No politician is talking about it, but there is a growing debate about corporate tax cuts, and it’s not about whether they should go up or down 1.5 percentage points. It’s about getting rid of them. Zero corporate income taxes. It is fast becoming the legendary goal for tax reform in some opinion-makers’ minds, and they are saying that economic […]
Read moreYesterday’s Jeffrey Simpson column was entitled, “Walking the Line on Corporate Tax Cuts.†Incredibly, he walks the narrow 1.5% line between the Liberal and NDP proposals. To his credit, Simpson takes an open-minded look at the evidence, which indicates “no discernible links†from corporate taxes to employment or investment. On this basis, he accepts the Liberal proposal to raise revenue […]
Read moreThere’s a disturbing trend buried in this morning’s report by Statscan on Canada’s foreign direct investment (FDI) abroad. Not only is an increasing share of Canadian direct investment abroad going through finance and insurance industries, but a growing share is also being funnelled into tax havens. The finance and insurance now accounts for over 52% of all Canadian direct investment abroad, a total of […]
Read moreHere is a link to the CCPA study we released yesterday, analyzing the determinants of business fixed non-residential capital investment spending in Canada on the basis of quarterly data from 1961 through 2010. It formally tests for the direct significance of corporate tax variables and finds no such evidence (in either univariate or multivariate analysis). There is still an indirect impact […]
Read moreA thousand economists, including a fair number of PEF members, have signed the following letter in support of a financial transactions tax. The Guardian has published a story about the letter and posted the list of economists. UPDATE (April 15): This PDF version of the economists’ list is slightly updated and much easier to navigate. Dear G20 Finance Ministers and […]
Read moreBook Review of Humanizing the Economy: Cooperatives in the Age of Capital, by John Restakis, New Society Publishers, 2010. The economy is about business, right? Sure, we have a dynamic mixed economy, and most people support decent social programs and government intervention to protect the environment or to improve living conditions for the poorest. In fact, the countries who have […]
Read moreI have an opinion piece in today’s Toronto Star regarding the recent controversy surrounding the Toronto Community Housing Corporation (TCHC). In the way of background: -TCHC is Canada’s largest provider of social housing, and Toronto’s largest landlord. -There have been two recent reports by the City of Toronto’s auditor–one looks at staff expenses at TCHC, and another looks at TCHC’s […]
Read moreA new progressive, grassroots tax fairness advocacy organization has just been established in Canada–and its first initiative is a petition and campaign to stop additional corporate tax cuts.  The text is below.  If you are in agreement, please sign on and pass this on to your contacts. We, the undersigned, oppose additional corporate tax cuts which will give billions of dollars […]
Read moreIt is now well-known that income inequality is hazardous to human health and a host of other social outcomes, as demonstrated by Richard Wilkinson and Kate Pickett’s book  The Spirit Level and Equality Trust organization (some great resources and slides there, too). Now a new study by the International Monetary Fund has found that higher rates of income inequality are strongly associated with shorter periods […]
Read moreThe first leg of the federal election campaign has featured much debate over who benefits from different proposals. At least indirectly, it has been a conversation about income inequality. What have they been saying? The Harper Conservatives have introduced a number of high-cost measures all of which are based on tax cuts, all of which would widen the rich/poor gap. […]
Read moreA quick and easy way to get a very bad bad headache is to attempt to compare and contrast the fiscal plans attached to the major party platforms. But they throw some light on the real priorities of the parties, and the real choices in play in the election. One thing the Conservatives, Liberals and New Democrats apparently have in […]
Read moreDespite all the arguments outlined on this blog, and the federal election debates, the race to the bottom in corporate taxation seems to be alive and well in the G-7. The latest move comes from the UK, whose March budget announced a new 2 percentage point reduction in their corporate tax rate. Meanwhile, Canadian provinces have their own corporate tax […]
Read moreJack Layton unveiled the NDP’s policy platform today. Among other things, it promises to eliminate the deficit (i.e. balance the federal budget) within four years. I’m not sure it should. Several years back, I had the opportunity to take a directed reading course from John Smithin. In addition to being a long-time member of the Progressive Economics Forum, John is […]
Read moreThe Progressive Economics Forum has the following line-up of sessions for this year’s Canadian Economics Association conference on June 3-5 at the University of Ottawa. Thanks very much to Nick Falvo for coordinating our conference activities and putting this schedule together. We are also hosting a summer school the day before and announcing our essay contest winners at the conference. […]
Read morePerhaps the most compelling villain on Star Trek: The Next Generation was the Borg, which seeks to assimilate other groups into its hive. The Macdonald-Laurier Institute seems to be performing this function for Canada’s conservative pundits (although corporate-tax cutters also resemble the Ferengi). Yesterday’s Globe featured an op-ed by Brian Lee Crowley, former President of the Atlantic Institute for Market […]
Read moreThe Ontario Nurses’ Association has released a research paper by PEF-member Salimah Valiani on health and healthcare in rural and northern Ontario. It analyzes socio-economic and environmental forces that contribute to lower health outcomes, labour-process data drawn from focus groups with front-line nurses, and how to alleviate the nursing shortage.
Read moreThe Progressive Economics Forum is organizing a summer school on economic theory and policy in our nation’s capital on June 2. For more information, please see the following poster or contact David Pringle: dpringle [at] ncf.ca Please download the poster and put it up at your local university campus. Â
Read moreHere is the CLC commentary and analysis.
Read moreA shorter version of this analysis was published today in the Globe and Mail’s online business feature Economy Lab. Stephen Harper has unveiled yet another plank in a platform that seems remarkably out of touch with the concerns of an electorate walking on post-recession eggshells. His latest proposal would double the contribution limit to the Tax Free Savings Account (TSFA) […]
Read moreHere are the most important facts about the Tax Free Savings Account. Will blog further on this tomorrow. Introduction of the Tax Free Savings Account: January 1, 2009, right at the height of the economic meltdown What’s new: Stephen Harper promises to double the contribution limits to the Tax Free Savings Account, from $5,000 a year to $10,000. REALITY CHECK […]
Read moreToday, by way of background to tomorrow’s labour force release, , the Canadian Labour Congress released the fifth issue of our Recession Watch bulletin (prepared by my colleague Sylvain Schetagne.) It highlights just how much slack there still was in the job market in February, 2010 compared to before the recession. Despite the rise in jobs since the bottom was […]
Read moreKen Battle of the Caledon Institute has written a very useful report, “Restoring Minimum Wages in Canada.” It contains a wealth of data on minimum wage trends by province since 1965 and their changing relationship to average wages and to the low income line. Battle shows that, in almost all provinces and territories, with the notable exception of BC, minimum […]
Read moreIn response to some recent PEF commentary (now in the mainstream media thanks to today’s Globe article) on corporations in Canada hoarding cash (after-tax profits greater than new investment), PEF member Eric Pineault weighs in with some more detailed analysis: The great corporate cash stash Eric Pineault As we debate the merits and uses of a corporate tax cut, corporations […]
Read moreWe already have several posts about today’s front-page Globe and Mail story, but that won’t stop me from piling on. Andrew and Marc have noted that today’s story makes points familiar to this blog’s readers. Indeed, posts questioning the alleged relationship between corporate tax cuts and business investment are almost too numerous to list. Jim, Armine, and I have all […]
Read moreFirst of all, today’s top Globe story on corporate income tax cuts not leading to increased investment is a nice example of “you heard it here first”, so a big pat on the back to Relentlessly Progressive Economics. As we like to say: tomorrow’s conventional wisdom, today. I want to take issue with Stephen Gordon’s response, an effort to torture […]
Read moreCorporate tax cuts have become a defining feature of the election campaign thus far. The Globe and Mail covered the topic today with an article entitled “Corporate tax cuts don’t spur growth“. Stephen Gordon fired off a critique of the piece in his latest blog at the Globe and Mail’s Economy Lab, to which I am also a regular contributor. […]
Read moreToday the CCPA released a study that I authored which examines and debunks one of the biggest contentions of this campaign, that corporate tax cuts create jobs. The payoff of corporate tax cuts has come under increasing scrutiny from various angles, although I focus specifically on job creation. To examine this contention, I took Canada’s biggest public companies, those on […]
Read moreIt is notable that the Globe has run a major story today – on p.1, above the fold in the print edition – drawing attention to the fact that recent corporate tax rate cuts have not produced an increase in real business investment. Reference is made to the views of labour economists. The Globe story will not be “news” to […]
Read moreCanada’s economic context at the time of Election 2011 is one of “precarious recovery”, and overall demand conditions are weakened by a few major factors. Unemployment is still just under 8%, which is good compared to the double-digit unemployment of the early 1990s, but not great compared to the expansions of the late 1990s and 2000s. Too much of the […]
Read moreI do not think anyone can disagree with the conclusion of Murray Fulton and Ken Rasmussen that Saskatchewan should “proceed with a thoughtful and deliberate process that ensures that the province is the long-term beneficiary of this asset.†The provincial opposition is advocating a royalty review process to achieve that goal. The government and potash companies claim that the appropriate […]
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