I found it odd last year when the CBC began proclaiming the economic downturn as "the Great Recession" as pundits were calling it the worst recession since the Great Depression (which lasted a decade and peaked at 30% unemployment). Meanwhile our natural unemployment rate in Canada is around 6%, and for our "Great Recession" we peaked at just over 8%. The effects of the market collapse are far worse in the United States where it started, but to compare it to the Great Depression is ludicrous!
The headline today read "Canada's Economy expands 5% in 4th quarter" marking our third consecutive quarter of economic growth. I would expect some economic slow down for the first quarter of 2010, as there is generally a retail hangover for two months after Christmas. Speaking of spending, Statistics Canada notes that "for a third consecutive quarter, growth in final domestic demand was led by increases in personal expenditures, government expenditures, and investment in residential structures,"
Hmmm, increases in personal expenditures lead to increases in domestic demand, which causes factories and service providers to sell more, leading to economic growth. Fantastic! Kevin Page would like to reduce the deficit by raising sales taxes and raising business taxes. Sure, lowering sales taxes increases expenditures and lowering business taxes increases employment (and therefore expenditures) but Mr. Page is adamant that government spending cannot be "structurally reduced". Instead we need to retard expenditures, growth, and employment to meet his objective.
Thanks Kevin.
File it with the H1N1 virus "crisis".
ReplyDeleteI wonder what amount of growth Kevin Page was predicting when he said we have a structural deficit??
ReplyDeleteFinance usually takes the average of the private sector projections and then lowers them by building in a fiscal cushion out of an abundance of caution.
Page's projections have been even more cautious then finance's.
But news reports are saying this growth is BETTER then what the private sector was expecting and therefore the fiscal picture is better than what finance predicted and better still then what Kevin Page predicted.
Evan just had some female on from some policy alternative group who says we need more spending, national day care, raise corporate taxes, and other spending initiatives. Now, Maude Barlow is on about some water problem.
ReplyDeleteWhere do they get these women. Have they never heard of a hairdresser.
I'm watching too MaryT. The secret is you can watch Soloman on mute without actually listening, and the captions at the bottom will signal the partisan slants he's pushing. I do unmute for certain segments depending on the subject and or guest.
ReplyDeleteI don't post much, but read your blog regular, and this I have to say, I agree with MaryT. Where do they find these women to interview, that show was terrible, and their comments, I am sure do not represent anything but their own personal view!!!!
ReplyDelete