9 comments

  • Especially given that the central bank seems, for no reason I can imagine, to be determined on a strong dollar policy. Hard to have export led growth via devaluation, with no devaluation.

  • We are going through the biggest job loss in history, yet not a country, at least from what I have heard, has developed a comprehensive jobs strategy.

    The high wage/high quality strategy based upon a manufacturing/ knowledge worker premise is the way forward for more advanced economies. It will take a whole lot more than monetary policy to make that happen, hence the need for a comprehensive jobs strategy.

    Pt

  • This is a topic for extended discussion, Paul, but I really am not as sure re the high wage/high quality strategy as I was a few years back. Lower wage developing countries are quite capable of producign high quality, sophisticated goods eg. China is rapidly climbing the value addded ladder and has major R and D operations, not to mention a large share of the world’s engineers and scientists. Ultimately I think we need much more activist trade and investment polices to hang on to let alone build our manufacturing base

  • I agree with Andrew and would just add that such an analysis applies to green jobs in manufacturing as well. China has been making massive moves into solar and has cornered the market on rare earth metals.

    The idea that we in the developed North are going to sit around as the thinking head for the BRICS while producing clean energy, with clean technology is a bit farcical.

    Now throw in a carbon transportation based consumption tax system, with a international financial transaction tax and then perhaps we can move on a green industrial plan.

    As things stand right now we have front row seats in the movie called Whither North America.

  • yes it is not as a pronounced strategy as it once was, however, that being said, given the kind of innovation needed to meet the needs of some future economy that it product and service smart, i.e. environmental and information oriented- I still see a road through, especially for a small open economy like ours.

    The US, however, I reading some quite eye opening education outcomes over the past 10 years, drop out rates are unacceptably high. I do fundamentally believe the more educated your worker, the more an organization can meet the efficiency requirements of a safe, healthy and productive workplace of a fast changing future.

    Of course that is if a company makes a strategic choice to compete on that basis, and not on worker standards.

    So in the end I do agree with you, but I do think there is plenty available space on that terrain for expanding the high wage/high quality strategy. If we get
    momentum transformed in the following

    1) from the low wage/ low value production, and develop more workers and production based on this model of development, we are reaching further towards the goals- social and environmental (assuming productive investment goes after or is enticed into these goals)

    2) a concomitant rise in the wages and labour standards of the lower output jobs, through various mechanisms

    We will raise the wage bill and hence consumer demand.

    There is no lack of consumer demand- given the global poverty, we have billions of more than happy consumers waiting to buy up all that production. THe question is the jobs to such feats.

    I wish every person in the world had a high quality/ high productive/ knowledge centric job which produced profits for everyone.

    If we could get closer to that goal, we would have a whole lot less hostility and problems.

    My summary- it is all in the magic of supply and demand, and building a productive economy – sadly, capital got lost along the way and found the financial economy too lucrative and a whole lot more politically appealing (especially once they usurped control and built the global shadow banking sector)

    But I will give you the advantage – as you are right- in order to grow such high wage/ quality job, we may need some help this time around in initiating the investment and maintaining some form of baseline market share. As long as we can get productive outputs in a similar space quality and output wise, why should local capital have a problem, at the global level we are all better off because of the rising wages.

    Let me know if you think I am wrong, as I have spent quite a bit of time recently meandering through these themes, and I was a one time a huge high wage/ high quality job believer, but like Zuboff and yourself, the shine has come off it, but maybe for different reasons.

    (mine is mostly the lack of interest in capital as it is lost in the financial profits- and seemingly given the QE2 is only interested in rebuilding the bubble.)

    Pt. sorry for the length but time here in the economic lab goes by fast- and I am running out of beakers, many are smashed against the wall, but the Bunsen burners have plenty more gas, and David Harvey is on his way with his lab coat and a fresh supply of beakers! lol.

  • Comment on the doc above, I do think something will be revealed at the G20.

    The USA is pretty much stuck and cannot get out of this economic quagmire.

    With QE2, the US policy makers feel they can lower longer term rates with the hopes that somehow it will reflate the housing market. This so banks can finally detoxify themselves and then somehow this will bring the US back into the economic hegemony it once enjoyed 3 years ago. This goes hand in hand with fueling more pressure to bring the US dollar lower, which potentially helps the prospects of seeing productive investment come forward as well.

    What we will witness is more ranting and raving at the US for their beggar thy neigbour solutions, and screaming at them for lowering and further destabilizing the global economy. Will we get any action?

    The only action that I see, is hopefully labour, as pointed out in this document, finally gets a closer seat at the table.

    What can the world do- bring in a new global currency and bringdown the financial castle that Wall Street has built. Without a productive economy to speak of, (I heard it mentioned today that 2/3 of American profit was generated by the finanical sector and if that holds) you can be assured that the US will not allow the barbarians at the gates to get their pitch forks over the wall.

    Historically, we are seeing the overthrow of our first truly modern economic dictator. I guess my question should be- this capitalism? Not in any of the books I have read.

    This is so totally the end of a long book- yet nobody is making the case. Damn, I mean John Baldwin published a paper last year stating that the decline of manufacturing in both Canada and to a lesser extent was pretty much just an aberration see his article published late 2009 called Canadian Manufacturing
    Sector: Adapting to Challenges.

    We can’t even get the embedded economists like Baldwin, or those at the clown infested side show over at the Worthwhile blog (Gordon et al) to even admit there is a problem.

    We are at the end of something here- and the majority of the pain is still to come.

    and a good Monday morning to all you PEFers!
    paul

  • should be “is this capitalism”

    cluster me up a new set of investment learning algorithms that you orthogonally and then oblique rotate the leading factor matrix and then feed those into the support vector machine matrices, then send me up a N! machine learning coefficients and run a final N! discriminant on those confusion matrix outcomes adjusting on the 5 key bias variable on the neural nets.

    that is not wealth creation

  • Richard Priestman

    Trade Union Statement to the G20 Summit
    “Employment has fallen off the agenda….”
    Comment:

    About 1.5 million Canadians are unemployed and looking for work. These people are hurting, those who are dependent on them are hurting, and society is hurting because they are not able to contribute financially to society. Minister Flaherty helped to relieve the situation in the early days of the recession through his stimulation program, but that program has stopped and he has said that it will not be continued.

    The government is concerned about increasing the deficit and leaving a bigger debt burden for future generations, but money borrowed by the government at cost from its central bank, the Bank of Canada, would not increase the government’s interest bearing debt. This money, invested in public services such as health care (e.g. hiring more nurses and doctors), education (e.g. hiring more teachers) and public infrastructure (e.g. upgrading roads, bridges, subways, hospitals, schools) would quickly circulate in the community where it would stimulate local businesses, encourage entrepreneurial activity and further increase employment. All interest paid by the government to the Bank of Canada is returned at the end of the year to the government as dividend.

    Other sovereign nations can do the same with their central banks. For example, interest paid by the American government to the Federal Reserve Board is refunded to the government at the end of the year.

  • Here is the post-summit press release from trade unions.

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