- John Crocker points out that the need for secure and sufficient pensions is only made all the more obvious by the abject failure of policies intended to force Canadians to fend for themselves:
According to Statistics Canada, six out of 10 Canadians have no formal pension plan. If rates of defined-benefit coverage continue to decline, we’ll have no discernible pension coverage in the next 10 to 20 years, and will be grappling with widespread senior poverty.- Jim Stanford paints a portrait of corporate Canada, showing exactly who's gaining and losing from the pattern of corporate tax-slashing:
We’ve already seen that Canadians aren’t saving for retirement on their own, given the $600 billion in unused RRSP room at the end of 2009, according to Statistics Canada.
A retirement income policy that assumes Canadians will take responsibility for their own welfare in retirement could result in disastrously low levels of senior income. We have to turn this argument around — rather than getting rid of pension plans, we need to strengthen and expand them. A pension plan that provides meaningful replacement income is our best line of defence against widespread senior poverty.
I zero in on the biggest of the big: the 50 most profitable public corporations in Canada in 2010, according to the rankings. These 50 companies raked in $80 billion worth of after-tax net income. In contrast, the remaining 950 companies on the RoB list received only $20 billion more. So by focusing on the top 50, we are certainly catching most of the action.- And Stanford also highlights some of the real threats to economic recovery which are being ignored even as the Cons try to manufacture outrage over Canada Post:
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Indeed, those 50 giant companies accounted for about two-thirds of the after-tax profits generated by all corporations (public or otherwise, foreign or Canadian) in Canada in 2010. According to Statistics Canada data, total before-tax corporate profits last year equalled some $180 billion, $55 billion (or 30%) of which was paid back in direct taxes to all levels of government, leaving some $125 billion worth of net income. Almost two-thirds of that was captured by the top 50 corporations.
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Reflecting the stunted structure of Canada’s private sector, the corporate top 50 listing is dominated by two sectors: finance (12 companies) and resource companies (17). These sectors took home over $25 billion each in after-tax profit (and together accounted for over two-thirds of the total profits of the top 50). While the leading role of big finance in corporate Canada has been fairly stable over time (there were 14 financial firms among the RoB’s top 50 a decade ago), the global commodities boom and Canada’s accelerating resource-dependence has almost doubled the number of resource producers represented among the top corporate ranks over the last decade. Petroleum companies have become especially prominent, now providing 11 of the top 50.
I was surprised by the huge employment numbers racked up by the big financial firms: 370,000 workers employed by the dozen companies. (The RoB ranking reports worldwide employment of participating companies, but most of the banks’ employees are in Canada.) At the other extreme, the resource producers had very modest employment: just 82,000 in total. This means that the resource industry is the pinnacle of “exploitation” (measured loosely by after-tax profits generated per worker). On average, each worker at those 17 companies generated a stunning $325,000 in profit for their employers – compared to a comparatively stingy $75,000 per worker in the financial sector. Of course, it is not just workers that the oil companies and other resource firms are exploiting: it is the planet, too.
Gasoline prices: Even at $1.25 a litre, gas prices will rip $40-billion from the pockets of Canadians this year. The soaring prices are a big reason why consumer spending has stopped in its tracks – an alarming development that could precipitate a recession. And you can’t invoke “market forces” to explain the prices. They’ve been driven up by speculation, fat oil industry profits and OPEC’s continuing power.- Finally, as part of Tim Naumetz' coverage, both Duncan Cameron and Robin Sears nicely sum up the effects of the NDP's back-to-work legislation filibuster:
Interest rates: The Bank of Canada is holding its prime rate at a historically low level. But the gap between that rate (which chartered banks pay on their own borrowing) and what banks charge their own customers has widened substantially. Spreads on credit cards and small business loans are even wider. No wonder the Big Six banks made $20-billion in profit last year – but no wonder borrowing by consumers and businesses alike is stuck in its tracks.
The loonie: According to the OECD, the fair value of our dollar (based on purchasing power) is 81 cents (U.S.). Currency traders have pushed it 25 per cent higher, jeopardizing Canada’s ability to sell anything (other than oil) to world markets. Again, savings on imports aren’t passed on to consumers. But the pain to our export industries and the threat to our future growth are real.
All these issues reflect contractual dealings between private parties that are jeopardizing economic growth. All reflect the working of power and policy, not the “pure” forces of supply and demand. And all are amenable to myriad forms of government intervention to attain better prices in the interest of continued recovery.
Why is the government, so quick to intervene to suppress compensation for the humble folks who deliver our mail, standing on the sidelines while powerful people enrich themselves at the expense of our national prosperity? Perhaps it’s not the economy they’re concerned with after all.
Much ink has been spilled since the May 2 election in analyzing the potential caucus management problems NDP Leader Jack Layton (Toronto-Danforth, Ont.) may have on his hands with a caucus suddenly weighted heavily on a new crop of Quebec MPs.
"Hasn't everyone been saying they're going to have problems? Wouldn't you say if you're the leader, your first priority would be to bring these people together somehow, find a way to bring them together? And he just did it," asserted Mr. Cameron.
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"The goal of all the players in a new Parliament is to try and set the frame of the story and their position in it," said Mr. Sears. "The NDP were determined to set the frame very quickly with themselves as the opposition, and I think they did it in a blunt and effective manner."
Like the Crocker article. At that, he's understating the problem--he talks about the average retirement savings, but that's one of those things which is almost certainly quite skewed by the much greater savings of the upper brackets. The median is probably rather less, and the bottom 40% or so likely have hardly anything.
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