Canada missed the memo: it’s OK to talk about inequality and capitalism

There is no political rocket science to the Oct. 19th election result. Even with our slanted first-past-the-post system, it would have been difficult for Stephen Harper’s Conservatives to squeak out a parliamentary majority, or even minority, given that more than two-thirds of the population wanted him out.

If vague notions of change played the lead role in the long campaign, then the economy wrote the script for much of the rest. The Liberals won, while the others lost, on economic issues.

Since the global crisis of 2007-08, most of us have seen stagnation in incomes and living standards. The past year, with the global resource and commodity price crash, has only made things worse by taking down the last bastions of growth, albeit ones based in the toxic extractive sectors of the Canadian economy.

Together these basic facts, lived every day by millions, made it inevitable that the economy would be the defining issue of the 2015 campaign and key to whether the change vote coalesced around the NDP or the Liberals. People were clearly tired of seeing Harper represent them, but in daily life, they’re tired of seeing their debt, their rent, their children’s tuition and their bills go up, while their jobs disappear or their incomes flatline. (more…)

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Kshama Sawant talks socialism in Seattle and beyond

Last year, Kshama Sawant shocked the continent by winning a seat on Seattle’s City Council. She defeated an incumbent Democrat to become the first openly socialist city councillor in Seattle in a century. Sawant, an immigrant from India with a background as a software engineer and an economics professor, is a militant socialist activist who played a major role in the 2011 Occupy protests. Not your typical politician to say the least.

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Sawant’s surprise electoral win in Seattle has sparked discussion across North America. Last week, she made her first speaking appearance in Canada, addressing a fundraising event organized by the Coalition of Progressive Electors in Vancouver. I sat down with her before the event for a wide-ranging discussion touching on everything from her background in economics to the minimum wage compromise in Seattle and the role of transitional demands in fighting climate change to the history of sectarianism and building today’s left.

Side note: you can now subscribe to Political Eh-conomy Radio on iTunes. Follow this link.

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The lament for Canada’s middle class

I’ve been posting more sparsely lately for a number of external reasons but this should change soon I hope. For now, here is the first major piece I wrote for Ricochet. In some ways, it’s the obligatory piece on Thomas Piketty’s Capital in the Twenty-First Century, but really it’s my way of trying to think through the hand-wringing about Canada’s middle class. Below are the first couple of sections, read the rest here.


The US is in the throes of a debate about inequality: It’s the Waltons versus the Walmart workers on food stamps, the runaway rich in the 1 per cent versus everyone else. Meanwhile, Canada’s inequality discussion has been largely confined to the woes of the middle class. Even the New York Times added grist to the mill by proclaiming Canada’s middle class better off than its US equivalent.

Similarly, while the US has made a veritable rock star out of French economist Thomas Piketty, whose 600-page economics tome Capital in the Twenty-First Century has topped best-seller lists, Canadian reception has been much more muted. This is a bit surprising because Piketty, in drawing out the link between capitalism and inequality, tells the story of a new Gilded Age replacing the post-war Golden Age that saw the middle class establish itself. One reason Piketty’s book may have left less of a mark on Canadian debate is that more of a middle class has endured in Canada. But will today’s middle class survive? (more…)

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Working class disarmed, Canadian redux

Looking at the prevalence of strikes in the US over the past six decades, Doug Henwood writes,

Second Amendment fetishism aside, there’s an old saying that the working class’s ultimate weapon is withholding labor through slowdowns and strikes. By that measure, the U.S. working class has been effectively disarmed since the 1980s.

Doug then produces a graph showing a precipitous decline in the number of strikes in the US involving more than 1000 workers starting about three decades ago. Intrigued, two thoughts quickly crossed my mind. First, as is often the case, I wanted to see whether the same trend holds for Canada. Second, I was curious whether the decline had anything to do with the large scale of the strikes in the data Doug used.

Sure enough, the conclusions are (sadly) the expected ones: Canada exhibits the same trend and shows it to be one that is independent of the number of employees striking or locked out.

Figure 1. Work stoppages relative to employment: the number of person-days of work lost to stoppages (strikes and lockouts) divided by total employment. Source: CANSIM, FRED and BLS.
Figure 1. Work stoppages relative to employment: the number of person-days of work lost to stoppages (strikes and lockouts) divided by total employment. Source: CANSIM, FRED and BLS.

(more…)

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We can’t all be workers: Putting inequality in the inequality debate

It’s easy to get confused about who is a worker and who isn’t these days. Your CEO may worker longer hours than you, not the top-hatted capitalist of the Monopoly board he. Indeed, it may seem that the leisure class of the turn of the last century has been replaced by the workaholic professional and managerial class of today. Yet, if everyone is a worker and no one is a capitalist, then how can we still be living under capitalism?

The short answer is we can’t…or, better yet, we are, which means that not everyone can be a worker, no matter how hard they try and how many hours they put in. These reflections are a continuation of something I just posted on the Progressive Economics Forum. With all the talk these days in Canada about income inequality and the shrinking middle class, I thought it might be a good idea to take another look at the labour share of income. I concluded that post with the following chart.

Figure 1. The labour share of income, with and without the 1%.
Figure 1. The labour share of income, with and without the 1%. (Source: Statistics Canada and World Top Incomes Database).

I think this has some of the answers as to why it is unhelpful to talk about the very highest income earners as workers. The reason is economic power, for which the labour share of income is a proxy. The widening gap between the income share made up by total employment income and the employment income of the bottom 99% shows precisely a gap in power. The highest earners disproportionately affect the power of labour, but they do so not as uber-workers but as something different entirely. (more…)

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Solving Christmas conundrums with New Year’s resolutions

I know I promised to not post until the New Year. Clearly the holidays have gotten the better of me. This, however, will be a short reflection and at once a New Year’s resolution.

Christmas is a time of large get-togethers for my family and this year was no different.  We feasted late into the night on Christmas Eve and again on Christmas Day. Both nights the talk at the table inevitably turned to politics.

The range of economic, social and political problems identified during our meals would make any left-wing activist squirm in her seat with glee. A dearth of good jobs, runaway inequality, corporate control of politics, rampant consumerism, housing unaffordability, environmental degradation, climate change – these and more like them were raised many times over and by different people. Indeed, there was broad agreement at both feast-tables that we are in the midst of a systemic crisis.

At this point, you would expect the token lefty writer and activist (me) to easily leap up onto the table, make a rousing speech and lead a rabble in its Sunday best to take over the nearest bank, corporate office or shopping mall armed with borscht spoons and pierogis…or, at least, to get widespread agreement among those at the table that the only sensible way forward is a strong left-wing program – one best able to address the concerns raised.

Sadly, nothing like the latter took place (nor the former in case you’ve been holding your breath). (more…)

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Notes on Black Friday

Black Friday may be a fitting day to start a blog on political economy. A day of extreme consumerism, a “working holiday” for many in the service sector, an outlet for anger and violence played out across store aisles and parking lots. At the same time, also increasingly a day of protest, of working people ready to say “enough!” even in the face of serious repercussions. It is a day when the global capitalist economy shows a bit more of its true face. This is the much-vaunted Western consumer, often poor and in debt, racing to buy the baubles produced in the global South by her even poorer counterparts…so that the profit engine can keep churning, GDP can keep growing and those like the Waltons can keep lining their pockets.

I was motived to write this blog entry after seeing too many news stories, images, Facebook posts and conversations of the “look at these stupid poor people trampling each other” variety. Today is an easy day to be smug. Sure, people don’t have to trample and fight with each other over trinkets. (more…)

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