Thursday Morning Links

This and that for your Thursday reading.

- Paul Krugman makes the case for significantly higher taxes on the rich:

What would raising tax rates at the top accomplish? It would, to some extent, mitigate the rise in inequality, which some of us consider a good thing in itself: You don’t have to be a leftist to acknowledge that extreme inequality of income and wealth has a corrosive effect on democracy.

Mainly, however, the benefit of higher tax rates on the wealthy would simply be that it would raise more revenue. We live in a time when politicians are trying to downsize even the most basic social protections, claiming that we can no longer afford to pay for them; well, why not raise taxes on millionaires instead of, say, denying nutritional assistance to the poor?

You will, of course, hear claims that raising taxes on the wealthy won’t even yield increased revenue – that the “job creators” will go on strike, or hide their income from the tax collectors. However, researchers have studied the revenue effects of tax hikes (and cuts) about as thoroughly as any topic in economics, and the evidence is decisive: Increasing top tax rates from their current level would lead to substantially higher revenue. At a sufficiently high rate – the best estimates put it above 70 per cent and possibly as high as 80 per cent – further increases would be self-defeating; but we’re nowhere near that point. 

And while Stephen Gordon partially distinguishes Krugman's U.S. numbers (at least for a couple of carefully-selected provinces), I'd think it's worth trying to reach agreement on a couple of principles: that tax rates should in fact be set such as to maximize revenue, and that for similar revenue expectations it's a reasonable public policy choice to minimize inequality rather than maximizing top-end wealth accumulation.

- Michael Wolfson discusses how health care contributes to a more equal society.

- David Climenhaga notes that the Cons are choosing yet again to attack the civil service in an effort to distract from their own scandals.

- Meanwhile, the Cons have also been caught spying on anybody who dares to challenge them. And misusing public resources for partisan gain, then falsely blaming others afterward. Is there any doubt why they're doing their utmost to prevent anybody from getting to the bottom of Robocon?

- Finally, Andrew Nikiforuk writes about new research showing that diluted bitumen doesn't act like oil when it spills - with the effect of rendering useless the oil industry's assurances that they can simply apply normal oil cleanup rules to pipelines transporting dilbit.

Saturday Morning Links

Assorted content for your Saturday reading.

- Kate Heartfield worries that the NRA knows exactly what it's doing with its jaw-dropping response to the Newtown shootings - and that it should be all too familiar based on the tactics of the Harper Cons:

It’s ridiculous, but ridiculous works, time and time again. “Elite” no longer means rich and powerful. It means smart. It means anyone who takes the time to look at the evidence and construct a logical argument. Not to be trusted, that. So all academics and journalists are suspect. The only way a journalist can avoid being seen as an elite is to go on the attack against other journalists, to promise, for example, to provide the straight talk that the so-called Media Party doesn’t want you to know.

This works. The Conservative government doesn’t have to construct a fact-based defence of its environmental or crime policies, because it doesn’t matter that they don’t make sense. No conservative (in the ideological, not the partisan sense) really thinks that costly, top-down regulation is the best climate-change strategy, for example. But it doesn’t matter, when it comes to the party’s electoral chances, which is all the party cares about. The policies don’t have to make sense. They just have to come attached to some boilerplate about how ivory-tower academics don’t understand the real world, or how statistics lie.

- Meanwhile, Andrew Coyne buries the lede in an otherwise unremarkable summary of the Cons' policy direction:

(A)t year’s end, it’s still not entirely clear whether the government has learned anything. We may stick with the F-35. We may not. We may go to competitive bids. We may not.
Meanwhile, the robocalls scandal has slowly dragged on, a steady drip of voter complaints, revelations arising from Elections Canada’s continuing investigation, and court testimony. Nothing as yet indicates any senior Tories knew about or colluded in attempts to mislead or harass voters in the last days of the campaign, but neither does it seem plausible that it was all the work of a few overzealous kids. The calls are too many, in too many ridings, with too much sophistication required.

Last, there are the omnibus budget bills, I and II: the point at which the government’s emerging policy ambitions and continuing contempt for Parliamentary democracy converge. I’ve said my fill about these earlier, so I’ll be brief here. When much of the government’s legislative agenda can be pushed through in a single bill, or two; when “debate” on these hydra-headed monstrosities is itself cut short by government fiat; when these arrive on top of the whole long train of abuses to which Parliament has already been subjected, starting under past governments but with conspicuous enthusiasm under the present – then the question for next year, and for years to come, is clear. It is whether we will still live under a Parliamentary system of government, or something else.

 - Michael Wolfson makes the case for a stronger Canada Pension Plan which pairs any age increase in benefit payments with recognition that lower-income seniors need an alternate source of income:

An expansion of the benefit levels of the CPP should be phased in more rapidly, say over 20 to 25 years rather than the 47 years implicit in all the current discussions. In parallel, the age at which full benefits from the CPP would start should rise gradually from 65 to 70. More rapid phase in of benefits, of course, means payroll taxes would have to rise. But a delay in the age when benefits become fully payable would reduce the need for tax increases.

Finally, the long run structure of the Old Age Security (OAS) and Guaranteed Income Supplement (GIS) portions of Canada’s public pension system should be coordinated with any changes to CPP to assure it is fair to those with lower incomes – a point clearly lost on the Harper government with their most recent cuts to OAS and GIS.

These options open the possibility of a more creative and better pension bargain – more adequate pensions that are also fiscally sustainable. Are Canada’s finance ministers ready to think outside the box?

- Finally, Brad Lavigne's analysis of the NDP under Tom Mulcair focuses almost exclusively on what Andrew Potter would consider the cynical side of the party's interests. But it's well worth noting that the NDP's upcoming policy convention will provide an ideal opportunity to discuss exactly where members actually want to be on that spectrum - and to assess Mulcair's responsiveness to members' concerns.

Tuesday Morning Links

This and that for your Tuesday reading.

- Paul Boothe discusses the dangers of giving in to resource-boom hype rather than planning for sustainable development:

The resource roller coaster and the crazy things it causes us to do are not new. Remember the federal government's 1980 National Energy Program? It grew out of a forecast that Alberta's oil royalties were likely to grow so large that they would fatally destabilize the Canadian federation. Remember Alberta's 1992 deficit that reached almost one-quarter of total revenues? It resulted from a forecast that natural gas prices would rise and bring on another royalty bonanza.

Resource economies grow faster on average, so what is wrong with riding the boom-and-bust roller coaster? Economists happily assume that workers can glide costlessly from one place to another in search of their next job. The reality is quite different.

Boom-and-bust economies are enormously disruptive to families and destructive of social capital. Travelling back and forth across the country searching for work means more children raised by single parents, fewer people checking in on the stay-at-home elderly, fewer minor hockey and soccer coaches. These things are the glue that binds our communities together.

Are there ways of avoiding repeating the boom-and-bust errors of the past? Yes. We can choose not to put all of our economic eggs in the natural resource basket. We can stop listening to those who proclaim the promise of the current boom and ignore the volatility that is part and parcel of staking our future primarily on natural resources. Developing our natural resources in an environmentally and socially sustainable way makes good sense. Betting the farm on them does not.

- Naturally, the obvious merit to a broader view explains why the Cons' strategy is to "lie and lie again" to distract from their reckless gamble on resource prices - and Craig McInnes is just the latest columnist to call them out on their deliberate and brazen dishonesty.

- Paul Wells summarizes the massive scope of the latest draft version of the CETA, while Heather Scoffield focuses on the EU's demand that investors take precedence over health, safety, the environment and all other considerations.

- Michael Wolfson takes aim at the lack of social mobility in Canada, along with the Fraser Institute's sad attempt to pretend there's no issues to be dealt with:

If the analysis had been done fairly, looking at relative mobility as it claims, it would have used income groups for the specific population being studied – younger earners. Then, for every person moving up a relative position on the income ladder (e.g. from the the bottom 20 per cent to the top 20 per cent, as in the Fraser analysis), someone else must have moved down, there being a fixed number of rungs (or 20 per cent income groups in this case).

Fortunately, there is an analysis of the question of income mobility in Canada based on a more careful methodology which I co-authored a few years ago, using exactly the same income tax data base. Our results lead to quite different conclusions.
...
(T)he top 1 per cent and even the top 0.01 per cent had incomes that bounced around less than the incomes of the 25 per cent at the poorest end of the income ladder. A major reason: low earnings are often the result of “precarious” jobs which not only pay low wages, but are unstable.

Life at the top may be risky, but the real risks in life lie at the bottom of the income spectrum..

This reality of precarious jobs amongst the poor, and current research standards for unbiased analysis of income mobility, are ignored by the Fraser Institute as it tries to perpetuate the Horatio Alger, ‘rags to riches’ myth.

 - Finally, Errol Mendes wonders whatever happened to the Stephen Harper who once fought against omnibus bills and top-down control.