I love it when folks who are in charge of the eonomy claim that they didn't see the recession coming, or they didn't expect it or they are shocked by it.
There is little doubt this week's developments signalled a change in the economic conditions affecting the province -- and in the messages coming from the Stelmach government, said political scientist Peter McCormick of the University of Lethbridge.
"I do think Alberta thought it was flying pretty high -- 'Recessions might hit lesser economies but they can't hurt us because we're oil, and oil never hurts,' " he said Friday."This is completely new territory for the government."
Oh please Peter gimme a break. There was the recession and oil crash of the seventies when the Tired Old Tories first took power. Then there was the oil boom and crash of the late seventies and early eighties which occured while the rest of Canada went into recession, by 1982 the oil market collapsed and Alberta followed the rest of the country into a downward spiral. Then there was the recession and debt/deficit crisis of the ninties. And through out it all the Tired Old Tories were in charge. So this ain't new territory.
Indeed the rose coloured blinders of the oil boom that the Tired Old Tories wear are the same ones they wore in the seventies and eighties. And now the recession has hit Alberta, we still have a budget surplus, just as we did in the ninties. But like the ninties, watch for the Tired Old Tories to start belt tightening and attacking the public sector while giving royalty holidays to their pals in Big Oil.
Indeed, the economic woes have hit on a number of fronts: the stock market slide has hammered Calgary-based petroleum producers; Alberta's housing market is slowing; retail sales are down; a handful of jobs have been cut.
While Ontario's manufacturing sector has been feeling the pain for months, the downturn in commodity markets -- particularly for crude oil -- is squeezing Alberta.
"We have been living in a bit of a dream world for the last little while. Things have not been well in other parts of the country," noted University of Calgary economist Ken McKenzie. "Until recently, we've been relatively removed from that because of high oil prices."
Much of the concern stems from just how quickly economic conditions, including commodity markets, have changed.
Resource revenue is still on pace this year for a record $14.6 billion, but it's about $4.3 billion less than what was predicted only three months ago.
Banks predict the Alberta economy will grow 1.9 per cent this year, gearing down to 0.3 per cent in 2009 -- the slowest since 1986.
"A $2-billion surplus is not a catastrophe compared to other provinces," Bernard said Friday. "There are a lot of positives, I think, for the Alberta economy, but for sure the drop in commodity prices is going to hurt."
McCormick agrees the province is faring better than other parts of the country where deficits are now being calculated. However, the government is trying to manage expectations by talking about tough times ahead.
"It's directed at universities, hospitals, school boards and government employees who are thinking about salary negotiations coming up -- that's who they are talking to," he said. "They are trying to get rid of boom-talk and boom-mentality now."
Alberta veers on royalties
Financial crisis forces energy-rich province to back down on its demands for a "fair share" from the development of its resources; New transitional rate for oil and gas wells will cost government $1.8-billion over the next five years.
It's the second time this year Alberta backtracks on the new policy, launched when energy prices were thought to rise forever. Last April, it backed off royalty increases affecting gas wells deeper than 2,500 metres and oil wells deeper than 2,000 metres.
The changes won't be the last.
SEE:
Black Gold
Steady Eddie Runs Away
Lougheed Spanks Klein
Don Getty's Legacy
You Won't Have Me To Kick Around
Lack of Planning Created Skills Shortage in Alberta
Laundry Workers Fight Privatization
Find blog posts, photos, events and more off-site about:$100 oil, Alberta, tarsands, oilsands, Canada, peak oil, royalties, oil, profits, Province, Bill Hunter, Alberta Royalty Review,Alberta Cabinet, CAPP, Ed Stelmach,Big Oil,oil royalties,
Saturday, November 22, 2008
Auto Solution II
Up the road without a map
KEN LEWENZA
national president, Canadian Auto Workers union
November 20, 2008
Your editorial demands CAW concessions as part of any deal to restructure the North American auto industry (Keeping A Foot In The Car Door - Nov. 19).
The CAW was the first major player in the North American industry to respond pro-actively to the devastating effects of the financial crisis and credit crunch. Our new three-year contract freezes wages, suspends cost of living protection, and introduces, once fully implemented, savings totalling $300-million per year (or more than $10,000 per worker, per year) for Canadian auto makers.
Auto labour costs are significantly lower in Canada than in the U.S., Germany and Japan - yet our productivity is higher (at least 10 per cent better than in America).
We didn't write the free trade deals, we don't manage the companies, we don't design the vehicles - we just build them. The best thing we can do as auto workers is to keep building vehicles in the most efficient, high-quality plants in the hemisphere, at competitive costs.
CAW Ken Lewenza says; "We didn't write the free trade deals, we don't manage the companies, we don't design the vehicles - we just build them." And that's the problem. The solution to the auto crisis is not more concessions from the workers, thats been tried and it hasn't worked. Just as federal provincial aid have not helped because we lack a made in Canada Industrial strategy.
Jim Stanford, chief economist at the CAW, said newly signed contracts between the union and the Canadian arms of the Detroit automakers include several unprecedented givebacks, such as an 18-month suspension in cost-of-living increases.
A lack of policy attention from governments in both Canada and the United States have contributed to Detroit's collapse as much as anything else, he said.
"In Japan and Germany and Korea and now China, governments proactively nurture and support high-value export industries like autos. In North America, for the last two decades, we haven't bothered."
Rather the solution is right in front of all of us the workers should control auto manufacturing in Canada they should manage and design the cars not just 'build them'.
Ken if you don't want to discuss concessions then you better start talking about workers control of the means of production.
If there is to be a bailout, let it be for us, the workers. Who dare say we’re unqualified? In the 1920s Italian workers at Fiat and Alfa Romeo took over the plants, and they made cars without bosses. Even as we speak, workers in Venezuela are taking over plants and running them.
And I would add to that the Paris Revolution of 1968 and the Hot Autumn of 1969 when auto workers in France and Italy along with student radicals took over factories and universities and put them under worker control.
Capitalism is in a crisis it is time to socialize capital under workers control.
November 20, 2008
A suggestion for Big Three and UAW (updated)
Michael Nadler
My conceptual solution to the auto company bailout question is as follows:
The federal government makes a one-time only injection of the requested $25 billion into the Big Three in return for a proportionate ownership stake in the companies. Based on the current market capitalization of GM and Ford and my estimate of the market value of privately-held Chrysler, that would give the government about 80% ownership in the 3 companies. (A discount from the market price could be justified for such an investment, providing a higher ownership stake.)
The $25 billion cash injection is conditioned on the United Auto Workers (UAW) accepting a gift of the 80% (or higher) ownership stake from the government, giving the UAW absolute control of the 3 auto companies which will then be exempted from any anti-trust restrictions on consolidations, etc. The fate of the Big 3 and its workers will then be entirely in the hands of the UAW, which could strike the appropriate balance between compensation and competitiveness, as well as the many other issues that will determine the fate of the auto companies it now owns, the jobs they provide and the workers it represents. In that regard, the obligations of the PBGC might be limited as part of this grand bargain.
Workers' control of the means of production?
One of the most influential books on my political outlook when I was first getting politically aware was Geoff Hodgson's The Democratic Economy, published by Pelican Books in 1984. In it he advocated an economy predominantly consisting of worker-owned enterprises: market collectivism, to use a phrase of Jaroslav Vanek. In a Market Collectivist economy, argues Hodgson(p.177), "The workers are self-managed: they do not work under the direct or indirect control of a capitalist...the workers (collectively) own the product of their labour, which they bring to the market for sale."
SEE:
We Own GM
Auto Solution
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
KEN LEWENZA
national president, Canadian Auto Workers union
November 20, 2008
Your editorial demands CAW concessions as part of any deal to restructure the North American auto industry (Keeping A Foot In The Car Door - Nov. 19).
The CAW was the first major player in the North American industry to respond pro-actively to the devastating effects of the financial crisis and credit crunch. Our new three-year contract freezes wages, suspends cost of living protection, and introduces, once fully implemented, savings totalling $300-million per year (or more than $10,000 per worker, per year) for Canadian auto makers.
Auto labour costs are significantly lower in Canada than in the U.S., Germany and Japan - yet our productivity is higher (at least 10 per cent better than in America).
We didn't write the free trade deals, we don't manage the companies, we don't design the vehicles - we just build them. The best thing we can do as auto workers is to keep building vehicles in the most efficient, high-quality plants in the hemisphere, at competitive costs.
CAW Ken Lewenza says; "We didn't write the free trade deals, we don't manage the companies, we don't design the vehicles - we just build them." And that's the problem. The solution to the auto crisis is not more concessions from the workers, thats been tried and it hasn't worked. Just as federal provincial aid have not helped because we lack a made in Canada Industrial strategy.
Jim Stanford, chief economist at the CAW, said newly signed contracts between the union and the Canadian arms of the Detroit automakers include several unprecedented givebacks, such as an 18-month suspension in cost-of-living increases.
A lack of policy attention from governments in both Canada and the United States have contributed to Detroit's collapse as much as anything else, he said.
"In Japan and Germany and Korea and now China, governments proactively nurture and support high-value export industries like autos. In North America, for the last two decades, we haven't bothered."
Rather the solution is right in front of all of us the workers should control auto manufacturing in Canada they should manage and design the cars not just 'build them'.
Ken if you don't want to discuss concessions then you better start talking about workers control of the means of production.
If there is to be a bailout, let it be for us, the workers. Who dare say we’re unqualified? In the 1920s Italian workers at Fiat and Alfa Romeo took over the plants, and they made cars without bosses. Even as we speak, workers in Venezuela are taking over plants and running them.
And I would add to that the Paris Revolution of 1968 and the Hot Autumn of 1969 when auto workers in France and Italy along with student radicals took over factories and universities and put them under worker control.
Capitalism is in a crisis it is time to socialize capital under workers control.
November 20, 2008
A suggestion for Big Three and UAW (updated)
Michael Nadler
My conceptual solution to the auto company bailout question is as follows:
The federal government makes a one-time only injection of the requested $25 billion into the Big Three in return for a proportionate ownership stake in the companies. Based on the current market capitalization of GM and Ford and my estimate of the market value of privately-held Chrysler, that would give the government about 80% ownership in the 3 companies. (A discount from the market price could be justified for such an investment, providing a higher ownership stake.)
The $25 billion cash injection is conditioned on the United Auto Workers (UAW) accepting a gift of the 80% (or higher) ownership stake from the government, giving the UAW absolute control of the 3 auto companies which will then be exempted from any anti-trust restrictions on consolidations, etc. The fate of the Big 3 and its workers will then be entirely in the hands of the UAW, which could strike the appropriate balance between compensation and competitiveness, as well as the many other issues that will determine the fate of the auto companies it now owns, the jobs they provide and the workers it represents. In that regard, the obligations of the PBGC might be limited as part of this grand bargain.
Workers' control of the means of production?
One of the most influential books on my political outlook when I was first getting politically aware was Geoff Hodgson's The Democratic Economy, published by Pelican Books in 1984. In it he advocated an economy predominantly consisting of worker-owned enterprises: market collectivism, to use a phrase of Jaroslav Vanek. In a Market Collectivist economy, argues Hodgson(p.177), "The workers are self-managed: they do not work under the direct or indirect control of a capitalist...the workers (collectively) own the product of their labour, which they bring to the market for sale."
SEE:
We Own GM
Auto Solution
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
NDP the New Reform Party
Reasearch just published on the results of the October Federal election shows that the new party rising in the West to challenge the Ottawa power base is the NDP. Even in Alberta, where the NDP won a seat they came in second place across the province over all. After all the original reform party of the west was the CCF; the NDP's predecesor. With a seat in Quebec and Alberta the NDP is now a national party unlike the Liberals.
Liberals ran third behind the NDP in every last western province. While New Democrats came second in 46 western ridings, Liberals came second in only 24 ridings. And, again in 24 western seats, Liberals placed fourth behind the Greens and Independents. Of 42 seats up for grabs in Alberta and Saskatchewan, Liberals won just a single seat -- belonging to veteran Grit Ralph Goodale.
SEE:
Liberals Gain Third Party Status
Populism and Producerism
Find blog posts, photos, events and more off-site about:,
Linda Duncan, RahimJaffer, Harper, Conservatives, Cabinet, Government, politics, Edmonton, Alberta, NDP, Liberals, Redmonton, politics, , federal election, Edmonton Strathcona Jack Layton,
Liberals ran third behind the NDP in every last western province. While New Democrats came second in 46 western ridings, Liberals came second in only 24 ridings. And, again in 24 western seats, Liberals placed fourth behind the Greens and Independents. Of 42 seats up for grabs in Alberta and Saskatchewan, Liberals won just a single seat -- belonging to veteran Grit Ralph Goodale.
SEE:
Liberals Gain Third Party Status
Populism and Producerism
Find blog posts, photos, events and more off-site about:,
Linda Duncan, RahimJaffer, Harper, Conservatives, Cabinet, Government, politics, Edmonton, Alberta, NDP, Liberals, Redmonton, politics, , federal election, Edmonton Strathcona Jack Layton,
Friday, November 21, 2008
We Own GM
Since the Big Three have already accepted taxpayer bail outs over the past five years, and now are delinquint on thier pension payments for their workers, why bail them out, we already own them. Time to make them publicly owned under workers control.
As the Toronto Star reported Saturday, GM's actuaries estimated the pension plan for hourly workers would have been short $4.9 billion if the company had gone out of business at the end of November, 2007. But because the pension fund is heavily invested in stocks, the recent fall in stock markets would have left the fund short another $1.5 billion, assuming no other changes in the meantime.
Paul Duxbury, an actuary who has advised GM pensioners in the past, said yesterday that such a shortfall would cost Ontario's guarantee fund as much as $3 billion, if the province provided the money.
The General Motors of Canada Ltd. pension funds had a shortfall of $4.5-billion as of last November - before the stock market collapse - creating a massive financial headache for the Ontario government and pension cuts for retired employees if the company falls into bankruptcy protection.
Senior GM officials revealed the shortfall between the assets in the company's unionized and salaried plans and their liabilities in a meeting yesterday with the editorial board of The Globe and Mail. The shortfalls are measured on a solvency deficiency basis, which would apply if the plans have to be wound up in the event of bankruptcy.
SEE:
Auto Solution
Whiners and Losers
Business Unionism Offers No Solution To Capitalist Crisis
Concessions Don't Work
And Then There Was One
Pension Rip Off
Buzz Off
Unions=Competitiveness
McGuinty Corporate Welfare
Is Delphi the Oracle of things to come?
How Ford Screwed Up
What's good for GM is bad for Workers
Unions the State and Capital
Chrysler Made In Canada?
tags MGuinty, GM, concesssion bargaining, unions, trade union, Marx, Ontario, Corporate Welfare, Canada, cars, automobilie, production, taxes, taxcredit, investment, environment, hybrid, self-valorization,, self-management,, workers control,, autoworkers,, Buzz Hargrove,,CAW, Big Three Auto,, libertarian socialism, automobile, Frank Stronach, Magna, business unions, auto parts, workers, layoffs, plant-closings, workers-control, unions, labour, Canada
As the Toronto Star reported Saturday, GM's actuaries estimated the pension plan for hourly workers would have been short $4.9 billion if the company had gone out of business at the end of November, 2007. But because the pension fund is heavily invested in stocks, the recent fall in stock markets would have left the fund short another $1.5 billion, assuming no other changes in the meantime.
Paul Duxbury, an actuary who has advised GM pensioners in the past, said yesterday that such a shortfall would cost Ontario's guarantee fund as much as $3 billion, if the province provided the money.
The General Motors of Canada Ltd. pension funds had a shortfall of $4.5-billion as of last November - before the stock market collapse - creating a massive financial headache for the Ontario government and pension cuts for retired employees if the company falls into bankruptcy protection.
Senior GM officials revealed the shortfall between the assets in the company's unionized and salaried plans and their liabilities in a meeting yesterday with the editorial board of The Globe and Mail. The shortfalls are measured on a solvency deficiency basis, which would apply if the plans have to be wound up in the event of bankruptcy.
SEE:
Auto Solution
Whiners and Losers
Business Unionism Offers No Solution To Capitalist Crisis
Concessions Don't Work
And Then There Was One
Pension Rip Off
Buzz Off
Unions=Competitiveness
McGuinty Corporate Welfare
Is Delphi the Oracle of things to come?
How Ford Screwed Up
What's good for GM is bad for Workers
Unions the State and Capital
Chrysler Made In Canada?
tags MGuinty, GM, concesssion bargaining, unions, trade union, Marx, Ontario, Corporate Welfare, Canada, cars, automobilie, production, taxes, taxcredit, investment, environment, hybrid, self-valorization,, self-management,, workers control,, autoworkers,, Buzz Hargrove,,CAW, Big Three Auto,, libertarian socialism, automobile, Frank Stronach, Magna, business unions, auto parts, workers, layoffs, plant-closings, workers-control, unions, labour, Canada
Thursday, November 20, 2008
Here Come the Seventies
The U.S. cannot cut its interest rates much more or it will end up at zero.
US interest rate falls to 1 per cent
Which means that the U.S. is no longer facing infaltion but the very real recessionary spiral of deflation. The very thing that created the crisis of the Seventies.
Deflation now tops policy-makers' hit list
Globe and Mail, Canada - These are some of the disquieting signs that the once-distant spectre of deflation is looming larger on the horizon, now that economies around the world .
..Deflation: A Primer New York Times
Deflation is the new bogey word as crunch sends prices tumbling Times Online
Deflation worries send Dow below 8000 Washington Times
When your house is burning, there is no sense fretting over painting the fence. With the U.S. economy mired in what will likely be a recession of historic proportions—and an outright depression in some industries—it would be foolish to get too worked up over future inflation concerns. Oracle-of-the-moment Nouriel Roubini, in his Forbes.com column, forecast the following for next year:
“The advanced economies will face stag-deflation (stagnation/recession and deflation) rather than stagflation, as the slack in goods, labor and commodity markets will lead advanced economies’ inflation rates to become below 1% by 2009.”
Remember those wheelbarrows of cash Germans had to use to buy things after WWI watch for Americans to roll out the barrow.
Deflation is considered a problem in a modern economy because of the potential of a deflationary spiral and its association with the Great Depression, although not all episodes of deflation correspond to periods of poor economic growth historically.
And true to form the Austrians celebrate deflation as one of the great things about the Great Depression.
Now we get to the crux of the matter: the Great Depression. The assumption is that falling prices somehow caused the economy to crumble. In fact, it was the after-effects of the boom combined with massive government intervention that caused the depression. The only silver lining in the entire period of the 1930s was precisely the falling prices that made the dollar count for more. Falling prices (a falling cost of living) are what Murray Rothbard has described as the "great advantage" of recessions. If you can imagine the Great Depression without falling prices, you have conjured up an image that is far worse than the reality.
As Rothbard has said, "rather than a problem to be dreaded and combatted, falling prices through increased production is a wonderful long-run tendency of untrammelled capitalism. The trend of the Industrial Revolution in the West was falling prices, which spread an increased standard of living to every person; falling costs, which maintained general profitability of business; and stable monetary wage rates—which reflected steadily increasing real wages in terms of purchasing power. This is a process to be hailed and welcomed rather than to be stamped out."
Now with deflation rising on the horizon as Bush bails out the financial market this prediction from the CATO Institute holds a warning for the future.
The Bush Legacy: Deflation or Inflation?
by Steve H. Hanke
Steve H. Hanke is a Professor of Applied Economics at The Johns Hopkins University in Baltimore and a Senior Fellow at the Cato Institute.
Added to cato.org on September 24, 2008
Economists of the Austrian school of economics term this type of debt deflation a "secondary deflation". If the forces of a secondary deflation are strong enough, a central bank's liquidity injections are rendered ineffective by what amounts to private sector sterilization. When people expect prices to fall, their demand for cash increases and soaks up central bank liquidity injections. This phenomenon characterized Japan's economy during most of the 1990s.
But what if the Federal reserve--fearing a secondary deflation, as they feared (incorrectly) a mild deflation in late 2002--pushed the Fed funds rate lower (now it's 2%) and turned on the inflation switch by monetizing more debt? Given the growing mountain of government debt, there is virtually an unlimited potential. It's a scenario worth thinking about.
And that future is here and now.
And since we are being nostalgic here is the theme song to the CTV series Here Comes the Seventies....
Tag
sasset-backed commercial paper ,, seventies,deflation, mortgages, housing, bubble, US, economy, oil prices, sub-prime mortgage, Wall Street, crash, recession,Bernanke, Inflation, Staglation, Stock-Market, US, Federal-Reserve-Chairman, Oil, gold, commoditiesSmoot-Hawley, protectionism, tariffs, Herbert Hoover, U.S., U.S. economy, Canada, Great Depression, John McCain, market crash, free trade, Republicans, recession,
US interest rate falls to 1 per cent
Which means that the U.S. is no longer facing infaltion but the very real recessionary spiral of deflation. The very thing that created the crisis of the Seventies.
Deflation now tops policy-makers' hit list
Globe and Mail, Canada - These are some of the disquieting signs that the once-distant spectre of deflation is looming larger on the horizon, now that economies around the world .
..Deflation: A Primer New York Times
Deflation is the new bogey word as crunch sends prices tumbling Times Online
Deflation worries send Dow below 8000 Washington Times
When your house is burning, there is no sense fretting over painting the fence. With the U.S. economy mired in what will likely be a recession of historic proportions—and an outright depression in some industries—it would be foolish to get too worked up over future inflation concerns. Oracle-of-the-moment Nouriel Roubini, in his Forbes.com column, forecast the following for next year:
“The advanced economies will face stag-deflation (stagnation/recession and deflation) rather than stagflation, as the slack in goods, labor and commodity markets will lead advanced economies’ inflation rates to become below 1% by 2009.”
Remember those wheelbarrows of cash Germans had to use to buy things after WWI watch for Americans to roll out the barrow.
Deflation is considered a problem in a modern economy because of the potential of a deflationary spiral and its association with the Great Depression, although not all episodes of deflation correspond to periods of poor economic growth historically.
And true to form the Austrians celebrate deflation as one of the great things about the Great Depression.
Now we get to the crux of the matter: the Great Depression. The assumption is that falling prices somehow caused the economy to crumble. In fact, it was the after-effects of the boom combined with massive government intervention that caused the depression. The only silver lining in the entire period of the 1930s was precisely the falling prices that made the dollar count for more. Falling prices (a falling cost of living) are what Murray Rothbard has described as the "great advantage" of recessions. If you can imagine the Great Depression without falling prices, you have conjured up an image that is far worse than the reality.
As Rothbard has said, "rather than a problem to be dreaded and combatted, falling prices through increased production is a wonderful long-run tendency of untrammelled capitalism. The trend of the Industrial Revolution in the West was falling prices, which spread an increased standard of living to every person; falling costs, which maintained general profitability of business; and stable monetary wage rates—which reflected steadily increasing real wages in terms of purchasing power. This is a process to be hailed and welcomed rather than to be stamped out."
Now with deflation rising on the horizon as Bush bails out the financial market this prediction from the CATO Institute holds a warning for the future.
The Bush Legacy: Deflation or Inflation?
by Steve H. Hanke
Steve H. Hanke is a Professor of Applied Economics at The Johns Hopkins University in Baltimore and a Senior Fellow at the Cato Institute.
Added to cato.org on September 24, 2008
Economists of the Austrian school of economics term this type of debt deflation a "secondary deflation". If the forces of a secondary deflation are strong enough, a central bank's liquidity injections are rendered ineffective by what amounts to private sector sterilization. When people expect prices to fall, their demand for cash increases and soaks up central bank liquidity injections. This phenomenon characterized Japan's economy during most of the 1990s.
But what if the Federal reserve--fearing a secondary deflation, as they feared (incorrectly) a mild deflation in late 2002--pushed the Fed funds rate lower (now it's 2%) and turned on the inflation switch by monetizing more debt? Given the growing mountain of government debt, there is virtually an unlimited potential. It's a scenario worth thinking about.
And that future is here and now.
This week's cover story in The Economist makes it more or less official. Deflation, not inflation, is now the greatest concern for the world economy. Over the past year, producer prices have fallen throughout the advanced world; consumer prices have been falling for the last 6 months in France and Germany; in Japan wages have actually fallen 4 percent over the past year. Until the recent crisis prices were falling in Brazil; they continue to fall in China and Hong Kong; they will probably soon be falling in a number of other developing countries.
So far, none of these price declines looks anything like the massive deflation that accompanied the Great Depression. But the appearance of deflation as a widespread problem is disturbing, not only because of its immediate economic implications, but because until recently most economists - myself included - regarded sustained deflation as a fundamentally implausible prospect, something that should not be a concern.
And since we are being nostalgic here is the theme song to the CTV series Here Comes the Seventies....
Tag
sasset-backed commercial paper ,, seventies,deflation, mortgages, housing, bubble, US, economy, oil prices, sub-prime mortgage, Wall Street, crash, recession,Bernanke, Inflation, Staglation, Stock-Market, US, Federal-Reserve-Chairman, Oil, gold, commoditiesSmoot-Hawley, protectionism, tariffs, Herbert Hoover, U.S., U.S. economy, Canada, Great Depression, John McCain, market crash, free trade, Republicans, recession,
Con Game
As I predicted here the Harpocrites have only one song sheet they sing from when it comes to the economy;the old neo-con tighten your belt.
Throne Speech warns of deficit
It pledged cost-control measures in Ottawa, including a squeeze on the budgets of many government departments and a law to limit the pay raises of civil servants.
"Hard decisions will be needed to keep federal spending under control and focused on the results," Ms. Jean read, following with the government's pledge to place grants and capital spending "under the microscope."
Mr. Layton argued that the Throne Speech adopted austerity measures and a laissez-faire approach, when intervention is needed. "I don't think you want to be taking ideas from the Mike Harris-era in Ontario and applying them to today's economic crisis," he said.
SEE:
Blue Throne Speech
Pinocchio Conservatives
Deja Vu
Tags
Canada, Great Depression, market crash, free trade, recession, Harper, Conservatives, deficit, Government, politics, Flaherty, Budget, GST, politicsCanada, Surplus, Economy, Taxes, EI,
Throne Speech warns of deficit
It pledged cost-control measures in Ottawa, including a squeeze on the budgets of many government departments and a law to limit the pay raises of civil servants.
"Hard decisions will be needed to keep federal spending under control and focused on the results," Ms. Jean read, following with the government's pledge to place grants and capital spending "under the microscope."
Mr. Layton argued that the Throne Speech adopted austerity measures and a laissez-faire approach, when intervention is needed. "I don't think you want to be taking ideas from the Mike Harris-era in Ontario and applying them to today's economic crisis," he said.
SEE:
Blue Throne Speech
Pinocchio Conservatives
Deja Vu
Tags
Canada, Great Depression, market crash, free trade, recession, Harper, Conservatives, deficit, Government, politics, Flaherty, Budget, GST, politicsCanada, Surplus, Economy, Taxes, EI,
Stiglitz On Market Fundamentalism
The market crisis exposes the failure of the neo-con agenda of deregulation, self regulation, privatization and contracting out. The real solution to this crisis as Stiglitz pointed out in 2006 is the socializtion of capital.
Joseph Stiglitz was awarded the Nobel Prize for Economics in 2001.
Gardels: What, then, is the ultimate impact of the Wall Street meltdown of market-driven globalization?
Stiglitz: The globalization agenda has been closely linked with the market fundamentalists -- the ideology of free markets and financial liberalization. In this crisis, we see the most market-oriented institutions in the most market-oriented economy failing and running to the government for help. Everyone in the world will say now that this is the end of market fundamentalism.
In this sense, the fall of Wall Street is for market fundamentalism what the fall of the Berlin Wall was for communism -- it tells the world that this way of economic organization turns out not to be sustainable. In the end, everyone says, that model doesn't work. This moment is a marker that the claims of financial market liberalization were bogus.
Financial markets are supposed to be a means to an end -- a more prosperous and stable economy as a result of good allocation of resources and better management of risk. But instead, financial markets didn't manage risk, they created it. They didn't enable America's families to manage the risk of volatile interest rates, and now millions are losing their homes. Furthermore, they misallocated hundreds of billions of dollar.
We will never achieve perfect stability of our financial markets, or of our economy. Markets are not self-correcting.
Gardels: What set of policies in the advanced countries can make globalization work?
Stiglitz: The prescription for making globalization work is what is generally called “the Scandinavian model.” That means high levels of investment in education, research and technology plus a strong safety net. That of course also entails, as in the Scandinavian countries, a highly progressive income tax.
Far from making these countries less competitive, it has made them more so. Though it may seem a contradiction to conservative ideologues who think cutting taxes is the answer to everything, the fact is that people are more willing to take entrepreneurial risks if they can count on a safety net and if they have the training to be innovative.
In Sweden, the social democrats who fashioned this policy have just been turned out of office. But we should not read that as a some kind of rupture in the social consensus. The new, more conservative government will only be about fine-tuning the model.
SEE:
Blue Throne Speech
Auto Solution
Not So Good News
Huh?
Super Bubble Burst
October Surprise Was The Market Crash
No Austrians In Foxholes
CRASH
Tags
recession,socialism,capitalism,George W. Bush,asset-backed commercial paper ,, stiglitz, globalization, mortgages, FDR, bubble, US, economy, 1933, sub-prime mortgage, Wall Street, crash, recession,Bernanke, Inflation, Staglation, Stock-Market, US, Federal-Reserve-Chairman, Oil, gold, commoditiesSmoot-Hawley, protectionism, tariffs, Herbert Hoover, U.S., U.S. economy, Canada, Great Depression, market crash, free trade, Republicans, recession,
Joseph Stiglitz was awarded the Nobel Prize for Economics in 2001.
Gardels: What, then, is the ultimate impact of the Wall Street meltdown of market-driven globalization?
Stiglitz: The globalization agenda has been closely linked with the market fundamentalists -- the ideology of free markets and financial liberalization. In this crisis, we see the most market-oriented institutions in the most market-oriented economy failing and running to the government for help. Everyone in the world will say now that this is the end of market fundamentalism.
In this sense, the fall of Wall Street is for market fundamentalism what the fall of the Berlin Wall was for communism -- it tells the world that this way of economic organization turns out not to be sustainable. In the end, everyone says, that model doesn't work. This moment is a marker that the claims of financial market liberalization were bogus.
Financial markets are supposed to be a means to an end -- a more prosperous and stable economy as a result of good allocation of resources and better management of risk. But instead, financial markets didn't manage risk, they created it. They didn't enable America's families to manage the risk of volatile interest rates, and now millions are losing their homes. Furthermore, they misallocated hundreds of billions of dollar.
We will never achieve perfect stability of our financial markets, or of our economy. Markets are not self-correcting.
Gardels: What set of policies in the advanced countries can make globalization work?
Stiglitz: The prescription for making globalization work is what is generally called “the Scandinavian model.” That means high levels of investment in education, research and technology plus a strong safety net. That of course also entails, as in the Scandinavian countries, a highly progressive income tax.
Far from making these countries less competitive, it has made them more so. Though it may seem a contradiction to conservative ideologues who think cutting taxes is the answer to everything, the fact is that people are more willing to take entrepreneurial risks if they can count on a safety net and if they have the training to be innovative.
In Sweden, the social democrats who fashioned this policy have just been turned out of office. But we should not read that as a some kind of rupture in the social consensus. The new, more conservative government will only be about fine-tuning the model.
SEE:
Blue Throne Speech
Auto Solution
Not So Good News
Huh?
Super Bubble Burst
October Surprise Was The Market Crash
No Austrians In Foxholes
CRASH
Tags
recession,socialism,capitalism,George W. Bush,asset-backed commercial paper ,, stiglitz, globalization, mortgages, FDR, bubble, US, economy, 1933, sub-prime mortgage, Wall Street, crash, recession,Bernanke, Inflation, Staglation, Stock-Market, US, Federal-Reserve-Chairman, Oil, gold, commoditiesSmoot-Hawley, protectionism, tariffs, Herbert Hoover, U.S., U.S. economy, Canada, Great Depression, market crash, free trade, Republicans, recession,
Wednesday, November 19, 2008
Blue Throne Speech
Why am I not surprised?
Throne speech warns of deficit, offers economic plan
No specifics in Tory economic plan
Because the neo-con agenda was about the failure of Keynesianism, except now all the capitalists and their political puppets are Keynesians when the market crashes. And when they applied their neo-con agenda it was during a temporary debt and deficit crisis of their own creation and it exasperated that into a full blown Reagan Recession. A little historical fact they fail to mention.
Canadian Prime Minister Stephen Harper moved closer to an about-face on economic policy today, outlining plans to stimulate growth that may run up a budget deficit after vowing to preserve surpluses.
A month after his Conservative Party government strengthened its hand in Parliament while falling short of a majority, Harper outlined his legislative agenda in a so-called Speech from the Throne, the ceremonial opening of a session. He pledged ``support'' for the country's car makers and plans to expedite infrastructure spending.
``In a historic downturn, it would be misguided to commit to a balanced budget in the short term at any cost,'' according to the text of the speech, which by tradition was read by Governor General Michaelle Jean in the country's Parliament, while Harper and other lawmakers listened. ``Ongoing'' deficits, though, would be ``unacceptable,'' Harper said.
Harper, who pledged ahead of his Oct. 14 re-election to maintain a balanced budget, told reporters last week his government may need to provide more stimulus to the world's eighth-largest economy to boost demand amid a global recession.
SEE:
Pinocchio Conservatives
Deja Vu
Business Unionism Offers No Solution To Capitalist Crisis
tags
asset-backed commercial paper ,, gold, homes, mortgages, housing, bubble, US, economy, oil prices, sub-prime mortgage, Wall Street, crash, recession,Bernanke, Inflation, Staglation, Stock-Market, US, Federal-Reserve-Chairman, Oil, gold, commoditiesSmoot-Hawley, protectionism, tariffs, Herbert Hoover, U.S., U.S. economy, Canada, Great Depression, market crash, free trade, recession, Harper, Conservatives, deficit, Government, politics, Flaherty, Budget, GST, politicsCanada, Surplus, Economy, Taxes, EI,
Throne speech warns of deficit, offers economic plan
No specifics in Tory economic plan
Because the neo-con agenda was about the failure of Keynesianism, except now all the capitalists and their political puppets are Keynesians when the market crashes. And when they applied their neo-con agenda it was during a temporary debt and deficit crisis of their own creation and it exasperated that into a full blown Reagan Recession. A little historical fact they fail to mention.
Canadian Prime Minister Stephen Harper moved closer to an about-face on economic policy today, outlining plans to stimulate growth that may run up a budget deficit after vowing to preserve surpluses.
A month after his Conservative Party government strengthened its hand in Parliament while falling short of a majority, Harper outlined his legislative agenda in a so-called Speech from the Throne, the ceremonial opening of a session. He pledged ``support'' for the country's car makers and plans to expedite infrastructure spending.
``In a historic downturn, it would be misguided to commit to a balanced budget in the short term at any cost,'' according to the text of the speech, which by tradition was read by Governor General Michaelle Jean in the country's Parliament, while Harper and other lawmakers listened. ``Ongoing'' deficits, though, would be ``unacceptable,'' Harper said.
Harper, who pledged ahead of his Oct. 14 re-election to maintain a balanced budget, told reporters last week his government may need to provide more stimulus to the world's eighth-largest economy to boost demand amid a global recession.
SEE:
Pinocchio Conservatives
Deja Vu
Business Unionism Offers No Solution To Capitalist Crisis
tags
asset-backed commercial paper ,, gold, homes, mortgages, housing, bubble, US, economy, oil prices, sub-prime mortgage, Wall Street, crash, recession,Bernanke, Inflation, Staglation, Stock-Market, US, Federal-Reserve-Chairman, Oil, gold, commoditiesSmoot-Hawley, protectionism, tariffs, Herbert Hoover, U.S., U.S. economy, Canada, Great Depression, market crash, free trade, recession, Harper, Conservatives, deficit, Government, politics, Flaherty, Budget, GST, politicsCanada, Surplus, Economy, Taxes, EI,
Funding A Myth
While the petro economy in Alberta gets bashed the Tired Old Tories plow ahead with funding for the mythical carbon capture and storage. What a waste of money.And this from a government that supposedly is not in the business of funding business, picking winners and losers. Well carbon capture and storage is not just a loser, it does not exist yet. Call it funding the Emperors New Clothes instead of saving for a rainy day. Clean Coal technology is a right wing fantasy.
However, in the face of a $6.5-billion surplus shortfall and multibillion-dollar "green" spending commitments made when oil peaked at $147 US a barrel in July, Finance Minister Iris Evans said Tuesday she doesn't expect there will be anything left to save.
In fact, the province's new fiscal update revealed the heritage fund's value has fallen to $15.8 billion from $17.1 billion, due to the financial market meltdown.
Several government critics are calling the government's decision to push ahead with $2 billion for technology to capture and store greenhouse gas emissions foolhardy.
NDP Leader Brian Mason said the province should inject those public dollars into savings, not hand over seed money to help the energy industry cut its carbon footprint.
"That is just a tiny drop in the bucket for an unproven technology that essentially landfills carbon, rather than focussing on real reductions in carbon emissions," Mason charged.
Evans, however, defended the spending, saying it will help strengthen the province's environmental reputation. Alberta produces more greenhouse gas emissions than any other province.
"Our $2 billion towards our carbon capture and storage is a necessary expenditure to show the world, to show Canada, that we're serious about environment and we're going to get emissions under control," Evans said
Now if only we had those oil and gas royalties in place our provincial budget would not have taken such a hit
SEE:
Harpers Alberta Green Plan
Between Coal and a Hard Place
King Coal
Coal=Cancer
Find blog posts, photos, events and more off-site about:
Alberta, tarsands, oilsands, Canada, state capitalism, royalties, oil, profits, Province, Bill Hunter, Alberta Royalty Review,Alberta Cabinet, Ed Stelmach,Big Oil,oil royalties, Conservatives, green, environment, Alberta, tarsands, oilsands, oil, green house gas, politics, Canada
However, in the face of a $6.5-billion surplus shortfall and multibillion-dollar "green" spending commitments made when oil peaked at $147 US a barrel in July, Finance Minister Iris Evans said Tuesday she doesn't expect there will be anything left to save.
In fact, the province's new fiscal update revealed the heritage fund's value has fallen to $15.8 billion from $17.1 billion, due to the financial market meltdown.
Several government critics are calling the government's decision to push ahead with $2 billion for technology to capture and store greenhouse gas emissions foolhardy.
NDP Leader Brian Mason said the province should inject those public dollars into savings, not hand over seed money to help the energy industry cut its carbon footprint.
"That is just a tiny drop in the bucket for an unproven technology that essentially landfills carbon, rather than focussing on real reductions in carbon emissions," Mason charged.
Evans, however, defended the spending, saying it will help strengthen the province's environmental reputation. Alberta produces more greenhouse gas emissions than any other province.
"Our $2 billion towards our carbon capture and storage is a necessary expenditure to show the world, to show Canada, that we're serious about environment and we're going to get emissions under control," Evans said
Now if only we had those oil and gas royalties in place our provincial budget would not have taken such a hit
SEE:
Harpers Alberta Green Plan
Between Coal and a Hard Place
King Coal
Coal=Cancer
Find blog posts, photos, events and more off-site about:
Alberta, tarsands, oilsands, Canada, state capitalism, royalties, oil, profits, Province, Bill Hunter, Alberta Royalty Review,Alberta Cabinet, Ed Stelmach,Big Oil,oil royalties, Conservatives, green, environment, Alberta, tarsands, oilsands, oil, green house gas, politics, Canada
Whew
That was close almost lost Peter Miliken as speaker of the house. Almost. Imagine Speaker Rob Anders....shudder.....
OTTAWA–They called for change, but in the end they stuck with experience and a side of optimism.
Peter Milliken, the Liberal MP from Kingston and the Islands who has been Speaker of the House of Commons since 2001, was re-elected by fellow MPs to the prestigious and demanding post yesterday.
It took five ballots for Milliken, challenged by seven other MPs, to win back his job. Many of the challengers campaigned on promises of restoring order and civility to the Commons, the scene of rancorous, partisan exchanges in recent years. Besides Milliken and Devolin, also running for the post were: New Democrat Joe Comartin (Windsor-Tecumseh); Conservative MPs Andrew Scheer (Regina-Qu'Appelle), Merv Tweed (Brandon-Souris), Rob Anders (Calgary West); and Royal Galipeau (Ottawa-Orléans) and Liberal Mauril Belanger (Ottawa-Vanier).
tags
Rob Anders, Conservatives, MP, Canada,Calgary-West,
OTTAWA–They called for change, but in the end they stuck with experience and a side of optimism.
Peter Milliken, the Liberal MP from Kingston and the Islands who has been Speaker of the House of Commons since 2001, was re-elected by fellow MPs to the prestigious and demanding post yesterday.
It took five ballots for Milliken, challenged by seven other MPs, to win back his job. Many of the challengers campaigned on promises of restoring order and civility to the Commons, the scene of rancorous, partisan exchanges in recent years. Besides Milliken and Devolin, also running for the post were: New Democrat Joe Comartin (Windsor-Tecumseh); Conservative MPs Andrew Scheer (Regina-Qu'Appelle), Merv Tweed (Brandon-Souris), Rob Anders (Calgary West); and Royal Galipeau (Ottawa-Orléans) and Liberal Mauril Belanger (Ottawa-Vanier).
tags
Rob Anders, Conservatives, MP, Canada,Calgary-West,
Turn About
"It is not a secret that in a real way this problem began in the United States
with completely inadequate regulation of the financial sector," Harper said in
Winnipeg. "Unregulated financial markets do not work. Canada has
known that for a long time. We all knew that from events of many decades
ago."
My, my now our neo-con, republican lite, libertarian free marketeer PM is proclaiming praise for state regulation. Like I said before when capitalism crashes there are no Austrians in fox holes. And as our PM has admited come a capitalist melt down there are no neo-cons in foxholes either.
Tags
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Nepotistic Boondoogle
The idea perhaps originated in the PMO after last election. Being a minority government who knew when King Stephen might get kicked from office. So lets find a legacy project for Steve. And viola what should appear on the horizon but the National Portrait Gallery. And as I pointed out here suddenly it was being moved out of Ottawa, lock, stock, and special atmospheric preservation equipment, to the Calgary riding of the PM.
Until last week when the whole idea was shelved, cause Calgary no longer looked like a shoe in for best P3 deal.
In a scathing editorial in the National Post entitled Portrait of Incompetence it is all made painfully clear. The P3 bid opened up to other cities was a mere fient, the fix was in for Calgary, until Edmonton put in two bids both lower than the Calgary costs.
The thoroughly depressing history of the project has been covered exhaustively -- but here is a capsule summary. Sheila Copps' original 2001 brainwave for a permanent centre at the old U. S. embassy in Ottawa ran headlong into cost overruns, belt-tightening in the national capital district and a new Liberal regime that was none too keen on building an expensive legacy for its leading critic. Paul Martin's government vacillated, and when it was ousted by the Conservatives, they seized upon the opportunity, first engaging in backdoor negotiations to find room for the gallery in downtown Calgary, and then opening the whole thing up to private-public bids from major cities across the country.
Edmonton threw a spanner in the works by coming up with not one but two bids that would have been extremely easy on the public purse; this led to the deadline being quietly extended so that Calgary could improve the terms of its proposed deal. Meanwhile, Ottawa's partisans put on a full-court press, arguing chauvinistically that the right place for a national gallery could not possibly be anywhere but the national capital. These master logicians told an ostensibly pretty story about the Portrait Gallery serving as a locus of educational tours of the capital, but failed ever to mention the real truth -- that in downtown Ottawa the building would probably remain a poor cousin to Parliament Hill, the National Gallery, the Museum of Civilization and other competing sites. The nation's capital Ottawa may be, but not many schools can afford to send children on the week-long field trips that the city perhaps deserves.
And speaking of Shelia Copps she has her own take on this mini-boondoogle.
The decision of Stephen Harper's Conservative government to cancel the National Portrait Gallery was a smart move to get out of a poorly conceived plan to build the museum as a public-private partnership, says former Liberal heritage minister Sheila Copps.
"I think that was a bit of a way of getting themselves out of a pickle that they'd created," Copps said Saturday. Heritage Minister James Moore announced on Friday that the gallery would be cancelled.
Moore said none of the proposals submitted by developers in a nationwide competition was acceptable and the government must act prudently in a time of economic instability.
But Copps said she didn't buy that excuse.
She described the competition as "poorly thought-out" and a "no-win" political situation that would pit the losing cities against the government.
This was always about Calgary. It was a sop to Encana, and the ideology of P3's. Encana of course is the company that Gwyn Morgan used to run. Harpers old political/business pal whom he tried to get appointed as the newly created Federal Government Appointments Commissioner after the 2006 election. But that too failed to pass. And like the National Gallery cancellation the post of Appointments Commissioner was never filled.
Until last week when the whole idea was shelved, cause Calgary no longer looked like a shoe in for best P3 deal.
In a scathing editorial in the National Post entitled Portrait of Incompetence it is all made painfully clear. The P3 bid opened up to other cities was a mere fient, the fix was in for Calgary, until Edmonton put in two bids both lower than the Calgary costs.
The thoroughly depressing history of the project has been covered exhaustively -- but here is a capsule summary. Sheila Copps' original 2001 brainwave for a permanent centre at the old U. S. embassy in Ottawa ran headlong into cost overruns, belt-tightening in the national capital district and a new Liberal regime that was none too keen on building an expensive legacy for its leading critic. Paul Martin's government vacillated, and when it was ousted by the Conservatives, they seized upon the opportunity, first engaging in backdoor negotiations to find room for the gallery in downtown Calgary, and then opening the whole thing up to private-public bids from major cities across the country.
Edmonton threw a spanner in the works by coming up with not one but two bids that would have been extremely easy on the public purse; this led to the deadline being quietly extended so that Calgary could improve the terms of its proposed deal. Meanwhile, Ottawa's partisans put on a full-court press, arguing chauvinistically that the right place for a national gallery could not possibly be anywhere but the national capital. These master logicians told an ostensibly pretty story about the Portrait Gallery serving as a locus of educational tours of the capital, but failed ever to mention the real truth -- that in downtown Ottawa the building would probably remain a poor cousin to Parliament Hill, the National Gallery, the Museum of Civilization and other competing sites. The nation's capital Ottawa may be, but not many schools can afford to send children on the week-long field trips that the city perhaps deserves.
And speaking of Shelia Copps she has her own take on this mini-boondoogle.
The decision of Stephen Harper's Conservative government to cancel the National Portrait Gallery was a smart move to get out of a poorly conceived plan to build the museum as a public-private partnership, says former Liberal heritage minister Sheila Copps.
"I think that was a bit of a way of getting themselves out of a pickle that they'd created," Copps said Saturday. Heritage Minister James Moore announced on Friday that the gallery would be cancelled.
Moore said none of the proposals submitted by developers in a nationwide competition was acceptable and the government must act prudently in a time of economic instability.
But Copps said she didn't buy that excuse.
She described the competition as "poorly thought-out" and a "no-win" political situation that would pit the losing cities against the government.
This was always about Calgary. It was a sop to Encana, and the ideology of P3's. Encana of course is the company that Gwyn Morgan used to run. Harpers old political/business pal whom he tried to get appointed as the newly created Federal Government Appointments Commissioner after the 2006 election. But that too failed to pass. And like the National Gallery cancellation the post of Appointments Commissioner was never filled.
Encana was also a victim of the Harpocrites about face on Income Trusts so having the National Gallery in Calgary built by Encana was simply payback.
This was about moving a National Gallery to Calgary to show that political power had shifted west, to the Petro Bay Street of Canada. It was also about selling off the Gallery to Encana. Thus Canada's National Portrait Gallery would have been the Encana National Portrait Gallery of Canada.
The new Conservative government killed that project in 2006 and tried to forge the EnCana deal. When that failed in the face of withering criticism from Ottawans and others, the government resorted to the bidding process. Now cities across the country have spent money preparing bids and $11 million has been wasted renovating the U.S. embassy location. The machinations surrounding the gallery have been a sorry display of government inefficiency and inept politics.
Once again the neo-con ideology of Privatization bites the bullet.
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Wage Controls
Here we go again the recession of the 1970's brought in wage controls under Trudeau. Then again in the ninties with the deficit and debt hysteria public and private sector workers faced assualts on their wages and benefits by provincial NDP and Conservative, and Federal Liberal governments. Now the Harpocrites are suggesting another attack on workers wages. While bailing out the bankers.
Flaherty also said the government is looking at controlling the rate of growth in the salaries of public servants, and is continuing with a strategic review of expenditures at all government departments.
We should not be surprised that Mike Harris's Finance Minister should talk about cutting wages for public sector workers. This was the neo-con aganeda during the ninties, carried out by Harris, Klein and Paul Martin. This is not new thinking, this is reactionary thinking. Attacking workers wages during a crisis of consumer capitalism will further entrench a recession which will then whipsaw into the private sector.
Flaherty says the equalization program itself isn’t threatened but spending growth needs to be controlled. "It’s a federal program, we will limit the growth of the program … it’s not sustainable otherwise," he said, I thought rather gravely.
The problem is, if transfers grow more slowly than inflation, provinces will face shortfalls. So less risky, politically at least, is cutting the civil service.
The Conservatives know there’s a standing constituency for strict control of public spending. And cuts can be doled out in ways that minimize the pain to particular constituencies.
That said, the last round of deep cuts was in the early 1990s, when Paul Martin and Jean Chretien put the brakes on federal transfers to the provinces and hacked away at programs. They cut the civil service and conditioned people to expect public spending cuts as the tactic of choice when times are tough.
While capitalist apologists bemoan any claw back of tax cuts to big business the Harpocrites now are suggesting attacks on workers wages.The reduction in transfer payments and discussions amongst the Premiers with Harper recently shows that the message has also been sent to these levels of government; prepare to roll back wages and benefits to your public sector workers. Anything to avoid a deficit. Class war has been declared by the Harpocrites.
Flaherty also said the government is looking at controlling the rate of growth in the salaries of public servants, and is continuing with a strategic review of expenditures at all government departments.
We should not be surprised that Mike Harris's Finance Minister should talk about cutting wages for public sector workers. This was the neo-con aganeda during the ninties, carried out by Harris, Klein and Paul Martin. This is not new thinking, this is reactionary thinking. Attacking workers wages during a crisis of consumer capitalism will further entrench a recession which will then whipsaw into the private sector.
Flaherty says the equalization program itself isn’t threatened but spending growth needs to be controlled. "It’s a federal program, we will limit the growth of the program … it’s not sustainable otherwise," he said, I thought rather gravely.
The problem is, if transfers grow more slowly than inflation, provinces will face shortfalls. So less risky, politically at least, is cutting the civil service.
The Conservatives know there’s a standing constituency for strict control of public spending. And cuts can be doled out in ways that minimize the pain to particular constituencies.
That said, the last round of deep cuts was in the early 1990s, when Paul Martin and Jean Chretien put the brakes on federal transfers to the provinces and hacked away at programs. They cut the civil service and conditioned people to expect public spending cuts as the tactic of choice when times are tough.
While capitalist apologists bemoan any claw back of tax cuts to big business the Harpocrites now are suggesting attacks on workers wages.The reduction in transfer payments and discussions amongst the Premiers with Harper recently shows that the message has also been sent to these levels of government; prepare to roll back wages and benefits to your public sector workers. Anything to avoid a deficit. Class war has been declared by the Harpocrites.
SEE:
Business Unionism Offers No Solution To Capitalist Crisis
tags
asset-backed commercial paper ,, gold, homes, mortgages, housing, bubble, US, economy, oil prices, sub-prime mortgage, Wall Street, crash, recession,Bernanke, Inflation, Staglation, Stock-Market, US, Federal-Reserve-Chairman, Oil, gold, commoditiesSmoot-Hawley, protectionism, tariffs, Herbert Hoover, U.S., U.S. economy, Canada, Great Depression, market crash, free trade, recession, Harper, Conservatives, deficit, Government, politics, Flaherty, Budget, GST, politicsCanada, Surplus, Economy, Taxes, EI,
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