The ECB and the Euro Crisis

Here is an excellent commentary by Andrew Watt on the new ECB commitment to buy bonds without limit to reduce interest rates on the government debt of troubled members of the Euro zone. While an important and necessary step, this still means that deflationary austerity will continue, and that there will be no offsetting stimulus in surplus countries. And he […]

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Hayek and Contemporary Neo Liberalism

In the spirit of “know thy enemy”, I  recently read Hayek’s The Road to Serfdom. (Note to the anxious – I survived the experience, and remain a convinced left Keynesian democratic socialist.) Hayek is, of course, the totemic figure of neo liberalism who fought Keynes and Keynesian economics in the 1930s and is the intellectual figurehead of today’s “austerians”; the […]

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Unionization and Labour Market Performance

Further to my earlier post on the “own goal” scored by the Fraser Institute report on North American labour markets, the Table below shows the rankings of the Canadian provinces – out of 60 states and provinces – for (1) labour market performance, 2007-11 and (2) the unionization rate. (I have reversed the Fraser ranking for the latter indicator so […]

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The Economic Crisis: Notes from the Underground

Tom Palley has published a new book – The Economic Crisis: Notes from the Underground.  I recommend it unread, having learned a lot from his excellent recent book,  From Financial Crisis to Stagnation. The back cover description follows. The book can be ordered – for just $9.99  – from https://www.createspace.com/3820028 This book provides a collection of short essays detailing the […]

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Canada’s Economic Problem is NOT High Wages

Bill Curry reports in today’s Globe that, at last year’s economic policy retreat, business leaders urged Finance Minister Flaherty to reduce the pay of “overpriced” Canadian workers, including through anti union right to work legislation. Coincidentally, or not, the subsequent 2012 federal Budget introduced new rules which will require most EI claimants to accept jobs at much lower wages, and […]

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“Right to Work” Laws and Jobs

Ontario Conservative leader Tim Hudak claims that passage of an anti union “right to work” (RTW) law (making mandatory union dues illegal) would create jobs, especially in hard-hit manufacturing. With companies like Caterpillar moving to get ever cheaper labour, it seems semi plausible that anti union laws might attract footloose new investment , albeit at the expense of workers. US […]

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TFSAs: Cutting Taxes for the Affluent

The latest issue of the Canadian Tax Journal has a number of articles on Tax-Free Savings Accounts. Among the papers of interest: Kevin Milligan projects the potential tax impact of accumulated TFSA contribution room by estimating what a mature TFSA would have meant for income taxation in 2005. Even short of doubling the contribution limit to $10,000, Milligan finds a […]

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Labour Losing to Capital

The just-released OECD Employment Outlook – full text not available on line – has an interesting chapter on the sharp decline of labour’s share of national income in virtually all OECD countries over the past 30 years, and especially the last twenty years. The median labour share in the OECD fell from 66.1% in the early 1990s to 61.7% in […]

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Unions and Democracy

Further to Jim’s post on the recent ratcheting up of the war on unions, I note that Hudak’s lead argument is that voluntary union membership is needed to “make unions more responsive to unionized employees.” (p6) “Labour laws” it is alleged “have given union leaders substantial power  with little or no accountability.” (p9) The basic idea seems to be that […]

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More on the OECD and Dutch Disease

Further to my earlier post on the OECD and “Dutch Disease”, I have received a heavily redacted response to an access to information request (A-2012-00073/CN.)  submitted to the Department of Finance, seeking any comments on the draft assessment and recommendations of the OECD delegation to Canada in 2012. This arrives just as Conservative ads attack the “risky economic theories” of […]

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Deflating Housing Bubble Risks Recession

Seen in isolation,  Finance Minister Flaherty probably did the right thing yesterday in seeking to safely deflate the housing bubble and lower the dangerous growth of household credit to a record level as a share of household income. But he did it very late in the game, and risks tipping an already very fragile economy into recession if he and […]

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In Memoriam: Perspectives on Labour and Income

Another sad tombstone to the shrinkage of information for informed social and economic policy – Statscan has decided to discontinue “Perspectives on Labour and Income” in both print and online format. For as long as I can remember, Perspectives reliably provided a firm empirical base for policy debate on key labour market and income issues -  everything from rising income […]

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Canada, the IMF and the G20

The Harper government decided to attack Thomas Mulcair on the issue of Canadian support for additional IMF resources to deal with the euro area crisis, implying that Canadian taxpayers should not be asked to “bail out” a rich area of the world. As recounted in Macleans here, on June 8, “Before QP yesterday, the Conservatives used four members’ statements—from Shelly […]

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The Budget, Employment Insurance and the Unemployed

Following  are the notes on which I based presentations to the Senate National Finance Committee on June 6 and the House of Commons Finance Committee on May 29. They summarize key CLC concerns with the Budget Implementation Bill. Lack of Consultation The significant changes to the Employment Insurance (EI) program proposed in Budget 2012 should not be implemented without a […]

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Youth Unemployment

Here’s the link to a TVO The Agenda panel I was on this Friday.  Good to put some focus on the fact that the “real” unemployment rate for young people is 20%, while the youth employment rate is down a full five percentage points from 2007. My basic take is that it is not very surprising that youth unemployment and […]

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A New Stage of the Crisis?

Until quite recently, it seemed that the global economy was set for an extended period of stagnation, lacking an obvious engine of growth in the advanced economies as households deleveraged, as governments imposed harsh fiscal austerity programs, and as corporations failed to see any good reason to invest significantly in new capacity. Relative optimists could point to China, Brazil, India […]

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Dutch Disease, the Canada – US Exchange Rate and Trade With Asia

Today’s Globe editorial provides further evidence of distorted economic reasoning being rolled out to attack Thomas Mulcair. “Mr. Mulcair seems to long for a golden age of manufacturing and a low dollar, but his longing won’t take Canada anywhere. Not only the dollar but Asian competition has inflicted damage on Canadian exporters.” The implication seems to be that the over-valued […]

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Implications of Inequality

I, Jason Clemens from the Macdonald-Laurier Institute and David Macdonald from the CCPA discussed the social and economic implications of growing income inequality on an ipolitics panel yesterday. Jason was a bit outgunned so I won’t go after him here, except to say that he took the usual neo liberal tack of shifting the debate to poverty so as to […]

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The Economics of EI “Reform”

Changes to the EI rules announced by the government today are not rooted in any lengthy policy rationale. But Minister Finley and and the media release spoke to the need to “strengthen work incentives.” This conjures up images of  unemployed workers sitting around and spurning job offers amidst growing labour and skills shortages. As I have previously commented, this framing […]

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Key EI Data No Longer Available

As Heather Scoffield of Canadian Press reports here, Statistics Canada are no longer publishing key EI data because HRSDC have stopped providing it. Data on the dollar value of EI regular benefits are not published in the monthly Statscan release, but were available each month on CANSIM…  until March of this year. As reported on Sam Boshra’s Economic Justice blog, […]

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Krugman: End This Depression Now!

I am an enthusiastic reader of Krugman’s columns and, especially, his economic blog. And I certainly side strongly with him in the intellectual and political struggle against “the Austerians” and “Very Serious People” who are unnecessarily prolonging the Great Recession in America and in Europe. That said, Krugman’s latest book “End This Recession Now” (Norton, New York, 2012) is not […]

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HRSDC Funded Research Contradicts Key Argument For New EI Policy

According to today’s Globe, the government says that the major target of pending changes to EI is frequent claimants, who are disproportionately to be found in  the high unemployment regions. This focus seems to reflect the common belief that supposedly “overgenerous” EI benefits stop some people from moving from high to low unemployment regions. Interesting to note, then, that research […]

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