On predictable arrangements

Aaron Wherry nicely summarizes the possible outcomes of the next federal election so the rest of us don't have to. But let's take a moment to consider what we can expect if we indeed have a hung Parliament, requiring parties to deal with each other to determine who will hold office.

To start with, Michael Den Tandt's theory about the NDP having any interest in propping up continued Con government is utterly out to lunch. But CuriosityCat's Lib spin is far from the right way to look at the NDP's position as well.

No, Jack Layton's tenure as leader (and rise to the position of Leader of the Opposition) isn't a cautionary tale. And that's precisely because Layton refused to make the type of deal Den Tandt sees as possible.

Here's Layton's first-hand account as to what happened when discussions after the 2004 election shifted from merely amending the Throne Speech, and turned to the possibility that Stephen Harper could become prime minister as head of a new government (Speaking Out Louder at p. 341-342):

I asked Mr. Duceppe what he thought would happen if the prime minister refused to accept such an ultimatum. He replied that a government defeat so soon after a general election meant the Governor General would have to turn "to one of us" to form a government. We both knew that meant Stephen Harper and his Conservatives. I asked Mr. Duceppe if he could accept such an eventuality. He was not only clear that he could, but he would.

Stephen Harper, while less inclined to brinksmanship, nevertheless warmed to the seduction of Mr. Duceppe's strategy. Under this scenario, Mr. Harper would become prime minister in an informal alliance with the Bloc. Unthinkable? Not to either Mr. Harper or Mr. Duceppe. The Bloc leader was willing to strategize for Stephen Harper to become prime minister, despite the Conservatives' many negative policies...Mr. Duceppe and the Bloc would have been key players in any Harper coalition, demanding significant dismantling of our collective capacities as Canadians as the price of his support. That dismantling was something that would coincide nicely with Mr. Harper's ideological and visceral distaste for any federal government oversight or ability to intervene in any social or economic programs administered by the provinces but utilizing federal tax dollars.

Realizing immediately the full magnitude of what was at stake, I knew I had to walk away. I was not about to participate in any scheme cooked up by the Bloc and the Conservatives that would put the country in the hands of Stephen Harper.

So Layton rightly concluded that installing the Cons in power was antithetical to the values he had been elected to promote. And he held to that position throughout the minority Parliaments from 2004 to 2011 - while the Bloc and Libs took turns supporting Harper (or running for the hills) when faced with opportunities to avoid Con government through a vote in Parliament.

There's no reason to think the NDP would change its view from the position it has held since 2004, as Thomas Mulcair has taken up Layton's mantle in defending the concept of a coalition in pursuit of progressive government. And if anything, the large group of Quebec MPs elected in no small part to maximize the chance of building an alternative government would have all the more reason to hold to the position.

We can thus expect the NDP to be strongly motivated to remove Harper from power if any opportunity presents itself.

And as I've noted before, there should be ample room for a deal between an NDP which is primarily focused on ensuring progressive policy outcomes, and a Lib party which is built primarily around personal advancement (and which is prepared to change its policies at the drop of a hat in pursuit of that end).

If the NDP ranks ahead of the Libs with enough combined seats to form government, it will be in a position to offer Justin Trudeau and his entourage a place in the cabinet to start shedding their "inexperienced" label - and likely wouldn't have much trouble fitting a prominent Lib platform plank or two into a governing agenda.

Similarly, if the Libs finish with more seats than the NDP, there's reason to expect the NDP to focus on having as much of its platform as possible implemented, while the Libs would try to maintain as much personal profile as possible while offering enough of a role in Cabinet to satisfy (and make use of) the NDP's strongest performers.

Of course, it's not clear that Trudeau shares Michael Ignatieff's intention of shedding the Cons' government given the opportunity. And that's where there's some significant risk for progressive voters: the stronger the Libs' perceived likelihood of approaching a majority in a subsequent election, the greater the danger that they'll leave Harper in power.

But there's plenty of reason to think it will be possible for the NDP and the Libs to work out a deal if both want a change in government. And there's no basis at all to worry that the NDP will be the party holding up that process.

Sunday Afternoon Links

Assorted content for your Sunday reading.

- Joan Walsh discusses Elizabeth Warren's work on improving wages and enhancing the strength of workers in the U.S., while Jeremy Nuttall interviews Hassan Yussuff about the labour movement's work to elect a better government in Canada.

- Bob Hepburn argues that getting rid of the Harper Cons is a first step toward regaining some faith in our political system. And Scott Reid worries that Stephen Harper's cynical view of government in anybody's hands may have spread to Canada's electorate - though while there's plenty of work to be done in the longer term, the short-term Con message of "you shouldn't trust government!" would seem to be readily supplemented with "especially this one!".

- Speaking of which, Joanna Smith catches Chris Alexander interfering in a response to questions about the Cons' immigration mess. And the argument that it's too much work to actually track outcomes hardly speaks well to the Cons' supposed management skills.

- Toby Helm reports on Ed Miliband's plan to set up a Living Standards Index to measure well-being beyond GDP alone as part of a push to show that right-wing orthodoxy misses the impact of the economy on the vast majority of people. And Ron Lieber observes that gross inequality can be toxic for the people who grow up with extreme privilege.

- Finally, Guy Dauncey responds to Sarah Petrescu's series on poverty in Victoria by pointing out that we'll need some big ideas to eradicate it altogether - though I'd note that he may miss the most important one.

On overtime losses

Those readers who follow my law blog will already be familiar with this week's news about the Saskatchewan Party government's attack on overtime pay for retail workers. But I'll take some time to assemble the full story here.

Historically, a "day" for the purpose of calculating overtime for Saskatchewan workers has been defined as any consecutive period of 24 hours. All Saskatchewan workers have been entitled to overtime if they are required to work more than 8 hours in any such period.

As part of its response to the Saskatchewan Party's employment law review process, the Retail Council of Canada wanted to change the definition of a "day" for the purposes of calculating overtime pay. (Unfortunately, the actual submission - along with everything else associated with the massive consultation process which resulted in a wholesale revision of Saskatchewan labour and employment law - has been wiped from the Ministry's website. But a summary of the RCC's position can be found in its followup submission here.)

The RCC wanted a "day" redefined to mean only a calendar day (or any other single 24-hour period set by an employer). That means that a worker could be required to work up to 16 hours out of 24 - say, a 4 PM-12 AM shift one day and an 8 AM-4 PM shift the next - without receiving a nickel of overtime pay.

The government declined to act on that submission in actually drafting the new Saskatchewan Employment Act (SEA).

Like the previous Labour Standards Act, the SEA explicitly states that for the purposes of the calculation and payment of overtime, a "day" means "any period of 24 consecutive hours". And nothing in the new Employment Standards Regulations - which were released without debate and with minimal consultation, but would at least have provided some public notice of planned changes - alters that definition or its application in any way.

In other words, the Ministry didn't offer any warning whatsoever that it planned to slash overtime pay for retail employees. And as late as October 2014, the Ministry published its new employment standards guide for employers (PDF) - which confirmed at page 19 that the existing rules governing "short-shifting" (as the RCC calls multiple shifts in a 24-hour period) hadn't changed.

But while the Wall government didn't make any change in the law or even offer any public notice that the Ministry might change its position, it directed the Ministry's staff to apply the RCC's interpretation to retail workers - rationalizing that the SEA was supposed to offer more "flexibility" to employers in cutting overtime pay even if if offered no authority whatsoever to change the law. And while that direction wasn't offered until December 12, staff were instructed to apply the RCC's interpretation to all hours worked after April 29, 2014 - the day the SEA was proclaimed in force.

In effect, the Saskatchewan Party secured passage of the SEA by assuring workers that it wasn't attacking employment standards. But it's since started telling employer groups, along with the public servants charged with enforcing the law, that the proclamation in force of the SEA means that all bets are off when it comes to employment standards.

As noted on my law blog, I'll be working on gathering more information both about this particular interpretation (which only became public because the RCC decided to brag about having won secretly what it couldn't win through a proper democratic process), as well as any other changes the Ministry has made in employment standards or other worker rights since the SEA came into force. But the clear takeaway for now is that Saskatchewan workers have reason to worry that the agency charged with enforcing their rights is receiving secret orders to attack them instead.

Update: I'll clarify a couple of points which I made on the law blog, but haven't yet noted above.

First, the change in interpretation didn't actually change the law: theoretically, employees should still have been able to claim the overtime provided for under the SEA. But they'd have had to fight the Ministry's interpretation through an adjudication and appeal process, representing a significant barrier for employees who don't have time or money to fight over the rights which are supposed to be protected by law.

And second, the Ministry did abandon its "pilot" interpretation last week, but only after it had been brought to light.

Saturday Morning Links

This and that for your weekend reading.

- Robert Ferdman reports on a Pew Research poll showing that wealthier Americans are downright resentful toward the poor - and think the people with the most difficult lives actually have it too easy:

(T)he prevalence of the view might reflect an inability to understand the plight of those who have no choice but to seek help from the government. A quarter of the country, after all, feels that the leading reason for inequality in America is that the poor don't work hard enough.

But as my colleague Christopher Ingraham pointed out last year, to say that the poor have it easy is to ignore how serious their struggle is in comparison to the rest of the population, and especially those with money to spare. The poor are much less likely to have health insurance, much more likely to be the victim of a crime. They don't get the same level of education or have the same food options. Inequality, as my colleague Matt O'Brien wrote, "starts in the crib," and it plays out even in what babies of different socioeconomic backgrounds are fed. And that's just the tip of the iceberg.

- Meanwhile, Amitha Kalaichandran counters that homelessness (like other aspects of poverty and inequality) is anything but a choice. And Sara Mojtehedzadeh reports on how poor neighbourhoods in Toronto rely on payday lenders, and how that only makes matters worse for people already trying to scrape by with very little.

- PressProgress highlights the stagnation of Canadian wages, while Andy Kiersz points out that Canadian household debt is not only higher than the U.S.' today, but also higher than the unsustainable levels that contributed to the 2008 economic meltdown. And Sherri Torjman argues (PDF) that the Cons' regressive income splitting scheme is the last thing Canadian families need at the moment.

- Andrew Jackson discusses the connection between increased reliance on information technology to perform skilled work, and the growing income and wealth gaps:

IT has eliminated middle skilled jobs, and new jobs are being created at the high and the low end of the education and skills spectrum. At the same time, IT development has resulted in huge “winner take all” rewards for a handful of individuals who have pioneered major new applications which have been widely adopted – think Google and Facebook. Compared to the giants of the industrial age, these companies have huge market capitalizations but relatively few workers, and only have to invest modestly in physical capital.

The theory of skill biased technological change tells us a lot but has significant problems as an overall explanatory framework for rising income and wealth inequality. As has been frequently noted, inequality still varies a great deal between advanced industrial countries using the same technologies because institutions, such as unions and labour laws as well as government social and tax policies, make an important difference.

And, as Thomas Piketty showed in his own 2014 best-seller, the ranks of the very rich go far beyond internet billionaires to include those who have inherited wealth, as well as the very well-paid CEOs of “old economy” enterprises who have ruthlessly used IT to cut costs. Technological change may explain why the less skilled are doing badly, but there is a bigger story behind the rise of the super wealthy compared to the merely highly educated.

That said, the authors of the Second Machine Age and their colleague David Autor at MIT make a convincing case that new technology has very much worked against those without very high levels of skills. They make the key point that the elimination of routine jobs by machines results in the relatively unskilled competing for the many lower level jobs which are non routine and cannot be readily automated, such as personal care support workers, hairdressers, cooks and chefs, janitors, security guards and so on. The relative weight of these low productivity, low skill, low pay positions in the job market is increasing, and their pay is flat or falling.
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The authors of The Second Machine Age discuss, but do not go so far as to advocate, a basic income for all citizens. But it will be hard to refute the moral and economic logic for spreading the bounty of technological progress to the many if the wealth of the very rich increases as rapidly as the power of the marvellous machines that are now at their service.

- Finally, Bruce Johnstone laments the willingness of resource-obsessed governments to get us stuck in commodity price traps. Which makes for a needed counterpoint to Murray Mandryk's odd position that the point when we recognize we're trapped is no time to try to free ourselves.

Musical interlude

tyDi feat. Audrey Gallagher - You Walk Away

Thursday Morning Links

This and that for your Thursday reading.

- Duncan Exley points out that the UK has nothing to be proud of when it comes to income inequality. And Bill Curry reports on the Cons' full awareness that the temporary foreign worker program was both taking jobs away from Canadian youth, and allowing employers to pay far less for foreign labour.

- DSWright highlights how Joseph Stiglitz appears to have been rejected by Republicans for a position advising on the U.S. financial system solely because he's dared to express the opinion that regulators shouldn't see their job as catering to the industry they're regulating.

- Meanwhile, Robert Reich discusses the dangers of the Trans-Pacific Partnership, while Patrick Caldwell is the latest to highlight how Kansas' right-wing utopia is turning into a disaster for everybody involved.

- Jeremy Nuttall expands on the Cons' censorship of websites for federal public servants.

- Frances Russell wonders what Tommy Douglas would have thought of the federal government's decreasing role in building a healthy Canada. And Linda McQuaig worries that the Harper Cons are getting away with destroying our medicare system:

(T)he prime minister’s apparent contempt for the democratic process has been so outrageous it’s sucked all the political oxygen out of the room.

In our distraction, we’ve barely noticed something else important going on. In addition to sabotaging our democracy, Harper has been restructuring our country in a fundamental way — something that will be hard to reverse and, incidentally, very pleasing to Canada’s elite.
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The essence of the Harper makeover of Canada has been the deep slashing of taxes, putting serious constraints on what government is able to provide in public programs and services.
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(F)ew Canadians seem to realize that, as things stand, our medicare system — an institution cherished by millions — faces serious spending cuts starting in 2017.

At that point, we’ll be told we can no longer afford a public health care system. What we won’t be told is that the revenue to pay for a public health care system has been spent already — in tax cuts.

Harper appears to have figured out how to discreetly undermine and eventually end medicare. This shouldn’t surprise us, since he once headed up the National Citizens Coalition — an organization established in the 1960s with the goal of killing medicare.

- And finally, John Cartwright offers some suggestions as to what we need to talk about in order to take back our country from the Cons and the corporate lobby in 2015.

New column day

Here, on the OECD's working paper showing that stronger environmental policies are entirely consistent with a more productive economy.

For further reading...
- Obviously, the area where the need for more stringent regulation is most obvious lies in our CO2 emissions. On that front, CBC reports on Christopher McGlade and Paul Elkins' study showing how many fossil fuels will need to stay in the ground to stay below a two degree temperature increase, while George Monbiot weighs in on the UK's reckless plan to maximize the harm it does to our climate.
- And as a reminder, Paul Krugman has noted that there are plenty of additional economic reasons to see fighting climate change in particular as a win-win proposition.

Wednesday Morning Links

Miscellaneous material for your mid-week reading.

- Nathan Schneider discusses the wide range of support for a guaranteed income, while noting that the design of any basic income system needs to reflect the needs of the people who receive it rather than the businesses who see it as an opportunity for themselves. And Art Eggleton includes a basic income and more progressive taxes as part of the solution to poverty in Canada.

- Meanwhile, Sarah Petrescu points to income supports and housing as the two most important issues in her review of poverty in Victoria. And Richard Florida highlights the connection between urbanism and inequality while making the case for cities to focus on their poorest citizens.

- Trish Hennessy offers up some numbers as to how Canadians see our political system. And the strong demand for action against inequality fits nicely with Carol Goar's argument that Canadians generally don't buy the pundit-class theory that voters won't accept real political change.

- CUPE points out how much we stand to gain by making meaningful public investments rather than limiting our range of policy choices to service and tax cuts. And Roger Peters makes the case that we should focus on the social economy, rather than judging development solely in terms of corporate interests.

- Finally, Lawrence Mishel, Elise Gould and Josh Bivens chart the stagnation of wages in the U.S. And Mishel expands on the causes of that stagnation:

[The U.S.'] dismal wage growth is the result of intentional policy choices made on behalf of those with the most income, wealth, and political power. As explained below, these choices fall into five broad categories: the abandonment of full employment as a main objective of economic policymaking, declining union density, various labor market policies and business practices, policies that have allowed CEOs and finance executives to capture ever larger shares of economic growth, and globalization policies. Collectively, these policy decisions have shifted economic power away from low- and middle-wage workers and toward corporate owners and managers.

The fact that wage stagnation stems from intentional policy decisions means that fundamental economic forces did not make these trends inevitable. The income, wealth, and wages generated over the last generation were sufficient to provide broadly shared prosperity for all families. There will be substantial growth in income, wealth, and wages over the next few decades as well, and whether the vast majority appropriately benefits from this growth will depend entirely on the policy choices that will be made.

Tuesday Night Cat Blogging

Cats on high.

Tuesday Morning Links

This and that for your Tuesday reading.

- Sam Pizzigati interviews Richard Wilkinson and Kate Pickett about the fight against inequality and the next piece of the puzzle to be put in place:

[Pickett:]...In The Spirit Level, we have all these correlations between inequality and social problems, and we have theories and hypotheses about what is driving these correlations. But we didn’t know then whether or not the drivers we hypothesized — things like status anxiety — were actually higher in more unequal countries. Now those kinds of data are being used increasingly in psychological research. So, for instance, there are papers looking at levels of social solidarity in relation to inequality in different European countries.

Wilkinson: Solidarity in terms of whether people are kind and helpful toward each other, whether people are willing to help old people or their neighbors or the disabled.

Too Much: Your upcoming new book, which I hear has the working title, Crisis of Confidence, will go into much of this new psychological research?

Wilkinson: Yes. I worry that many people think that these things we’ve been writing about — like violence or poor educational performance — all go on out there in “society” and have nothing to do with what they think matters most to them, like their own personal and emotional ups and downs and the well-being of their friends and family. So I’m rather keen to show how inequality gets into our intimate worlds.

- Meanwhile, Rick Noack looks at how inequality has undercut economic growth in numerous developed countries including Canada. And Joseph Stiglitz writes about the damage ineequality has done to the U.S.' youth.

- Keith Reynolds discusses Ontario Auditor General Bonnie Lysyk's findings about the gross waste resulting from the use of P3 structures based on unfounded assumptions:

Risk transfer is the magic bullet that is used to justify spending more money on public-private partnerships. The thinking is that the private partner absorbs large amounts of risk that would otherwise be carried by the province and that this justifies additional costs. In the Ontario example, the AG says the government uses calculations that assume there is five times as much risk from public procurement as there is from a public-private partnership.

How much risk is actually involved? The Dominion Bond Rating Service published a document in February outlining how it rated the credit worthiness of P3s. It concluded most P3s were "of low to moderate risk." If this assessment is good enough for P3 investors listening to the DBRS, maybe we should be listening too. As a specific B.C. example, a Finance Department memo obtained under Freedom of Information looking at the Fort St. John Hospital P3 questioned the return the company was getting for taking on risk. The Internal Rate of Return (IRR) is the return the company expects to get back on its invested capital. The government memo said that the IRR the company was demanding in return for accepting "risk" was ridiculous given that:

• There is no revenue risk in a hospital project.
• Counter-party risk is the province, so as long as the proponent manages the projects minimal equity risk.
• Only political risk, which is relatively low.

The Ontario auditor general went even further questioning the whole underpinnings of the "risk transfer" justification.  She found that there was absolutely no "empirical data" supporting the valuation of the cost of risks transferred to the private sector by P3s.  The risks to justify the enormously higher costs, she reported, were anecdotal.

- But perhaps even more telling than the strength of Lysyk's findings is the weakness of the counterargument - and Paul Boothe for one isn't going to let the fact that the argument for P3s relies on wishcasting stop him from keeping up a steady stream of fact-free anecdotes and reliance on an incestuous consultant industry to evaluate itself.

- A new OECD working paper finds that contrary to the Cons' spin, a properly-administered set of environmental regulations doesn't need to cost the economy anything. And Scott Vaughan points out that Canada could easily turn renewable energy into a far larger export industry if we weren't stuck with a government determined to push the dirtiest energy sources available.

- Finally, Jim Stanford offers some good economic news from 2014 (while pointing out that there's still a long way to go). 

Monday Morning Links

Miscellaneous material to start your week.

 - Emma Woolley discusses how homelessness developed into a social problem in Canada in large part through public neglect. Judy Haiven is the latest to emphasize that charity is no substitute for a functional society when it comes to meeting people's basic needs. And Ed Lehman is rightly concerned that Brad Wall and company are still determined to avoid acknowledging the fact that there are plenty of Saskatchewan residents trying to make do with nowhere near enough.

- Emily Badger reminds us how inequality early in life can shape - and block - opportunities for a lifetime to come. And on the subject of people getting far less than a fair chance in life, Robert Mendick and Robert Verkaik report on the latest anti-Muslim hysteria from the Cons' UK cousins - featuring an edict that nurseries and child-care providers inform the government of supposed extremism among the ever-threatening toddler set.

- Blacklock's exposes the Cons' orders forbidding federal employees from viewing news. And Michael Harris discusses how far too many Canadians seem willing to accept having our democratic institutions and constitutional protections negated by executive fiat.

- Meanwhile, Rafe Mair points out that proportional representation can go a long way toward ensuring that one leader doesn't exercise power so recklessly.

- Finally, Dan Leger suggests eight steps to improve Canada's democracy.

Sunday Afternoon Links

This and that for your Sunday reading.

- Alex Himelfarb writes about the corporate push to treat taxes as a burden rather than a beneficial contribution to a functional society - and why we should resist the demand to slash taxes and services alike:

How is it that we don’t now ask of these tax cuts upon tax cuts: What will be the consequences for these public goods, goods that most of us continue to value, that demonstrably contribute to the general welfare? In part the answer may be that we devalue public goods because they are not priced and so we underestimate or simply take for granted their value. We surely don’t think very often, if at all, of how much it costs to light our streets, or ensure that clean water pours from the tap or that we can more or less trust the food we eat. But these are all things we buy with our taxes because together is the only way we could ever afford them.

Furthermore, public goods don’t give us any edge over our neighbours. Unlike the bigger house or the fancier car, our access to high quality education or healthcare confers no special status. Perhaps that is one reason that some, usually rich, Canadians insist that they should be able to buy their way to better or faster service even when the evidence is overwhelming that that would make things worse for the many. We ought to be asking whether more money to fuel the consumption race is really what we need, whether a little more change in our pocket is more important than strengthened public goods – better health care, affordable child care, first-rate infrastructure, access to justice…
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The promise of tax cuts funded through ending the gravy train is what University of Toronto philosopher Joseph Heath has called a magic hat, wishful thinking. Successive parliamentary budget officers have told us precisely this. So we should not be surprised that the governments which for years promised painless – consequence-free – tax relief, now tell us that our most basic programs are unsustainable, that we have no alternative but to cut or privatize services and forego investments. New programs? Unthinkable. Of course tax cuts have consequences: in a word, austerity.

Austerity in Canada is certainly not as deep or brutal as in some parts of Europe. But even our slow motion version brings with it a vicious cycle of erosion and distrust. It leads to what game theorists call a social trap—when we don’t trust one another enough to do what we know is in our interest. Economist Hugh Mackenzie has been quantifying the value of the public services we buy with our taxes and has found that for the vast majority, taxes are one of the last great bargains. Most of us get more back than we put in, and that’s the case at every stage of the life cycle. But austerity undermines our trust in this bargain. Programs and services are increasingly targeted, serving only a few, or are starved of resources and slowly erode, amplifying our perceptions that governments can’t do anything right, further sapping our will to pay taxes. The family that celebrates tax cuts soon finds that the gains are dwarfed by what is lost—for example, in out-of-pocket healthcare expenses, unavailable and more expensive child care, delayed old age security, higher tuitions, endless user fees including higher postage, and the end of home delivery. And then they hate government and taxes even more.

Austerity feeds short-termism. We today reap the benefits of public services built by previous generations more willing to pay taxes. But what will we be passing on to future generations? In the name of austerity we put off investments critical to our future. We also put off the maintenance of our existing infrastructure, our schools and hospitals, roads and bridges, the worst kind of false economy, passing on even more expensive problems to future governments, future generations, jeopardizing our economic performance, and exposing citizens to avoidable health and safety risks.

Austerity also leads to greater inequality, eroding our redistributive institutions and the programs that reduce and help mitigate inequality. The consequences of austerity always fall first and most heavily on the vulnerable—refugees, migrant workers, prisoners, the poor, people with disabilities, and on the young—a kind of trickle-down meanness.

- Lynn Stuart Parramore interviews Joseph Stiglitz about the sources of growing inequality and the public policy response needed to combat it. And Henry Grabar discusses how the most significant concentrations of wealth are being hidden from public view.

- Meanwhile, David Dayen highlights the need for an accurate history as to the type and volume of public assistance shoveled toward the financial sector after it crashed the global economy, rather than toward the people most affected by the economic crisis.

- Finally, Humera Jabir discusses the Cons' efforts to devalue Canadian citizenship by treating it as a privilege which can be undone by the actions of foreign governments, rather than a right which can't be stripped away.

Saturday Afternoon Links

Assorted content for your weekend reading.

- Robin Sears offers his theory that the upcoming federal election could represent a meaningful referendum on competing visions for Canada - and Paul Wells seems to expect much the same. But while that might make for a useful statement of the actual consequences of electing the anti-government Cons as opposed to having a progressive coalition materialize, it's hard to see a clash of visions represent the core of the campaign - particularly when the party currently in power won't admit to its active hostility toward social programs and the environment, while another major party seems to be planning to hold off on deciding what it believes in until it has no choice but to do so.

- In the alternative, Crawford Kilian suggests that we should make 2015 the year to mock the Harper Cons in advance of the impending federal election.

- In keeping with that theme south of the border, Dylan Matthews identifies the worst argument for wealth inequality yet. And Danny Feingold interviews Bill de Blasio about the growing recognition that inequality affects everybody.

- Meanwhile, Michael Lewis again discusses the psychological dimension of wealth inequality:

A team of researchers at the New York State Psychiatric Institute surveyed 43,000 Americans and found that, by some wide margin, the rich were more likely to shoplift than the poor. Another study, by a coalition of nonprofits called the Independent Sector, revealed that people with incomes below 25 grand give away, on average, 4.2 percent of their income, while those earning more than 150 grand a year give away only 2.7 percent. A UCLA neuroscientist named Keely Muscatell has published an interesting paper showing that wealth quiets the nerves in the brain associated with empathy: If you show rich people and poor people pictures of kids with cancer, the poor people's brains exhibit a great deal more activity than the rich people's. (An inability to empathize with others has just got to be a disadvantage for any rich person seeking political office, at least outside of New York City.) "As you move up the class ladder," says Keltner, "you are more likely to violate the rules of the road, to lie, to cheat, to take candy from kids, to shoplift, and to be tightfisted in giving to others. Straightforward economic analyses have trouble making sense of this pattern of results."

[There is an obvious] chicken-and-egg question to ask here. But it is beginning to seem that the problem isn't that the kind of people who wind up on the pleasant side of inequality suffer from some moral disability that gives them a market edge. The problem is caused by the inequality itself: It triggers a chemical reaction in the privileged few. It tilts their brains. It causes them to be less likely to care about anyone but themselves or to experience the moral sentiments needed to be a decent citizen.

Or even a happy one. Not long ago, an enterprising professor at the Harvard Business School named Mike Norton persuaded a big investment bank to let him survey the bank's rich clients. (The poor people in the survey were millionaires.) In a forthcoming paper, Norton and his colleagues track the effects of getting money on the happiness of people who already have a lot of it: A rich person getting even richer experiences zero gain in happiness. That's not all that surprising; it's what Norton asked next that led to an interesting insight. He asked these rich people how happy they were at any given moment. Then he asked them how much money they would need to be even happier. "All of them said they needed two to three times more than they had to feel happier," says Norton.

The evidence overwhelmingly suggests that money, above a certain modest sum, does not have the power to buy happiness, and yet even very rich people continue to believe that it does: The happiness will come from the money they don't yet have.

- Finally, Frances Woolley nicely summarizes how our relationship to possessions affects economic theory.

Musical interlude

Adam Szabo & Willem De Roo - Medusa

Friday Morning Links

Assorted content for your Friday reading.

- Mariana Mazzucato discusses how inequality and financialization have teamed up to create an economy with little upside and serious risks for most people:

(W)hat should we do in 2015? Financial reform–aimed at bringing finance and the real economy together again–must thus critically first study the facts, not the myths, in the real economy. Periods of longest stable growth in most economies [occur] when medium to large firms have invested their profits in R&D and human capital. What is needed today is long-term committed finance, in the form of public banks (such as German’s KfW or Brazil’s BNDES) and a taxation policy that fosters long-termism, rather than constant tax cuts for speculators. And while taxation policy must be progressive and not regressive[, it's] fundamental to also build those institutions that can continue to negotiate a better deal for labour, in a period in which the profit wage ratio [continues] to [soar]. Trade unions are not the problem, they are the answer–and must of course become the key pillars fighting for innovation led growth rather than the status quo, no matter how much the latter might be good for a select few.

Until we bring together innovation policy, financial reform, and the strengthening of institutions that can fight on the behalf of labour (the wage share of income), we will continue to obsess over ‘fixing finance’, while leaving the real economy as sick as before: rising inequality, many small weak firms, and a few large financialised ones, asking for more and more while giving back less and less. The perfect recipe for the next financial casino and… bust.

- Meanwhile, James Bloodworth writes that inequality in the UK is making social mobility an increasingly distant dream. And the CCPA studies the increased income disparity between CEOs and the rest of us in Canada.

- David Reevely discusses research showing a connection between payday lenders, poor health and mortality rates. And Jennie Smash recounts the difficulties facing the "sort-of-poor" who are being left behind in a system designed to direct wealth upward.

- Frank Graves writes about the forces which will shape Canada's federal election in 2015. Mary Agnes Welch reports that Manitoba voters (like many others) would much prefer real services like child care spaces rather than more of the Cons' tax baubles. And Jenny Uechl interviews Naomi Klein about the electoral choices we'll need to make in order to end the continued erosion of our society and our environment.

- Finally, Robert Reich argues that our most important political debates should be focused less on the size of government than the question of who government is intended to serve. 

New column day

Here, on how we'll soon be seeing both federal and provincial governments alike try to block out their real history with glossy ad campaigns - and why we shouldn't let them get away with the plan.

For further reading...
- Torstar reported here on the Cons' use of public money to generate fake news and how it fits in to the broader federal advertising machine. And Gregory Thomas discussed their shift toward using public money for communications rather than programs here.
- Mike De Souza wrote about the CRA's newly-ordered destruction of employees' text records here. And Paul McLeod exposed the CFIA's attempt to hide internal ethical breaches.
- And CBC discusses the cancellation of a few months' worth of lean consulting contracts here, while smart meters continue to pose dangers even while their removal is in progress. But the larger costs of both Sask Party schemes will be felt for plenty of time to come.

Thursday Morning Links

This and that to start your year.

- Ian Welsh comments on the challenges we face in trying to turn wealth increasingly concentrated in the hands of a few into a better world for everybody:

The irony is that we have, again, produced a cornucopia.  We have the potential to create an abundance society, the world over and eventually off this world.

We have much of the technology necessary, and we could direct our research and development towards the remaining technology we need.

Instead, we rely on markets controlled by oligarchs and central banks captured by oligarchs to make most of our decisions about our future.

We have systematically dis-empowered ourselves. Going from mass conscription armies and industrial warfare and mass markets driven by relatively egalitarian citizen-consumers in democracies, to oligarchies with unrepresentative armies increasingly filled with drones (and effective ground combat drones will be here in 10 to 20 years), surveillance states bordering on police states, and democracies which are hollow, where we can choose from Oligarchical faction one, two or maybe three.  The differences between them, while real, are within the broad agreement to keep giving the rich more.

And so, we come back to, how do we change the direction of our societies?  Our society, for the world is more and more one society.

- And Dacher Keltner discusses the connection between wealth, inequality, and the empathy deficit which offers the most obvious opportunity for improving the society in which we live:



- Meanwhile, Cameron Roberts makes the case for a guaranteed annual income from an environmental perspective. Zoe Williams writes that we should appreciate the ability to benefit from paying our fair share of taxes toward public benefits. And Bernie Sanders nicely summarizes the progressive vision we should be working toward.
 
- The Star's editorial board writes that we can't expect meaningful social progress in Canada without a federal government willing to work toward it.

- Finally, Paul Adams highlights Preston Manning's eagerness to throw democracy out the window in Alberta as a compelling example of phony right-wing populism designed only to entrench corporate interests. But Owen Jones is hopeful that genuine popular movements are building up which can offer alternatives to business as usual.

Wednesday Morning Links

Miscellaneous material for your mid-week reading.

- Alex Himelfarb and Jordan Himelfarb write about the growing appetite for stronger public services and the taxes needed to fund them in 2014 - even if we're a long way from having that translated into real policy changes:

Certainly tax phobia has framed our politics and shaped our governments. Our politicians of every stripe seem to believe that Canadians want tax cuts, whatever the costs, and won’t accept tax increases, whatever the benefits. This austerity mindset stunts the political imagination, making us doubt that we can do great things or much of anything together just when more imagination is exactly what we need.

But the costs of decades of tax cuts and austerity are piling up and there’s a growing chorus arguing that reversing course on taxes is key to our future well-being.
...
Over this past year, however, some unexpected voices have started to talk about taxes not as a burden, part of the problem, but as a key part of the solution to our challenges. Even some organizations that have always embraced and promoted the low-tax austerity agenda have started to wonder out loud whether this has all gone too far. The IMF, the OECD, bond rating agency Standard and Poor’s — past champions of austerity — have all published reports this year making the case that the costs of tax cuts now outweigh whatever benefits they were supposed to deliver.
...
(T)hese business-friendly organizations are also worried that reduced revenue for public investment is undermining economic growth in other ways. What does business really need? Better transportation and communications infrastructure or more tax cuts? And are we making the investments in science and technology essential to our future health and prosperity?

Most important, these studies show that higher and more progressive taxes are not the job killer that we are constantly warned about. Inequality is. Growing inequality strangles demand for goods and services, depletes our human capital and diverts needed resources to tackling its adverse consequences — crime, illness, social disruption. Of course, we have to take into account the behavioural consequences of tax increases, but, we are warned, if we don’t turn things around soon, our problems will just get worse. And with aging infrastructure and aging populations, much worse.

- Meanwhile, Suzanne Daley discusses the continued disastrous effects of austerity in Greece. And Peter Newcomb and Alex Sazanov document the concentration of wealth, as the world's 400 richest people added $92 billion to their already-preposterous fortunes in 2014.

- Meteor Blades highlights the reality of low-paying work in the U.S. (with Canada also ranking among the developed countries with the most low-paying jobs), while Sarah Petrescu's series on poverty notes how multiple jobs may not keep a worker afloat.

- Finally, Stan Sorscher comments on the effect of the new generation of corporate rights agreements:

Opposition has been raised on many issues important to regular people. Those objections have been brushed aside.

Clearly, these aren't "trade" deals. They are really about global governance. Corporate lawyers will sit on shadowy tribunals and hear cases about the environment, labor rights, human rights, public health, food security, internet freedom and financial regulation. But they will base their decisions on the corporate values and corporate-friendly language in the trade deals. They will take no account of the Constitutions or legal traditions of the US, Canada, Australia, Japan or any other country. Language in these "trade" deals becomes the new governance standard for the world.

These deals consolidate power relationships that favor global investors. The values and priorities in these deals bring more wealth and power to those who already have plenty.

These deals will determine how life is organized in 2050.

Every President since Gerald Ford has promised prosperity from each new trade deal. In our lived experience, we've lost millions of jobs, de-industrialized our economy, weakened bargaining power for every worker in America, run a cumulative trade debt approaching $10 trillion and we've lost our strategic advantage in manufacturing to Korea, Japan, Singapore, Germany, Denmark and China.
...
It is ironic that President Obama, speaking to CEOs from the Business Roundtable, tells the rest of America to trust him. It makes much more sense for him to speak to environmentalists, workers, communities and companies trying to manufacture in the US. Show us why these deals will be good for us, when the opposite has been true up to now.

On limited victories

Truly, I wish Andrew Coyne's latest actually described policy-making in Canada, and not merely the state of theoretical political debate.

But in fact, we live in a country where "let's consider whether a trade agreement actually has benefits, rather than signing whatever gets shoved in front of us" has been shouted down by two national parties and the corporate press as an extreme view.

In fact, the "progressive" premier put forward as the paragon of leftism is from a government which brags about both trashing regulations for the sake of trashing regulations, and imposing perpetual real-money cuts to the public sector.

And in fact, we're seeing far more Crowns actually privatized (in whole or in part) than we're seeing proposals for any meaningful new public institutions or programs to meet our evolving needs.

Now, it's true that there are more "serious proposals on the table" for progressive ideas than conservative ones. But that's primarily a function of the fact that being serious isn't a prerequisite for the radical changes generally preferred - and regularly implemented - by the right.

Building an effective program or institution requires ample planning, consultation and review. And so we can fully expect people who believe government can and should provide those things to carry out at least some of the necessary advance work on a regular basis.

In contrast, destroying one takes a single swing of the wrecking ball with no previous warning or debate. And right-leaning governments across the country have been following that pattern for decades, with no sign of letting up anytime soon.

At the federal level alone, the Cons have privatized or eliminated core functions of AECL, the Canadian Wheat Board and Canada Post, not to mention set up a ten-figure P3 promotion apparatus put in place to ensure infrastructure is built to benefit big business over the public. And all this based on precisely zero advance discussion, and in the face of evidence showing them to be asinine ideas from any standpoint other than one focused solely on turning public investments into private profits.

Which isn't to say the contest of ideas doesn't matter: obviously if we want to build a better world, it's essential to have some idea what it looks like. But well-crafted, thoughtful policies are only a necessary precondition, not a sufficient one. And there's not much to celebrate as long as the right (in whatever party guise) is able to treat anti-social vandalism as a viable governing strategy.

Tuesday Night Cat Blogging

Accessorized cats.

Monday Morning Links

Miscellaneous material to start your week.

- David Foot and Daniel Stoffman discuss Thomas Piketty's role in highlighting the need to work toward greater equality, while pointing out a few options to increase public revenues from people who can afford to pay them. And Ezra Klein interviews Paul Krugman about inequality (along with a wider range of issues):

Ezra Klein: Do you worry more about wealth inequality or income inequality?

Paul Krugman: Income inequality, but I don't think they're separable issues. We need to worry a lot more about lagging incomes in the bottom half or bottom two-thirds of the income distribution than we worry about soaring incomes at the top. And the people in the bottom two-thirds of the income distribution have hardly any wealth. For them, wealth has gone from essentially zero 30 years ago to essentially zero now. So for them, it's income that is crucial.

The wealth inequality measures are useful because they are, in some ways, a more reliable gauge of what's happening at the top. If incomes fluctuate a lot at the top, you can argue, though it's overstated, that it's a changing cast of people. But the top 0.1 percent in wealth is not an ever-shifting cast of characters.

Ezra Klein: Do you think the story of median and lower-than-median wage stagnation and the story of income inequality are the same story, or different? It seems to me that you can see different patterns. The story of the huge changes in income inequality seems to really be focused in the top three or four percent, and it seems to start about 10 years after media wage stagnation. Or, I guess, to put it another way, do you think we could solve wage stagnation without solving income inequality?

Paul Krugman: Probably not. I think if you really did something about wage stagnation you would find that it would have a pretty strong effect in curbing incomes at the top as well. I think if you try to understand the factors behind soaring incomes at the top, they are many of the same forces that are leading to stagnating incomes for workers. The idea that we can totally separate these things is wrong. It almost harkens back to the Clinton-Blairism. You did have, in the UK at least, a fairly serious attempt in Blair/Brown to tackle poverty and to reduce income inequality, combined with a sympathetic, laissez faire attitude towards the top one percent. It produced results for a while, but in the end, it seems to be economically and politically unsustainable. It gave rise, eventually, to a regime that's doing its best to increase inequality on all fronts.

- Meanwhile, Robert Reich comments on the Republicans' plan to eradicate accurate budget analysis in favour of absolute, evidence-free devotion to the belief that tax cuts inevitably increase revenues.

- Bill Waiser laments the Cons' destruction of our archives and new gathering of information about Canada alike, while Mike De Souza calls out their contempt for access to information in response to some noteworthy requests. But the Cons' dishonesty and secrecy fit perfectly into their political strategy, as Matt Henderson points out that our history doesn't exactly fit with any attempt to create a myth of national exceptionalism. 

- Finally, Owen Jones hopes that a wave of activism in 2014 is just the beginning in restoring government accountability to its citizens.

Saturday Afternoon Links

Assorted content for your weekend reading.

- Lana Payne discusses how we can bring about change in the new year by demanding that our political leaders recognize and use the power of collective action:

Social justice requires a collective response and political action. It is at the root of wonderful nation-building programs like universal health care, the Canadian Pension Plan and Old Age Security, which act as great equalizers in our society.

Charity will always have its place in society. It reflects an important part of our humanity. It is the same part of us that supports greater collective goals — goals that are more broad-based.
...
Common interests. Shared purpose. These are still possible in a nation such as Canada. We may have been given every reason to give up on such things, and yet somehow this time of year, I find renewed hope that it is not just possible, but likely.

I believe Canadians want such a country. They just need politicians who believe, too.

- Canadian for Tax Fairness weighs in on the need to reduce inequality through a more fair tax system. And Andrew Jackson calls for a raise for Canadian workers:

(W)ages of permanent workers have risen a bit faster than those of temporary workers, and wages of women have risen a bit faster than those of men. But these differences do not hide the fact that real wages are pretty much flat across the board.

According to the most recent International Labour Organization (ILO) Global Wage Report, average real wages in the advanced economies have stagnated or fallen since the Great Recession, and indeed have fallen significantly in some countries. United States average real wages in 2013 were just above the pre-recession level, and real wages have collapsed in the most hard-hit European economies such as Greece and Spain.

The ILO notes that, across the advanced economies, wages have lagged productivity (the value produced per hour of labour) since 2000, with the result that labour's share of national income, including in Canada, has declined while the share of corporate profits has risen.
...
(A)n increase in real wages would give a significant needed boost to a slow-growing global economy. They also note that the problem of stagnant wages is compounded by the fact that wage increases are typically distributed very unequally. This contributes to rising debt for the middle-class and rising surplus savings for the most affluent.
...
A shift to a wage-led growth strategy would, according to the ILO, include significant increases to minimum wages and more government support for unions and the process of collective bargaining.

These items are not exactly high on the policy agenda of most governments, not least that of the Harper government, but continued stagnation in 2014 may yet force some needed re-thinking.

- Zeeshan Aleem comments on the correlation between increasing inequality and lower marriage rates for the less well-off in the U.S.

- Bill Moyers' site takes a look at the stories from 2014 which deserved more attention than they received. And Kathryn May reports that one of those issues is much more familiar in Canada, as a substantial majority of respondents to a poll are concerned about vote suppression in light of Robocon and other attempts to manipulate election outcomes.

- Finally, Stephen Maher notes that we have ample reason to be skeptical about the Cons' self-serving security spin. And PressProgress highlights ten moments from 2014 which encapsulate the Cons' attitude toward the country they govern.

Musical interlude

Lemonchill - Dragonfly

Friday Morning Links

Assorted content to end your week.

- Daniel Tencer nicely surveys how a guaranteed annual income could work in Canada, as well as the obstacles to putting one in place:

Imagine the government started handing out $10,000 annually to every adult in the country, or implemented a negative income tax rate so that low earners and people out of work would receive tax money instead of paying it.
...
(A) growing number of economic thinkers -- and not only on the left -- are saying it could be the exact opposite: that it could be the policy idea of the century. While not exactly a silver bullet to solve all ills, it could eliminate poverty to a great extent, and set the stage for a healthier and more productive society.
...
(I)n the short run, we could be facing a major problem. If new industries and activities don’t take the place of disappearing jobs fast enough, we could see a similar sort of displacement and impoverishment as seen in the early years of the industrial revolution, when many skilled craftsmen were put out of work by machinery.

In a 2013 article, Nobel prize-winning economist and liberal pundit Paul Krugman argued for a minimum income as a way of cushioning the blow from the automation revolution -- a way of ensuring the middle class isn’t decimated in this transition to a new economy.

In an economy like this, “the only way we could have anything resembling a middle-class society ... would be by having a strong social safety net, one that guarantees not just health care but a minimum income, too,” Krugman concluded.

- Chris Rhomberg comments on the U.S.' barriers to social programs - noting that an end to easily-accessible social programs hasn't done anything to end or reduce poverty. Erika Eichelberger discusses how a lack of access to affordable financial services imposes an extra burden on people living in poverty. And Jessica Silver-Greenberg and Michael Corkery report on the spread of title loans as yet another financial-sector scheme to extract massive amounts of money from the people who can least afford to lose it.

- Mitchell Cohen is hopeful that now may be just the time to make a push for more affordable housing - if we elect a federal government interested in taking on the cause.

- And finally, Owen Jones interviews Thomas Piketty about the need for wealth taxes and other means of reining in inequality.

New column day

Here, on the need to turn the holiday spirit of charity into lasting improvements in the lives of the people who need help the most.

For further reading...
- Joe Gunn and Iglika Ivanova also discuss the limitations of charity compared to structural change.
- Jordon Cooper discusses Saskatchewan's bad habit of accepting food banks as a substitute for food and income security. And again, there's reason for doubt (PDF, see Harpauer's dissembling about child poverty rates at p. 6085) that the current government plans to take poverty seriously.
- Finally, the provincial government's announcement of the Advisory Group on Poverty Reduction is here. And as noted in the column, it will be worth keeping an eye on both the group itself (as we'll have to wonder whether a large contingent of current provincial higher-ups will be willing to criticize the government), and whether the Sask Party intends to turn ideas into action.

Merry Xmas to all!

And to all, a reminder that you'd best get your holiday dinner inspected for yourself, because the Harper government isn't so much on the job.

Wednesday Morning Links

Miscellaneous material for your mid-week reading.

- Mark Bittman discusses the connection between economic and social ills in the U.S., and offers a message which applies equally to Canada:

I have spent a great deal of time talking about the food movement and its potential, because to truly change the food system you really have to change just about everything: good nutrition stems from access to good food; access to good food isn’t going to happen without economic justice; that isn’t going to happen without taxing the superrich; and so on. The same is true of other issues: You can’t fix climate change or the environment without stopping the unlimited exploitation of natural and human resources (see Naomi Klein’s “This Changes Everything”). Same with social well-being.

Everything affects everything. It’s all tied together, and the starting place hardly matters: A just and righteous system will have a positive impact on everything we care about, just as an unjust, exploitative system makes everything worse.

Increasingly, it seems, there’s an appetite and even unity to take on the billionaire class. Let’s recognize that if we are seeing positive change now, it’s in part because elected officials respond to pressure, and let’s remember that that pressure must be maintained no matter who is in office.

- Louis-Philippe Rochon writes about the harm inequality is doing to Canada's economy, and proposes an eminently reasonable set of policies to reduce it:

1.  Governments must make job creation their mission.  In fact, nothing short of a full employment policy will do.  Since when is unemployment an acceptable social and economic end?

2. We must raise the minimum wage and make sure that it is sufficient for Canadians to live on.  The Canadian Centre for Policy Alternatives estimates that for two working parents with two children, the living wage in Toronto should be $16.60 an hour and $14.07 in Winnipeg, a far cry of where it stands now. Many studies show raising the minimum wage does not hurt employment nor does it cause slower growth.  In fact, the contrary is true.
3. We should adopt a guaranteed annual income for all working Canadians. There are many variations of this policy, and more work needs to be done to determine the best program for Canada, but the central idea is a sound one.
4. We must implement an inheritance tax, in order to avoid the transfer of tax-free wealth from one generation to another. Canada remains to this day one of the only industrialized countries without an inheritance tax.
5. We must cap corporate annual bonuses. It has become common for corporate CEOs to make six and sometimes seven-figure bonuses. Bonuses are certainly valid in many instances, but the practice has become extreme.
6. We must raise the number of tax brackets and marginal tax rates on higher income. We now have evidence that high or higher taxes on income do not hinder growth. So what’s stopping governments from raising the marginal tax rate on higher income to 60 per cent or even 70 per cent? Canada’s tax system has become considerably less progressive in recent years. 7. We must encourage increased unionization. This will allow workers to be better protected and in general have higher wages and better benefits.
8. We must reconsider taxes on capital gains. We must consider all capital gains as taxable income.

- Zi-Ann Lum reminds us of Dauphin's experience actually eliminating poverty through a guaranteed annual income. And Michael Bryant suggests that eliminating anti-panhandling laws would be a valuable step in ending the criminalization of poverty.

- David Pugliese reports that as another prime example of their Mostly Competent Government, the Cons are committing Canada to paying more than twice as much as other countries for the same C-17 transport planes.

- Jordan Press writes about Suzanne Legault's investigation into the Cons' refusal to release public data in usable formats. And Jason Kirby duly mocks the Cons' excuses so far.

- Finally, Thomas Walkom discusses the catch-22 facing anybody who's wrongfully and unilaterally proclaimed to be terrorists by the Cons - as it's impossible to raise money to even challenge the designation without putting donors at risk of receiving the same label themselves.

Tuesday Night Cat Blogging

Downed cats.

Tuesday Morning Links

This and that for your Tuesday reading.

- Lynn Parramore interviews Joseph Stiglitz about the spread of inequality, along with the need for a strengthened labour movement to reverse the trend:

LP: In your paper, you indicate that the power of the 1 percent to exploit the rest seems to be increasing. Why is this happening? Are there limits to this exploitation?

JS: In a more careful, academic way of putting it I would say that one of the explanations of what is going on is increased exploitation. You see the ratio of wages to productivity going way down, and that certainly is consistent with increased exploitation. And you see that the ratio of CEO pay to worker pay has gone up. So what I would say is that some of the explanations have to do with weakened worker bargaining power, weaker unions, asymmetric state liberalization where capital moves but labor can’t move, corporate governance laws that provide relatively little check on abuses of corporate power by CEOs, and an increase of monopoly power because of network externalities. So there are certainly a number of factors that would lead one to suggest that overall there is an increase in market power. There are some things where there’s more competition — because of the Internet, for example, there’s more competition on the price side, but overall, when you look at the ratio of wages to productivity, there’s a marked increase in market power.

Probably there are limits — sometimes the degree of exploitation is expressed as the ratio of wages to marginal productivity of labor, and when that ratio gets down to zero – that’s a limit! What I would say is that things could get much worse if we don’t do something. That’s a relevant issue. What’s important is whether or not we’re on a path that’s looking worse and worse.

- Matthew Yglesias notes that inequality makes "market-based" solutions unfair as the people with the least means to make choices for themselves bear the burden of directives from above:

Microeconomics tends to tell us, again and again, that life is best when sellers can set prices to rise and fall with the ups and downs of supply and demand. The idea is that markets should "clear." Everything that's produced should be sold, but you shouldn't have shortages that force people to wait around forever and ever.

This is an appealing idea, but as Steve Randy Waldman has written, it tends to brush distributional issues under the rug.

When people say that a price-based scheme for rationing water is most efficient, they mean that prices will deliver the most efficient distribution of dollars and water. The idea is that how much people are willing to spend on something is a good proxy for how much they care about it, or how important it is to their well-being. Different people like different things, but you can buy all kinds of different stuff with dollars, and seeing what people choose to spend their money on tells you a lot about their preferences.

But dollars aren't a perfect proxy for well-being, because money means different things depending on how rich or poor you are.
...
To the extent that inequality undermines arguments for efficient price-based schemes, the correct conclusion is to reject inequality, not reject pricing. It's probably no coincidence that the three countries to really embrace congestion pricing are either egalitarian (Norway and Sweden) or dictatorial (Singapore). Efficiency-enhancing economic schemes often simply assume a background where there's not too much inequality, in part because, in many cases, they were hatched during the decades when the income distribution was much more even. But to actually implement these schemes in the real world, we need to also deliver the equality.

There's an old saw in the economics profession that there's a tradeoff between egalitarian outcomes and efficient ones, but empirical research consistently fails to find evidence that inequality boosts growth or redistribution slows it. One reason is that needs conditions of macro-equality to make micro-efficient schemes tolerable.

- And as an example on point, Hilary Osborne writes about poverty in the UK, and finds evidence of large number of people being forced to limit their food and heating in order to pay rent. 

- Kyle Chayka discusses how we're headed toward the destruction of almost all jobs in the (recent) historic sense of the word. And Jim Tankersley points out that the massive gap in pay and security between the financial sector and nearly all other options is pushing far too many of the world's best and brightest into destructive jobs.

- Gareth Kirkby follows up on the Cons' attacks on charities. And Bruce Campbell assures us that the Canadian Centre for Policy Alternatives (for one) won't be silenced by Conservative bullying.

- Finally, Mike De Souza reports that the CRA is being put behind a veil of secrecy, as the Cons are trashing both existing work texts and the capacity to collect future ones. And Jim Bronskill exposes Tony Clement's asinine excuse for refusing to release public data in usable forms.

Monday Morning Links

Miscellaneous material to start your week.

- Ryan Meili examines why Craig Alexander of the TD Bank is calling for a move toward greater income equality in Canada:

The OECD reports that income inequality is at the highest level in 30 years, and that economic growth has been slowed by as much as 10 per cent in some countries as a result. A 2014 IMF study showed that redistributive policies through tax and transfers not only do no harm to the economy, but can improve performance in the long-term. In fact, it appears that public investments in child care and other services are far more effective in creating jobs and increasing economic growth than corporate or income tax cuts.

Returning to the TD report, it recommends a variety of key public investments to reduce inequality, including affordable housing, health and social services, early childhood development and decreasing barriers to all levels of higher education, from skills training to professional colleges. These are encouraging comments, as they also address key social determinants of health, meaning they are not only good for the economy, but more importantly, good for Canadians.
...
(I)t’s extremely encouraging to see this shift in thinking coming from so many directions. When economists working for one of the Big Five banks — Canada’s largest lender, in fact — come out with a strong position on income inequality, it’s indicative of how much this has moved from being a fringe concern to economic orthodoxy.

Last year at this time we heard Conservative Minister James Moore channel his inner Scrooge, implying that the poverty of his neighbour’s child was none of his concern, and neither was the poverty of Canadians any business of the federal government. How delightful to hear a message far more in keeping with the spirit of the season, however unlikely the source. 

- Meanwhile, Alex Himelfarb talks to Possible Canadas about the damaging effects of inequality and austerity. And LOLGOP points out that slightly more progressive taxes under the Obama administration have been put in place at the same time the U.S. has experienced its best job growth of this century.

- Justin Ling interviews Tony Clement about access to information under the Cons, only to find that Clement's own responses consist solely of talking points and redactions. And Torstar reports on the Cons' use of a paid PR service at public expense to manufacture government-approved "news".

- Radical Centrist discusses the need for Canada to talk realistically about the meaning of minority election outcomes - and notes that the U.K. offers a readily-available basis for comparison. And Frank Graves finds that there's plenty of popular support for a coalition government to replace the Harper Cons, even as the Libs once again try to order Canadians not to accept change other than on their own unilaterally-dictated terms.

- Rob Drinkwater reports on CNRL's contamination of drinking water near Cold Lake.

- Finally, Naomi Klein writes about the scant attention paid to murdered and missing aboriginal women by Canadian authorities (with the full support of a callous government), while highlighting the movement to end the silence.