Anarchist Economics

This years Nobel prize in economics was given to an American Political Economist who for all intents and purposes espouses the anarchist economics of community control, mutual aid and direct action. While much attention has been given to the fact that this was first time a woman was given the award much commentary has been that this was another Euro slap at the rampant liberaltarian free market economics of the U.S. In fact Elinor Ostrom's political economic analysis is far more libertarian than the apologists for U.S. capitalism.

Professor Ostrom - who shares the prize with Oliver Williamson of the University of California, Berkeley - has spent much of her career challenging the view that when people share a finite resource, they will inevitably end up destroying it. This widely held belief, known as the tragedy of the commons, is used to support arguments for tighter regulation or even privatisation.

She has approached the argument from an unusual perspective, too. Through her study of the way that natural resources have been managed around the world, she has found that, left to manage resources on their own and given the right support, local people often develop the most effective methods of sustainable development.

“We have a team of people studying forestry in 200 cities around the world. This is very big study, trying to understand why some forests have just disappeared and others have been sustained. We started in 1992. We have been able to go back and go back and go back to get very good data sets.

“Our findings are that some local people who have had long-term assurances of harvesting rights are able to manage forests more effectively than people who do not have the same assurances. The lessons are that when regulation comes from a distant authority and is uniform for a very large region, it is not likely to succeed.”

Professor Ostrom - whose doctorate is in political science and who considers herself a political economist - will not be drawn to comment on hot political issues, such as the push for tighter regulation of Wall Street or the perennial question of American healthcare. They are, she says, not her field.

But she does have a message for government: “The big message is that we need to have respect for the capabilities of humans living all over the world, not just those occupying high positions,” she said. “It’s not that we want to get rid of government. It’s about getting rid of the idea that government can solve everything.”

To this end, she is a firm supporter of direct action. “I have recently written a paper on global warming and argued that we should not sit around twiddling our thumbs waiting for someone to do something. We should act now. There is a lot we can all do at all levels,” she said.

Forward to the Past

Well excuse me if I am not surprised that Steady Eddie Alberta's CEO produced a TV show last night that announced nothing new. In fact while some folks bemoan the premier for not being Ralph Klein, including King Ralph his-self, Steady Eddie is living up to his name.

In fact he is the ghost of the Tories Past, the actions of his government are just a rehash of Klein's fiscal renovation, of the 1990's. The government is cutting hospital beds and freezing hiring of nurses and doctors, just as Klein did. The are cutting back funding to schools, just as Klein did. They are cutting funding to post secondary institutions just as Klein did. They are calling for a wage freeze for two years for all public sector workers just as Klein did. The debt and deficit hysteria that launched the Klein regime has returned like Marley's ghost to haunt the Alberta Government. Having no plan Steady Eddie returns to the past to find solutions to the Tories Made In Alberta Recession.

Blaming the economic crash of last year for Alberta's current deficit is of course par for the course, all governments have used the crash to explain away their economic mistakes. But in Alberta that crash should have been expected, since we have experienced boom and busts before, and those who had like former Premier Peter Lougheed warned that the Alberta Government led by his old party, had no plan to deal with the boom. And of course it had no
plan to deal with a crash.

The failure to invest the Heritage Trust fund or to fund it adequately led to the current deficit. And yet those in charge of investing both the Trust fund and the new AIMCO investment fund (made up of your and my public sector pension funds) lost the province billions, that now make up part of the current deficit. It was this investment failure that has cost the province much including outrageous buy outs and bonuses to these same fund managers.

The province's Heritage Savings Trust Fund lost the $3 billion between March 2008 and March 2009 in the economic downturn, and currently sits at $14.3 billion. The record loss sent Alberta into a deficit for the first time in 15 years. It was the biggest loss in the fund's 33-year history.

two AIMCo executives earned a combination of more than $5 million last year even as the funds they managed -- including the Heritage Savings Trust Fund -- lost more than $7 billion.

The collapse of oil and gas prices of course added to the deficit but not to the degree that the bad investments of our surpluses did. In fact the decline in natural gas production in the province began back in 2001 and is something that could be planned for, if you had a government that was not adverse to planning.

The problem, however, is that production in the Western Canadian Sedimentary Basin (WCSB) is declining. Production peaked in 2001; the vast majority of the country's natural gas is produced in the WCSB. According to Canada's National Energy Board (NEB), Canada's marketable production peaked around 17 Bcf/day in 2001.

Sadly, no amount of drilling is going to reverse the decline. Production declined in 2005, despite having a record number of well completions in the WSCB. Take a look for yourself:

If we take a look back, 2005 should have been a huge year for Canadian natural gas. That year, we saw the most active Atlantic hurricane season in recorded history. Fifteen hurricanes blew past us. Five became Category 4 hurricanes and four reached Category 5, including Katrina and Wilma.

That same year, Canada imported 3.7 Tcf of natural gas to the U.S. However, Canadian production of marketable natural gas fell 1.7%, compared to 2001 levels. According to NEB projections for 2009, natural gas production will sit at 5.5 Tcf — 12% lower than in 2001.

Add to that the expansion of infrastructure projects, that under Klein had been halted, as labour costs increased during the boom and you have another reason for the deficit.

Finally we have the creation of Hospital Boards, which were to have been publicly elected and were for one term and then when to0 many liberals and dippers were elected the boards were fired by Klein and replaced with Tory hacks. Steady Eddie's first act as Premier was to follow in Klein's footsteps, firing the regional boards and forming a super board, the cost of which was again payouts resulting in the new super board having a half billion dollar deficit.


And while Steady Eddie announced a wage freeze for senior government managers it means little when in fact these same managers racked in bonuses worth $6.7 million last year. And we suspect that even if he follows through with MLA and cabinet salary freezes its after the cabinet gave itself and the Premier a 34% increase last year.

The other reason for the deficit is that Alberta is business friendly. The cost of doing business in this province is nil, zilch, nada. The working class taxpayers in Alberta shoulder the burden of business costs. And thanks to the generous tax breaks to business the burden of the deficit is shouldered by you and me, and the solution that some are suggesting is the dreaded of all taxes the sales tax.

The Progressive Conservative government, in power since 1971, has long had a hands-off approach to business. Foreign investors have long been attracted by the lack of sales, payroll or capital taxes, low income taxes and competitive corporate taxes, at 29 per cent and dropping to 25 per cent by 2012. Despite a current deficit, overall net direct and indirect debt is low, totalling C$1bn or 0.3 per cent of GDP on March 31, according to a recent Moody’s report that gave Alberta a triple-A debt rating.

Like the mythical debt and deficit crisis of the Klein years this too is a short term recession, with a temporary deficit. And like then the deficit will be paid off by cutting public sector funding and freezing wages rather than taxing the capitalists. Nothing new here just as there is nothing new with the Tired Old Tories still in power.

SEE:

Your Pension Plan At Work

P3

Your Pension Dollars At Work

P3= Public Pension Partnerships

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Obama Embraces Neo-Con Agenda

President Obama continues to embrace a conservative reformist agenda with his Monday fiscal summit and his speech to the congress last night. In particular in education he has embraced merit pay and he told congress his administration wishes to expand charter schools. This later move has been the child of the Cato institute in the U.S. and the Fraser Institute in Canada. It is the bugaboo of the neo-con revolution, market delivery of public education by private companies. Setting up competitive private schools in competition with public schools. It as been tried in Alberta and B.C. and has not delivered any greater success in student achievement than public schools. Where it has succceeded is due to a simple fact; smaller class sizes which results in more indidivdual student attention.
At his Monday joint summit meeting, proposals for education reform included merit pay, despite union opposition to this idea, While on the surface merit pay may appear a good idea, it is all in the details. Who decides what merits the pay increase? Is it test scores? Is it an evaluation by students and parents? If it is the former test scores do not reflect real cognitive learning, rather they reflect the limited ability of rote learning; memorising anwsers to test questions.
The Obama administration is embracing other neo-con ideas as well in the areas of health care and social security reform. They begin with the premise that some one is ripping off the system, and a review of health care rip offs was announced to congress by Obama. He also promised that younger American workers would be able to supplement their social security with a persoanl tax free retirement investment plan. Where have we heard this before? Why from the Bush and Clinton administrations of course.
Like Clinton before him, he is a classic liberal, and as I have pointed out here before, classic liberals are embraced by libertarians, radical republicans and liberals. That he is willing to embrace ideas of the neo-con era, shows he truly is bipartisan

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1930's Oscars

Did anyone else notice that this years Oscar's ceremony was a flashback to the 1930's. It contained a depression era set, sepia toned back drops of store front hoardings, complete with a 1930's vaudeville dance routine, straight out of a Fred Astaire movie. Yep they got the message, America is about to enter a depression. And with the overwhelming win of Slumdog Millionare, the message could not be clearer, don't worry be happy. All that was missing was Hugh Jackman singing; Brother can you spare a dime.

They used to tell me I was building a dream, and so I followed the mob,

When there was earth to plow, or guns to bear, I was always there right on the job.

They used to tell me I was building a dream, with peace and glory ahead,

Why should I be standing in line, just waiting for bread?

Once I built a railroad, I made it run, made it race against time.

Once I built a railroad; now it's done. Brother, can you spare a dime?

Once I built a tower, up to the sun, brick, and rivet, and lime;

Once I built a tower, now it's done. Brother, can you spare a dime?

Once in khaki suits, gee we looked swell,

Full of that Yankee Doodly Dum,

Half a million boots went slogging through Hell,

And I was the kid with the drum!

Say, don't you remember, they called me Al; it was Al all the time.

Why don't you remember, I'm your pal? Buddy, can you spare a dime?

Once in khaki suits, gee we looked swell,

Full of that Yankee Doodly Dum,

Half a million boots went slogging through Hell,

And I was the kid with the drum!

Say, don't you remember, they called me Al; it was Al all the time.

Say, don't you remember, I'm your pal? Buddy, can you spare a dime

Harper Does Right Wing Talk Shows

PM Stephen Harper visited NYC yesterday to assure U.S. business interests that all is well in Canada. Especially with our banks. Interestingly his handlers set him up to appear on cable news shows. They chose to have him appear on right wing pro capitalist shows, in the morning he appeared on Fox Money News and in the afternoon he appeared on Larry Kudlows show on CNBC. Neither of these is as widely watched as say CNN or MSNBC political programs. But they were safe waters with both Fox and Kudlow cushing over the PM's presence. On Fox he once again defended NAFTA and warned against protectionism/isolationism. And of course he didn't appear on PBS. Nope these were safe right wing news programs that tossed him puff balls for questions. Kudlow in particular did not know that in Canada GM's union is not UAW but CAW, opps someone didn't do their research. Aw well the PM finally had an appreciative media audience not like the Press Gallery he has to suffer with up here.

Obama's Bipartisanship

Missed by the American media pundits on the cable political talk shows was that Obama's bipartisanship has nothing to do with charming Republicans but about meeting with Conservative PM Stephen Harper.

"If Canadians were no fans of Mr. Bush, their conservative leader, Prime Minister Stephen Harper, found in him a kindred philosophical spirit . . . "

In personal terms, there should be excellent chemistry between these two guys. In generational terms, they belong to the same baby-boomer cohort. Harper was born in 1959, Obama in 1961. They both come from modest backgrounds, where their mothers were the most important influence in their lives. They both saw themselves as agents of change, both made audacious reaches for power at a young age, and both have grasped the brass ring.

Never mind that Obama is a liberal Democrat and Harper is a right-of-centre Conservative. Both have taken parties of chronic losers and made them winners. That's the starting point between them. And in any event, the left in the U.S. can be to the right of centre in Canada. Obama wants to double U.S. troop strength in Afghanistan, while Harper has promised to pull Canada out of the country by 2011. Obama would never support legislation or constitutional amendment to legalize same-sex marriage in the U.S., while Harper called a free vote on it in Canada, and dropped his opposition when a parliamentary resolution backed the courts.

After all as I pointed out here on several occasions Obama is a classic liberal, that is a 'progressive' conservative. While Harper too is a classic liberal, though more influenced by American Republican interpretations of libertarianism equating it with Ayn Randism. Underneath their discourse was the common view that it was time to fortify the gates of fortress North America, which includes Mexico, over issues of common security, shared climate change policy and mutual stimulus packages.

Despite big differences in philosophy and style, Obama and Harper presented a common front on issues as varied as the war in Afghanistan, reversing the recession and pushing back the hot-button issue of trade protectionism.

Together, they announced a "clean energy dialogue" aimed at finding technological answers to the twin environmental dilemmas of Alberta oil sands and American coal.

For left wing Americans and Canadians who think Obama is left wing, their enthusiasm for Obama is simply their misunderstanding of his realpolitik, as Thomas Walkom notes.
His vision is that of Lincoln Republicanism, especially the radical Republicans who have nothing in common with the right wing evangelicals who took over the current party under Reagan, nor anything in common with the isolationists of the Republican Party of the FDR era.
In that he and Harper share a common understanding of the classical liberal politics of self improvement through self reliance and self responsibility, progress through merit, not class or status. These are the masonic values of the enlightments further espoused by the utilitarian philosophers.
Yes the visit to Canada was truly an expression of Obama's successful bi-partisan politics, the politics of radical republicanism.


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Big Auto Crisis is the Crisis of Capitalism

The time has come to quit pussy footing around the issue at hand. Capitalism is in collapse. But the truth is that factories still are capable of production, raw resources are still available, technology has increased worker productivity, and workers are still able to work. So why are GM and Chrysler incapable of being productive. Because they rely not on creating products but creating profit. And the bottom line is that while their Canadian factories are some of the most productive they now face closure. No bail out by taxpayers, no bail out by bond holders (that's you folks who own mutual funds and bonds, including your pension funds which are institutional bond holders) nor concessions by workers will end the bleeding at GM or Chrysler. Indeed you can include Ford in that as well.
Instead of bailing out the Big Three it is time to fire the executive class, stop the bleeding of white collar and blue collar jobs and socialize big auto under workers control. In fact that should be the agenda of the left from the NDP and CLC through to the more radical of the left.
And yet nowhere do I hear the call to socialize capital under workers control. Despite statist attempts to nationalize banks and financial institutions by various governments of diverse ideologies, this is simply a public bail out of private capital.
Capitalism is the problem contrary to Gordon Brown, George Bush and Stephen Harper, it is not the solution. The solution is not taxpayer stimulus of existing infrastructure of capitalism and its state. Rather it is the complete and total overhaul of capitalism by socializing it, recognizing that capitalism is currently publicly funded by workers wages, pensions and taxes. It is time to restructure all production under workers control, to reconstitute government as the administration of things rather than people.
Just as big auto cannot restructure itself neither can capitalism. Ownership at GM and Chrysler has not changed, the executives have not changed, the command structure of the organisation has not changed. Nor has concessions, nor bail outs changed the fact that big auto like capitalism in general is simply about the creative destruction of workers and factories, in order to get slim enough to increase the bottom line; profit. And what is profit? It is the surplus value accumulated for further investment to make, more profit. It is this simple equation which exposes the capitalist system as being incapable of solving its own crisis. Which is not a crisis of production but of profit making.
This is the solution that needs to be shouted from the roof tops. And yet I find no cheerleaders for socialism, rather the left seems as despondent as the apologists for capitalism. It is time to challenge the established propaganda of the day that capitalism is a horrible system but it is better than the alternative. The alternative is socialism which contrary to popular mythology is not the same as state owned public works. Socialism is socialized capital, and production under the democratic control of those who own and use it that is us the vast majority of people.
Socialism as a democratic restructuring of capitalism and its statist forms is the unknown country, still to be explored. In this crisis it is time to begin the broad discussion that was so vibrant forty years ago, after the failures of Stalinism and Labourism, about new forms of community and worker control, extending democracy to the work place and into our public institutions, etc.
Unless we have a vibrant vision of a new world, being built in the shell of the old, we will not be grave diggers of capitalism, but rather labour and its political parties will simply dig themselfves into a grave created for them by the current capitalist crisis. Their lack of imigination is their failure to see beyond things as they are, because inevitably for the past fifty years they have abandoned the belief in the revolutionary potential of the working class they claim to represent.


SEE

There Is An Alternative To Capitalism

Auto Solution II

tags
MGuinty, GM, concesssion bargaining, unions, trade union, Marx, Ontario, Corporate Welfare, Canada, cars, automobilie, production, taxes, tax credit, investment, environment, hybrid, self-valorization,, self-management,, workers control,, autoworkers,, KEN LEWENZA,,CAW, Big Three Auto,, libertarian socialism, automobile, Frank Stronach, Magna, business unions, auto parts, workers, layoffs, plant-closings, workers-control, unions, labour, Canada

That's All For Now Folks

Well thats it folks, I am outta here until the new year. Moving into my new house, setting up, cleaning the old place up. And my internet access will be limited until the new year. So till then have a Happy Holiday.Merry Christmas, Happy Solstice, Merry Yule Happy Hanuaka and Happy New Year.

May there be peace in the trenches.

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Two Tier Alberta Redux

The Stelmach government made several announcements this week concerning seniors. All of them are about their plan to end universality and create a two tier system of seniors service.
Alberta seniors who can afford it to be able to buy extra care
Ironically one of those announcements backfired.
Seniors won't pay for braces, artificial limbs
seniors earning more than $21000 were going to be required to pay part of the cost of the devices that had been free.
And while the government quickly backtracked claiming that it was all a miscommunication, it wasn't. The government is giving with one hand and taking away with another.
Alberta opening doors to for-profit drug providers for seniors
As of January 2010, the Stelmach government will eliminate its universal Alberta Blue Cross benefit for the province’s elderly and replace it with a new income-based system that opens the door to “private, for-profit health insurance companies,” says Elisabeth Ballermann, president of the Health Sciences Association of Alberta (HSAA/NUPGE).
So despite the backpedaling on one miscommunication, the reality is that the government does not have a leg to stand on when it says it is improving seniors care in the province. It is introducing two tiered seniors care. And with that can two tiered health care be far behind?
David Eggen, executive director for Friends of Medicare, said the government's move to charge well-off seniors jeopardizes the universality of health care. "We're very concerned about all the Albertans targeted for increases," Eggen said. "Seniors should be upset after they have been paying into the system their entire lives and then the rules change."
And while the government is claiming wealthy seniors can pay for more care services the reality is that in B.C. such programs have hurt those who cannot afford it. B.C. like Alberta has promoted P3's.
PORT ALBERNI — On Wednesday of this week it was reported that the former residents of Cowichan Lodge are now paying more at the P-3 Sunridge Place. When the Government fired all the workers at Cowichan Lodge and forced the residents to leave a publicly funded facility and move into Sunridge Place, VIHA and the Government promised no extra fees and better service. The extra costs are reported by one patient to be approx $300 per month. This is how the private part of the partnership makes money. They have to charge for “extras” that used to be covered in the main costs at the publicly funded facility. The government may be still paying the same amount per patient, but the company can’t make a profit on that unless they slash wages, lower services and increase “user fees.” This equals less care and more costs for our retired elderly workers and their families. Is this what we want for our parents or ourselves? With many seniors’ loss of assets due to the market downturn these extra charges are even more mean spirited than usual.

See:
Two Tier Alberta
Medicare Calgary Style

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Caanda's Economic Engine Runs Out Of Oil

The overheated Alberta economy has screeched to a halt. And it does not look like the 'engine of Canada's economy' will be saving the country from recession anytime soon. So while manufacturing declines in Ontario, especially auto manufacturing, the result will mean even further decline in the need for gas and oil.
Opp's didn't plan for that did we. Of course not Alberta politicians provincially and federally oppose any concept of 'economic planning'.
And its not like we haven't been through all this before! Alberta Oil Jobs Evaporating
Despite the provincial governments head in the sand approach to oil development Albertans are speaking out, even as the oil economy bottoms out. Petro-Canada's planned pipeline bad for Alberta
And once again Alberta comes calling to Ottawa to bail it out!!! And of course the Alberta based Harpocrites are only to willing to oblige. But don't worry this is typical Conservative hype, they are simpy reannouncing previous commitments to capital investment.

Crisis forces Alberta to consider red ink
Opposition parties have been warning for years that the Tory government's spending was out of control, and that it was not doing enough to save the eye-popping surpluses it was reaping from soaring oil and natural-gas royalties. This year's surplus is expected to be $2-billion, down from the record of $8.6-billion in 2005-06.In 2007, the finance minister of the day, Lyle Oberg, speculated a deficit was possible if the province could not rein in its runaway spending. Since 2005-06, total government spending has jumped at least 32 per cent and per capita spending has been higher than that of any other provincial government.

Energy prices blamed as Alberta faces first deficit in 15 years

Alberta's decelerating energy sector can no longer be relied on to be the sole engine driving the province's economy, says a report issued yesterday by the Royal Bank of Canada. "While our new forecast for the provincial economy still reflects some degree of vigour, it does show a fair amount of steam seeping out of Alberta's engine," said Provincial Outlook, penned by economists Robert Hogue and Paul Ferley. The most visible example of the fading vigour is the delay or outright cancellation of several upgrader projects worth approximately $45 billion, as well as plans to scale back drilling because of low natural gas prices, the reports says. RBC has revised its GDP forecast to 2.1% for next year, down from a previous estimate of 3%.

Alberta inflation takes breather at 2.1 per cent
ATB Financial senior economist Todd Hirsch attributed the price jump in fruits and veggies in part to a weaker Canadian dollar."Alberta's inflation figures are being swept lower by falling commodity prices, especially crude oil and gasoline, but also by softer consumer demand," he said. Still, Canada's inflation was two per cent in November, the first time in two months that Alberta's inflation edged higher than the nation's.

Nearly across the board, oil companies have begun cutting spending. A survey by Barclays Capital found 2009 capital budgets were 12% lower than 2008 spending plans, and some believe they might head lower. Budgets in the U.S. and Canada are being cut the most, as projects in the high-cost oil-sands and unconventional natural-gas fields now make less economic sense. Companies such as Chevron Corp. and ConocoPhillips have delayed announcing budgets to spend more time assessing the market.

Alberta projects get$1B boost
PM commits gas tax funds to rebuilding infrastructure
A day after announcing it would sink deep into the red, the Harper government waved around a lot of green Friday in Conservative Alberta.On the heels of declaring it would run deficits totalling tens of billions of dollars over the next few years, Ottawa announced about $1 billion worth of previously committed infrastructure funding for projects in Wild Rose Country.The capital dollars come from earlier federal funding pledges, including $100 million to twin the Trans-Canada Highway near Lake Louise--with construction officially commencing today --and a promise by the Harper government to permanently allocate gas tax dollars to infrastructure.

Ottawa to give Alberta nearly $800-million
Calgary -- In a bid to keep Albertans working and help municipalities keep up with growing infrastructure demands, Ottawa announced yesterday it will pump more than $798-million into the province between 2010 and 2014.The extension to the federal gas-tax funding agreement could see cash earmarked for projects involving public transit, roads, water and waste disposal. Federal Labour Minister Rona Ambrose said the money will provide a "strong stimulus for the economy."

SEE:
Alberta Loses Billions
Recession Hits Alberta
Capitalism Caps Tarsands Expansion


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