the US government deficit a tad easier to finance. The stock market has been juiced, which may have a wealth effect on aggregate demand. And the US dollar […]

Silencing Student Dissent

Across Canada, university student associations–at both the undergraduate and graduate level–provide democratic representation to their members.  When students register for a term, memberhip fees are automatically collected by the university’s business office, much like an employer automatically collects union dues in a unionized workplace.  The university’s business office temporarily holds student membership fees “in trust,” […]

Is Social Democracy Dying? – Part 2

I would venture there are three reasons why social democracy is pretty much kaput: 1) a flawed ideology 2) the power of capital and 3) a propensity for selling out and drifting to the right. 1) Flawed ideology Ever since people have exploited other people’s labour for their personal gain, it’s long been the dream […]

Peter Van Loan’s Made-Up Trade Statistics

Here’s an amusing epilogue to my recent CCPA report on the possible economic and employment impacts of a free trade agreement between Canada and the EU.  (Here is the report; here is my blog on it.) The day after the report came out, reporters asked Trade Minister Peter Van Loan to comment on its predictions […]

Pervasive market failures

Most people reading this blog already get it that neoclassical economics is deeply flawed. But I’m still amazed at its persistence in the classroom and in the blogosphere. My blood boils when I see the standard neoclassical workhorse brought out of the stable when really it ought to be put to pasture. In a nutshell, […]

Trade Union Statement to the G20 Summit

http://www.ituc-csi.org/IMG/pdf/01-tuacG8G20-Seoul_English.pdf Employment has fallen off the agenda with the turn to co-ordinated austerity in the struggling developed economies.  What remains to be seen is if they can engineer some kind of coherent program to stop everyone from counting on export led growth via devaluation.

Potash and the Renaissance of Economic Nationalism

Who would have thought it. More than twenty years after the Canada-US FTA all but buried the economic nationalist legacy of the Trudeau era, a major foreign take-over seems to have been blocked. That’s twice under the Conservatives, after years of Liberal rubber stamping of foreign acquisitions under the Investment Canada Act. This is certainly […]