Month: February 2009

Recession comparisons

I asked my good friends at the TD Bank's economics department if they could give me some key benchmarks that might let us compare the other two great recent recessions that Canada went through — most economists I've talked to say the worst years we've had prior to this one were 1981 and 1991 — against the current recession. The key takeaway here, as you may have heard, is that we are in much, much better shape to weather a recession than we were in 1981 and 1991. Here's the benchmark averages for the years prior to the worst recession year:

Inflation

  • 2008: 2.37 %
  • 1990: 4.78 %
  • 1980: 10.13%

Unemployment rate:

  • 2008: 6.1 %
  • 1990: 8.2 %
  • 1980: 7.6%

Exchange rate ($CDN need to purchase 1 US$)

  • 2008: 1.0671
  • 1990: 1.1668
  • 1980 (Dec. 19): 1.1692

Crude Oil (in constant 2008 dollars)

  • 2008: $100.16
  • 1990: $35.61
  • 1980: $96.84

CIBC Prime Rate (this data set is courtesy the Parliament of Canada. CIBC's Prime Rate could be expected to largely mirror the prime rate of every other major Canadian bank)

  • 2008 (Dec. 10): 3.5%
  • 1990 (Dec 21): 12.75 %
  • 1980 (Dec. 19): 18.25%

And now, here are the forecasts for 2009 for each of those variables except Prime:

  • Inflation: 0.50 %
  • Unemployment: 7.7%
  • Exchange rate: $1.2060
  • Crude oil: $36.07
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A corrective: Will American foreign policy change under Obama?

David E. Sanger, the chief Washington correspondent for The New York Times, has a new book out and in it, he suggests that we all should take a pill if we think CHANGE is coming so far as America's stance towards the world …

In this sense, even the title of David Sanger’s quick-paced chronicle, The Inheritance, offers a corrective: Obama will not craft anew; he will inherit. “The world he is inheriting from Bush will constrain his choices more than he has acknowledged, and certainly more than the throngs of supporters believed as they waved their signs proclaiming CHANGE,” Sanger writes, with justifiable asperity.

Will American normalcy be restored? Absolutely not. It is “illusion” to imagine that “with George W. Bush retired in Texas, America will now sheath the Big Stick.” Will there be a respite abroad? Probably not. Only a naïf “thinks the Iranians will give up their nuclear program without the lingering concern that bombers may appear over the skies” of their reactors. Can nothing budge the habits of American statecraft? Not really, given that “the crises may be too plentiful and the accompanying expectations may be too high” for Obama to steer an honestly new course. His more excitable lieutenants, with a conviction that things are the other way around, are just as likely to perpetuate Washington’s strategic bankruptcy.

Really? I'm looking forward to reading Sanger's book and so I don't want to take issue with him based on this review (even if the review is by Lawrence F. Kaplan). But if Sanger is suggesting Obama will have trouble fighting Bush's inertia when it comes to foreign policy, then how was it that Bush (II) was able to take American foreign policy in such a new direction after Clinton? Was 9/11 such an enabler for Bush? Is Obama constricted on foreign policy without a similar enabling event? Is his enabling event the fact that his ascension to the White House such a historically significant event because of his skin colour? Is Obama's enabling event the global hope/interest/pressure that accompanied his election?

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Help: Looking for some freeware Mac OSX audio recording software

I'm looking for a freeware (or real cheap shareware) virtual version of the digital recorder (an Olympus WS-210S) I have plugged into the phone on my desk.

I use this digital recorder to record telephone interviews. When I'm done the interview, I transfer the digital recording to my Mac. So I'm thinking: Why do I need the extra step? Why not just record straight to the Mac?

It's easy enough to do this with the right software. Now, I've got Audacity loaded up on my machine and it's fabulous for a lot of audio jobs but it's too much software for the simple job of recording a telphone call that can last 5 to 20 minutes.

And more importantly, when I'm talking to someone I like to note “timecode” so I can quickly come back and identify key clips. I do this on my Olympus. When someone sends something quotable, I note the 'runtime' code on the Olympus recorder so that I can quickly come back to it or, if I'm e-mailing the digital file to a colleague, I can tell them that so-and-so said something about such-and-such a subject at a particular time in the interview. You can note the time in Audacity but you have to be in a micro-close up view of the track you're recording and, well, let's just say it's kind of clunky to figure out and takes too long to set up.

The other beef with Audacity is that records in its own very bulky “.aup” format which means once you're done you've got go through the extra step of exporting as .wav or .mp3 files if you want to ship them around the office, archive them, or publish them on the Web.

I've been through Audio HiJack Pro, RecordPad (which was close to perfect in terms of the feature set but at US$40 is way too pricey), RecOSX and some others but they're not much of an improvement over Audacity's price or feature set.

So here's what I'm looking for in this little package:

  • Records “line-in” audio on Mac Intel machines
  • Has a “timer” while recording
  • Records in some compressed format (.mp3 preferably but .wav or .ogg)
  • Is free

Alternately – maybe you know of a plug-in for Audacity that puts a little timer window up front and centre while you're recording.

Gobsmackingly bad job data this morning

Things have gotten bad in Canada's economy and in a hurry.

This morning, Statistics Canada says 129,000 jobs disappeared in January, the biggest single monthly loss ever.

Employment fell by 129,000 in January (-0.8%), almost all in full time, pushing the unemployment rate up 0.6 percentage points to 7.2%. This drop in employment exceeds any monthly decline during the previous economic downturns of the 1980s and 1990s.

Forecasters didn't see this coming. They were thinking it would be something in the range of 40,000 job losses or so. (Which is still a big month).

All of the job losses came in Ontario, B.C. and Quebec.

Manufacturing lost more than 100,000 jobs in January, an all–time record.

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Chalk River, the Ottawa River and radioactive water

Today, in the House of Commons, Natural Resources Minister Lisa Raitt said:

Mr. Speaker, … there was no radioactive leak into the Ottawa River …

And she appears to be quite right.

But, as the documents she tabled today in the House indicate, there will be a release of radioactive water into the Ottawa River:

The collected heavy water, along with other waste water from the Chalk River site, will be treated at Chalk River's Waste Treatment Centre to reduce contamination. Prior to any release of water to the river, water is treated to remove the majority of radio-nuclides. All applicable release limits are agreed with the CNSC, and adhered to by AECL, consistent with Ministry of Environment regulations.

In instances of handling water with tritium, which is not removed in the treatment process, concentration levels dictate whether the water will be stored or released. Releases from AECL's Waste Treatment Centre are carefully monitored and released at a controlled rate, subject to provincial and federal regulatory limits. AECL routinely monitors water in the Ottawa River for concentration of tritium. For example downstream from Chalk River Labs, at Petawawa, tritium concentrations in the Ottawa River are similar to the naturally-occurring level upstream of Chalk River, and negligible compared to the Canadian drinking water standard.

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Government triva: Feeding prisoners and running the country

Some notes pecked out as I pass the time inside the lockup for the release of the latest series of chapters from the Auditor General:

Feeding prisoners

Correctional Services Canada, the federal government agency responsible for running the 51 institutions that house those serving federal prison sentences spends about $72 million a year on food, clothing and cleaning supplies. (The A-G is complaining about that — saying there's lots of room to cut that cost). Fo the fiscal year, 2007-08, CSC's managers budgeted $4.47 per inmate per day for food. Turns out, though, that those planning targets were not very realistic. It's costing about $9 per inmate per day to feed a prisoner. For those prisoners requiring a special diet for religious, medical or ethical reasons, it's costing $20 a day. And here's something you won't be surprised to hear: The number of inmates demanding those special $20-a-day diets is on the increase. Criminals may be dumb but they ain't stupid.

Overtime for prison guards

So here's an odd one. Over the last few years, Canada's prison population has remained the same, the number of prison guards has remained the same or increased and there has been no spike in the incidence of prison violence. Why then, the Auditor General, is overtime costs at our prisons spiralling out of control? (That would be Exhibit 7.3 of Chapter 7 of the A-G's December 2008 report). The overtime bill last year was $47 million. Two years ago it was less than $30 million. Here's the key graph from that report:

prisonovertime.jpg

Crown Corporations

These tidbits come from the recently tabled (by Treasury Board President Vic Toews) annual report on Federal Crown Corporations:

  • The federal government is divided up – for legal, corporate and reporting purposes — into 383 distinct units. (Combined, those 383 units will spend about $230 billion this year, incidentally). Government departments — Justice, Health, Natural Resources, and so on — are the biggest units and each one has a minister. There are 20 of those. There are 125 “shared governance” corporations, 76 wholly-owned subsidiaries of Crown corporations, 58 statutory and other agencies, 48 Crown corporations but just 2 joint enterprises in which the federal government (or one of those 383 units) is one of the partners. That's a whole lot of stuff for your correspondent to keep an eye on.
  • John Baird, the Minister of Transport, Infrastructure and Communities has the greatest number of “units” reporting to him. In addition to his own department, he has 76 Crown corporations, statutory agencies, and shared governance corporations which Parliamentarians expect him to answer for. Heritage Minister James Moore is second in that regard, with 47 such units. Toews is third with 42 such units.

New federal institutions

Some you've probably heard of, some you probably haven't, but here's a list of new federal institutions created between August 1, 2007 and July 31, 2008, listed according to the department responsible for the institution.

  • Indian Affairs and Northern Development
    • Indian Residential Schools Truth Indian Affairs and and Reconciliation Commission Secretariat
    • Registry of the Specific Claims Tribunal
  • National Defence
    • Office of the Communications Security Establishment Commissioner
  • Canadian Heritage
    • Registry of the Public Servants Disclosure Protection Tribunal*
  • Human Resources and Social Development
    • Canada Employment Insurance Financing Board
  • Finance
    • PPP Canada Inc.

Former DFAIT mandarin to chair key WTO body

John Gero was the Assistant Deputy Minister in charge of Trade Policy and Negotiations Branch at the Department of Foreign Affairs and International Trade.

Last November, he was named Canada's ambassador and permanent representative to the World Trade Organization (WTO) in Geneva.

This week, he was named the chairperson of the WTO's Dispute Settlement Body.

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Reaction to Duffy's maiden speech …

… was — shall we say? — mixed. From today's Senate Question Period:

Hon. Joan Cook: Honourable senators, my question is for the Leader of the Government in the Senate. Does the leader condone and associate herself with the remark made by her colleague Senator Duffy in his maiden speech yesterday regarding Premiers Williams and Ghiz?

Hon. Marjory LeBreton (Leader of the Government and Minister of State (Seniors)): I thank the honourable senator for the question. It is a pleasure to take a question from Senator Cook. I have not gone over word for word the comments of Senator Duffy in his maiden speech in the Senate. Senator Duffy is free, as are all senators, to speak his mind and to speak freely in this place. It is not a matter for me as the Leader of the Government in the Senate to judge any senator’s speech or the contents of their speech.

Senator Cook: With the house's indulgence, I would like to read part of yesterday's speech. On page 73 of the Debates of the Senate, Senator Duffy states:

Honourable senators, I was disappointed to see that our dynamic young Premier in Prince Edward Island, Robert Ghiz, has climbed into bed with the Premier of Newfoundland and Labrador, and honourable senators know what a grotesque scene that is. Do honourable senators know what happens when two politicians climb into bed together? One of them comes out on top and I am afraid that when one is in bed with Danny Williams he will come out on top and I would hate to see where that will leave P.E.I. in the end. However, I will leave all that for another day.

Hon. Lillian Eva Dyck: I heard the honourable Leader of the Government in the Senate say that it was not up to us to look at what senators were saying and that we had freedom of speech. Would the minister not say that within this chamber there is an appropriate standard of speech which we must uphold and that we should set a high standard? Does she agree with that?

Senator LeBreton: I thank the honourable senator for the supplementary question. I do not think it is within my area of responsibility to adjudicate or judge individual senators' speeches. That is a role for the Speaker, not for the Leader of the Government in the Senate.

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The job creation disconnect

Here is Derek Burleton, an associate vice-president and director of economic analysis at the TD Bank, writing today about the country's economic outlook:

In the job market, some 325,000 jobs are expected to be shed on a net basis this year, pushing the unemployment rate towards 8.8%.

Here is the first paragraph from an annex in one of the budget documents, “Economic Action Plan: Employment and Output Impacts”:

… the measures in this budget will boost real GDP by 1.4 per cent by the end of 2010, which translates into about 140,000 jobs created or maintained. Including funds leveraged from other orders of government, the impact on real GDP is estimated to be 1.9 per cent by the end of 2010, translating into almost 190,000 jobs created or maintained.

So, just to review:

  • Jobs to be lost this year: 325,000
  • Government job creation target: 190,000

Meanwhile, the Commons Finance Committee will hear evidence tomorrow from Kevin Page, the Parliamentary Budget Officer. Page may have some comments about the size and effectiveness of the government's stimulus plan and its impact on job creations.

The steel lobby: Axe green regs or raise trade barriers with China

I'm back in the business pages in some papers today with:

Months before Canada's steel industry found itself at the centre of a brewing trade war with the United States, it was pressing the federal government to either put up trade barriers to protect it from what it called unfair Chinese imports or somehow exempt it from pending environmental regulations.

Canwest News Service has learned that Canada's steel companies, which collectively employ about 150,000 people, have been aggressively lobbying politicians, including Finance Minister Jim Flaherty and Environment Minister Jim Prentice, and senior government officials for months.

The industry's dilemma underlines one of the thorniest issues that policymakers in Canada and other developed nations must face: How to live up to environmental commitments in the face of an economic downturn.

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A briefing note prepared for Mr. Flaherty last spring said the Canadian Steel Producers Association is pushing the government to put up trade barriers that would limit or restrict the amount of steel being imported into Canada from countries like China, so that “that the domestic steel industry is not put at a competitive disadvantage,” the note said.

You can read the rest here …

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