An oped based on my and Brock Ellis’ recent report, Canada’s Carbon Liabilities, was published in iPolitics (alas, behind a pay wall):
Canada’s economic development model is on a collision course with the urgent need for global climate action. Worldwide, extreme weather events from drought to floods to powerful storms and record-breaking temperatures are making a powerful statement that climate change can no longer be denied.
Hurricane Sandy, which rudely interrupted a US election in which candidates ignored climate change, pushed climate action back onto the US policy agenda. Costs are piling up, with one recent estimate of $1.2 trillion per year in global damages already from climate change and related environmental costs from a carbon-intensive economy. ...Read more
Tags: Economy & Economic Indicators·Environment·Pensions
Divestment from fossil fuels is an idea whose time has come. Sparked by Bill McKibben’s Rolling Stone article last summer, “Global Warming’s Terrifying New Math”, divestment campaigns are now up and running on over 300 university campuses in the US, with 4 early victories already notched. Students in Canada have declared tomorrow (March 27) Fossil Fools Day, a national day of action, with many campuses launching divestment campaigns. ...Read more
Tags: Economy & Economic Indicators·Environment·Fossil fuel divestment
The C. D. Howe Institute have put out a study on later retirement by Peter Hicks, a former senior official with HRSDC and the OECD who has written a lot on the policy implications of ageing societies. I find this to be one of his less convincing efforts.
The argument – with parenthetical comments – is as follows.
1) Employment rates of older workers, including those over age 65 have been rising rapidly, and this trend can be expected to continue “without any policy action” (p.20). Indeed, employment rates can be expected to rise significantly higher and future retirees can be expected to work at least five years longer on average. (A convincing case is made that current base case scenarios under-state the degree to which older workers will retire later.) ...Read more
Tags: Employment and Labour·Pensions
“It’s time for the public sector to have its 2008 recession,” proclaimed former RBC Chief Economist Patty Croft, impeccably dressed and looking admirably well-rested (early retirement seems to suit her), on CBC Newsworld’s The Bottom Line.
We know that governments make budgets, and budgets are about choices, but her wish list struck me as oddly personal—more grudge match than analysis. However, by 4:00 pm on March 29th, Patty’s Proclamation turned out to be prophetic.
Budget 2012 certainly spreads the pain around—paying special attention to some of the most vulnerable. But it’s a lot less generous when it comes to sharing the recovery. ...Read more
The 2012 federal budget, which purports to deliver “jobs, growth and long-term prosperity,” does nothing of the kind. Make no mistake, this is an austerity budget— spending cuts outpace new measures 7:1— that worsens income and inter-generational inequality, destroys jobs and locks in a slow growth, high unemployment future.
Let’s start with jobs. It mandates $5 billion in cuts to the public service phased in over three years. The government claims this budget only axes 19,000 jobs, but that’s truly just the tip of the iceberg. Combine this year with the previous two year’s spending cuts, they will have resulted in over 70,000 full-time job cuts over the next three years (35,000 in the public sector and 37,000 in the private sector), adding 0.3% to Canada’s unemployment rate. ...Read more
Tags: Economy & Economic Indicators·Federal Budget·Poverty and Income Inequality
Marc, Andrew and Toby have posted substantial analyses of yesterday’s federal budget and I have some comments in today’s Hamilton Spectator. My two cents about the budget’s economic forecasts follow.
Table 2.1 envisions a 7.5% unemployment rate this year, slightly above last year’s rate of 7.4%. That seems like an admission of failure from a budget ostensibly about job creation.
This table also projects real GDP growth rates of 2.3% in Canada versus 2.6% in the U.S. over the next five years. The higher American figure may well be realistic given that the U.S. economy is starting to bounce back from a more depressed level than Canada. However, these forecasts further deflate the Conservative talking point about outgrowing our American cousins and the rest of the world. ...Read more
Tags: Employment and Labour·Federal Budget·Media·Pensions
The Budget justifies raising the age of eligibility for OAS and GIS on the grounds that the long-term fiscal sustainability of the program is being undermined by rising life expectancy.
No estimates of savings are provided. They will be very modest.
Given that average life expectancy at age 65 is 20 years, raising the eligibility age by two years could only save a maximum of 10% of projected spending on future retirees if implemented immediately.
However, the government proposes to phase in the increased eligibility age between 2023 and 2029 which will hugely reduce any savings relative to current projections. ...Read more
Tags: Federal Budget·Pensions
Canada’s job market remains stalled and Canadians are understandably anxious about their future, and increasingly question whether their children and grandchildren will do better than they did. In fact, the latest job numbers have revealed that tens of thousands of Canadians have lost hope and given up looking for a work. Compound that with the federal governments’ decision to close youth employment centres at a time when Canada’s youth unemployment levels are disturbingly high, and you have a threat to the economy that you cannot ignore. ...Read more
Tags: Alternative Federal Budget·Federal Budget
On CTV yesterday, human resources minister Diane Finley said (45 seconds into this interview): “As we go forward, we’re going to have three times the expense in Old Age Security as we do now, but we’re only going to have half the population to pay for it.”
That sounds pretty scary. If the total cost triples, with only half as many people to pay it, each Canadian would have to pay six times as much for Old Age Security (OAS)!
The Chief Actuary does estimate that the cost of OAS, in nominal dollars, will almost triple by 2030. But where is Finley getting her population figures? ...Read more
Tags: Federal Budget·harper·Pensions
It is argued that eligibility for OAS/GIS discourages older Canadians from remaining in the workforce, and that we need to keep them working to avoid labour shortages and a sharp rise in the so-called dependency ratio.
But the fact of the matter is that 65 is not the trigger for retirement that it used to be, and that an increasing proportion of older Canadians stay in the workforce well past that age.
Statistics Canada recently reported that, while life expectancy has indeed been rising, the average number of years spent not working has actually been stable since the mid 1990s due to the fact that more and more seniors are still working. ...Read more