Thursday, February 26, 2015

Thursday Morning Links

This and that for your Thursday reading.

- Jacob Hacker and Paul Pierson link inequality and climate change as massive problems which are generated by political choices (and thus amenable to correction through the political system):
Rising inequality is no more natural than global warming. And just as with global warming, our biggest fear should be that it becomes increasingly self-reinforcing — not because of some “natural” economic process, but because economic power begets political power, which can be used to further increase economic advantage. Look around, and the evidence that this is a real threat abounds. To cite just one example of many, the Koch brothers network, led by businessmen who are committed libertarians opposed to any effort to reduce inequality, are planning to spend almost $1 billion in next year’s election.

In other words, read beneath the headline of Leonhardt’s article and you have an argument for greater alarm about the toxic relationship between rising inequality and the dysfunction of the federal government — a message exactly opposite of the one that the inequality deniers want to hear.
- Frances Woolley writes that tax-free savings accounts - and particular the expanded version which the Cons are planning to push soon - represent both a deliberate choice to exacerbate inequality, and one of the most devastating attacks yet on Canada's federal revenue system:
RRSPs leave a legacy of tax revenue to future governments. Increasing TFSA contribution limits does just the opposite – it creates an investment vehicle that is ripe for abuse, whether by generating super-normal returns, or by sheltering income in a TFSA while claiming government benefits. At the same time, it deprives future governments of the opportunity to tax investment income.
...
There’s a saying in policy circles: “the costs are the benefits.” For some, the revenue foregone by expanding TFSAs is a cost. For others, it’s a benefit. Prime Minister Stephen Harper is on the record as believing in small government. One sure-fire way to shrink governments is to deprive them of revenue. Doubling the TFSA limit will do that. Not now, and not in a year from now. But in 10, 20, or 30 years’ time, the doubling of the TFSA limit will gradually erode the ability of Canadian governments to raise revenue, redistribute income, and pay for public services.
- But then, individual savings likely aren't the best means of ensuring retirement security in any event, as David MacDonald finds that a retirement system based on mutual funds diverts massive amounts of savings toward financial sector compared to the alternative of effective pension plans. 

- Michal Rozworski notes that while Canada's wage picture isn't quite as bad as the U.S.' over the past two decades, it's most certainly nothing to celebrate - particularly since any gains were tied up almost entirely in since-deflated oil prices.

- Finally, Haroon Siddiqui laments the Cons' wilful stupidity in dealing with the Middle East. And Paul Adams calls out the tantrum-based foreign policy which includes pulling funding from friendly service providers for having the nerve to question John Baird.

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