The Harper government claims to be paragons of fiscal virtue. They have pledged to balance the federal budget this year, notwithstanding a slowing economy, and are likely set to announce details of the balanced budget legislation promised in the 2013 Speech from the Throne.
The promised legislation will disallow annual deficits in “normal economic times” (whatever they are) and “set concrete targets for returning to balance in the event of an economic crisis.”
In the run-up to the delayed federal budget, there is a strange disconnect between fiscal policy and our changing economic circumstances. Balancing the budget seems to remain the key political priority, as if nothing had changed.
But the collapse of oil and other resource prices has changed a lot. Most notably, the Bank of Canada has, unexpectedly, cut interest rates to take out “insurance” against a serious slump in our resource-dependent economy. TD Economics forecast slow growth of just 2.0% this year, and have projected that unemployment will rise by 0.2 percentage points in the next few months.
Meanwhile, Prime Minister Stephen Harper has said that he will not run a deficit unless and until Canada falls into an outright recession, something we would know only in hindsight.
The words “industrial policy” have been virtually banned from polite company, and should certainly never be uttered in the presence of small and impressionable children.
Many mainstream economists and conservative think-tanks believe that governments should seek only to create a favourable business climate through low taxes and light regulation, and should not intervene in the investment decisions of private corporations.
And yet, industrial policy (which should be called strategic economic policy) persists, and arguably has a greater impact on investment and jobs than broad framework policies like deep corporate tax cuts.
OTTAWA — B.C. experienced the worst income growth — in fact, incomes declined — of any province in Canada during the 2006-12 period, according to an analysis of Statistics Canada data by an Ottawa think-tank.
You’ve probably read stories about how Canada’s wage growth is nothing to write home about, but new research from the Broadbent Institute adds a surprising dimension to the story: No fewer than 15 of Canada’s 32 largest metro areas saw incomes slide during 2006-2012.
The Harper government claims to be good economic managers pursuing a successful jobs and growth agenda.
To be sure, there are many factors other than federal government policy that strongly influence Canadian jobs and incomes, such as resource prices, business decisions, the state of the United States and the global economy, and the actions of provincial governments. No federal government can take all or even most of the credit or blame for how our economy is doing.
In a week where the U.S. President has signaled new taxes and fees on the wealthiest American individuals and corporations and where the financially and politically powerful meet in Davos, Oxfam is warning of growing inequality across the globe. Today we look at the implications of counting up the haves and have-nots.
OTTAWA -- The Canadian labour market capped off 2014 by losing 4,300 net jobs in December, a slight dip from the previous month that left the unemployment rate locked at 6.6 per cent, Statistics Canada said Friday.