Friday, May 29, 2009

$1.4 million per job saved: Cheaper than letting GM fail?

The Globe and Mail is reporting on the new cost estimates of the auto sector bailout bill, which could be as large as $13.5 billion dollars. What kind of cost is that putting on taxpayers - many of whom don't have the high wages or padded benefits packages that autoworkers enjoy?

At General Motors of Canada Ltd. alone, the rescue package could amount to a staggering $1.4-million for every job saved, with no guarantee that the bailout will ensure the long-term survival of the company's remaining auto assembly and engine plants.

You read that right - GM alone will cost taxpayers $1.4 million per job.

What's worse is that it's awfully hard to believe that these bailouts actually create or save any jobs at all.

“You're not going to save jobs. All you are going to do is destroy jobs at Ford and Toyota,” said Mark Milke, director of research at the Frontier Centre for Public Policy in Calgary.

Mr. Milke dismisses the bailouts of GM and Chrysler as “a massive transfer of wealth to companies that consumers have already rejected.” The result, he maintains, is that governments “are punishing the companies that have actually run their businesses very well.”

More evidence that when government gets involved in business it's no longer "give the customers what they want," it's "make them pay for what they don't."

Cross posted to the Shotgun.


Wednesday, May 27, 2009

Shameful behaviour by striking CUPE workers in Windsor, ON

I live in Windsor, Ontario, where city workers have been striking since mid-April. There has been no garbage pickup or park maintenance, but I've been happy to see the people of Windsor stepping up to do what they can to take care of the city. People have started going out with their kids to help clean up parks as a way to teach them about littering and keeping the planet clean. One major cleanup by folks cleared piles of Tim Horton's cups and other garbage from the riverfront.

Entrepreneurs have also come to the forefront, offering garbage pickup with their trucks and trailers for people who don't want to leave their garbage at the road in the hot weather for rats or raccoons to tear open or to store it in their basements as the city suggests. It's been absolutely heartwarming to see people helping one another in my city.

Apparently, though, this isn't OK with the city workers, who shout at those trying to clean up and have been reported to have even grabbed garbage from workers at local businesses to dump it into city parks. Most startling so far, though, is this cell phone video of a woman shouting at a couple and their granddaughter as they pick up garbage in a park. The woman aggressively approaches them, tears open a bag of garbage and kicks it all over the ground the child and couple have finished cleaning, telling them, "Here's some more garbage, since you think you should be doing our jobs."

The man who shot the video is afraid to be identified because he's worried the union will retaliate against him. Apparently he should be. The columnist who wrote the article on entrepreneurs linked above had his car vandalized after his article was printed for the first time in a long career of controversial writing.

When unions were first started they had a noble purpose - to protect workers from mistreatment and to give them an equal voice when bargaining for their jobs. The high value of the workers protected their jobs when they were on strike and reminded employers of their value.

Over the years this purpose has been completely lost, especially as legislation has taken away the ability of the employer to have equal status when bargaining -striking employees cannot be fired and replaced if others are willing to do their job for less. Although employees' labour does not have the high value it once did, employers are forced to treat them as though it did.

Public sector unions, though, are the worst. When they go on strike they are basically holding third parties - taxpayers and citizens - hostage to get their demands. Because they provide public services, they are infuriated even by something as positive as people working together to make the world a better place.

The rumour here in Windsor is that CUPE president Sid Ryan is using Windsor to set an example and let municipalities know that CUPE will not take lower raises or benefits because of the economic downturn, dispite the hardships their taxpayers might be facing.

If this is true and Ryan is looking to make an example, perhaps he should start with the CUPE picketers who would intimidate, frighten or shout at the people, including children, trying to keep their parks safe.

Cross posted to the Shotgun.

You know those ads to raise awareness of the government's new and various tax credits? "You've earned it. Claim it!" - as though you hadn't earned every last penny of the taxes you'd paid instead of just the ones the Ottawa plans to toss back your way.

With this year's deficit forecast to be $16 billion higher than planned, clocking in at over $50 billion, it's becoming obvious that Canadians are not getting their money's worth from this stimulus. It seems that the government's real slogan, says Terence Corcoran, is "We've borrowed it. Now you pay for it."

There are roughly 18 million income-tax filers in Canada, which means Mr. Flaherty's new deficit will put the average Canadian taxpayer about $2,700 deeper in hock by the end of this fiscal year. Add in the deficits running up in places like Ontario, and the total average debt load per income-tax filer could run to $5,000.

That's a lot to pay for the thrill of "stimulating" the economy.

How many Canadians will get $5,000 worth of benefit out of what is quickly becoming a major national extravaganza of spending and borrowing? Canadians who spent $1,350 on home reno materials this year will be in debt for three times that amount.

Oh well. I guess at least we're not $2 trillion (and counting) in the hole like the land of the free is this year, but their deficit will surely come back to bite us, too.

Cross posted to the Shotgun.

Don't blame the economy


As we all know, Finance Minister Jim Flaherty announced yesterday that the government's 2009-2010 budget deficit will be upwards of $50 billion dollars, rather than the originally planned $33.7 billion laid out in the budget.

Surely, though, this is simply a result of poorer-than-expected economic performance, right? The finance minister and government couldn't be at fault.

Not quite, says Terence Corcoran.

... blaming growing deficits on the recession and unforeseen turns in the economy is a political device rather than a solid explanation. Today's deficits in Ottawa are a direct product of five years of fiscal expansionism and continued spending increases. Spending has been rising at twice the rate of population growth and inflation, an unsustainable trend.

In a commentary today in the Financial Post, the Fraser Institute's Niels Veldhuis plots the numbers. Mostly under a Conservative government, average annual spending rose 6.2%, exactly double the rate of growth suggested by the increase in population and inflation. Spending this year is heading for a gain of more than 10% - before taking into account the final auto bailout numbers.

When governments run up big spending increases during boom times - as Ottawa and all the province did - then there's nothing left to tap into when the economy slows down. There's no buffer. Revenues fall and spending growth increases, creating a deficit trap from which there is no escape other than waiting for the private economy to catch up with public spending and begin the "Now you pay for it" phase.

Veldhuis, in his article, suggests legal restrictions on government spending to help to keep it from getting out of control as it has in Canada and, to be fair, all over the world. Canadians ought to see his point.

Cross posted to the Shotgun.

Surprise, surprise: the deficit is going to be bigger than expected

Finance Minister Jim Flaherty is starting to prepare Canadians for bigger deficit numbers than the government predicted when it tabled its budget in January.

This isn't surprising - or shouldn't be to anyone who's a fan of public choice. We should expect to see (and I've predicted) the same thing happen to the McGuinty government's projected deficit in Ontario, and to any other government expecting a deficit this year.

Realistically, and thankfully, Canada's debt-to-GDP is the smallest in the G7, so borrowing is cheaper for us than it is for most. That doesn't mean that expanding or continuing budgets are excusable, though.

For all the rigmarole surrounding Ignatieff's assertion that Ottawa is going to have to raise taxes (or make spending cuts, but thankfully the Tories didn't attack him for that half of the comment), he's right. Getting out of deficit isn't going to be easy or painless for Canadians, and as much pressure as possible needs to be put on the Conservatives to stop piling up the debt so that they don't have to be the ones to make the cuts.

UPDATE: Finance minister Jim Flaherty now says that the deficit will be $50 billion this year, up from the original estimate of $34 billion. This alone will raise the five-year deficit up to $102 billion, barring unexpectedly high economic growth over those years. I have a hard time believing it will happen but realistically no one knows.

Cross-posted to the Shotgun.

Monday, May 18, 2009

"Throw me in that briar patch, I'm guilty. I love liberty."

Governer Mark Sanford (R - South Carolina) responds in this short video to criticisms that he might be "too libertarian" in a way that more politicians ought to.

Cross posted to The Shotgun.

Montreal woman handcuffed for not properly riding an escalator Globe and Mail is reporting that a Montreal woman was handcuffed, detained and fined $420 for not holding the hand rail on an escalator in the Montreal subway system.

Bela Kosoian, a 38-year-old mother of two, says when she didn't hold the handrail Wednesday she was cuffed, dragged into a small holding cell and fined.

“It was horrible, disgusting behaviour [by police],” said Ms. Kosoian, a 38-year-old student of international law. “I did nothing wrong. They should go find the guys who stole my tires off the balcony.”

Ms. Kosoian, who studies at the Université du Québec à Montreal, was riding an escalator down to catch a 5:30 p.m. subway from the suburb of Laval to an evening class downtown when she started rifling through her backpack looking for a fare.

Ms. Kosoian, who grew up in Georgia when it was still part of the Soviet Union, says she didn't catch the officer's instruction to hold the rail when he first approached.

When he told her again to hang on, she says she replied, “I don't have three hands.” Besides, she had been sick and feared catching a new bug.

That's when the officer demanded identification so he could write her ticket, she said.

Ms. Kosoian started arguing. The officers handcuffed her and threw her into a small holding cell. The officers searched her bag and gave her a $100 ticket for failing to hold the banister and another $320 ticket for obstruction.

The handcuffs bruised Ms. Kosoian's wrists and an officer's boot scraped skin off the top of her foot.

She intends to fight the tickets.

Saturday, May 16, 2009

Fresh from the rumour mill: PCPO leadership contestants' membership sales

Stephen Taylor is reporting the following membership sales according to "a source close to the [Ontario PC] party."

Elliott: just over 8,000
Hillier: just over 3,100
Hudak: just under 7,000
Klees : just over 9,000
New memberships not attrubuted to a leadership candidate: 6,500

I've heard elsewhere that these numbers are very close to accurate.

Taylor also mentions that the CP reported that Elliott is way ahead of Hudak in fundraising, having raised ten times what he did.

If these numbers are representative of what's actually going on with the PCPO, the leadership vote might end up being more interesting than most had expected.

Cross posted to The Shotgun.

Thursday, May 07, 2009

More on the Canada-EU trade agreement

Back in October the Shotgun reported here and here on a possible trade agreement between Canada and the European Union as reported by the Wall Street Journal.

These talks are back in the news - this time in the Globe and Mail. Quebec now wants in the deal, demanding a role for the provinces in negotiations, and Newfoundland demands that the deal only go forward if the EU lifts its ban on seal products. Luckily, Harper's got his eye on the ball:

Mr. Harper said yesterday that his government is vigorously defending the sealing industry both domestically and internationally, but also said he would not allow Europe's ban on seal products to "contaminate" a potential trade deal.

"It is important that in any relationship, but particularly in a mature and complex commercial relationship like ours, that we not allow a dispute on one issue to contaminate our relations on a whole bunch of other things," he said during a news conference at the conclusion of a one-day summit between Canada and the EU.

"If we were to make our trade relations with the European Union only the sealing issue, we will never have any trading relations because as we know this is a disagreement of long standing, one of which I suspect we may never see eye to eye," he added.


It's hoped a deal, which will seek accord in areas such as labour mobility, customs procedures, food safety, sustainable development and goods, could be signed within a year.

Stockwell Day announced that a free trade agreement with the EU - Canada's second largest trading partner - would translate into an increase of $12 billion in exports and thousands of jobs. I'm not sure about the numbers, but he's right in saying that the impact of this agreement would be unambiguously positive.

I've been critical of the Harper government on a lot of issues but I've been fairly pleased with their performance on trade - or at least proliferating Canada's free trade relationships.They deserve more praise and encouragement here.

This trade agreement is something that all Canadians and EU members should look forward to... even the Newfies!

Cross posted to The Shotgun.

Stephen Taylor finishes off his series of PCPO leadership interviews with Randy Hillier this afternoon.

Hillier emphasizes the policies he's announced and their benefits to all Ontarians (rather than benefits only to targeted demographics) and delves into some new areas:

  • Musing over the idea of a flat tax, which he says is a worthy one. (He doesn't comment on Elliott's proposal specifically),
  • Condemning Hudak's policy announcement today where he said he would focus on asset seizure as part of tackling grow ops in Ontario,
  • Highlighting his top priority to get Ontario back on track: cutting regulation and red tape that he says stifles economic activity and freedom.

You can also watch Stephen Taylor's interviews with Tim Hudak, Christine Elliott and Frank Klees.

Cross posted to The Shotgun.

It's just plain sexy: Christine Elliott would implement a flat tax in Ontario.

Christine Elliott, once the "red tory" of the Ontario PC leadership race, announced this morning that she would implement a flat tax in Ontario if she were elected premier.

This is beyond my expectations for any major party politician. It's almost too good for me to believe that any leadership candidate in the PCs would endorse this. As a friend of mine often says, a flat tax is just plain sexy.

From Elliott's website:

“The tax burden on working families is too high and it’s getting worse. Ontario families pay more in taxes than for food, clothing and shelter combined,” said Elliott. [The Shotgun reported on that tidbit here.] “By making people pay a higher rate of tax as their income grows, Ontario’s tax system punishes hard work and initiative, and suffocates growth. As a result, it will take longer for us to recover from a recession, and it will be harder to take advantage of growth during times of recovery.”

“Others are proposing to merely tinker with the tax code,” said Elliott, “but now is the time to transform the tax system. Extraordinary times call for bold action.”

Elliott will phase in lower taxes for all Ontarians and collapse the three current brackets into one rate of tax. This means:
  • The Basic Personal Amount will increase from the current $8,881 to approximately $18,000 to provide tax cuts for all Ontarians and take low-income taxpayers completely off the tax roll.
  • The current three tax brackets will be collapsed into one single bracket of eight per cent.

“The most important feature of a flat tax is the positive impact on productivity, employment, income, living standard, and the economy in general,” said Elliott. “This has been achieved wherever flat taxes have been introduced.”

A flattened tax structure has been successfully implemented in both Alberta and New Brunswick and has been promoted by the Fraser Institute and the Canadian Taxpayers Federation.


Elliott’s plan specifically ensures that lower income earners will pay less by increasing the Basic Personal Amount. The proposal removes many low-income taxpayers from the tax roll without punishing high-income earners and the economy with high tax rates.

“My tax plan is competitive, fair and encourages economic growth,” said Elliott. “It is simply better.”

This is absolutely outstanding. Did I mention that already? Just in case you missed it: outstanding.

Cross posted to The Shotgun.

Hudak would focus on asset seizure as part of "tough on crime" policy

Back off Tim Moin Yahya posted an article that he wrote yesterday on the Supreme Court's horrendous decision in Chatterjee v. Ontario to allow asset seizure from those who are suspected of (not "charged with" or "convicted of") criminal activity.

Tim Hudak, who briefly redeemed himself to me last week with some good economic policy, has come out, guns blazing, in favour of this policy.

In fact, as part of his "tough on crime" policy package (which is otherwise fairly status-quo for a Conservative politician), he pledges to focus on asset seizure when dealing with grow-ops. From his website, Hudak says he would focus on:

  • Toughening laws and sentencing for violent crimes
  • Taking aggressive steps to stamp out grow ops in Ontario including a focus on asset seizure
  • Toughening prosecutorial and sentencing standards for organized crime
  • Increasing penalties for offenders caught in the act of defacing property

(emphasis mine.)

This is not some innocuous policy that only property rights "nuts" ought to be concerned with, nor is it something that can go wrong only in hypothetical cases. The fallout of allowing such property seizures in the United States has resulted in complete disregard for the law by some police officers - mostly warrants without probable cause - and extremely tragic cases such as the death of an innocent man in a raid that was motivated by a desire to seize his (impressive) assets and suicide by a woman who saw it as the only way to prevent asset seizure leading to homelessness and impoverishment.

Even if you are in favour of continuing the war on drugs, this complete disregard for property rights and the rule of law in Ontario should be wholeheartedly condemned by anyone who cares about either. It is extremely disappointing to see any serious Conservative politician (or anyone at all) endorsing this nonsense.

Cross posted to The Shotgun.

Tuesday, May 05, 2009

What part of legal immigration don't you understand?

What part of legal immigration don't you understand? Hit & Run reports
that Reason magazine has won a "Maggie Award," given by the Western Publishing Association, for the best editorial cartoon - entitled "What part of legal immigration don't you understand?"

I wish (oh, how I wish) that I could post it here in a way that would make it easier to view, but you'll just have to click on it instead. Please do - it's brilliant.

Cross posted to The Shotgun.

Quebec's civil registrar intervenes in naming babies

Apparently Quebec's civil registrar has the ability to reject names that parents want to give their children, as one Quebec couple found out while trying to give their child the middle name "Avalanche."

But Marie Godbout, a spokeswoman for the registrar, says the translated letter should have said the government had a problem with Logan's middle name, Avalanche.

She says the registrar only rejects uncommon names it feels will cause children to be ridiculed and that parents can appeal the decision.

William Azeff says he and his wife chose the name because it reflects their commitment to nature.

He said the registrar originally took issue with the name of his other son, Brant Glacier, before giving approval.

Sure, they're a couple of hippie parents naming their kids after cold-weather phenomena, but who cares? If this kind of legislation spread we might not have Moxie CrimeFighter Jillette.

h/t: Ker

Cross posted to The Shotgun.

Elliott would freeze minimum wage

Like Tim Hudak, Christine Elliott has promised that she would freeze Ontario's minimum wage for four years if she were elected Premier of Ontario to help job creation in the province.

Elliott voiced her concern about the impact Dalton McGuinty’s wage hikes are having on Ontario’s minimum wage workers: “It is vulnerable new entrants to the workforce especially young people and new Canadians—who are most affected by McGuinty’s foolish policy. Minimum wage jobs may soon become scarce in Dalton McGuinty’s Ontario. His wage increases have made it harder for businesses to hire that one additional employee – the costs are simply becoming prohibitive.”


Elliott, herself a small business owner, noted that “while a high minimum wage rate often sounds like a nice idea, the reality is that minimum wage employees and small business owners end up paying the higher price. It makes us less competitive at a time when we cannot afford it.”

It looks like this is a policy we can count on seeing in the platform of the PC party in the next election.

Cross posted to The Shotgun.

Monday, May 04, 2009

William Joseph reported last week on some promising economic policy (finally) from Tim Hudak's leadership camp.

Over the weekend Christine Elliott jumped into the fray as well, first calling for an end to the mandated 48 hour work week to return to the 60 hour work week as specified under the Employment Standards Act of 2000, and then calling for employment insurance reform that's better for Ontario and even considering pulling out of the federal EI program.

These are positive proposals, especially if she's serious about opting out of federal EI. Moving employment insurance to the provincial level, where it would be applied to a more similar workforce than it is when spread across the country, would be a good move that could see a reduction in the use of EI as a huge government slush fund and has the potential to make the program a lot more accountable.

These are good steps forward in the policy discussion that should be (and finally is) a part of this leadership race. Hopefully we can look forward to more fiscal policy from all candidates over the course of the week.

Cross-posted to The Shotgun.

Saturday, May 02, 2009

Harper quashes Coalition 2.0

Stephen Harper is denying any rumours that his government would form any sort of pact with the Bloc or the NDP. Harper was quoted in this story:

"That is absolutely untrue. We listen to all members of Parliament. The Bloc Quebecois stands for the breakup of this country. We will not govern this country in a pact or arrangement with the Bloc Quebecois. We've been clear on that for years. I don't know where that's coming from, but there is no contemplation of that, let alone possibility of that."

Well, as fun as it would have been if it panned out (I, for one, would have had a field day), I am happy to hear that the Conservatives aren't that inconsistent.

I reported on the rumors here and here, although as I said from the get-go, even if the Bloc and/or NDP did prop up the government, it would only be a "coalition" by the definition of some partisan Tories.

Cross posted to The Shotgun.

Bernier's bad bet

Adrian Wyld/Canadian Press Maxime Bernier is taking a gamble. He believes that there is a large, disenfranchised voting bloc in Canada...