Month: November 2011

I (and about another dozen press gallery journos) are about to hop in the back of Prime Minister Stephen Harper's military Airbus to head Cannes, France for the G20 summit where leaders will be consumed with the harrowing debt situation in Greece in particular and in Europe more generally.

Inevitably, we will be wondering if the Harper government should continue with its “steady as she goes” approach focusing on debt reduction or whether, as the NDP has argued, it is time for a new round of stimulus.

I argue today that now is not the time for Canada to act though it should be ready to do so …

… as we’re seeing now in Europe, a government that does not have its fiscal house in order is powerless to help its populace when it most needs help, usually in a recession.
So Flaherty [austerity focus], for now, is right.
Since Canada is not in a recession and, assuming our good luck holds, will not be in a recession for the foreseeable future, it is prudent government policy to do what we can to clean up the federal balance sheet.
After all, the Canadian economy, with some help from government stimulus programs, has created more than 650,000 jobs since July 2009.
As Harper has been boasting on the international circuit, “Canada is one of only two G-8 countries that have more people working now than before the 2008 recession.” [Read the rest]

Armine Yalnizyan, senior economist with the Canadian Centre for Policy Alternatives, argues that now is precisely the right time for more spending:

Prime Minister Stephen Harper and Finance Minister Jim Flaherty have championed deficit reduction and austerity measures at G20 meetings since summer 2010.
But [Nobel Prize-winning former chief economist of the World Bank, Joseph] Stiglitz says the austerity agenda misses the point: budget cuts simply shift the risks to the private sector and raise the economic stakes, in both the short and long term.
“Austerity is a suicide path” Stiglitz said bluntly, the opposite of what the global economy needs.
Balancing the books by trimming public spending guarantees even slower growth given the underwhelming nature of private sector investments in job creation and production.
The solution isn't more stimulus through more quantitative easing either, Stiglitz says. “It stretches credulity that more leverage will fix the problem.”
No, the solution is to tax and spend. [read the rest]

 

A couple of weeks ago, I filed this column for distribution to our chain of papers:

… as Conservatives bust up one kind of agricultural monopoly [the Canadian Wheat Board], how about taking on the other agricultural cartels such as the dairy farmers who force Canadian consumers to pay more for food and hurt our standing on the international stage as free traders?
Sadly for consumers, the Conservatives, like the Liberals before them, don’t seem interested in dismantling the so-called supply management system that gives the country’s dairy farmers $2.4 billion a year in subsidies that one think-tank called “an implicit tax that governments have authorized farmers to impose on consumers. [Read the rest]

Shortly after that column was published, the Canadian Dairy Farmers of Canada — anxious that we not even bring this up for discussion — went on a full-court PR blitz, distributing this “fact sheet” and sending this Urgent Letter to Prime Minister Stephen Harper [pdf], NDP Leader Nycole Turmel and other party leaders. Conservative MP Laurie Hawn even read the “Urgent letter” into the record in the House of Commons:

We have just received a letter addressed to the Prime Minister and to the leaders of all the parties in the House from the president of Dairy Farmers of Canada, which I will read into the record. It is about supply management.

We are urgently writing to you today in response to the discourse that has been taking place and is having an unintended negative impact on supply management. We do not want our system to be drawn into discussions on other collective marketing systems such as the Canadian Wheat Board.

… Dairy farmers appreciate the strong support of all political parties for the supply management system. We also appreciate the repeated support and demonstrated willingness of the federal government to defend supply management both domestically and internationally. We do not question this government's support for our system. We have accepted the clear policy intentions that the government has stated in several throne speeches.. [read the rest from Hansard]

But, despite the Dairy Farmers attempt to make all this go away, it looks like we're starting to have that debate. Today, University of Guelph economics professor Sylvain Charlebois chips in with this:

Supply management controls domestic production and imports for five specific commodities: eggs, milk, chicken, turkey and broiler-hatching eggs. While supply management regulates domestic production based on consumer demand to guarantee decent returns for farmers, Canada has high import tariffs for these commodities. It’s heaven on Earth for many farmers in Canada. While Canadian supply management does not concern more than a few lobby groups in the country, it has been highly contested abroad. The Wheat Board’s monopoly and supply management are correlated: Both are bureaucratic marketing boards that distort trade and undermine entrepreneurial know-how and innovative thinking in Canadian agriculture.

…Changes to supply management will be forced on Canada externally, through free-trade negotiations with other countries. It may not happen under this government, but it will happen eventually. Food politics condemns Canada to wait for the bagpipers to end supply management. Let’s hope that, unlike the Canadian Wheat Board, which is still challenging the government, supply-managed farmers will have the foresight to befriend change – and get on with it.