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The Broken Promises of Corporate Tax Cuts
The pace of business capital spending in Canada has been weak in recent years, for several reasons – including the slowdown in the petroleum industry, the erosion of Canadian manufacturing, and now the impacts of the global COVID-19 pandemic and recession. This has spurred a resurgence of demands from the business community for lower company tax rates, which advocates claim will accelerate business capital spending. In this analysis, published originally by the Canadian Tax Foundation, Centre for Future Work Director Jim Stanford agrees that stimulating more capital investment (both private and public) is a vital goal. But there is no evidence from either recent Canadian history or international comparisons that…
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The Gap between Stock Markets and Society has Never Been Greater
It seems counter-intuitive that North American financial markets have been on a tear for several months, in some cases setting all-time record highs – even as the COVID pandemic proves deadlier and longer-lasting than we all hoped for. In this commentary, originally published in the Toronto Star, Jim Stanford considers this “cognitive dissonance” between the exuberance of stock markets and the hardship of the real world. Booming Financial Markets Belie Social Hardship Canadians have confronted an avalanche of depressing news about the COVID-19 pandemic and accompanying recession: infections, deaths, job losses, bankruptcies. Amidst the doom and gloom, however, one light shines brightly. Even as fears of a second wave intensify,…
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Podcast on the Economics of Capitalism in a Crisis
Rational RationalReminder is a fascinating podcast series hosted by Benjamin Felix and Cameron Passmore. They work in the financial services sector (in Ottawa), but their series ranges very widely into broader economic, financial, and social issues. Episode #106 features a full hour interview with Centre for Future Work Director Jim Stanford. The conversation covered many aspects of the COVID-19 economic crisis and how government must respond – including debunking knee-jerk fears about government debt, and rejecting demands for fiscal austerity. It also delved into the nature of economics and how it could become a more realistic and socially embedded discipline. See video of the full conversation here: https://www.youtube.com/watch?feature=youtu.be&v=G1kKktotDGM
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Interview with Evan Solomon about Fiscal Policy, Income Supports, and Other Responses to the Pandemic
Centre for Future Work Director Jim Stanford recently appeared on Evan Solomon’s national radio program, Overview, to discuss the continuing evolution of the COVID-19 recession, and its implications for all areas of government policy. Evan and Jim discussed Finance Minister Bill Morneau’s fiscal ‘snapshot,’ the significance (or not) of the federal government’s large deficit, and the feasibility of various proposals for a basic income to help Canadians through the crisis (and to deal with the economic insecurity they already faced, even before the pandemic). Jim proposed far-reaching reforms to Canada’s deeply flawed Employment Insurance system, including a ‘hybrid’ approach that would combine improved access, a basic income threshold (similar to…
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Pearson Centre Webinar on Economics After COVID, Featuring Director Jim Stanford
Canada’s macroeconomy continues to grapple with the effects of the COVID-19 pandemic and resulting restrictions on normal work and economic activity. Data confirm we are well into the worst downturn since the Great Depression of the 1930s, and the impacts on a wide range of indicators (including employment, incomes, consumer confidence, business investment, and government revenues) have yet to be fully felt. To discuss the economic outlook, and the government policies that will be required to respond to it, Centre for Future Work Director Jim Stanford recently joined a webinar hosted by the Pearson Centre, a progressive think tank based in Ottawa. He advanced a range of far-reaching measures, including:…
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Reconstruction After COVID-19 Will Require Sustained Government Leadership
The Centre’s Director Jim Stanford had a feature interview yesterday with Michael Enright on CBC Radio’s public affairs show, Sunday Edition, on how Canada’s economy will rebuild after the COVID-19 pandemic and lockdowns. A full recording and an abridged transcript is available on the CBC site here. Stanford argued that government investment, income security payments, expanded public services, and direct public sector employment will all be crucial to lift Canada’s economic activity back to its potential, once it is safe to go back to work. “This has actually been a real-time experiment that a national government — particularly one that has its own currency, as we do in Canada — has…
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‘Official’ Unemployment Just the Tip of the Iceberg
This commentary was originally published in the Toronto Star. Statistics Canada has just released its monthly labour force report for April. It’s the first monthly release that captures the full extent of the COVID shutdowns; the previous report (which covered one week in mid-March) reflected only the initial stages of pandemic-related closures. By the time Statistics Canada did its April survey (during the week of April 12-18), millions of workers had stopped working. Not surprisingly, the numbers are grim. 2.4 million Canadians were counted as officially unemployed in April. That’s 13.0% of the labour force – bad by any definition. However, that statistic is only the tip of the iceberg.…
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A New ‘Marshall Plan’ to Rebuild After the Pandemic
Centre for Future Work Director Jim Stanford was recently interviewed on CBC News Network to discuss his proposal for a massive, government-led rebuilding plan to support the economy’s re-opening once the immediate health emergency of COVID-19 has passed. He stressed that private sector businesses will not be able to lead a normal ‘cyclical’ recovery, given the unprecedented speed and severity of the current downturn. Government will need to play a leading role in sponsoring new investment, permanently expanding public services, and expanding direct public job creation to help repair the shattered labour market. His conversation with CBC’s Natasha Fatah is posted here.
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Quantitative Easing: What It Is and What It Could Mean
The Bank of Canada has finally joined other central banks around the world in undertaking an ambitious “quantitative easing” (QE) program to support credit flows and reduce interest rates during the current health emergency and economic crisis. Our Director Jim Stanford has prepared an accessible introduction to QE and how it works. He also makes 4 specific proposals for extending and strengthening the practice. This research was originally published by the Canadian Centre for Policy Alternatives. Making the Most of Quantitative Easing With the COVID-19 recession getting deeper by the day, the Bank of Canada has joined other central banks in quickly reducing its target interest rate to near zero,…
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Recovery from Pandemic Will Need an Ambitious Rebuilding Plan
The unprecedented shutdown of much of the economy to limit spread of the coronavirus is not like an “ordinary” recession – and recovering from it will require powerful leadership from government. Director Jim Stanford compares it to recovering from a war, and argues for an equivalent to the Marshall Plan that helped western Europe rebuild after World War II. This article was originally published by the Institute for Research on Public Policy. A Marshall Plan to Rebuild after Coronavirus Economic policy-makers have been understandably focused on addressing the immediate economic shocks from the COVID-19 pandemic: developing new income supports for the millions who will need them, stabilizing the credit system…