Harper plays the surplus fiddle while Canada burns

[fuji]

http://www.theglobeandmail.com/try-it-now/?articleId=26141782&service=mobile

I used to think he was politically savvy but this is dumb. Did he lose all his good political advisors?

Going into a recession you caused is NOT the time to brag that you have cut back. What a moron!

 

[red]

No different than in 2008- "good buying opportunity"

 

[onthebottom]

http://www.theglobeandmail.com/try-it-now/?articleId=26141782&service=mobile

I used to think he was politically savvy but this is dumb. Did he lose all his good political advisors?

Going into a recession you caused is NOT the time to brag that you have cut back. What a moron!

Will find out Tuesday if Canada has entered a recession - odd position to take, a budget surplus during a quarter of negative growth as a bad thing.....

Are you supporting many years of declared deficit spending (Liberal view) or Cap-n-trade NDP?

 

[train]

Will find out Tuesday if Canada has entered a recession - odd position to take, a budget surplus during a quarter of negative growth as a bad thing.....

Are you supporting many years of declared deficit spending (Liberal view) or Cap-n-trade NDP?

There are some mighty strange political minds on this forum.

 

[onthebottom]

There are some mighty strange political minds on this forum.

Indeed

 

[jcpro]

http://www.theglobeandmail.com/try-it-now/?articleId=26141782&service=mobile

I used to think he was politically savvy but this is dumb. Did he lose all his good political advisors?

Going into a recession you caused is NOT the time to brag that you have cut back. What a moron!

if you're looking at the recession from the political POV, then sure, going into massive deficit might sound reasonable. However, our recession is not caused by a systemic flaws or general collapse. It's caused by weakness in oil prices. Why would a lefty fight that? Low $ might help the manufacturing sector and end the economic dependence on oil. Isn't that what the "experts" were screaming for the last decade? So, the conclusion is undeniable- Justin's stand on deficit spendings is purely political. I fear for this country.

 

[lomotil]

Mulcair just promised to increase the minimum wage and decrease the retirement age if elected. The Greek model is something that the NDP wishes to emulate?

 

[saxon]

Mulcair just promised to increase the minimum wage and decrease the retirement age if elected. The Greek model is something that the NDP wishes to emulate?

And this guy is claiming he can keep all of these expensive promises with just a "small" increase in corporate taxes. Ya right.

 

[onthebottom]

I can't help but root for the NDP.

 

[Garrett]

I can't help but root for the NDP.

Is this in the same manner we root for Trump?

 

[onthebottom]

Is this in the same manner we root for Trump?

Yes, I think it would be funny and I don't have to pay for it.

 

[fuji]

if you're looking at the recession from the political POV, then sure, going into massive deficit might sound reasonable. However, our recession is not caused by a systemic flaws or general collapse. It's caused by weakness in oil prices. Why would a lefty fight that? Low $ might help the manufacturing sector and end the economic dependence on oil. Isn't that what the "experts" were screaming for the last decade? So, the conclusion is undeniable- Justin's stand on deficit spendings is purely political. I fear for this country.

Our recession was caused by Harper subsidizing the oil industry for many years, creating a surplus capacity that drove up the dollar and drove manufacturing out of Canada.

Manufacturing as a percent of GDP has fallen to HALF what it was when Harper was first elected.

That is the cause of the recession.

To say it is oil prices ignores the way the Conservatives doubled down on oil to the detriment of the rest of the economy pumping BILLIONS in subsidies to the oil industry.

That strategy may have looked good when oil was flying high but it has turned into a catastrophe for Canada.

 

[onthebottom]

Our recession was caused by Harper subsidizing the oil industry for many years, creating a surplus capacity that drove up the dollar and drove manufacturing out of Canada.

Manufacturing as a percent of GDP has fallen to HALF what it was when Harper was first elected.

That is the cause of the recession.

To say it is oil prices ignores the way the Conservatives doubled down on oil to the detriment of the rest of the economy pumping BILLIONS in subsidies to the oil industry.

That strategy may have looked good when oil was flying high but it has turned into a catastrophe for Canada.

That's a little simplistic, manufacturing was going to China regardless.

 

[fuji]

That's a little simplistic, manufacturing was going to China regardless.

Untrue, labor in China is increasingly expensive and modern automated factories are more efficient than simply throwing bodies at production. Other advanced economies have begun to increase their manufacturing base again, but in Canada we sacrificed it chasing an oil pipe dream.

 

[jcpro]

Our recession was caused by Harper subsidizing the oil industry for many years, creating a surplus capacity that drove up the dollar and drove manufacturing out of Canada.

Manufacturing as a percent of GDP has fallen to HALF what it was when Harper was first elected.

That is the cause of the recession.

To say it is oil prices ignores the way the Conservatives doubled down on oil to the detriment of the rest of the economy pumping BILLIONS in subsidies to the oil industry.

That strategy may have looked good when oil was flying high but it has turned into a catastrophe for Canada.

Oh, please.... There's no catastrophe. We have Ontario and Quebec that killed their manufacturing base and very low oil prices. None of which can be blamed on the fed. If Harper is really responsible for our recession, then the dive of the dollar should bring back the manufacturing again, no?. I'm betting it will not. And whose fault will that be? I suggest a bit more objectivity and a bit less partisanship.

 

[fuji]

Low oil prices cannot be blamed on the fed, but the impact of oil prices on the Canadian dollar can very much be blamed on the fed. The billions in annual subsidies to the oil industry resulted in MUCH higher oil output than free market forces would have produced, and furthermore the fed had a responsibility to immunize the rest of the economy from oil price shocks, instead they magnified them.

The result is a made in Canada recession where we gutted our own economy by betting on a one trick pony that has now finished last.

 

[fuji]

And no, the dive in the dollar will not bring back the manufacturing base that Harper annihilated. It is gone. It is not a matter of factories ramping up production, the factories are not there anymore and with a government that continues to SUBSIDIZE the oil industry, creating a highly volatile currency, nobody will build new ones.

Factories are a massive capitol investment that takes decades to pay back the initial investment. They need a stable currency or else investors face too much risk from currency volatility to have a reasonable risk/return.

Since the Fed bet on oil choosing to provide tax breaks and subsidies for oil exploration and development the Canadian dollar has become too tightly bound to the price of oil for Canada to be a manufacturing country. It was a conscious choice made by Harper to prioritize western oil over eastern manufacturing.

A different choices would have been to tax rather then subsidize and use the revenues to stabilize currency. That would have resulted in less investment in oil but would have protected the rest of the economy from oil price shocks.

The government could also have remained neutral neither subsidizing nor restricting oil output, but it did not. The feds put BILLIONS of tax dollars into oil, with the direct consequence that manufacturing in Ontario was cut in half.

 

[jcpro]

Low oil prices cannot be blamed on the fed, but the impact of oil prices on the Canadian dollar can very much be blamed on the fed. The billions in annual subsidies to the oil industry resulted in MUCH higher oil output than free market forces would have produced, and furthermore the fed had a responsibility to immunize the rest of the economy from oil price shocks, instead they magnified them.

The result is a made in Canada recession where we gutted our own economy by betting on a one trick pony that has now finished last.

Before I get too bored with this subject. The total, REAL subsidies to the oil and gas sector amounted to $211 million in 2014. It will go down to $71 million in 2016. A far cry from $34 billion IMF came out with, which included such gems as almost $12 billions in untaxed carbon emissions, for example. The bottom line is, the money for exploration and production in oil and gas fields came from the private sources, driven by the rising energy prices. Canada is a resource based economy. It was more balanced in the past, but the combination of high commodities prices and provincial mismanagement in the industrial provinces brought us to the present situation. Blaming the fed is just political talking points.

 

[fuji]

Your estimate of the subsidy is too low, you leave out tax credits for exploration and development. The provincial government in Alberta also doled out dramatic subsidies but here we are talking federal. This is aside from political support as the government sought to promote and subsidize pipelines, and authorized many other forms of transportation, often recklessly, in order to ramp up oil exports.

In any case as opposed to a subsidy there should have been restraint on the oil sector in order to prevent it from damaging other industries. Either that or we should have shifted to the US dollar, but no one expects the government to be that innovative.

What we do expect is sound fiscal management of the economy and we got reckless exuberant over investment in oil instead.

 

[JohnLarue]

Our recession was caused by Harper subsidizing the oil industry for many years, creating a surplus capacity that drove up the dollar and drove manufacturing out of Canada.

Manufacturing as a percent of GDP has fallen to HALF what it was when Harper was first elected.

That is the cause of the recession.

To say it is oil prices ignores the way the Conservatives doubled down on oil to the detriment of the rest of the economy pumping BILLIONS in subsidies to the oil industry.

That strategy may have looked good when oil was flying high but it has turned into a catastrophe for Canada.

oh Boy

You do not have a clue about economics if you honestly believe that
#1 You have traveled down that

Harper subsidizing the oil industry for many years

bullshit many times incorrectly claiming the oil industry caused
a) inflation, which I proved as incorrect
b) a labour shortage which I proved incorrect
as you searched for rational to support your incorrect theory

#2 Oil industry tax incentives have been in place for decades along with incentives for manufacturing. One industry apparently did not take advantage of them to remain competitive.
#3 The PM has very little control over exchange rates
#4 Canadian Manufacturing is no longer competitive, with or without a strong dollar. Inflexible labor, payroll taxes, high electricity costs, a lack of innovation & investment & poor productivity are well ahead of the value of the dollar in terms of the blame game.
#5. If a business model requires a weak dollar in order to be competitive , that business model is flawed.

Pleas separate fact from your fantasy in the future. That will help to if you want anyone to see you as anything more than a ranting fool.
Fuji the fool. You wear it well