Saturday Morning Links

Assorted content for your weekend reading.

- Ezra Klein comments on the U.S.' doom loop of oligarchy - as accumulated wealth is spent to buy policy intended to benefit nobody other than those who have already accumulated wealth:

On Thursday, the House passed Paul Ryan's 2015 budget. In order to get near balance, the budget contains $5.1 trillion in spending cuts — roughly two-thirds of which come from programs for poor Americans. Those cuts need to be so deep because Ryan has pledged not to raise even a dollar in taxes.

As a very simple rule, rich people pay more in taxes and poor people benefit more from services. So if you pledge to balance the budget without raising taxes, you're going to end up making the rich richer and the poor poorer. But Ryan goes further than that: he actually cuts taxes on the rich.
...
Wealthy people will be even better poised to influence the 2014 and 2016 elections than they were to influence the 2010 and 2012 elections. Now, wealthy people are not a single voting bloc, but most wealthy people would like to continue being wealthy. And so you see bipartisan movement towards policies that protect their wealth, most recently with the Democratic legislature in Maryland voting to eliminate the state's estate tax.

Over time, a political system that gives the wealthy more power is a political system that is going to do more to protect the interests of the wealthy. It's the Doom Loop of Oligarchy, and we're seeing it daily.

- Meanwhile, Jim Stanford documents Canada's own descent into neoliberalism. And Carol Goar highlights how the Cons are doing their utmost to eliminate opportunities for young workers.

- The National Post's editorial board points out the absurdity of the Cons attacking their own appointed Chief Electoral Officer. Andrew Coyne calls out the Cons for turning what should be wholly unobjectionable principles - such as an accurate census and a fair electoral system - into their own political firing line. And Tabatha Southey duly mocks the assertion that Elections Canada is the new Illuminati.

- But then, a party merrily engaged in systemic illegality - such as, say, interference with access to information - figures to have little choice but to try to shout down any investigation which might reveal what it's actually up to.

- Finally, Thomas Walkom reminds us about some of Jim Flaherty's deliberate cuts to important public services including the CBC. And PressProgress charts how Lib and Con governments alike have slashed Canada's public broadcaster over the past three decades.

Musical interlude

Weekend Players - Pursuit of Happiness

Friday Morning Links

Assorted content to end your week.

- Linda McQuaig responds to the CCCE's tax spin by pointing out what's likely motivating the false attempt to be seen to contribute to society at large:

Seemingly out of the blue this week, the head honchos of Canada's biggest companies, the Canadian Council of Chief Executives, put out a media release insisting that their taxes are not too low.

This defensive posture -- who mentioned murder? -- reveals they fear others may be slowly catching on to the massive transfer of wealth to the richest Canadians that's been going on for the past 14 years due to the systematic cutting of corporate tax rates.

If Canada's corporate tax rate was the same today as it was in 2000, we'd be collecting roughly an extra $20 billion a year in taxes -- enough to fund national child care, free university tuition, children's dental care or other programs that have long existed in other advanced countries but that no one here, in these lean and mean times, dares to be caught dreaming about anymore, let alone advocating out loud.
...
(T)he CBC's interview with Howlett sparked gasps of rage from the bowels of the business press, notably Terence Corcoran in the National Post -- even though a detailed description of the Cameco case and other tax avoidance schemes had just appeared in a special issue of Canadian Business under the cover headline: How to pay no taxes -- Many of Canada's largest companies pay almost no tax: What's their secret?

Of course, that report, directed towards a business audience, is seen as harmless. It's quite another matter when that information is used by the likes of Howlett to wake up the Canadian public to this wealth grab by some of our biggest corporations -- companies which pushed governments to slash taxes and then largely avoided even those lower rates by shifting their profits offshore.

- David McKie reports on the PBO's latest study - which shows that the federal government has once again been underestimating the cost of cleaning up contaminated sites by billions of dollars (which will have to be funded out of the public purse).

- Dr. Dawg discusses the Fort Chipewyan cancer cluster - and the even more cancerous attitude on the part of the Alberta government which is looking to silence the victims rather than acknowledge any health problems which might be caused by the tar sands. And David Climenhaga wonders what comes next now that we know about both the cluster and the province's disdain for those affected.

- Jason Markusoff reports on Calgary's work in figuring out the costs and benefits of new construction - which lead to the conclusion that newly-developed suburban neighbourhoods tend to be a cost sink for at least 11 years, with the cost of repaying the resulting debt eating up any tax revenues for another ensuing decade.

- Finally, Andrew Coyne weighs in again on the Cons' combined refusal to try to justify anything within the Unfair Elections Act, along with their choice to instead declare war on Elections Canada as a diversion from the bill. Anita Vandenbeld describes the bill and its ramming through Parliament as global disgraces. Lawrence Martin notes that the Cons' attacks on Marc Mayrand are mostly a matter of fear that the truth about 2011 electoral fraud is about to be revealed. And Adam Bunch nicely summarizes what's at stake as the Unfair Elections Act is considered by Parliament.

On public priorities

I'm not sure whether last week's column played a role, but there have been an awful lot of attacks on Saskatchewan's Crowns since then at a time when the parties don't seem to be highlighting the issue. So let's sum up the arguments being made to undermine the public enterprises that are serving Saskatchewan so well.

Shorter Will Chabun:

Sure, actual people may be better off because of Crown competition in the wireless sector. But won't somebody think of the rent-seekers?

And shorter Star-Phoenix editorial board:

The Wall Saskatchewan Party has no coherent or sensible policy when it comes to the Crowns. So let's eliminate the only legal barrier to a wholesale sell-off and see what happens.

New column day

Here, on the distance Canada has yet to travel in meeting even the basic needs of our fellow citizens - as well as the promise that Housing First and other new models may help to bridge that gap.

For further reading...
- Michael Green commented on the Social Progress Index here, while Canada's results can be found here.
- By way of comparison to the Social Progress Index, see my earlier post and linked column on other means of going beyond GDP in measuring development, with particular emphasis on the Canadian Index of Wellbeing.
- And CTV reported on the success of Housing First here, while the Mental Health Commission of Canada's summary and detailed report (PDF) are both available for review.

Thursday Morning Links

This and that for your Thursday reading.

- Paul Krugman's review of Thomas Piketty's Capital in the Twenty-First Century includes his commentary on our new gilded age:

Still, today’s economic elite is very different from that of the nineteenth century, isn’t it? Back then, great wealth tended to be inherited; aren’t today’s economic elite people who earned their position? Well, Piketty tells us that this isn’t as true as you think, and that in any case this state of affairs may prove no more durable than the middle-class society that flourished for a generation after World War II. The big idea of Capital in the Twenty-First Century is that we haven’t just gone back to nineteenth-century levels of income inequality, we’re also on a path back to “patrimonial capitalism,” in which the commanding heights of the economy are controlled not by talented individuals but by family dynasties.

It’s a remarkable claim—and precisely because it’s so remarkable, it needs to be examined carefully and critically.
...
(I)t turns out that Vautrin was right: being in the top one percent of nineteenth-century heirs and simply living off your inherited wealth gave you around two and a half times the standard of living you could achieve by clawing your way into the top one percent of paid workers.

You might be tempted to say that modern society is nothing like that. In fact, however, both capital income and inherited wealth, though less important than they were in the Belle Époque, are still powerful drivers of inequality—and their importance is growing. In France, Piketty shows, the inherited share of total wealth dropped sharply during the era of wars and postwar fast growth; circa 1970 it was less than 50 percent. But it’s now back up to 70 percent, and rising. Correspondingly, there has been a fall and then a rise in the importance of inheritance in conferring elite status: the living standard of the top one percent of heirs fell below that of the top one percent of earners between 1910 and 1950, but began rising again after 1970. It’s not all the way back to Rasti-gnac levels, but once again it’s generally more valuable to have the right parents (or to marry into having the right in-laws) than to have the right job.

And this may only be the beginning. Figure 1 on this page shows Piketty’s estimates of global r and g over the long haul, suggesting that the era of equalization now lies behind us, and that the conditions are now ripe for the reestablishment of patrimonial capitalism.

- Meanwhile, Sam Ro interviews Gerald Minack about the long-term damage to business as wages get pushed downward in the name of temporary profits. And Don Cayo is the latest to expose the CCCE's dishonest tax contribution spin.

- Tim Harford discusses the corrosive effects of long-term unemployment, noting that people who have been unemployed for six months or more are effectively shut out of the job market afterwards. Kate McInturff points out the continued gender imbalance in hiring both between and within professions. And Armine Yalnizyan highlights what the federal government could do to help younger workers get a foot in the door if it was actually interested in reducing youth unemployment.

- But there's plenty of reason for concern that the needs and preferences of the public aren't generally finding their way into law - as Larry Bartels writes in comparing the relative influence of public opinion and different types of pressure groups:

A forthcoming article in Perspectives on Politics by (my former colleague) Martin Gilens and (my sometime collaborator) Benjamin Page marks a notable step in that process. Drawing on the same extensive evidence employed by Gilens in his landmark book “Affluence and Influence,” Gilens and Page analyze 1,779 policy outcomes over a period of more than 20 years. They conclude that “economic elites and organized groups representing business interests have substantial independent impacts on U.S. government policy, while mass-based interest groups and average citizens have little or no independent influence.”

Average citizens have “little or no independent influence” on the policy-making process? This must be an overstatement of Gilens’s and Page’s findings, no?

Alas, no. In their primary statistical analysis, the collective preferences of ordinary citizens had only a negligible estimated effect on policy outcomes, while the collective preferences of “economic elites” (roughly proxied by citizens at the 90th percentile of the income distribution) were 15 times as important. “Mass-based interest groups” mattered, too, but only about half as much as business interest groups — and the preferences of those public interest groups were only weakly correlated (.12) with the preferences of the public as measured in opinion surveys.

- Finally, Paul Adams asks whether Stephen Harper is done for as a political force.

Wednesday Morning Links

Miscellaneous material for your mid-week reading.

- David Dayen discusses how prepaid debit cards are turning into the latest means for the financial sector to extract artificial fees from consumers. And Matt Taibbi reports on the looting of public pension funds in the U.S.:

Nor did anyone know that part of Raimondo's strategy for saving money involved handing more than $1 billion – 14 percent of the state fund – to hedge funds, including a trio of well-known New York-based funds: Dan Loeb's Third Point Capital was given $66 million, Ken Garschina's Mason Capital got $64 million and $70 million went to Paul Singer's Elliott Management. The funds now stood collectively to be paid tens of millions in fees every single year by the already overburdened taxpayers of her ostensibly flat-broke state. Felicitously, Loeb, Garschina and Singer serve on the board of the Manhattan Institute, a prominent conservative think tank with a history of supporting benefit-slashing reforms. The institute named Raimondo its 2011 "Urban Innovator" of the year.

The state's workers, in other words, were being forced to subsidize their own political disenfranchisement, coughing up at least $200 million to members of a group that had supported anti-labor laws. Later, when Edward Siedle, a former SEC lawyer, asked Raimondo in a column for Forbes.com how much the state was paying in fees to these hedge funds, she first claimed she didn't know. Raimondo later told the Providence Journal she was contractually obliged to defer to hedge funds on the release of "proprietary" information, which immediately prompted a letter in protest from a series of freaked-out interest groups. Under pressure, the state later released some fee information, but the information was originally kept hidden, even from the workers themselves.
...
Today, the same Wall Street crowd that caused the crash is not merely rolling in money again but aggressively counterattacking on the public-relations front. The battle increasingly centers around public funds like state and municipal pensions. This war isn't just about money. Crucially, in ways invisible to most Americans, it's also about blame. In state after state, politicians are following the Rhode Island playbook, using scare tactics and lavishly funded PR campaigns to cast teachers, firefighters and cops – not bankers – as the budget-devouring boogeymen responsible for the mounting fiscal problems of America's states and cities.

Not only did these middle-class workers already lose huge chunks of retirement money to huckster financiers in the crash, and not only are they now being asked to take the long-term hit for those years of greed and speculative excess, but in many cases they're also being forced to sit by and watch helplessly as Gordon Gekko wanna-be's like Loeb or scorched-earth takeover artists like Bain Capital are put in charge of their retirement savings.

...

(T)he "unfunded liability" crisis had nothing to do with the systemic unsustainability of public pensions. Thanks to a deadly combination of unscrupulous states illegally borrowing from their pensioners, and unscrupulous banks whose mass sales of fraudulent toxic subprime products crashed the market, these funds were out some $930 billion. Yet the public was being told that the problem was state workers' benefits were simply too expensive.

In a way, this was a repeat of a shell game with retirement finance that had been going on at the federal level since the Reagan years. The supposed impending collapse of Social Security, which actually should be running a surplus of trillions of dollars, is now repeated as a simple truth. But Social Security wouldn't be "collapsing" at all had not three decades of presidents continually burgled the cash in the Social Security trust fund to pay for tax cuts, wars and God knows what else. Same with the alleged insolvencies of state pension programs. The money may not be there, but that's not because the program is unsustainable: It's because bankers and politicians stole the money.

[Update: And just in time for the C.D. Howe Institute to sell the same kind of snake oil in Canada.]

- And on the subject of the value of public services being gifted to corporate cronies, Simon Enoch highlights the Wall government's broken promise not to privatize Saskatchewan's Crowns - most obvious lately in their elimination of rural liquor stores in favour of corporate-owned replacements.

- Meanwhile, Karen Kamp points out the dangers of allowing for massive corporate funding of political messages to go undisclosed until it's too late.

- Jason Koblovsky catches Con insider Geoff Norquay admitting that the Unfair Elections Act is intended as "vengeance" against Elections Canada for doing its job in investigating the Cons' in-and-out scandal. And Frances Russell takes a look at some of the ways undue restrictions on voting rights may be unconstitutional.

- Finally, Duncan Cameron and Chantal Hebert weigh in on the results of this week's Quebec election. Paul Wells muses about the illusory attraction of the "star candidate". And John Conway focuses on how the PQ's shift in focus from progressive economic policies to reactionary social ones earned it a miserable defeat.

Tuesday Night Cat Blogging

Packaged cats.

Tuesday Morning Links

This and that for your Tuesday reading.

- Livio Di Matteo discusses the wasted opportunity to improve Canada's health care system through concerted national investments. And Ryan Meili asks who will provide future direction now that the Cons have scrapped the Health Council of Canada:

Now we see the federal government making a bad situation worse by walking away from the process of rebuilding a national health system entirely instead of negotiating a more robust agreement with targets and timelines for innovation and cost-savings.

The elimination of the Health Council only further underlines this movement away from national planning for better outcomes. Were this a one-off elimination of a governmental body created for a short-term purpose, this decision would be merely disappointing. That the Council’s disappearance is part and parcel of a larger strategy of the elimination of the dissenting and unbiased voice — something that is so needed in a democracy — is downright disturbing.

By removing or limiting evidence-gathering bodies, be they in health, the environment, or general information such as the long-form census, we decrease the evidence available to us to inform our debate and decisions. By strictly controlling how scientists can share information, cutting public broadcasting and eliminating watchdog organizations like the Health Council, we groom an ill-informed electorate.

These backward steps are the recipe for bad decisions to be called good, the recipe for a poor-performing health care system, a weakened economy, and worse health outcomes and quality-of-life for Canadians.

- On the bright side, the CP reports on the Mental Health Commission of Canada's findings that a "housing first" strategy more than pays for itself in addressing both homelessness and associated social issues.

- Kathy Tomlinson breaks the story that McDonalds' franchises in B.C. have been going out of their way to hire temporary foreign workers rather than local applicants. And CFIB spokesflack Dan Kelly comes right out and admits to a preference for employees who lack any rights or leverage - leading to Gil McGowan's proper response:

But Gil McGowan, president of the Alberta Federation of Labour, strongly rejects claims that Canadian workers are less productive than temporary foreign workers. He said the difference is that many foreign workers are compliant, out of fear of losing their job.

"Is it a bad thing that Canadians stand up for themselves and don't allow themselves to be pushed around by their employers in low-wage service sector jobs?"

"What he's saying is that the government should provide low-wage employers with a compliant, pliable group of workers who are afraid to stand up for themselves," McGowan said. "And that when workers stand up for themselves and refuse to be disrespected in the workplace, that that is somehow a bad thing? I think most Canadians would find that offensive."

- Meanwhile, Adrian Lee writes that the labour movement has a long way to go in attracting young workers - but that there's plenty of opportunity to serve as a voice for a generation which has been told it can't expect anything more than precarious employment.

- David McLaughlin discusses how electoral non-participation is all too likely to become a habit. And Althia Raj reports that the Cons are trying to reinforce exactly that habit by squelching a pilot program to encourage students to vote.

- Finally, Karl Nerenberg examines the impact of last night's Quebec election on the federal political scene - particularly in eliminating demagoguery over sovereignty as a viable strategy for the foreseeable future.

Monday Morning Links

Miscellaneous material to start your week.

- Laura Ryckewaert looks in more detail at the continued lack of any privacy protection in the Unfair Elections Act. And Murray Dobbin is hopeful that the Cons' blatant attempt to suppress voting rights will instead lead to a backlash among those who are intended to be excluded:

(W)hatever the outcome, perhaps the best possible response of democracy activists would be to treat this loathsome piece of legislation as a useful crisis. This is exactly what leaders of the African-American and Latino communities have done in their fight against the blatant voter suppression efforts in the U.S. -- where individual states determine voting procedures for federal elections. "A Center for Social Inclusion report entitled "Citizens Denied: The Impact of Photo ID Laws on Senior Citizens of Color" warned that nearly half of black voters over age 65 and one in three Latino senior voters would have a more difficult time registering and voting on election day due to photo ID laws passed in some 33 states."

In at least some cases efforts at voter suppression in the U.S. have backfired because the attack on black and Latino communities has galvanized them to get out the vote. The government of Florida reduced the early voting period which prompted black churches "to conduct a two-day 'souls to the polls' marathon. And even as election day turned into a late election night, and with the race in Ohio, and thus for the 270 votes needed to win the presidency, called by 11 p.m., black voters remained in line in Miami-Dade and Broward, two heavily Democrat counties in Florida, where black voters broke turnout records even compared to 2008."

Efforts to suppress the vote in civic elections in North Carolina and Texas also backfired, resulting in record turn-outs of the people targeted by Republican party controlled board of elections.

With young people, the homeless and First Nations voters at the low end of the turn-out numbers, the Harper government's crude effort to suppress their votes even more can and should be used to galvanize the vote from those communities.

Student organizations, anti-poverty groups, the Idle No More movement and senior's groups are well placed to take up the challenge, with help from groups like Democracy Watch and perhaps the NDP.

While many in those communities have found little reason to go to the polls given the slim likelihood of any change in their lives, no one likes to be told what they can and can't do -- especially when it comes to rights. For the people targeted by Harper for disenfranchisement, the 2015 election could be purely about democracy itself.

- Dave Seglins reports on even more rail safety incidents which were left unreported by the railways involved. And Wendy Gillis notes that Transport Canada and MMA are refusing to release the details of the safety plan whose failure caused the Lac-Mégantic disaster - effectively declaring that so far as they're concerned, the plans approved by the government as being sufficient to keep the public safe are none of the public's business.

- Don Lenihan looks at the military procurement process, and highlights the problem with governments allowing contractors to dictate public procurement goals.

- Donald Gutstein tests Andrew Coyne's fudged numbers used to argue against the need for public revenue. But Coyne's figures look downright healthy compared to those being spun by the CCCE - who are trying to claim income taxes and other taxes merely remitted by big business on behalf of others as part of their calculation of what the corporate sector contributes.

- Finally, Barrie McKenna comments on Thomas Piketty's observations about the link between growing inequality, and the corporatist goal of promoting capital returns over broad-based growth:

Prof. Piketty challenges one of the underpinnings of modern democracies – namely, that growth and productivity make each generation better off than the previous one. With hard work and education, conventional thinking goes, anyone can achieve upward mobility, and live the Canadian (or American) dream.

Prof. Piketty warns instead that global economic growth will limp along at just 1 per cent to 1.5 per cent for the rest of this century – roughly half the pace of the past century. The spoils will flow increasingly to the wealthy – entrepreneurs, owners of capital and those fortunate enough to inherit wealth, he argues. Workers will fall further behind.

Think of Prof. Piketty’s world as the antithesis of free-market champion Milton Friedman’s mantra that capitalism spreads the “fruits of economic progress among all people.”

Without radical intervention, the result will be growing inequality and social strife, Prof. Piketty argues.
...
Just as controversial as his dissection of the problem is his recommended solution – a global tax on wealth. Prof. Piketty would slap an annual graduated tax on stocks, bonds and property, which are typically not taxed until they are sold (capital gains). The tax would thwart the concentration of wealth and limit the flow of income to capital.

To be effective, it would have to be applied not just in one country, but virtually everywhere.

Sunday Morning Links

This and that for your Sunday reading.

- David Dayen discusses the massive corporate tax giveaways handed out through the U.S.' annual budget process. And in a system where lobbying by the wealthy is rewarded with a 24-to-1 return, it shouldn't be much surprise if inequality is getting even worse than previously assumed, as Jordan Weissmann reports:

Forget the 1 percent. The winners of this race, according to Zucman and Saez, have been the 0.1 percent. Since the 1960s, the richest one-thousandth of U.S. households, with a minimum net worth today above $20 million, have more than doubled their share of U.S. wealth, from around 10 percent to more than 20 percent. Take a moment to process that. One-thousandth of the country owns one-fifth of the wealth. By comparison, the entire top 1 percent of households takes in about 22 percent of U.S. income, counting capital gains.
...
This new batch of research is similar in spirit to Saez’s pioneering work quantifying income inequality, which he has published with French economist Thomas Piketty. (It's probably no accident that this research is coming out around the same time that Piketty, Saez's longtime collaborator, has published Capital in the Twenty-First Century, his highly touted book about capital accumulation—aka wealth.) Both projects substitute tax data analysis for older approaches that relied on government surveys, which tend to undercount the very rich. In this case, Saez and Zucman use taxes on investment income to reverse-engineer their wealth estimates. The results are still very preliminary and could change with further study.

But they are basically in keeping with what has already been shown about income inequality. Occupy Wall Street trained Americans to frame the economic gap in terms of the 99 percent and 1 percent. But writers and economists have been pointing out for years that the biggest winners in today’s globalized, finance-heavy economy have been an even smaller band of super-rich. Tim Noah dubbed them “the stinking rich.” Chrystia Freeland went with “plutocrats.” No matter what you choose to name them, the largest economic gains have accrued to Americans at the very, very tiniest tip of the earnings pyramid.

- At the same time, Alan Pyke highlights the lack of a link between education and income, noting that nearly half a million American workers with post-secondary degrees are earning the minimum wage. And Tyler Cowen takes a look at the roots of structural unemployment.

- Bill McKibben comments on ExxonMobil's arrogant response to the increased threat of climate change. And Andrew Jackson points out the IMF's conclusion that tar sands expansion (along with other oil and gas development) doesn't figure to actually add much to Canada's economy - even under a government determined to push resource development ahead of all other social and economic priorities.

- Scott Tribe self-identifies as a voter who may be disenfranchised by the Cons' Unfair Elections Act. And Karl Nerenberg tears into some of the most blatant dishonesty being used by the Cons to push an attack on voting rights and electoral fairness alike.

- Finally, Daniel Kahneman discusses how to ferret out and adjust for some of the errors that tend to show up in typical reporting.