The Canada-US FTA at 25
My take, in the Globe Economy Lab today.
Read moreAuthor: Andrew Jackson
Do Corporate Tax Cuts Really Pay For Themselves?
A new paper by Jack Mintz ( with Duanjie Chen) argues that “corporate tax reductions of more than 30% since 2000 have, contrary to the critics’ cries, failed to make an appreciable dent in tax revenues thanks to multinationals habit of shifting profits to Canada to take advantage of lower rates.” This is the subject of a report in ipolitics, […]
Read moreThe End of Men?
The Globe and Mail on Saturday devoted two pages of its Focus section to a discussion of Hanna Rosin’s book, The End of Men. There are a few interesting anecdotes on changing sex roles, but there are no facts cited to substantiate the argument that North America is seeing the rise of a matriarchy as women have displaced men in […]
Read moreThe 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 […]
Read moreHayek and Contemporary Neo Liberalism
In the spirit of “know thy enemy”, IÂ 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 […]
Read moreUnionization 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 […]
Read moreLabour Market Regulation and Labour Market Performance
A release by the Fraser Institute – Measuring Labour Markets in Canada and the United States, 2012 Edition – registers as a spectacular own goal. The Fraser Institute believes – and argues in this study – that strong unions, high minimum wages and high levels of public sector employment undermine labour market performance measured in terms of job growth and […]
Read moreThe 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 […]
Read moreCanada’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 […]
Read moreLabour Law and Jobs: A Tale of Two Provinces
Ontario Conservative Leader Tim Hudak claims that union busting right to work laws would create jobs in hard hit industrial Ontario. I have already noted that there is no evidence that Right to Work states in the US do better than other US states in terms of attracting and retaining manufacturing jobs. A glance closer to home also suggests that […]
Read more“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 […]
Read moreTFSAs: 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 […]
Read moreLabour 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 […]
Read moreUnions 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 […]
Read moreMore 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.)Â 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 […]
Read moreSmall Businesses NOT Big Net Job Creators
Small business – or at least the CFIB – consistently claim to be the big job creators in the economy. This has never been borne out by the available data on net job growth by firm size. And Statscan has now added to our knowledge by releasing a new paper and new CANSIM data today. The paper looks at the […]
Read moreDeflating 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 […]
Read moreMarc Lavoie and Monetary Economics
There is a very interesting interview with PEF’s own Marc Lavoie here on the Naked Capitalism site on his new book. Monetary Economics was co-authored by Marc with the late Wynne Godley. (Make sure to start by linking back to Part 1.)
Read moreGrowth After Financial Capitalism
A thoughtful short essay by Wolfgang Streeck, concluding with a reflection on how extreme inequality gets in the way of a needed de-emphasis on crude economic growth.
Read moreIn 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 -Â everything from rising income […]
Read moreIncomes Flat in “Recovery Year” of 2010
Today’s Statscan release of income data for 2010 allow for a backward glance at the state of the recovery. What is most striking is that – following two years of flat income growth in 2008 and 2009 – there was no meaningful economic recovery for most Canadians in 2010. Median earnings (half earned more, half earned less) were slightly down […]
Read moreCanada, 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 […]
Read moreOECD Agrees We Suffer From Dutch Disease
OECD economist Peter Jarrett – lead on the just released Economic Survey of Canada – agrees with the Mulcair diagnosis.
Read moreThe 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 […]
Read moreRecord Low Interest Rates Mean Governments Can Save By Borrowing More
Today’s record low interest rates on long term Canadian government bonds present a fantastic opportunity to save money by borrowing more. Back last December I wrote a post pointing out that the federal government could and should be much more aggressive in locking in low interest rates by shifting new borrowing to long term bonds and away from T Bills. […]
Read moreYouth 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 […]
Read moreA 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 […]
Read moreDutch 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 […]
Read moreImplications 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 […]
Read moreThe 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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