This blog’s readers will not be surprised at me questioning Neil Reynolds (although my last post on him was somewhat complimentary.) However, his latest Globe and Mail column was organized around an especially odd claim: The average Canadian household, for example, spends $14,800 (Canadian) a year on personal income taxes, the most expensive purchase – 20 per cent of income […]
Read morehttp://www.ilo.org/public/english/bureau/inst/download/promoting.pdf This is quite an interesting and very timely paper from the ILO International Institute for Labour Studies, squarely directed to next week’s meeting of G20 labour ministers. As pressures to cut budget deficits intensify, it argues that job-centered spending measures can in fact reinforce fiscal sustainability while boosting employment. Austerity measures which raise unemployment today can lead to the […]
Read moreThere was some media coverage in the FT and the Guardian on a recent conference on this theme at King’s College, Cambridge, showcasing a new economic institute. A number of videos of presentations can be found here http://ineteconomics.org/ This venture is funded by Soros and includes many well-known progressive economists such as Stiglitz, Akerloff etc. I gather one point of […]
Read moreI have just returned from Calgary and the pension forum organized by Jack Mintz through the University of Calgary. Mintz was, of course, the author of a recent research report to the federal and provincial finance ministers which concluded that the status quo was basically working well, except for a modest proportion of middle income earners who may not be […]
Read moreMy post on the night after Ontario’s budget hit the key features. However, the budget had a couple of other interesting aspects from a federal-provincial perspective. Childcare Funding Some progressive voices trumpeted the provincial budget’s allocation of $63.5 million annually to replace discontinued federal funding for childcare spaces. While the Ontario government finally made the right decision on this file, […]
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Read moreA recent visit by some Regina friends reminded me how affordable public automobile insurance is. They insure two cars, one of which is newer than my car, for about the same rate as my one vehicle in Toronto. My first car, which I registered with Saskatchewan Government Insurance (SGI), cost about $500 per year. My sense is that an under-25 male would have […]
Read moreThis morning, Statistics Canada provided another piece of evidence that the job market is not recovering nearly as rapidly as Gross Domestic Product. In March, total employment rose by 17,900, but full-time employment was actually down by 14,200. This divergence reflected 32,200 more part-time positions. The modest increase in total employment kept pace with Canada’s growing labour force, but barely […]
Read moreGrowing up in Saskatchewan, the oil and gas industry’s line was always that we had to charge lower royalties to compete with Alberta for investment. The provincial NDP government bought into that mantra and repeatedly slashed royalty rates, even as commodity prices took off during the past decade. When Alberta’s Conservative government announced in late 2007 that it would raise […]
Read moreIn 2009, in the midst of the financial and economic crises, Robert Skidelsky, the acclaimed three volume biographer of Keynes, added a fourth, Keynes: The Return of the Master. It is a radical and provocative assessment of economic theory since Keynes, insisting that at its core Keynes’ s Keynesianism was about uncertainty, about the irreducible uncertainty that cannot be cast […]
Read moreSerge Coulombe, an economics professor at the University of Ottawa, has a great op-ed in today’s Financial Post: The Fraser report looks at the change in the contribution of government expenditures to the GDP growth between the second and the third quarters, and the third and the fourth quarters, of 2009. This approach is problematic since it focuses on the […]
Read moreWhen conflict erupts between Conservative politicians and the Fraser Institute, I am inclined to react as Henry Kissinger did to the Iran-Iraq War: “It’s too bad they can’t both lose.†But in the recent spat over stimulus, it was easy to choose sides. However grudging the Harper government’s decision and however inadequate its execution, it did the right thing by […]
Read moreThe comments on my post about Ignatieff and corporate tax cuts have turned into a debate about Quebec’s recent budget. In particular, Stephen Gordon has thrown down the gauntlet: The Quebec budget includes measures to increase incomes of low-income households. Why would self-described progressives dismiss that? . . . Just what is the goal of the PEF? Because I’m having […]
Read moreMichael Ignatieff sent an April Fool’s Day letter to the Canadian Chamber of Commerce. It marshalled compelling evidence against more corporate tax cuts, but insisted that the Liberals still favour more corporate tax cuts: In a study that KPMG describes as “the most thorough comparison of international business locations ever undertaken by KPMG,†it was demonstrated that Canada is already […]
Read moreHere former IMF Chief Economist Simon Johnson urges Greece to default rather than impose a swingeing austerity program. http://www.project-syndicate.org/commentary/johnson6/English
Read moreI 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 read the following in their […]
Read moreYesterday, I appeared on CBC’s Lang & O’Leary Exchange regarding corporate taxes in response to Ignatieff’s announcement and KPMG’s 2010 Competitive Alternatives report. (To watch the video, search for “langâ€, click “Most recentâ€, select March 31, and go 13 minutes in.) My co-panellist, John Risley, seemed more interested in talking about the “dinosauric†nature of unions and the need to […]
Read moreThe Fraser Institute is winning 6-0, at least in terms of The National Post’s coverage of its flawed study on stimulus. On March 24, The National Post reported this study on its front page while its business section, The Financial Post, ran an op-ed by the study’s authors. A couple of days later, The National Post published a column by […]
Read moreEarlier this month the Economist ran a leader (editorial) and longer article asking and then largely answering who should for the costs of the economic crisis (public services and workers of course!). That’s when I wrote the piece that leads the March 2010 issue of the Economic Climate for Bargaining publication that I produce quarterly. (I was in a bit of […]
Read moreGDP Halfway Home Canada’s Gross Domestic Product (GDP) blew past an important milestone in January. Output is now closer to the high-point attained before the crisis than to the low-point reached during the crisis. Specifically, GDP (in chained 2002 dollars) peaked at $1,241 billion in July 2008 and plummeted to $1,185 billion in May 2009. By January 2010, it recovered […]
Read moreThe Steelworkers are carrying on their historic and very brave battle with Vale-Inco up in Sudbury. Last week’s huge solidarity rally was a sign that the rest of the labour movement is finally waking up to the threat that this battle poses to all of us. Imagine a profitable global company like Vale, buying up a precious Canadian resource at […]
Read moreLast night, I went to sleep early before watching any coverage of the Liberal Policy Conference. This morning, a well-rested Erin Weir marched into the office with such purpose that I did not even look below the fold on The Globe and Mail’s front page. Imagine my pleasant surprise when I got an e-mail about Michael Ignatieff proposing to cancel […]
Read moreBelatedly, two days after the fact, the Globe picked up on Bank of Canada governor Carney’s discussion of the Bank’s model of the world economy (I blogged about that speech here) at a speech to the Ottawa Economics Association (OEA) last Wednesday. The Globe spun the story in an unusual way by suggesting that the Bank and its analysis (using […]
Read moreHere is some of what Terry Corcoran wrote in today’s Financial Post about Bank of Canada Governor Mark “Carney’s suggestion that Canadian business has so far ‘disappointed’ because it has failed to revive Canada’s lagging productivityâ€: Central bankers appear to know many things, and have big fancy computer systems and economic models to tell them what’s happening in an economy […]
Read moreToday’s provincial budget continues previously announced stimulus in the short term and projects severe, but largely unspecified, spending restraint in the long term. The most surprising new measure, a lower electricity rate for northern Ontario industry, is of little fiscal significance (costing just 0.1% of the budget). A less surprising measure of potentially greater fiscal significance is the attempt to […]
Read moreWhen the global recession hit in late 2008, economic output and employment fell so steeply in such a short period of time that policy-makers were seriously concerned about the possibility of the downturn growing into a global depression. The sense of urgency led to unprecedented levels of multilateral economic coordination, with stimulus spending rolled out worldwide and significant deficits incurred […]
Read moreThe Ottawa Economics Association (OEA) held a conference today and yesterday evening. The usual suspects were in attendance saying the usual things: Mark Carney spoke about the need for China to understand the risks of the “paradox of thrift” (see my post from earlier today) that will be unleashed by fiscal consolidation. Don Drummond sang from the productivity choir book […]
Read moreIglika makes several cogent, high-level criticisms of the Fraser Institute’s “analysis” of how much government stimulus has contributed to Canada’s economic recovery. However, I think that it is guilty of a far more basic flaw. To determine how much government purchases and investment contributed to economic growth, one would compare the increase in government purchases and investment with the increase […]
Read moreThe media and pundits parsed Mark Carney’s speech today to the Ottawa Economics Association (OEA) every which way to Sunday today and concluded that Carney had effectively signaled the Bank’s intention to raise its target for the overnight interest rate sooner rather than later. But in all the hand wringing about the inevitability of rate hikes (do people ignore Japan […]
Read moreYesterday, the Fraser Institute published a new report, which argues that the government stimulus did not drive Canadian economic growth in the last two quarters of 2009 and suggests that government spending on infrastructure was useless for the economy. The report earned the scorn of Finance Minister Flaherty, who was quoted in the Vancouver Sun calling the report “poorly done […]
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