I note that 4 of the 9 economists on the CD Howe’s rather grandiosly titled Monetary Policy Council are supporting a rate cut by the real folks at the Bank of Canada next week, and two of them (including Ed Carmichael from JP Morgan Chase) even call for a half point cut.  http://www.cdhowe.org/display.cfm?page=monetaryReleases The bare majority calling for an unchanged […]
Read moreJohn Myles (University of Toronto) points out that his research on the decline of poverty among lone mothers, cited by Richards, shows that “soft love†(day care in Quebec) probably has the biggest “social policy effect.†He notes that “tough love†does “workâ€Â in the following sense. Cut other cash benefits to the bone and employment levels among lone mothers […]
Read moreStatistics Canada released an interesting but utterly misleading technical paper last week on Canada’s supposed “Reversal of Fortune.” They examined Canada-U.S. comparisons in national income (a concept that is subtly but importantly different from GDP, as I’ll explain in a minute), and decided that Canada has become the star economic performer of the continent. Since 2002, our real national per […]
Read moreI was a friend of John Richards many years back, in the late 70s, when we shared a common passion for prairie left populism. He’s a bright guy, and a great writer. What bugs me is that he is still treated as a progressive by the media – based on his very brief history as an NDP Saskatchewan MLA in […]
Read moreWake up to the dangers of a deepening crisis By Lawrence Summers Published: November 25 2007 18:51 | Last updated: November 25 2007 18:51 (From Financial Times) http://www.ft.com/cms/s/0/b56079a8-9b71-11dc-8aad-0000779fd2ac.html?nclick_check=1 Three months ago it was reasonable to expect that the subprime credit crisis would be a financially significant event but not one that would threaten the overall pattern of economic growth. This […]
Read moreToday, Premiers McGuinty and Charest kicked off “free trade” negotiations between their provinces. The key question is whether this process will be a sweeping “race to the bottom” like the BC-Alberta Trade, Investment and Labour Mobility Agreement (TILMA) or a focused effort to develop common standards in the few areas where problems may exist. As usual, the rhetoric about “inter-provincial […]
Read moreThere’s quite an interesting piece on pension coverage in today’s Daily from StatCan. http://www.statcan.ca/english/freepub/75-001-XIE/2007111/articles/10405high-en.htm The study suggests that some of the statistical series showing sharply declining pension coverage are rather suspect, and they provide a series from tax data showing the proportion of taxfilers with a positive pension adjustment. This is a larger number than contributors to registered pension plans, […]
Read moreGiven the rapid expansion of the temporary foreign worker program and the frequent complaints of employers that workers are hard to find, one might expect that Government of Canada research would support the view that there are, and will continue to be, pervasive skill shortages. Yet this is not the case. The most recent ten year outlook for the Canadian […]
Read moreAlthough my knowledge of Australia’s politics is limited, they always interest me. Not only is the country similar to Canada in many ways, but it also had among the most successful labour movements and Labor Parties in the English-speaking world. (The party changed its name from “Labour” to “Labor” in 1912, when it seemed that Australia would adopt American spelling.) […]
Read moreToday’s edition of The Economist magazine includes a good article on temporary foreign workers in Canada. It extensively quotes Gil McGowan, president of the Alberta Federation of Labour. The present regime allows employers to import workers from abroad without seriously demonstrating the unavailability of Canadian workers for the job. Once the foreign workers are in Canada, it is easy for […]
Read moreThe Commons Finance Committee, spurred by my old debating opponent John McCallum, is holding hearings in the next two weeks on the economic and fiscal consequences of the loonie’s unsustainable flight. (I kind of miss crossing swords with John, actually: In the good old days he was the evil but friendly Bay Street banker, justifying federal spending cuts — and […]
Read moreNouriel Roubini – professor at NYU and noted blogger on the global economy – tends to the gloomy but is now seriously worried about where we are headed. With the Economist now out with a front page story on the likelihood of a serious US recession, his views seem to be entering the mainstream. http://www.rgemonitor.com/blog/roubini With the Recession […]
Read moreDuring the sixteen years that the NDP governed Saskatchewan, provincial expenditures fell from just over 30% to just over 20% of Gross Domestic Product (GDP). This accomplishment is dubious for a political party committed to using government as a vehicle to redistribute wealth and finance important public programs. Why did the proportion of Saskatchewan’s economy available for these purposes decline […]
Read moreToday’s Consumer Price Index (CPI) release reveals that inflation has dipped to 2.4% and core inflation has fallen to 1.8%, its lowest level since June 2006. These figures undermine the argument that interest rates should be maintained to slow inflation. As the National Post reports, “A weaker-than-expected rise in the inflation rate for October could give the Bank of Canada […]
Read moreDiane Francis has written many unsubstantiated columns. On July 6, for example, she claimed that “Canada has the highest corporate taxes in the world.” However, based on the following quotes, Tuesday’s column probably takes the cake. If last week’s election upset is any indication, Saskatchewan is going to be on a roll for a few years. I have no idea […]
Read moreTuesday’s Financial Post featured an op-ed by William Robson, President and CEO of the C. D. Howe Institute, arguing that “The expansion of the public sector in an economy with no slack is squeezing the private sector, driving up interest rates and the dollar in the short run, and threatening Canadian prosperity in the long run.” Today’s Financial Post includes […]
Read moreHere’s a really useful commentary from the Caledon Institute on the substance of the Liberal poverty reduction plan, especially emphasising its timidity in terms of reversing the ill thought- out Conservative changes to child benefits. They share my view that we need a better poverty target.  http://www.caledoninst.org/Publications/PDF/659ENG%2Epdf
Read moreI’m a big fan of setting clear and attainable targets and timetables to eliminate poverty, and applaud last week’s Liberal Party commitment to reduce the number of those living in poverty by 30% and the numbers of children living in poverty by 50% within 5 years. http://www.liberal.ca/story_13293_e.aspx Clear targets and timetables have recently been called for by the National Council […]
Read moreThe relative importance of oil in Canada’s exports bears on the debate about oil prices and the exchange rate. A challenge is that the most widely-cited figures often lump oil and natural gas together. I compiled the following table from the merchandise-trade figures that Statistics Canada updated through September today: Canada’s Energy Trade, 2007 year-to-date ($ millions)  Exports % […]
Read moreThe unprecedented surge in the Canadian dollar from 85 cents US in early 2007 to as high as $1.10 in early November is deeply disturbing in terms of its implications for the health of the economy and the job market. Very rapid exchange rate appreciation is bad news for most enterprises exporting abroad, or competing with US and Asian exporters […]
Read moreThe Saskatchewan Party won 37 seats with 51% of the popular vote and the NDP won 21 seats with 37% of the vote. Obviously, the Saskatchewan Party’s victory is bad news for progressives. The provincewide figures mask significant regional variations. Outside of the main cities, the Saskatchewan Party won 27 seats with 62% of the rural vote. Two of the […]
Read moreSome of the knee-jerk commentary in response to my paper has been about what an ideal, or fair, tax system should really look like. These people question progressive taxation. To them, I quote Adam Smith from The Wealth of Nations (from Wikipedia): The necessaries of life occasion the great expense of the poor. They find it difficult to get food, […]
Read moreThe CCPA today released my paper, Eroding Tax Fairness: Tax Incidence in Canada, 1990-2005. The Toronto Star ran a front-page story on it that is quite good. This paper was a long time in the making – while it might seem fairly straightforward to calculate the share of taxes in income for different groups, there are many tricky data and […]
Read moreIn yesterday’s Ontario Farmer, the federal Minister of Agriculture, Gerry Ritz, railed against “tremendous inter-provincial trade barriers.” His example was restrictions on moving beef between provinces. My understanding is that, to the extent such restrictions exist, they arise from federal regulations rather than from provincial policy. Ritz claimed, “I have no problems with Quebec beef coming into Ontario as long […]
Read moreIn an op-ed printed today, John Mortimer of LabourWatch applauds an Ontario court’s decision not to enforce the Public Service Alliance of Canada’s fines against members who crossed picket lines. One wonders how his inane rhetoric about “human rights” slipped past the Financial Post’s editors. To an economist, this issue is a classic “free rider problem.” Collectively, the workers benefit […]
Read moreHeather Scoffield had an interesting little “how-to” guide in Saturday’s Globe and Mail on the macroeconomic effects of the improvement in Canada’s terms of trade (the result of soaring global prices for the resources which Canada increasingly exports). The terms of trade, for the blissfully uninitiated, is the ratio of a country’s export prices to its import prices. You can […]
Read moreThe whole idea of the free-market is that the relentless pursuit of self-interest leads people to do greedy things that ultimately benefit all of us. That’s what makes it so humorous to see that appeals to voluntarism have become one of Finance Minister Jim Flaherty’s major policy tools. At least there was a bit of poetic justice in his phony, […]
Read moreIntroduction The Canadian Labour Congress, the Ontario Federation of Labour, the Quebec Federation of Labour (FTQ) and the United Steelworkers recently commissioned a major, technical report on the manufacturing sector from the economic consulting firm Informetrica. (The study “Economic Effects of Structural Changes in Manufacturing: A Retrospective View†is available from http://www.informetrica.com/IL_ManReport1_Final.pdf). The study confirms a great deal of what […]
Read moreLike other disciplines, economics tends to organize material into narratives. It is worth scrutinizing the “stylized facts” that underlie these narratives, as page B15 of Saturday’s Globe endeavoured to do. One piece of conventional wisdom is that the Canadian dollar’s value is driven by the skyrocketing price of oil. David Wolf argued, and Heather Scoffield reported, that the loonie is probably […]
Read moreWhile reading a recent issue of l’Aut’ Journal, I came accross a story claiming that the Montréal municipal police offers privately some of its services (e.g. bodyguards). Well, a rapid visit on the website of the municipal police verified that claim. In fact, there is a whole brochure on the site which details all the services that can be privately […]
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