A lot of people I meet these days ask about the risk of a future surge in inflation, or even a return to “hyperinflation,” as a result of government’s efforts around the world to stimulate spending and demand — in part through large deficits, and in part through very loose and unorthodox monetary policy (including, in some jurisdictions, “quantitative easing”). […]
Read moreOn the first of this month, I appeared before the Senate’s Standing Committee on National Finance regarding the Employment Insurance (EI) provisions of the 2009 Budget Implementation Act. The Senate recently posted the transcript online. A fellow panellist was Michel Bédard, former Chief Actuary of the EI Fund. Last year, he and I appeared in the same panel before the […]
Read moreMedia coverage of the Bank of Canada’s much anticipated Monetary Policy Report inevitably focuses on the prospect of “unconventional” measures, such as quantitative and credit easing. But the verbs in today’s headlines – “may use” , “ready to” , “lays out” , “sets stage” – reflect how little was actually announced. The Bank provided three pages explaining quantitative and credit […]
Read moreBack in the 2005 BC election, a proportional representation system, known as Single Transferable Vote, or STV, was put to the people. It was recommended as an alternative to the current First-Past-the-Post system that has delivered some unusual and uneven results in BC and other parts of Canada over the years. STV captured a majority of votes – a larger […]
Read moreFor several months, it has been clear that there is no near-term threat of inflation and that the economy needs all the stimulus it can get. In this context, the Bank of Canada should cut interest rates as far as possible. Since January, I have been calling for a target interest rate of zero percent. We should applaud this morning’s […]
Read moreBelow is an oped of mine that was done at the request of the Vancouver Sun and that ran in today’s paper. Unfortunately, for reasons that are not entirely clear, the last two paragraphs were cut off, leaving the oped hanging. I put them back in below, and have requested that the online version be changed. UPDATE: The online version […]
Read moreWe may all be Keynesians now in terms of the public discourse,  but governments are mainly posturing rather than delivering. That strikes me as a fair summary of a technical and rather dismal discussion of fiscal stimulus packages by the OECD (Chapter 3 of the Interim Economic Outlook relased just before the London G20 Summit.) http://www.oecd.org/document/59/0,3343,en_2649_33733_42234619_1_1_1_1,00.html The OECD calculate that […]
Read moreThe Consumer Price Index decline in March confirms that deflation remains a greater risk than rising inflation. The annual inflation rate fell to 1.2% nationally and turned negative in one province, Prince Edward Island. The recent revelation of the first annual decline in American consumer prices in half a century underscores concerns about deflation. While falling prices benefit consumers with […]
Read moreOne of the most striking contradictions in BC’s climate action plan is the oil and gas industry. Greg Amos in The Hook, quotes our “green” premier out on the campaign trail in the northeast: “Let me tell you what’s happened in the energy industry in British Columbia in the last eight years: thirteen billion dollars of investment,†Campbell told a […]
Read moreWith the BC election campaign now officially on, the carbon tax debate is back. Since the fall’s federal election, when the Prime Minister dropped in to beat up the carbon tax to solidify his support in BC, the carbon tax has dropped off the public radar, replaced by stories about the economic and financial crisis. Gas prices have also dropped […]
Read moreA year and a half ago I published an updated study on tax incidence in Canada. It found that the Canadian tax system is progressive up to the middle of the income distribution, then flattens out before becoming regressive at the very top. (Interestingly, a short piece on the US tax system by Citizens for Tax Justice just came out […]
Read moreStatistics Canada provides an “R8” unemployment rate which adds to the unemployed: – discouraged job searchers who have dropped out of the labour force – those working part -time due to unavailability of hours – those not looking for work because awaiting a return to work By this measure, the unemployment rate jumped from 11.7% to 12.4% last month — […]
Read moreJust in time for a heated election campaign, the latest unemployment numbers paint a grim picture for BC. Just a year ago, BC was coasting along with an unemployment rate of just over 4%. By the end of 2008 that had crept up to 5%. And now a truly brutal first quarter that saw the rate leap to 7.4% in […]
Read moreHere’s the quick analysis from my colleague Sylvain Schetagne. “61,300 jobs were lost in Canada in March. In fact, 79,500 full-time jobs were lost but some part-time jobs were added last month. The number of full-time jobs lost since October 2008: 386,500. Canadian workers who have lost their jobs since October 2008: 356,500. The unemployment rate has risen to 8.0% […]
Read moreHere is my take on today’s Labour Force Survey: National Unemployment Much attention will undoubtedly focus on the unemployment rate hitting 8% in March, which Statistics Canada notes is “the highest rate in seven years.” While technically correct, this presentation understates the situation’s severity. The unemployment rate briefly reached 8% seven years ago, in December 2001 and January 2002. However, […]
Read morePosted below is my Globe and Mail column this week raising questions about whether troubled companies can really “cut their way to viability.” When companies face trouble, the knee-jerk response is always to cut back: close plants, reduce headcount, cut compensation. Reflecting their shorter-term time horizon (and their consequent hunger for a faster payback), financial markets favour the most determined […]
Read moreI have enjoyed being one of the three economists appearing on the occasional “Bottom Line” panel which CBC TV has been running on its National News. My fellow panelists (Patricia Croft from RBC Securities and Mark Mullins of the Fraser Institute) are personable, informed, and for the most part non-dogmatic about things. (I know it will surprise many PEF readers […]
Read moreI was out of the country but have the impression that the extremely gloomy OECD forecast and critical recommendations for Canada released just before the G20 London summit were not given the attention they deserved. http://www.oecd.org/document/59/0,3343,en_2649_33733_42234619_1_1_1_1,00.html The OECD released its intermim outlook largely to push the case for more stimulus by G20 countries, particularly those, like Canada, with strong fiscal […]
Read moreRather than blog furiously on this, here is an excellent substantive assesment from the international labour movement. http://www.tuac.org/en/public/e-docs/00/00/04/82/document_doc.phtml Having been on or about the fringes of the event, I’d see the main substantive outcome as the further institutionalization of global economic governance. The IMF gets increased resources and clout.. with some very modest strings of reform in terms of who […]
Read moreThe Council of Canadians organized a set of news conferences across Canada on March 31, the day before TILMA came into force for local governments in Alberta and BC. I was one of four speakers at the Toronto event. There are obviously larger and more important economic issues facing Canada today than interprovincial “free trade” deals. However, the free-market approach […]
Read moreI’ve been thinking a lot about energy efficiency in buildings lately (in the BC context, anyway). About 11% of BC’s greenhouse gas emissions are attributed to residential and commercial buildings, so obviously efficiency has to come under the microscope as part of any GHG mitigation plan. Part of my reticence to look at this topic before is that there are […]
Read moreIt makes my blood boil when I see headlines like this one from the Globe online: “Economic optimism boosts markets”. They are, of course, not talking about the markets that matter for most families’ day-to-day lives – those markets are still tanking. No, the Globe is talking about the stock market, as if an uptick of optimism among our financial […]
Read moreI cannot believe we are seeing such nonsense in this day and age. The right is now reaching deep into the 19th century for inspiration. Solving the Economic Crisis through a Free Market in Labor (Chicago) Labor will not be entirely free until it can be bought and sold, says a cutting edge new report from the Freedom Institute, a […]
Read moreLast week’s Ontario budget was quite momentous and challenging to digest. Budget analysis was initially overtaken by the Premier’s minimum-wage musings. The budget featured a combination of large expenditure increases and large revenue reductions. Overall, I think that it embodies the proposal from bank economists for temporary spending and permanent tax cuts. While it provides proportionally more short-term stimulus than the […]
Read moreA missive from CCPA Executive Director Bruce Campbell: The G-20 the leaders’ meeting in London on April 2 will be a important test of whether the major nations are up to the challenge of confronting this recession and preventing it from becoming a depression. Will their collective response of monetary, fiscal and financial reform measures be bold enough and sufficiently […]
Read moreFrom Lynne Fernandez and Errol Black, of CCPA’s Manitoba office: Budget day always presents an opportunity to contemplate the state of society, and this year in particular has most of us pondering the current economic mess we are in. How did this crisis happen? How and when will we move back to more stable times? This year’s provincial budget takes […]
Read moreWhile BC has not formally abandoned the P3 model, there is a notable absence of new P3 announcements at a time when billions of dollars are being channeled to infrastructure spending. If P3s really provided value for money and brought the benefits of private sector efficiency and innovation to the delivery of public-sector infrastructure, then why aren’t we seeing more […]
Read moreYesterday’s Ontario budget lauded the announced minimum wage increase to $10.25 per hour on March 31, 2010. Today, media reports indicate that, “following a meeting with business leaders in Ottawa,” Ontario’s Premier is reconsidering this increase. The argument seems to be that, given hard economic times, we may not be able to afford a higher minimum wage. However, if the […]
Read moreThe global economy is in free fall, gripped by what the International Monetary Fund calls the“Great Recession.†In a crisis that is unfolding everywhere at once, global trade and production are slumping, unemployment is soaring, pension funds are evaporating, big global banks are still teetering on the edge of insolvency (if they are not already insolvent), stock markets are cratering, […]
Read moreThe IMF’s reputation took a real beating during the Asian financial crisis more than a decade ago. During a financial panic, it decided to impose contractionary monetary and fiscal policies on countries that came to it needing funds in the short-term. I won’t get into the details but Stiglitz’s Globalization and its Discontents and Krugman’s Return of Depression Economics are […]
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