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Archive for 'OECD'

Flaherty’s Legacy: Ideological, reckless and just plain lucky

This piece was originally published at the Globe and Mail’s online Report on Business feature, EconomyLab.   There are two reasons why it is difficult to comment on the legacy of a finance minister. 1) It is a tremendously challenging job, anywhere, any time. Stewarding one of the largest economies in the world through a […]

Broadening the Bank of Canada’s Mandate

Yesterday, Mike Moffatt took to The Globe and Mail’s “Economy Lab” in response to my suggestion that the Bank of Canada should moderate the exchange rate. (Perhaps his motive for encouraging me to seek the Saskatchewan NDP leadership was to get me as far as possible from the levers of monetary policy.) My rebuttal of […]

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 […]

Randy Hoback’s Pulp Fiction

Last week, Conservative MP Randy Hoback had another letter in The Prince Albert Daily Herald blaming the NDP for the pulp-mill closure in 2006. He still has not addressed my main point about resource royalties. I have the following response on page 4 of today’s Herald: Pulp mill saga proves Mulcair’s point Notwithstanding MP Randy […]

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 […]

CPI Deflates Case for Rate Hike

Today’s report that the national inflation rate fell to 1.2% in May deflates calls for higher interest rates to reduce inflation. The central bank’s core rate was 1.8%, also below the 2% target. The other argument for an interest-rate hike was to moderate mortgage lending and the housing market. However, the federal government’s move to […]

OECD Agrees We Suffer From Dutch Disease

OECD economist Peter Jarrett – lead on the just released Economic Survey of Canada – agrees with the Mulcair diagnosis.

Inflation On Target; Exchange Rate Off Target

Today, Statistics Canada reported an annual inflation rate of 2%, precisely in line with the Bank of Canada’s target. With inflation under control and renewed risks to the global economy, there is little rationale for the central bank to raise interest rates anytime soon. In fact, the Bank of Canada should now be more concerned […]

Deflating the Monetary Hawks

Canada’s business press has recently been filled with speculation that the Bank of Canada may soon hike interest rates based on its somewhat more optimistic economic outlook. But today’s Consumer Price Index report indicates that there is no need to raise interest rates. Statistics Canada reported that both headline and core inflation fell to 1.9% […]

The Loonie’s Stagnant Purchasing Power

The following note also appears on Business Insider. I owe Paul Tulloch a hat tip for reminding me of these issues in a good comment on my last post. When Ontario’s Premier recently complained that Canada’s petro-dollar undermines manufacturing exports, many economists tripped over each other to counter that a strong loonie benefits all Canadians […]

Deregulation: A Bad Idea Crosses the Atlantic

The Harper government announced today that federal “regulators will be required to remove at least one regulation each time they introduce a new one that imposes administrative burden on business.” At the risk of imposing a proofreading burden on communications staff, that sentence is missing the word “an.” I first heard this idea at a […]

Mind the OECD Credibility Gap

Further to Toby’s post, the OECD report on inequality is well worth a careful read. It bolsters, through careful empirical and cross country analysis, two key arguments long advanced by the labour movement and progressive economists: -  key trends in the labour market – widening wage disparity between top earners and the rest, and the […]

OECD on Inequality

Following concern expressed by the IMF, the Conference Board and of course thousands of protesters around the world, the OECD has just released an extensive 400 page report on the problem of growing inequality: Divided We Stand: Why Inequality Keeps on Rising. I haven’t read through it yet, and it also has quite a lot […]

Apocalypse Soon?

The OECD’s new assessment of the macro-economic situation makes for pretty grim reading. And their forecast of very sluggish global growth (just 1.6% for the OECD area in 2012) is based on an increasingly incredible view that the Eurozone will “muddle through”and experience only a mild recession. They do not seem to have convinced even […]

McGuinty’s Graph Misleads on Corporate Taxes

Further to Jim’s excellent critique of the Ontario Conservative platform’s graphs, I am similarly struck by the Liberal platform’s lone graph. “Cutting Ontario’s Taxes on New Business Investment in Half” (page 25) purports to show that corporate tax cuts are required to get the province’s “Marginal Effective Tax Rate” below the US and OECD averages. […]

Use University Research to Increase Manufacturing Jobs

Manufacturing jobs have been declinining as a percentage of total jobs in most OECD countries for several decades, with Ontario being especially hard-hit as a jurisdiction. At the end of the Second World War, manufacturing jobs accounted for 26% of all Canadian jobs; by 2007, this figure had dropped to just 12%. And as I’ve […]

Canada Doesn’t Deserve the Silver

It has been widely reported in the Globe and elsewhere that Canada ranks #2 in the just-released OECD Better Life Index, outstripped only by Australia. I am all for measures of objective and subjective social well-being that go beyond GDP as a measure of progress, and this OECD report offers up some useful information. But […]

Mintz: Wrong Again on Corporate Taxes

Ten days ago, Jack Mintz released yet another paper claiming that international competitiveness requires continued corporate tax cuts. In addition to the usual questionable interpretations, it featured at least one straight factual error. Mintz inaccurately reports Iceland’s 2010 statutory corporate tax rate as 15% (Table 2 on page 7 and Table 3 on page 9 […]

OECD Corporate Tax Rates: Does Size Matter?

Advocates of corporate tax cuts like comparing Canada to an unweighted average of Organisation for Economic Co-operation and Development members. Since the OECD keeps admitting more microscopic economies with very low corporate tax rates, this average keeps falling regardless of whether any country actually lowers its rate. Last year’s admission of Estonia, Israel and Slovenia […]

Mintz Misleads on Corporate Taxes

Jack Mintz is out today with yet another paper applauding the federal corporate tax cut from 18% in 2010 to 15% in 2012. Revenue Fudge He claims that the revenue loss will be “relatively small” or “relatively insignificant” without actually suggesting a dollar amount (pages 3 and 20). By comparison, the Department of Finance (see […]

Taxing Multinational Corporations

Earlier this month, I attended a very interesting conference on the taxation of multinational corporations. It included a case study of how SABMiller avoids paying tax in Africa. While many of the points presented are undoubtedly familiar to this blog’s readers, the conference put it all together with a clarity that I attempt to reproduce […]

Taxes and Economic Growth

The term “Austrian economists” usually refers to the likes of Hayek, Menger and von Mises. But I recently met some rather different economists from the Austrian Chamber of Labour. Austrian law requires that union members pay dues to the Chamber of Labour, so it is very well-funded for a progressive think tank. Similarly, all Austrian […]

The OECD Attack on Medicare

The OECD Economic Survey of Canada (unfortunately only a summary is available on line) was released this week, and its call to impose user fees or deductibles on services covered by Medicare (ie physician and hospital care) received quite a lot of media coverage.  I saw OECD economist Peter Jarrett doing at least two TV […]

Dangerous delusions about corporate income tax cuts

For years we have been asking Stephen Gordon to provide the evidence for lower corporate taxes. Like Stephen I like the Nordic model and take away from it that tax mix matters, so funding a large public sector may require more than taxes on “people we do not know” (ie corporations and the rich), so […]

Do OECD Economists Read OECD Data?

I had the opportunity to meet late last week with the OECD Policy Mission to Canada – the folks who write the country reviews. These meetings are usually interesting and useful, though I find the OECD Economics Department to be ultra neo liberal in their orientation. Even so, I was a bit taken aback to […]

Transatlantic Echo Chamber

The big news for Canadians from the OECD’s Going for Growth 2010 report was that we should privatize Canada Post. An article in the current issue of Maclean’s (pages 26 and 27), which does not (yet) seem to be available online, sheds some interesting light on that recommendation: [Yvan Guillemette was] working for the C. D. […]

Exchange Rate vs. Inflation Target

The Canadian dollar is again becoming more overvalued. After dipping as low as 92 US cents at the end of October, it rocketed up to 96 US cents so far today. Meanwhile, the OECD has released another month of purchasing-power data. Although the loonie’s average price on foreign-exchange markets edged up between August and September, […]

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 […]

Canada vs. The G-7

Keystone Liberals Yesterday, Andrew Coyne lambasted a Liberal Party “Reality Check” from Thursday that looks eerily similar to the table that I had posted on Monday. Like my table, the Liberals use the words “Growth”, “Decline”, and “Britain.” By contrast, the OECD’s tables use a negative sign (instead of words) to denote declines and refer […]

Canada’s Third Quarter: Worst in the G-7 Again?

Disappointingly, press coverage of Monday’s GDP numbers missed the fact that Canada had posted the worst second-quarter performance of any G-7 country.  To his credit, Julian Beltrame of Canadian Press picked it up on Tuesday. The media has redeemed itself by noting that today’s Organisation for Economic Co-operation and Development (OECD) projections suggest that Canada will […]