This month, I strangely find myself of the cover of BC Business magazine, along with four other economists (online version here). All but one academic are policy-oriented economists who comment regularly on the BC economic scene. The tag line for the cover goes like this: The Economists: They were supposed to predict the Great Recession but didn’t. Some even say […]
Read moreThis IMF staff paper – the lead author is the chief economist, Olivier Blanchard -is well worth reading. Makes a rather urgent call for expansion of internal consumption demand in China and currency realignments if we are to work our way out of the crisis. http://www.imf.org/external/pubs/ft/spn/2009/spn0929.pdf
Read moreBoth employment and unemployment edged down between November and December, reflecting a smaller total labour force. This news raises concern that some jobless workers are leaving the labour force altogether. However, the labour-force decrease was only 9,000, far smaller than the previous monthly increase. Overall employment changed so little because private-sector payrolls stabilized. While stability is welcome after the recent […]
Read moreThe more I read about the Parliamentary Budget Officer Kevin Page, the more respect I have for him. He has proven to be an excellent choice for his position, much to the dismay of the Conservative government who created his job in the first place, back in the days when open government was on the agenda. Apparently, Mr. Page has […]
Read moreFurther to my earlier post on the Mintz report on pensions http://www.progressive-economics.ca/2009/12/20/the-mintz-report-and-the-pensions-debate/ Statistics Canada have released the major study on income replacement rates in retirement by Yuri Ostrovsky and Grant Schellenberg which was cited at some length by Mintz. http://cansim2.statcan.gc.ca/cgi-win/cnsmcgi.pgm?Lang=E&AS_Abst=11F0019M2009321&ResultTemplate=/Stu-Etu/Anal_RchAbst The study looks at the incomes of retirees in their early 70s in 2006 in relation to their earnings some […]
Read moreNine days ago, I posted some back-of-envelope math on the proposal to privatize the Liquor Control Board of Ontario (LCBO). Specifically, I noted that keeping its annual profit of $1.4 billion would be worth more than the estimated sale price of $10 billion, which would reduce provincial debt charges by no more than $0.5 billion per year. PublicValues.ca and the […]
Read moreMy commentary on Tuesday morning’s Employment Insurance release mentioned the simultaneous Survey of Employment, Payrolls and Hours (SEPH) release. The SEPH indicated that, from October 2008 through October 2009, average weekly earnings edged up 1.6% across all Canadian payrolls. Earnings fell in forestry, construction, manufacturing, and a few service industries. But no one reported the most striking figure: earnings in […]
Read moreIn October, Canada’s inflation-adjusted Gross Domestic Product (GDP) expanded by 0.16%, which rounds up to 0.2%. While a second consecutive month of growth is unambiguously good news, we should be concerned about the amount and type of growth. Amount of Growth Real GDP (in chained 2002 dollars) dropped from a peak of $1,241 billion in July 2008 to a trough […]
Read moreThere is more evidence in today’s release of EI data that the decline in the number of EI beneficiaries is being driven by exhaustion of benefits rather than by a fall in unemployment. Between September and October, the number of unemployed (seasonally adjusted) rose by 37,700 but the number of regular EI beneficaries (also seasonally adjusted) fell by 4,040. Between […]
Read moreToday’s Employment Insurance (EI) release indicates that 4,000 fewer Canadians received benefits in October. The key unanswered question is whether these workers found jobs or simply ran out of benefits. To make matters more ambiguous, the two main employment measures point in opposite directions. The Survey of Employment, Payrolls and Hours for October, also released this morning, indicates that non-farm […]
Read moreI blogged back in August to express some concern about the implications of Jack Mintz’s appointment as research director for the federal and provincial finance minister’s review of the Canadian pension system. http://www.progressive-economics.ca/2009/08/06/jack-mintz-research-and-pensions/#comment-20646 .  Suffice to say now that the general thrust of his report, tabled this week, http://www.fin.gc.ca/activty/pubs/pension/riar-narr-eng.asp , did not come as a great surprise to me. (The […]
Read morePaul Samuelson was the greatest economic theorist of the 20th century. If we see Leon Walras, with his general equilibrium theory, as the Newton of economics – which I think Samuelson did – then Samuelson was its Einstein. In his Foundations of Economic Analysis in 1947, he laid out the fundamental mathematics that underlay the ideal market economy. For the […]
Read moreWhile The National Post typically supports privatization, today’s lead editorial correctly characterizes Premier McGuinty’s recent musings as “a desperate government trying to unload assets during a down market.†The following paragraphs note the extreme difficulty in getting anything approaching fair value for the sale of huge, complex assets like electric power systems and the folly of trying to balance the […]
Read moreEarlier this year, the Ontario government introduced a bill to give legal force to recent Agreement on Internal Trade amendments. The usual suspects – the union movement, the Council of Canadians, etc. – requested public hearings. After months of stonewalling, the government announced on December 1 that there would be one day of hearings on December 3. This process was […]
Read moreAs reported on the front page of yesterday’s Globe and Mail, the McGuinty government’s “deficit reduction” strategy involves not only cutting taxes, but also divesting revenue-generating assets. Today’s Globe comment page features three sassy letters on the contemplated privatization. But the editorial strikes a seemingly pragmatic tone, arguing that the Ontario government should sell “if the price is right.†However, […]
Read moreThe national inflation rate jumped to 1.0% in November from 0.1% in October. As Statistics Canada notes, this apparently large increase is “due primarily to gasoline prices.” Specifically, last month’s gasoline prices are being compared to the depressed gasoline prices of November 2008. Given the changed base of comparison, it is not surprising that the headline inflation rate has returned […]
Read moreA TD-Pembina-Suzuki study released seven weeks ago projected that cutting Canada’s carbon emissions by 20% below 2006 levels, or even 25% below 1990 levels, would only modestly reduce overall Canadian GDP. Last week, Jack Mintz critiqued this study for positing a fixed amount of capital investment in Canada. Under this highly dubious assumption, climate policy only shifts capital around between […]
Read morePublic debate in Ontario tends to frame sales-tax harmonization either as an unjustified “tax grab” or as a needed contribution to the deteriorating provincial budget.  Both views incorrectly assume that the HST will increase government revenues. In fact, the original proposal was more or less revenue neutral. Removing sales tax from business inputs and cutting personal income taxes would have offset […]
Read moreAs the communique from the Pittsburgh G20 put it, “it worked.” Unprecedented macro-economic stimulus in the form of ultra low interest rates and large government deficits pulled the global economy back from the abyss. Canada has now joined most countries in exiting the recession, at least very tentatively. But what is next? The official line from the Canadian government, the […]
Read moreThe Twelve Days of Christmas 2009 by British Poet Laureate Carol Ann Duffy (Published in Radio Times) http://www.radiotimes.com/content/features/carol-ann-duffy-the-twelve-days-of-christmas/ ON THE FIRST DAY OF CHRISTMAS, a buzzard on a branch. In Afghanistan, no partridge, pear tree; but my true love sent to me a card from home. I sat alone, crouched in yellow dust, and traced the grins of my kids […]
Read moreThe following is an extract from the CLC publication “Recession Watch” available at http://www.canadianlabour.ca/sites/default/files/Recession-Watch-03-Fall-2009-EN.html Before the recession, more than one in four (27.9%) of claimants exhausted their benefits (29.9% of women and 26.5% of men) and more than one in three (34.3%) older workers exhausted their benefits. Currently, claimants are eligible for between 19 weeks and 50 weeks of benefits […]
Read moreThe Globe seems rather agitated about the plight of male university students . On top of a front page story by Elizabeth Church yesterday pointing out the now rather well known fact that female undergraduate enrollment now outstrips male enrollment by a margin of 58% to 42%, they editorialize today as follows: “Indira Samarasekera, the president of the University of […]
Read moreNovember’s 79,000 increase in employment combines a 32,000 decrease in self-employment with 111,000 additional positions paid by employers. This job creation is significant and welcome. But there is still no indication of a sustained labour-market recovery. Today’s numbers may just continue the recent seesaw pattern in which employment is up one month and down the next. Because Canada’s labour force […]
Read moreLast Saturday the Globe and Mail (November 28, page B1) ran a multi-page spread on national government debt. It was a mish mash of large titles, large numbers and sensational assertions: “A World Awash in Debt”; “Climbing out of this hole won’t be easy”; “the numbers are staggering”, “debt would climb to about 300 percent of GDP… tweak that and […]
Read moreI’m posting this CSLS media release since the two studies look well worth reading. They can be found at http://www.csls.ca/ CSLS Releases New Estimates of Index of Economic Well-being for Canada and OECD Countries Ottawa, December 3, 2009 – On September 14, 2009 French President Nicolas Sarkozy released the report of the Commission on the Measurement of Economic Performance and […]
Read moreA couple years ago I put out a report for the CCPA that crunched the numbers on health care sustainability. The main finding was that public health care was basically sustainable in that it could handle projected increases in population, aging and inflation as long as GDP continued to grow at a reasonable rate (consistent with what we have seen […]
Read more(The following post is a slightly edited version of the CLC Submission to the House of Commons Human Resources Committee.) Bill C-56 extending EI special benefits to the self-employed looks likely to pass very soon with all party support. It is an important step forward in term sof extending needed benefits to a growing category of workers, but some important […]
Read moreI was surprised to see the IMF highlighting the potential virtues of a Financial Transactions Tax (FTT) on the front page of its website. The Bloomberg news service earlier had a good story about on the background of this idea, tracing it back to Keynes.  This is a proposal that progressive economists and unions have advocated for many years, so it is […]
Read moreThe Economic Policy Institute in the US have released a five point American Jobs Plan which, hopefully, will be a major focus of discussion at the soon to be convened Presidential Jobs Summit. http://www.epi.org/index.php/american_jobs/american_jobs_plan Speaking to a joint CLC/CCPA meeting a couple of weeks ago, EPI President Larry Mishel – who has been invited to the Summit – said that […]
Read moreAt the BC NDP convention over the weekend, Opposition Leader Carole James reiterated calls for a $10 an hour minimum wage. While $10 an hour would certainly be better than BC’s current $8 an hour (lowest in the country), I’m concerned that this campaign is stuck on a round number not what is adequate for improving the livelihoods of the […]
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