Category: Capitalism

Drop taxes now…

…but they have to come back up when times get good.

If we as a planet are going to adopt the Keynesian model of economics over the neo-liberal free market model that’s been dominating for the past few decades, then we cannot continue to drop taxes in good times.

Lynne Fernandez at the Progressive Economics Forum makes the argument nicely for the upcoming Manitoba budget, the only province that currently has a NDP government (also featuring Canada’s longest serving premier).

We recommend that the province take another, closer look at Keynes’ ideas: tax cuts should never be a permanent feature of a progressive, forward-thinking society. Eventually there will not be enough money for the important initiatives so needed in our province; initiatives that would allow us to ride out the current crisis and emerge even stronger. [emphasis added]

Too bad Canada and most provinces are at such low tax rates as a result of the past philosophy that cuts now are going to make budgets bleed anaemically. As well, with a SoCon government, it will be tough to extract the necessary targeted funding to make a difference.

You shouldn’t be finance minister if you can’t add

Edmonton Journal reported Trish Audette reports from a budget meeting this morning in Edmonton that Iris Evans expects Alberta to lose only 15,600 jobs this year, when in Jan-Feb we’ve already lost 29,400.

That’s right, either our finance minister can’t add, read the paper, or is somehow under the perception that Alberta is going to come out of this recession before this summer, and get all those people jobs again by December.

Wow.

Edmonton Journal calls for higher taxes?

Okay, this isn’t straight from the editorial board, but the Journal did publish a column today by Dr. Roger S. Smith, professor emeritus and former U of A vice-president, research, and dean of business, calling for an Alberta sales tax and higher gas taxes.

The logic is that our resources will run out (or at least revenues from them), and when they do we’ll need some other sources for money. He also argues that these taxes can supplement the Heritage Fund, getting us to $100 billion in the bank by 2030, which would provide revenue (from interest) of $3.5 to $5 billion per year (about half of our current resource revenue).

Unfortunately in 20 years we’ll likely need a lot more revenue than we do now, but luckily a sales tax would grow directly with our population.

He even gives us a short term bonus: a slowly implemented sales tax (3% in 2010 and up a percent or two each year after that) would stimulate spending from people who don’t want to pay more in January.

Hopefully someone (in the Tory cabinet) takes note of this column and the ideas therein (which have been heard before).

The irony, it’s so sweet

“Minority governments show no particular tendency to fiscally irresponsible behaviour, contrary to some theoretical predictions.”

“A general observation would be that, while there is no evidence of a ‘chronic deficit’ tendency in Canada historically, neither is it clear how such a problem is resolved once it occurs.”

“The record indicates that particularly activist Keynesian policy has been rare in the postwar period. The results indicated that it should remain so.”

Harsh words for the current Prime Minister.

However, they come directly from his own thesis.

That’s right, just after Dr. Frank Atkins, Harper’s thesis supervisor, came out in the Herald stating: “This is not an economic budget in my mind. It’s a political budget, much more so than any other budget has been a political budget,” Don Martin, with the National Post, got a hold of Harper’s thesis and pulled some juicy quotes from it.

Basically, it boils down to the fact that Harper has sold his soul (again?) and upset around 90% of the (small c) conservative academia of the University of Calgary.

Now, if only there were a potential party on the right that represented the beliefs of disenfranchised conservative Albertan voters. Then the two of them could split the votes, like we on the (centre to) left have had to deal with for far too long.

(h/t: A BCer in Toronto)

MLAs may take pay cut? Too good to be true

First the good news:

The Alberta government will review upcoming MLA raises and revisit hefty hikes approved last year, Premier Ed Stelmach said in Calgary Friday.

That’s reasonable, but oddly admirable of our premier, what’s the catch?

“We’re in this together,” the premier said after a media conference at the Calgary Drop-In Centre. “I am not going to ask any sacrifices from the public sector of the province of Alberta if we’re not willing to sacrifice ourselves.”

Wait… I think this means he’s going to ask for sacrifices from the public sector.

What will this look like? Pay cuts, removal of rights to strike, benefit cuts? It definitely doesn’t sound like it promises to be an economic stimulus.

Here’s a hint Ed: taking money out of people’s pockets is not a good way to get them to spend more money and get an economy going.

I guess we’ll have to wait and see what happens in his budget. Either way, I’m likely out of this province in 7 months.

Not having a plan in March is starting to show

Remember months ago when Albertans didn’t vote and we got far too many seats for the incumbent Conservatives (to me they lost the title “Progressive” a long time ago)? Remember how “Steady-Eddie” Stelmach ran with no plan?

Seems it’s caught up to him.

Stelmach said the provincial treasury is being depleted by crashing commodity markets and loss of tax revenue, which could see spending outstrip revenues for the fiscal year — technically producing a deficit that is illegal under provincial law.

I’m sure he was later heard to say, “what, bubbles burst?”
Continue reading Not having a plan in March is starting to show

Canada’s media has lost its integrity

If there’s one thing I’ve taken from this past week of political foofaraw, it’s that Canada’s media fails at being non-partisan and often is pretty weak on its journalistic standards in a rush to get a story out.

Those words may be a bit harsh, but this is a blog, where I’m expected to be partisan and have little to no standards.
Continue reading Canada’s media has lost its integrity

Future shop gives 53,000 sq. ft. middle finger to recession

This past Wednesday evening Alan and I got the opportunity to get a tour of the new Future Shop in South Edmonton Common. They gave us food, a tour, and a free bluetooth headset in the interests of biasing our opinions.

This store is massive. It’s more than double the size of an average Future Shop. Imagine a Costco-sized warehouse dedicated to electronics.

But they weren’t going to settle with being the largest store, this is also a special pilot store where they plan on introducing new product lines and feeling out new markets.
Continue reading Future shop gives 53,000 sq. ft. middle finger to recession

Conservative FAIL

Perhaps Harper needs to go back to school and learn some more economics. Lowering taxes and raising spending, while entering a recession, is not the best time to promise that you won’t go into a deficit.

For some reason, people still think neo-cons know something about economics. They don’t. They know about giving money to big business and big religion.

From the Globe and Mail (emphasis added):
Continue reading Conservative FAIL