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…)

Read More

Cutting through Canada’s election fog: inequality, climate change and free trade

This week’s podcast is a Canadian Centre for Policy Alternatives double-header. The CCPA has been an invaluable resource for alternative economic and political analysis for decades and I always enjoy highlighting their work. First up, I speak with Seth Klein, the director of the Centre’s British Columbia office, on how inequality and climate, two major issues to which Seth and the CCPA devote considersable effort, have fared in Canada’s election debate so far. Seth also talks about how the platforms of the parties stack up against the Leap Manifesto. The second half of the episode contains my conversation with Scott Sinclair, the CCPA’s chief trade researcher. Scott talks about the freshly-concluded Trans-Pacific Partnership, or TPP, and what this enormous trade pact means for us and our democracy.

elxn_issues

Read More

The economic debate we got and the one we need

I feel more like a broken record: another piece for Ricochet on the economic debate in the 2015 election and the missing big picture. This after the Globe Debate on the economy.

The Conservatives have promised balanced budgets and have even enshrined them in law. The NDP is also promising balanced budgets, painting itself as “responsible” with government finances.

The Liberals are the only party to break out of the balanced budget consensus, admitting that for a few years they may run small deficits of about $10 billion, or 0.5 per cent of GDP.

The leaders will meet in Calgary to go head-to-head at an event sponsored by the Globe and Mail. But will they break out of the narrow constraints that have thus far defined the conversation on the economy? (more…)

Read More

This election, let’s really talk about the economy

The word ‘austerity’ is finally in the mix, but all parties stuck in the right-wing’s frame

Austerity is on the agenda of the Canadian election, as the word was finally uttered — by Justin Trudeau. Bizarrely, this came the same day as the Liberal leader rolled out his economic agenda flanked by Paul Martin, the former finance minister and prime minister who engineered deep austerity measures in the 1990s.

The way austerity has finally made it into the discussion highlights the absurdly limited nature of the economic debate so far. It’s time for a grown-up conversation about the economy in this campaign.

Right-wing frame

Politicians have been falling over each other to make economic promises they cannot keep, all the while firmly stuck in the muck of a right-wing frame. The debate has mostly been limited to whether there will be a deficit and how big, rather than the real questions of who the economy works for and why. (more…)

Read More

The case for a $15 minimum wage the NDP should make

Of all of the NDP’s campaign promises so far, one of the simplest has gotten the most press: the $15 minimum wage for workers in federally regulated sectors. This campaign plank should be an easy sell for the NDP, yet Conservative and Liberal attacks have managed to undermine it. The way it’s been presented has left it open to attack, but this needn’t be so. (more…)

Read More

Harper’s hopeless housing promises

Over the past ten days, Stephen Harper has introduced three new housing policy promises. However, they won’t help the crisis of affordability. The pattern is familiar: make things worse and prepare to blame others.

  1. First, there’s the promise to allow first-time home buyers with RRSPs to take an extra $10,000 out of their retirement savings for a down-payment. This will likely have only a small effect, but whatever effect it does have will further heat up the housing market by increasing demand here and there. This makes the housing crisis worse. (Bonus negative effect: it eats into retirement savings.)
  2. Second, Harper promised to bring back a home renovation tax credit: people who own homes and spend $1000 to $5000 on renovations will be eligible to get 15% back at tax time. Again this isn’t much (and it’s poor tax policy too), but ultimately it helps drive up property values. This too makes the housing crisis worse.
  3. Finally, Harper says he would gather data on foreign real estate buyers. While there is certainly lots of capital sloshing around the world and some of it is landing in places like Vancouver and Toronto housing, it’s unclear how much of our bubble is due to foreign money and how much of these fears are a xenophobic blame-game. Data will be good, but given how Harper has been blaming all of Canada’s economic woes on external factors, this looks more like an exercise in something similar.

20130816_5108

It’s certain that we are in the midst of a housing unaffordability crisis—that much Harper gets right. His proposed solutions, however, continue in the pattern of the past few decades, a pattern that has created bubbling housing markets that have left many shut out and scrambling. (more…)

Read More

Linda McQuaig is right, but there’s more to it

Since her common-sense quip that most of Canada’s tar sands reserves will have to stay in the ground, Linda McQuaig has been vilified by much of the political establishment and (rightfully) defended by a minority of voices in the media. That the facts of climate science vindicate her has made little difference to the debate. Is this because McQuaig’s comments have inadvertently scratched at a nerve that goes far deeper?

In what would be a world very different from our own, we can imagine a fairly straight line going something like this

Climate science → Climate regulations → Fiscal policy → Just transition

First, climate scientists tell us that 85% of tar sands reserves (given how high-cost they are) will most likely have to be left in the ground if globally we are to limit warming to two degrees. In response, the Canadian federal and provincial governments slowly stop subsidizing oil development, stop funding oil-related infrastructure and prepare for industry phase out (by for example, increasing royalties as extraction nears a limit). Next comes a big push for developing green projects, whether funded through direct spending or incentives. As the oil jobs and industries wither, new green jobs, new green industries and compensating income transfers take their place. Voila: just transition level unlocked!

Have a laugh first, then ask, where is the major stumbling block between this make-believe world and our own? For now politicians are acting and being berated for differing at the first step: brushing off the problem and effectively denying the climate science. Yet beyond Petroleum Correctness is a set of increasingly onerous political and economic constraints. (more…)

Read More