Saturday, June 21, 2014

Saturday Morning Links

Assorted content for your weekend reading.

- Andrew Jackson reviews the OECD's economic recommendations for Canada - featuring a much-needed call for fair taxes on stock options:
Special tax breaks for stock options primarily benefit senior corporate executives, especially CEOs of large public companies who are commonly given the right to buy shares in the future at heavily discounted prices. Options make up a big slice of the total compensation of senior corporate executives.

90% of the benefits of the stock options tax break go to the top 1% of taxpayers. The stock options tax break costs the federal government $785 million per year, according to the Department of Finance.

Stock options are not only unfair, they are also economically destructive in that they encourage corporate executives to boost short-term profits just before options become due. This comes at the cost of long term corporate performance according to Roger Martin, former Dean of the Rotman School of Management at the University of Toronto.
- Meanwhile, Robert Reich points out a few more corporate leaders who are sounding the alarm about the threat of inequality. Paul Krugman does some quick math as to how austerity continues to damage the global economy. And Paul Buchheit lists a few of the more egregious anti-equality policies which are serving to enrich the wealthy at the expense of everybody else in the U.S.

- Noel Ortega writes that any discussion of a more sustainable, more equal economy needs to take into account our planet's ecological limits - most notably the dangers of climate change. Chris Rose and John Upton both discuss Nicholas Stern's observation that we may be severely underestimating the damage we're doing by using our atmosphere as a dumping ground for greenhouse gases. And Kat Sieniuc discusses how climate change is also at the top of the list of issues which demand policy action as a matter of protecting public health.

- Paul Thomas reminds us that it's thoroughly self-defeating to trading our ability to shape policy in the long run for short-term material gains. And Hopi Sen offers some rules for aspiring politicians.

- Finally, Tabatha Southey and the Beaverton stand out from the pack in commenting on Peter MacKay's view of female judges.

Friday, June 20, 2014

Musical interlude

Blue Rodeo - Til I Am Myself Again

Friday Morning Links

Assorted content to end your week.

- Rick Salutin discusses how corruption has become endemic in the global economy as an inevitable consequence of me-first values:
You wouldn't have those CEO pig-outs absent neo-liberalism's moral model: get rich not just quick but hugely. As Kevin O'Leary loves saying, and CBC plasters on its promos: God put us here to get rich. Note it's a public broadcaster where he barks that and no one contests it. (I consider Amanda Lang's ripostes pro forma.)

Since there's no counter model (excluding, maybe, the pope) it becomes almost embarrassing not to grab for all you can get, legality be damned. The mentality seeps into areas like pro sports and the World Cup, with PED corruption, game fixing -- and trickles down to kids. There's also a sort of pre-emptive political corruption, where leaders like Bill Clinton and Barack Obama have their eye on the vast returns available after they leave office, through their own foundations, etc., as long as they don't offend the corporate titans who are the donors. But none of it would thrive without the grotesque, tantalizing wealth inequalities that equate with neoliberalism.

Why anyone thought privatizing huge chunks of public wealth and letting the profit motive slither all over them would mean less corruption evades me, along with thinking Ontario's Liberals are the beginning and end of the problem. Corruption may always be with us but it comes in different forms. We're currently driving the globalization-privatization model right off a cliff.
- Meanwhile, Jacques Leslie takes note of Gabriel Zucman's work on the widespread abuse of tax havens. And in a sign of just how thoroughly the service-to-the-rich is becoming entrenched, CBC reports on the latest WikiLeaks revelations - showing Canada among a group of countries negotiating an agreement to prevent governments from reining in financial-sector abuses.

- In case there was any doubt that fair tax increases can form part of a viable electoral strategy, Linda McQuaig argues that Ontario's recent experience - featuring both high-income surtaxes implemented in a minority provincial Parliament, and a decisive election defeat for the party insisting on cuts all around - should put that to rest.

- Stephen Maher reports on impending legal challenges to the Unfair Elections Act. But Leslie MacKinnon reminds us that the Cons will doggedly fight voting rights in any form and in the most intrusive way possible - most recently by waiting until four by-elections were in full swing before seeking a stay of a ruling extending voting rights to Canadians living abroad.

- James Hutt writes about the dangers of increasingly privatized health care. And Iglika Ivanova responds to some anti-teacher spin from B.C.'s Liberal government by pointing out that teachers - like most public servants - have been receiving far less than their fair share from economic growth.

- Finally, Wade Rowland makes the case that a stronger CBC would do wonders for all kinds of broadcasters in Canada.

Thursday, June 19, 2014

New column day

Here, offering a suggestion as to how to give Saskatchewan workers significantly more control over their working hours than they hold today.

For further reading...
- Again, the OECD report recommending a "right to ask" for flexible hours is here (PDF). And the UK already has similar legislation.
- The Saskatchewan Employment Act is available online here. And of particular note for the purposes of today's column, see sections 2-11 to 2-14 which provide the only protection for working hours, as well as section 2-63 which creates an employee notice requirement.
- Finally, for those wanting to delve into the case law on changes in hours, there are examples of a unilateral change in hours being treated as a constructive dismissal: see here and here. But even that only entitles an employee to receive pay in lieu of notice for having been terminated. And see here for an example as to how an employer can effectively insulate itself from any responsibility take employee availability into account (absent some legal protection to the contrary).

Wednesday, June 18, 2014

Wednesday Morning Links

Miscellaneous material for your mid-week reading.

- Kathleen Geier discusses the U.S.' culture of overwork and its human toll:
There is abundant evidence that long working hours is incredibly dangerous from a public health perspective. Fatigued or sleep-deprived workers who drive or operate heavy machinery are an obvious menace to public safety, but there are other health costs associated with overwork as well. A 2004 Center for Disease Control report found that excessive overtime was associated with “poorer perceived general health, increased injury rates, more illnesses, and increased mortality,” and a 2008 study linked long work hours to depression and anxiety. Studies have also shown a strong association between working long hours and developing coronary heart disease.

In its culture of overwork, the United States is very much an outlier, when compared to other industrially advanced nations. Unlike much of Europe, we don’t mandate paid vacations or make it illegal for employees to work more than forty-eight hours a week. The usual justification for American employers’ massive overtime requirements is that they enhance “productivity,” but evidence actually suggests that the opposite is true.
Americans began agitating for the right to an eight-hour workday over 200 years ago. Countless workers fought and died for that right before it was institutionalized under the Fair Labor Standards Act of 1938. But, sadly, it looks like this is one battle that we all must continue to fight.
- Meanwhile, Lynn Vavreck helps to explain how wealth may lead to a perceived need for more wealth by pointing out how one's definition of "rich" changes at different income levels. The OECD has some suggestions to address the employer-heavy bias in U.S. employment law (h/t to Miles Corak). And Andre Cote comments on the difference a strong child-care system could make in Canada compared to the current alternative:
Let’s think about the downstream implications of not funding child care.

First, there is a big economic impact, as the lack of care tends to reduce the workforce participation rate of mothers with young children. For instance, 77% of mothers with infants work in Québec, compared with 70% in the rest of Canada. Fewer working moms is bad for businesses and for government tax revenues, which fund services…like child care. Some evidence suggests Quebec’s program actually pays for itself.

Second, we forego the educational benefits of providing child care and early learning – especially when targeted at lower-income families. The “human capital” early learning creates – i.e. more able workers later in life – pays dividends by supporting Canada’s productivity and competitiveness.

Third, it has a huge impact on the careers of parents who stay home (again, mostly women). Not only is it demotivating to go back to the office to find that your office-mates have all been promoted ahead of you, but it limits future advancement and earnings potential. For many career-oriented women, it’s a reason to delay having kids, or not to have them at all.
- The CP takes a look at Canadians' views on temporary foreign workers, and finds that the public shares the goal of giving easily-exploited workers the opportunity to build a life in Canada (while recognizing the need to hold employers accountable for abuses).

- Tim Harper discusses how a rigged approval process for the Northern Gateway pipeline did nothing to earn any genuine social license. Frances Russell takes a look at the role British Columbians may play in stopping the Gateway, while Bill Tieleman argues that the 2015 federal election will likely be the decisive factor in determining whether or not it it will ever be built. And PressProgress reminds us why we shouldn't trust the pro-pipeline spinmeisters.

- Finally, Michael Harris writes that Canada's Constitution seems to have earned an increasingly prominent place on the Cons' enemies list.

Tuesday, June 17, 2014

Tuesday Night Cat Blogging

Outbound cats.


Plenty of commentators theorized this week that the Cons might pay some heed to public opinion when it comes to the Northern Gateway pipeline.

But let's remember where this process all started: from the beginning, the Cons consistently decreed that nobody was permitted to say "no". And we can hardly be surprised that they've ended a review process which was never intended to allow for any other answer by decreeing that Enbridge shall have its way.

Tuesday Morning Links

This and that for your Tuesday reading.

- Following up on this morning's post, George Monbiot discusses the need for a progressive movement which goes beyond pointing out dangers to offer the promise of better things to come:
Twenty years of research, comprehensively ignored by these parties, reveals that shifts such as privatisation and cutting essential public services strongly promote people's extrinsic values (an attraction to power, prestige, image and status) while suppressing intrinsic values (intimacy, kindness, self-acceptance, independent thought and action). As extrinsic values are powerfully linked to conservative politics, pursuing policies that reinforce them is blatantly self-destructive.

One of the drivers of extrinsic values is a sense of threat. Experimental work suggests that when fears are whipped up, they trigger an instinctive survival response. You suppress your concern for other people and focus on your own interests. Conservative strategists seem to know this, which is why they emphasise crime, terrorism, deficits and immigration.
None of this is to suggest that we should not discuss the threats or pretend that the crises faced by this magnificent planet are not happening. Or that we should cease to employ rigorous research and statistics. What it means is that we should embed both the awareness of these threats and their scientific description in a different framework: one that emphasises the joy and awe to be found in the marvels at risk; one that proposes a better world, rather than (if we work really hard for it), just a slightly-less-shitty-one-than-there-would-otherwise-have-been.
- And Laurie Monsebraaten reports on the hope that a consensus to move toward income equality is within reach.

- Robert Reich calls out three right-wing lies about poverty, while Ben Phillips notes that fighting poverty should be a matter of right and wrong rather than left and right in the first place. And Danielle Kurtzleben writes that poverty is just as incompatible with equality of opportunity as it is with fair outcomes:
In a new article in the spring issue of the Princeton University journal The Future of Children (and highlighted by the Brookings social mobility blog), researchers show that poverty is directly correlated to kindergarten performance. Children who live in poverty have far lower performance than their richer peers across a variety of measures, and those who live in near poverty in turn have dramatically worse performance than middle-class peers. The poorest kids, for example, are less than one-third as likely as middle-class kids to recognize letters.
Early academic achievement can have lifelong effects. Harvard economist Raj Chetty found in a 2010 study that moving from an average to an excellent kindergarten teacher can boost a student's later work earnings by $1,000 per year on average. And Chetty and fellow economists from Harvard and Berkeley wrote in a wide-ranging study on economic mobility this year that primary education is one of the key factors in moving people up the ladder.

It's not that money directly buys better outcomes. Having extra cash does mean that adults can, for example, better invest in kids' development with games and toys at young ages and have more time to spend with kids. But the effects are also less direct, as growing up poor can create psychological stress and hurt development.
- Meanwhile, Jordon Cooper discusses the link between secure housing and mental health.

- Finally, Susan Adams refutes any justification for outsized CEO pay, pointing out that businesses which pay more money to their top executive are actually rewarded with worse performance. And Mariana Mazzucato observes that we should be working on developing far more entrepreneurial government - and coddling far less private-sector rent-seeking than we do now.

On greatness

Plenty of commentators have pointed to Dean Beeby's report on public consultations about Canada's most inspiring people as evidence that Stephen Harper and his Cons couldn't be much further from the mark. And that point is fair enough on its own.

But it's worth noting something else as well: respondents to the Canadian Heritage Department's survey seem to have drawn a close link between political greatness, and signature achievements in institution-building:
The Canadian Heritage Department extracted a Top 10 list for an April 29 briefing note for the minister, Shelly Glover.

Only one clearly identifiable Conservative appears: Sir John A. Macdonald, Canada’s first prime minister, in eighth place.

The list was topped by former Liberal prime minister Pierre Trudeau, followed by marathon-of-hope runner Terry Fox; NDP leader Tommy Douglas; former Liberal prime minister Lester B. Pearson; astronaut Chris Hadfield; environmental activist David Suzuki; NDP leader Jack Layton; Sir. John A.; hockey legend Wayne Gretzky; and Romeo Dallaire, the soldier and Liberal senator who recently announced his resignation.

The consultation also asked which of Canada’s accomplishments of the last 150 years “make you most proud to be a Canadian?”

Medicare topped that list, followed by peacekeeping, then the 1982 Charter of Rights and Freedoms at No. 3.

The Conservative government, which has recently been buffeted by a series of Charter-based losses at the Supreme Court of Canada, did not mark the 25th anniversary of the Charter in 2007, nor the 30th in 2012.

The rest of the accomplishments list, in order: contribution to the Second World War; the Canadarm; multiculturalism; contribution to the First World War; bilingualism; space exploration; and the Constitution Act of 1982.
And it's also noteworthy who's missing: relatively recent, long-serving politicians whose time was marked mostly by cuts and tinkering (Jean Chretien), or whose big plans produced few or negative results (Brian Mulroney, Stephen Harper). In effect, with the exception of Jack Layton, respondents didn't see anything about the last 20-plus years of Canadian politics to be the least bit inspiring.

Which leads to an obvious question: if we're indeed inspired by big ideas and strong principles, then why aren't there more of those on offer in our current political system?

It's well and good to recognize in retrospect the importance of Medicare, the Charter, multiculturalism and bilingualism. But in recent election cycles, anything of comparable ambition has been not only left off the table, but labeled unfit for political consumption: anybody proposing a new social program or constitutional change is immediately shouted down for trying to accomplish something which isn't easy, quick and poll-tested.

Which serves Stephen Harper and his ilk fairly well in the long run. If Harper is doomed to the "uninspiring" pile (due to the fact that his plans for giant pipelines, climate obstruction and capacity slashing tilt distinctly toward the negative side of the ledger), he'll probably accept as a second-best outcome a legacy of chipping away at past accomplishments and salting the earth so that nothing inspiring can ever grow again.

But it's less clear why anybody else should be willing to accept that inspiring politics (as a matter of setting and meeting big public goals, not merely personal branding) should be a thing of the past. And any current politician wanting to join the list of leaders who have made a lasting impact should be laying the groundwork to do more than simply outlast one or two opponents an election at a time.

Monday, June 16, 2014

Monday Morning Links

Miscellaneous material to start your week.

- Katie Allen discusses the Equality Trust's research into tax rates in the UK - which shows that the poor actually pay the highest share of their income in taxes, even as the public has been led to believe the opposite:
The poorest 10% of households pay eight percentage points more of their income in all taxes than the richest – 43% compared to 35%, according to a report from the Equality Trust.

The thinktank highlights what it sees as a gulf between perceptions of the tax system and reality. Its poll, conducted with Ipsos Mori found that nearly seven in ten people believe that households in the highest 10% income group pay more of their income in tax than those in the lowest 10%.

The survey of more than 1,000 people also found a strong majority – 96% – believe that the tax system should be more progressive than is currently the case.
- But then, the poor can hardly afford to match the constant PR offensive put on by the corporate elite to demand preferential treatment. Which leads to Maria Konnikova's observation that poverty presents far more obstacles that a lack of money alone:
When we think of poverty, we tend to think about money in isolation: How much does she earn? Is that above or below the poverty line? But the financial part of the equation may not be the single most important factor. “The biggest mistake we make about scarcity,” Sendhil Mullainathan, an economist at Harvard who is a co-author of the book “Scarcity: Why Having Too Little Means So Much,” tells me, “is we view it as a physical phenomenon. It’s not.”

“There are three types of poverty,” he says. “There’s money poverty, there’s time poverty, and there’s bandwidth poverty.” The first is the type we typically associate with the word. The second occurs when the time debt of the sort I incurred starts to pile up.

And the third is the type of attention shortage that is fed by the other two: If I’m focused on the immediate deadline, I don’t have the cognitive resources to spend on mundane tasks or later deadlines. If I’m short on money, I can’t stop thinking about today’s expenses — never mind those in the future. In both cases, I end up making decisions that leave me worse off because I lack the ability to focus properly on anything other than what’s staring me in the face right now, at this exact moment.
(T)he most unfair aspect of the whole thing is that the bandwidth tax doesn’t affect everyone equally. If you aren’t your fully strategic self all the time, so be it. If I miss one deadline — or even two — it’s far from the end of the world. But if I’m also poor in the traditional sense? Suddenly, the lack of time has a nonlinear, compounding effect: My bandwidth isn’t just a bit more taxed. The tax is completely off the charts, and I have little recourse to repair the damage.
The poor are under a deadline that never lifts, pressure that can’t be relieved. If I am poor, I work or I churn until decisions like buying lottery tickets begin to seem like attractive alternatives. I lack the time to calculate the odds and think of alternative uses for my money.
If poverty is about time and mental bandwidth as well as money, how does this change how we combat its effects? “When we think about programs for the poor, we don’t ever think, hey, let’s give them programs that don’t use a lot of bandwidth,” says Mr. Mullainathan. Instead, we fault people for failing to sign up for programs that are ostensibly available, even though we don’t factor in the time and cognitive capacity they need to get past even the first step.
- Conversely, an excess of concentrated money tends to beget brand-new ways of distorting the economy. And Janet McFarland reports on a study by Michael Wolfson, Mike Veall and Neil Brooks which finds that past measures likely underestimate inequality in Canada by failing to take into account money funneled through privately-held corporations:
Using data that includes CCPCs changes the picture of Canada’s top income earners because these are the people most likely to set them up. Only 5 per cent of people in the bottom half of income earners own a stake in a CCPC, and the study shows that, over the past decade, up to 80 per cent of those in the top 0.01 per cent of income earners owned a stake in a CCPC. Some people own stakes in four or more CCPCs, the report shows.

CCPCs are typically used to hold a private business, so they could be created by the owner of a store or restaurant to incorporate the business. Dr. Wolfson said they are also legally used by doctors, lawyers, accountants and other professionals as a way to incorporate their business activities, allowing the corporation to be paid income rather than having the individuals paid in the form of salaries.

There can be many advantages to having income go into a corporation rather than receiving it as a salary, including the ability to defer income, split income with a spouse, and reduce capital gains tax.
Researchers have long found it difficult to measure income for top earners and that has led to an inaccurate picture of the degree of income inequality between the rich and the poor. Including CCPCs has given a better portrait of high income earners and revealed the sizeable impact of these private holdings.

The report shows that income for the top 10 per cent of earners increased an average of 16 per cent when CCPCs were included in the income data. The increase was even more dramatic for those in the top 0.1 per cent. Their average income rose to $2.1-million when CCPCs were taken into account, compared with $1.3-million if CCPCs were excluded. That’s a difference of 55 per cent.
- Shannon Gormley comments on how the Harper Cons' paranoia is leading Canada toward a policy of citizenship-stripping normally applied by only the world's worst human-rights abusers.

- Finally, Alice Funke provides a thorough review of what actually happened in Ontario's provincial election.

Sunday, June 15, 2014

Sunday Morning Links

This and that for your Sunday reading.

- Margaret Somers and Fred Block write about Karl Polanyi's critique of the free-market myth and its increased relevance today:
(F)ree-market rhetoric is a giant smokescreen designed to hide the dependence of business profits on conditions secured by government. So, for example, our giant financial institutions insist that they should be free of meddlesome regulations while they depend on continuing access to cheap credit—in good times and bad—from the Federal Reserve. Our pharmaceutical firms have successfully resisted any government limits on their price-setting ability at the same time that they rely on government grants of monopolies through the patent system. And, of course, the compliance of employees with the demands of their managers is maintained by police, judges, and an elaborate structure of legal rules.

Polanyi effectively brings the role of government and politics into the center of the analysis of market economies. And in doing so, he opens up possibilities that are often obscured in other currents of left thought. If regulations are always necessary to create markets, we must not discuss regulation versus deregulation but rather what kinds of regulations we prefer: those designed to benefit wealth and capital, or those that benefit the public and common good? Similarly, since the rights or lack of rights that employees have at the workplace are always defined by the legal system, we must not ask whether the law should organize the labor market but rather what kind of rules and rights should be entailed in these laws—those that recognize that it is the skills and talents of employees that make firms productive, or those that rig the game in favor of employers and private profits?
There is too much public discourse, even within the Democratic Party, that accepts and even propagates the right-wing propaganda that a restoration of economic growth requires austerity and greater deference to the needs of business. The reality is that austerity usually results in rent-seeking behavior, with the consequence of further stagnation and crises rather than productive investment. Polanyi teaches us that periods of prosperity and rising living standards, by contrast, were a direct result of democratic gains in politics and civil society. The greatest prosperity in living memory in Europe and the United States came during the social democratic moment—in the 1950s and 1960s—when the constraints on business were the greatest. In short, more democracy and more economic justice are the necessary foundations for the path to socialism and a more vibrant, prosperous, and sustainable economy.
- And Elias Isquith interviews Shar Habibi about the role of privatization in simultaneously eroding public services and linin the pockets of the wealthy:
What did you find when you examined privatization/government outsourcing?

What this report really looked [at] was the effects of government outsourcing, at the local and state levels, on jobs and the impacts it has on the community and ultimately on the issue of income inequality. What we see is that … when state or local government outsources, these jobs are no longer good, public-sector jobs that provide a decent wage and benefits, but instead become jobs for a contractor that pay very low wages and typically have very few or no benefits. And really what is kind of alarming about this is [that] outsourcing public services sets off a downward spiral in which reduced worker wages and benefits can hurt the local economy and the overall stability of middle- and working-class communities. By paying family-supporting wages and providing important benefits like health insurance and sick leave, governments have historically created what we’re calling “intentional ladders of opportunity” to allow workers and their families to reach the middle class. And this has been especially true for women and African-Americans, for whom the public sector has been a source of stable, middle-class careers. Unfortunately low-road government contracts reverse this dynamic. So while corporations rake in increasing profits through taxpayer dollars and while CEO compensation continues to soar, the examples in our report show that the workers employed by state and local government contractors receive those low wages and few benefits.
How big of a role do you think privatization plays in the larger phenomenon of growing inequality?

I think that it’s often overlooked, but it’s a sizable piece of the puzzle … We don’t have exact numbers of how many workers this affects because state and local governments aren’t keeping good, systematic records of this (and fixing that is one of our recommendations in the report) but … we do know on the federal level there are three times as many contract workers as civil-service workers and so we also know that there are about 14.5 million full-time, and almost 5 million part-time, state and local government workers. So if the proportion is anything near the federal ratio of contract-to-direct-government-worker, that’s millions of jobs that we’re talking about. There’s also some very rough estimates that total state and local procurement can be valued around $1-1.5 trillion — that’s a very crude estimate. But contracting anywhere approaching that fiscal magnitude means millions of jobs are being created through state and local contracting. So when states and local governments use low-road contractors that slash wages and benefits and create low-wage jobs, this is really a factor in growing income inequality and the disappearing middle class. It’s often overlooked, but it’s very significant.
- Meanwhile, Paul Krugman discusses how the U.S.' corporate elite has lost control of the movement it set up to take political power, then follows up with the ultimate sign of establishment desperation:
Corporations and plutocrats had a good deal going: they bankrolled politicians who talked cultural populism during campaigns, but more or less ignored all that and focused on tax cuts and deregulation after the polls closed. And Cantor fit that profile perfectly.

But now the big money has lost control; the base is demanding politicians who don’t just talk the crazy talk, but walk the crazy walk. For a couple of months the story line was that the money was regaining control, but between Cantor and Cochran that narrative has been blown out of the water.
How bad is it? So bad that some establishment Republicans — which means people who work for the corporate side — are pining for another run by, yes, Mitt Romney.
- But if the business sector may be having trouble controlling its political puppets, it's having rather better luck avoiding any accountability to the public at large - as David Atkins highlights how corporations are going to greater and greater lengths to avoid having to answer for the injuries they inflict on others.

- Finally, Jessica McDiarmid offers a prime example, pointing out how the rail industry is demanding that governments across Canada and the U.S. keep the public in the dark about the risk it's creating. And Andrew Nikiforuk discusses how abandoned oil wells are doing severe environmental damage by releasing methane and other gases.