Minimum wage hikes across Canada this year could cost about 60,000 jobs, despite the benefits they would bring, the Bank of Canada says in a new report.
The central bank published a report over the winter break, attempting to calculate what sort of economic impact a series of minimum wage hikes set to come into force this year will have on Canada’s economy.
As of Jan. 1, Ontario’s minimum wage is now $14 an hour, up from $11.60. By the end of 2018, Alberta, Quebec and Prince Edward Island are also expected to hike their minimum wages.
Start-up accelerator Y Combinator plans to roll out its initial cash handout trial to thousands of people across two U.S. states.
Its President Sam Altman has been one of many top Silicon Valley bosses to get behind the idea of basic income – the idea that all citizens should be paid a regular sum of money regardless of their employment status.
Forget social security, medicaid and WIC, today’s progressives have moved well beyond discussing such entitlement relics of the past and nowadays dedicate their efforts to the concept of a “Universal Basic Income” for all…call it the New ‘New Deal’. You know, because having to work for that “car in every garage and chicken in every pot” is just considered cruel and unusual punishment by today’s standards.
Simon Fraser University political scientist Sanjay Jeram is bravely going where few Canadian scholars — and virtually no politicians — dare to go.
In the face of an unspoken taboo against seriously debating immigration policy in Canada, Jeram says the time has come for Canadians to start openly discussing the migration issues they’ve been avoiding.
“But it just doesn’t add up, because a working immigrant comes with dependants. And with rising immigration rates, that can become expensive and unsustainable. It’s nothing to do with race. It’s just economics.”
No longer, in the latest discomforting milestone for a country facing a steep population decline. Last year, the number of births in Japan dropped below one million for the first time, the Ministry of Health, Labor and Welfare said on Friday.
The shrinking of the country’s population — deaths have outpaced births for several years — is already affecting the economy in areas including the job and housing markets, consumer spending and long-term investment plans at businesses.
[Christophe] Guilluy doubts that anyplace exists in France’s new economy for working people as we’ve traditionally understood them. Paris offers the most striking case. As it has prospered, the City of Light has stratified, resembling, in this regard, London or American cities such as New York and San Francisco. It’s a place for millionaires, immigrants, tourists, and the young, with no room for the median Frenchman. Paris now drives out the people once thought of as synonymous with the city.
Yet economic opportunities for those unable to prosper in Paris are lacking elsewhere in France. Journalists and politicians assume that the stratification of France’s flourishing metropoles results from a glitch in the workings of globalization. Somehow, the rich parts of France have failed to impart their magical formula to the poor ones. Fixing the problem, at least for certain politicians and policy experts, involves coming up with a clever shortcut: perhaps, say, if Romorantin had free wireless, its citizens would soon find themselves wealthy, too. Guilluy disagrees. For him, there’s no reason to expect that Paris (and France’s other dynamic spots) will generate a new middle class or to assume that broad-based prosperity will develop elsewhere in the country (which happens to be where the majority of the population live). If he is right, we can understand why every major Western country has seen the rise of political movements taking aim at the present system.
In France, political correctness is more than a ridiculous set of opinions; it’s also—and primarily—a tool of government coercion. Not only does it tilt any political discussion in favor of one set of arguments; it also gives the ruling class a doubt-expelling myth that provides a constant boost to morale and esprit de corps, much as class systems did in the days before democracy. People tend to snicker when the question of political correctness is raised: its practitioners because no one wants to be thought politically correct; and its targets because no one wants to admit to being coerced. But it determines the current polarity in French politics. Where you stand depends largely on whether you believe that antiracism is a sincere response to a genuine upsurge of public hatred or an opportunistic posture for elites seeking to justify their rule.
Reality check: Except for the elite, globalization averages things. A step up for the immigrant busboy; a step down for the once-employed French deplorables. Then there is the fun, for elite virtue-signallers, of sneering at the latter group’s unhappiness. And enjoying the thrill of a mild, containable panic over the possible return of fascism..
See also: How did “populism” become such a dirty word? A left-wing journalist offers some thoughts
Automation is hardly the main worry in U.S. manufacturing employment.
The conventional wisdom about the decline in American manufacturing jobs is that automation is to blame—“Most US manufacturing jobs lost to technology, not trade,” a Financial Times headline claims. Similarly, a December New York Times article self-assuredly states, “The Long-Term Jobs Killer Is Not China. It’s Automation,” as does CNN Money in its article, “Rise of the machines: Fear robots, not China or Mexico.”
This assessment of the state of U.S. manufacturing rests on two statistics that seem to be in tension. First, employment in U.S. manufacturing has plunged 30 percent since 2000. Second, manufacturing output has held steady as a percentage of GDP. Improvements in productivity, including automation, explain the divergence of these trends: factories are making more with fewer workers. In other words, the only concern regarding American manufacturing competitiveness is what to do with the workers who’ve lost their jobs to robots.
In fact, the conventional narrative is wrong; it is based on misleading manufacturing statistics. A new, more informed counter-narrative is emerging from a handful of economists and Washington policy analysts. This highly technical analysis involves knowledge of the way U.S. statistical agencies calculate manufacturing output. It shows that employment has indeed fallen in manufacturing, but it is likely that output has fallen, too.
These discussions tend to focus on the feasibility of the policy, and comparisons with the current safety net of government programs like Medicaid and food stamps, while ignoring a crucial question: What would it mean to remove the expectation that one provide for oneself and one’s family, instead assigning that role entirely to the state? While policymakers sift through the data, non-economists will find their answer in common sense and lived experience.
An older population is a consequence of capitalism making Western societies richer beyond anything conceivable when our grandparents were young. Capitalism, albeit with hiccups and an occasional convulsion, will go on making us richer and better able to care for the elderly
“…Beyond embracing capitalism, numbers of factors come into play to explain why one nation is more prosperous than another. Education is undoubtedly important. The wisdom of rulers in the way they go about taxing, spending and regulating is important. The availability of natural resources might play a part as, less tangibly, might the degree to which societal norms create an environment which encourages individuals and businesses to be adventurous and innovative. How does population—its size and growth—fit in?
As I will show, by a quick look at the evidence, population size itself hardly matters at all. The economic effects of falling population growth are more difficult to assess. They fall broadly under a heading of the direct and indirect consequences of an ageing population. Those consequences most prominently discussed are increased welfare spending, a fall in the rate of saving, a deficiency of aggregate demand, and a loss of adventure and innovation. I will consider each in turn, but first to population size.”
Scary Population Tales — a Response
Peter Smith has exposed the hollowness of ageing-related excuses for high population growth, but misses the point that these are merely excuses. Until we have a government willing to elevate the interests of ordinary people, the immigration throttle will remain glued to the floor
Peter Smith’s welcome article “Scary Population Tales” makes some valuable points, but was marred by some glaring misrepresentations and ideological non-sequiturs. It’s refreshing to hear a devout ‘capitalist’ questioning the population growth agenda. But I find much of his position hard to stomach.
Related… Lawrence Solomon: American workers didn’t have to suffer for NAFTA, but the deal was rigged so they would
“…It was all for the greater good. But it wasn’t the free market at work. It wasn’t the inevitable march of progress. It wasn’t even for the greatest good. It was, rather, a vast central-planning exercise in which the mandarins — government officials lobbied by myriad trade associations and other special interests — decided which communities would win and which would lose through thousands of pages of legislation and regulations. Their decisions were based not on economics but on politics.”
Canadian household debt as a share of income hit a record high in the second quarter, Statistics Canada data showed on Thursday in a report likely to reinforce concerns of overborrowing by consumers.
The ratio of household credit market debt to disposable income rose to 167.6 percent in the second quarter from 165.2 percent in the previous quarter. That means Canadians had C$1.68 ($1.27) of debt for every dollar of disposable income.
Household credit market debt, which includes consumer credit and mortgage and non-mortgage loans, rose 2 percent in the quarter, easily outpacing growth in disposable income of just 0.5 percent.
Years of low interest rates since the financial crisis have seen Canadians take on more debt, largely due to rising home prices.
Consumers borrowed a seasonally adjusted C$29.2 billion in the second quarter, an increase of C$3.5 billion from the previous quarter. Mortgages accounted for C$19.1 billion of that, up from C$18.4 billion, while other types of debt stood at C$10.1 billion, up from C$7.3 billion.
D.C. Restaurants Lose 1,400 Jobs Amid Minimum Wage Increase
In the first six months of 2016, leading up to a $11.50 per hour minimum wage, Washington, D.C., lost 1,400 restaurant jobs, according to the Bureau of Labor Statistics. This is a full 2.7 percent decline in food service jobs in two quarters, the largest such drop since the 2001 recession 15 years ago. In fact, this is the first time since 1991 that restaurants lost jobs in five of the first six months of a year. Even the 2008 recession pales in comparison to this loss of employment.
The decline in such jobs appears limited to the confines of the district. In the Maryland and Virginia suburbs surrounding D.C., restaurants added 2,900 jobs during the first six months of this year. In Virginia, the state minimum wage is only $7.25 per hour, 37 percent below D.C.’s, and in Maryland the state minimum wage is $8.75 per hour (although two counties, Montgomery County and Prince George’s County, have scheduled increases to bring their local minimum wage up to $10.75 per hour).
As Mark Perry, a scholar at the American Enterprise Institute (AEI) and a professor of economics and finance at the University of Michigan, explained, the circumstances provide “a natural experiment to test for the employment effects of DC’s minimum wage law,” and those seem 100 percent negative. More.
Reality check: From the progressive perspective, it doesn’t matter and will not affect their electoral chances. The unemployed slowly transition to a dependent existence, far more in need of progressive policies that they ever were before. Their children grow up knowing nothing else. Having no needed skills to market, they will market identity, grievances, and entitlement.
All of which, progressive government is better prepare to cater for than any government that would encourage initiative in the pursuit of prosperity.
A general economic principle is that any law or regulation that restricts market entry tends to impose the greatest burden on those who can be described as poor, latecomers, discriminated-against and politically weak.
The president of the NAACP’s St. Louis chapter, Adolphus Pruitt, has petitioned a circuit court judge to reject the St. Louis Metropolitan Taxicab Commission’s conspiratorial call to issue a temporary restraining order that would force Uber to shut down. He says the order would negatively impact nearly 2,000 African-Americans who work as Uber partners in black neighborhoods that have long been ignored by taxis and other transportation providers. In a statement, Pruitt said, “The immediate harm of a (temporary restraining order) would strand thousands of African American riders who depend on Uber to travel around a city that has measurable gaps in its transportation system and has failed to serve our neighborhoods for decades.”
For years, the McKinsey Global Institute has been leading the charge for globalization, publishing research on the virtues of free trade, open data flows, cross-border investment, and liberalized immigration.
“The core drivers of globalization are alive and well,” the think tank of American consultancy McKinsey & Co. wrote in a 2010 study, while the world was still recovering from the financial crisis. “To be unconnected is to fall behind,” its researchers wrote in 2014.
But a study McKinsey released today stresses that the economic gains of changes in the global economy have not been widely shared lately, especially in the developed world. It’s called “Poorer Than Their Parents? Flat or Falling Incomes in Advanced Economies.” Prospects for income growth have deteriorated significantly since the financial crisis, the report finds.
Critics of Donald Trump “America First” economic nationalism are undoubtedly correct when they assert that his policies will raise consumer prices or, put concretely, the $5 made-in-who knows where but probably overseas shirt from Walmart may be history. But, the awaiting price increase is only part of the larger financial perspective, and if viewed more broadly, the picture looks less bleak.
The costs of economic nationalism can be viewed from two vantage points. The dominant perspective, and the one usually favored by multi-national businesses, is to focus on imports as an unqualified good deal for consumers. It is an alluring argument — after all, how many shoppers will pay a premium for an item that comes with a “100% made-in-America” tag? Imagine if Walmart offered imported products side-by-side with those costing a third or more? A no-brainer or so it would seem. In other words, trade agreements like NAFTA and cheap immigrant labor are a boon for bargain-minded American consumers.
“…This year, the Finnish government hopes to begin granting every adult citizen a monthly allowance of €800 (roughly $900). Whether rich or poor, each citizen will be free to use the money as he or she sees fit. The idea is that people are responsible for their actions. If someone decides to spend their €800 on vodka, that is their decision, and has nothing to do with the government. In return for the UBI, however, the public accepts the elimination of most welfare services. Currently, the Finnish government offers a variety of income-based assistance programs for everything from housing to children’s education to property insulation. Axing these programs should free up enough public resources to finance the UBI. The bureaucracy that currently governs welfare payments will disappear. There will no longer be any need to ask for government help, nor to fill out forms or wait for the competent authorities to examine each dossier to determine eligibility.”