It's important to parse...

what's being acknowledged in the business section nowadays... like when a company "wants" to hire workers but whines and snivels that it can't find people with the right skill set - a tacit acknowledgment that the company doesn't want to pay enough to attract the candidates they so desperately want.
Because as any member of the Gordon Campbell swines-at-the-trough parade will tell you, "you have to pay top dollar" to attract the right personnel.
Right guys?

Oh - and one last thing.
Word has it that a very large provincial union is being asked to slash it's younger $20+ dollar an hour workers down to $12 or so, while the management is seeking increased stipends for themselves.
Stay tuned.

How much blatant deceit can a society take ?

I guess we are going to find out, on a provincial and federal level. There is no going back to yesterday, because yesterday was the beginnings of today.
I no longer have a full life in front of me, but I sure as hell feel concerned for my children and their children.

Thats if we survive long enough.

Oh and Harper experimented with shrinking civil liberties

to see if enough people cared! Not that many seem concerned that he created a temporary police state during the G8 and G20 self backslapping conference!

socializing the costs, privatizing the profits

Seems to me that the $16 billion snatched from Canadian taxpayers for new fighter jets socializes the costs of Herr Harper's empire-building dreams.

That's nearly $500 taken from every man, woman and child in the country for noisy killing machines that burn 80 gallons an hour. We are being lead to the poorhouse by dinosaurs.

Concise and Accurate

Dobbin once again delivers a powerful, articulate analysis of the ideology driving our neoconservative leaders. Like Harper (and Campbell). Very frightening times.

Great coverage!

Banking on It

Canada is Oil.
Harper is King.
Regulations were yesterday
Today banks are backing slow boats to China
as dollar rides on oil prices.
200 million and you to can have your own boat to China as filled to the brim as HST drills the way and banks loan the way.
As Canadian banks take Credit for being a rock and yet all they are is a pump.

No economic sense in this

No economic sense in this article. Great rant against Harper though (Don't you just love to hate the guy? I do.) On the one hand personal debt is decried but somehow government debt is a good thing for the economy. The first round of stimulus should never have been approved. It bailed out the mortgage bankers and auto companies at the expense of you and me. The should have let the bastards go bankrupt. Asset prices should have been allowed to drop like a rock. There would have been pain. Now there will be much greater pain later. The government deficits in Canada are just as high on a per capita basis and as a percentage of GDP as the US deficits. When bondholders become nervous they will cease to lend and quantitative easing (money printing) will be the order of the day. No mention in this article about the monetary system that enslaves every person and legal entity in a web of debt. No mention of how government has given away its powers of monetary creation to the criminal central bankers and substituted taxation and debt as its only sources of revenue. As for the no growth economy mentioned as desirable by the author we will have one again as soon as this false recovery is over. A no growth economy leads to recession and depression. This is because our monetary system requires growth in order to pay all the interest on the the endless loans people clamor for. A truly sustainable economy starts with money that is sound and not based on debt. It allows deflation to lower prices slowly over time instead of inflation that destroys your net worth. It gives governments the power to regulate the monetary system so it does not have to steal from its citizens via taxation, indebt future generations or default on its obligations. Paul Krugman is right, stopping the stimulus will lead to a double dip recession and even all out depression but he is wrong to suggest that more debt is the solution to a problem caused by years of cheap credit. Canadians are in for a rude surprise.

goodness me, rangergord

I have trouble reconciling your first sentence with all the others.

If you have truly read Krugman, you would have known that when the bailouts of the credit system occur and asset prices drop like a rock, that interest rates go through the roof to compensate. this makes the cost of borrowing for businesses trying to recover market share or expand into the spaces left by bankruptcies prohibitive, as the dollar also slides. This has the added effect of making our assets cheaper for other countries to buy, and we end up owning none of our own assets, and often find ourselves saddled with the debts of others as capital (read: the ability to place collateral debt obligations on capital assets anywhere in the world) ebbs and flows where it will. It also worsens our balance of payments, which reinforces the slide of the dollar. The whole mess is on giant negative feedback loop, not a self-correcting mechanism.

Everything is linked to everything else. I may not like the banks and the insurance companies that run our country (what, you thought it was government?) but I recognize that they were the linchpin that held this economy together, and when the conga line of trucks and ships and airplanes stops because there's no business to be done at a price people are willing to pay, then you simply have to remember that we only have about a week's worth of food in our stores here in the whole country. After that, Canada turns into South Park on a bad day....

If you want to deconstruct the financial system and redo it along different lines, there are better ways than walking into a forest fire to light your cigarette.

Training?

100-700 hours per employee? I doubt it. I remember similar claims, though not so high, but emphasizing that Europe put roughly triple into its labour force what North America did.

However Asia does pretty much no training whatsoever. In fact, when super-factories like Foxconn are held up as model enterprises, one sees the Asian model is to have employees pay for their own training at a Foxconn "university", then start work as an intern at no pay while they are training up for the job that will eventually have them working 15 hours a day under the harshest of rules, without one whit of labour law to protect them.

I'm sure, that even if you include Japan and Korea, that training totals are far lower than Canada.

Besides, nobody likes training here. Witness all the whining and snivelling about teachers getting 10 pro-d days a year, where they actually have to sit in a classroom and learn shit for themselves, and not go golfing or sailing or whatever....

And now, on to the article...

It's hard to disagree with Dobbin, except I fear he is incorrect on two counts. One is planning a recession: there will always be ways to plan a recession, and ways to steamroller out of it. As long as Canada has assets to sell off (and there are plenty - we don't have to sell our children just yet!), there will always be the continuous cycle of credit-driven boom and bust. (How long before we have our own brand of Canadian Wahabism, just like Saudi Arabia? Maybe we already do....) Whether the people actually wake up and refuse to allow any further corporate debt to be loaded onto their own personal backs is another conversation entirely, and not one that has anything to do with Ottawa.

The second is that Harper actually has something to do with this whole mess. No more than Paul Martin or Jean Cretien did, Harper is merely the latest in a long line of cheerleaders for the corporate sector. The Economist thinks he's a lucky idiot - people who get struck by lightning and live, generally don't the second time. When Canadians step up and demand alterations to the corporate model of shedding responsibility by banning the corporation, politicians will follow there too, and at least some of the tremendous distortions of the economy in favour of the rich will be eased.

http://www.economist.com/node/16059938

Harper's version of democracy

$16 billion on fighter jets, $5 billion on prisons, $1 billion on G20 security, $2 million on a fake lake for the G20 meeting, the only Western country without a national social housing program, missing a national child care program--this is Harper's version of democracy. And it's MINORITY democracy--imagine what he'd do with a majority.

Will they wear brown shirts, or black!

I hope at the bext G8 ; G20 security budget boondoggle all of the demonstrators stay home and sit-in their MP's office; de-cerntralizing protest and making miltary-like (and expensive) security moot!

If you have truly read

If you have truly read Krugman, you would have known that when the bailouts of the credit system occur and asset prices drop like a rock, that interest rates go through the roof to compensate. this makes the cost of borrowing for businesses trying to recover market share or expand into the spaces left by bankruptcies prohibitive, as the dollar also slides.

Actually I have read Krugman and many other economists as well. Bailouts of the credit system do not cause asset prices to drop. They attempt to prop asset prices up and at least slow their fall. Interest rates do not rise because asset prices fall. Asset prices rise unsustainably because interest rates are too low. Now when interest rates rise it will cause havoc, bankruptcy and foreclosures. There is no way out of this mess. We will face the pain sooner or later.

This has the added effect of making our assets cheaper for other countries to buy, and we end up owning none of our own assets, and often find ourselves saddled with the debts of others as capital (read: the ability to place collateral debt obligations on capital assets anywhere in the world) ebbs and flows where it will. It also worsens our balance of payments, which reinforces the slide of the dollar. The whole mess is on giant negative feedback loop, not a self-correcting mechanism.

No question about it, a debt based economy is an unstable beast that will deliver to Canadians its bitter harvest.

Everything is linked to everything else. I may not like the banks and the insurance companies that run our country (what, you thought it was government?) but I recognize that they were the linchpin that held this economy together, and when the conga line of trucks and ships and airplanes stops because there's no business to be done at a price people are willing to pay, then you simply have to remember that we only have about a week's worth of food in our stores here in the whole country. After that, Canada turns into South Park on a bad day....

Yep, the food system is already on the verge of crisis. It will not get better any time soon. You can stay where you are and apologize for the corruption or you can expose it to the light of day.

If you want to deconstruct the financial system and redo it along different lines, there are better ways than walking into a forest fire to light your cigarette.

I didn't start the forest fire but I cannot pretend its not there.

The Forest Fire...

"No question about it, a debt based economy is an unstable beast that will deliver to Canadians its bitter harvest."

I disagree with some of your analysis here, and wish I had time to really get into it with you. Maybe later. (Mrs Coyote is demanding to be fed.)

But principally it's with the positiveness with which you seem to see the status quo financial system, when its functioning "properly". The emphasis on "when" of course.

Though especially its with your apparent caveat to some of us... though I may be reading your critique direction wrong here.

"If you want to deconstruct the financial system and redo it along different lines, there are better ways than walking into a forest fire to light your cigarette." you wrote.

Whereas, with my anti-capitalism ilk's perspective, we would reply, that whereas deconstructing the financial system, especially its ruling class controlled format basis is essential to the future wellbeing of the rest of us, along with creating a new economic foundation itself, the historical evidence thus far says, always subject to new evidence of course, that there is "no choice", for serious social transformers/revolutionaries, but to walk into the forest fire to light our joint.

Though you are correct, we didn't start the forest fire either. They did. The ruling class and its serving political minions. (Which includes ongoing chickenshit "social democracy".) It's left to us, all the "other" class strata of society, to deal with it in the final analysis, to put it out. And to ensure, this time around, that these pyromaniacs never get the opportunity to start it again.

If you do decide to get into

If you do decide to get into it coyoteman, keep in mind that much of the above are the words of Zalm and my replies to his support and apology for the status quo.

Mistakes Always

have consequences. Some are easy enough to foresee - going into a forest fire to light your joint (as if you need a joint that badly). But this civilization's primary mistake (believed at the time to be just common sense) was going off the Gold Standard. That single policy pitted every financial instrument against every other financial instrument globally rather than allow their competition against a common standard, the price of gold.

Out of that kind of instability, the gamblers took over, and took power from shareholders by bribing them to look away from responsible oversight - getting richer by making the shareholders (and the public) believe that corporations have no function other than "making profits" constantly.

The corollary for politics is that nothing counts anymore except "getting votes." One way to do that is to promote the idea that voting itself is a loathsome chore that will provide no real change to the way that things are done. We do deserve the government we get when we allow governments, controlled by corporations, to govern for the benefit of those corporations.

Major errata...

Now that I've undressed myself for rangergord, you can all have a look too. What I meant to say was:

"...when the bailouts of the credit system do not occur and asset prices drop like a rock, that interest rates go through the roof to compensate..." This should make the argument flow better.

The instructive example is Argentina's default. Though now there is evidence that international banks such as Citibank, were using a hidden financial transaction clearing house called Clearstream which ultimately caused the forex disparity that led to the Argentinian default, the original story (and still major cause) of the default was the failure of the government peg of the peso to the dollar and consequent overvaluing of the economy (printing money). This is a classic example of how economies get into trouble - it's happened dozens of time sin the last two hundred years with nearly as many nations.

Argentina lost financial credibility, inflation rose, interest rates with it, the currency depreciated, and when investors felt it was safe to come back into the market (because Argentinians were desperate for imports lost during the crisis) they found their currencies bought three times what it did before, and brought not only good s to sell, but profits to buy capital with - stores, factories, antiques, banks, property - you name it. As a result, within three years, the Argentine government had to carefully manage its balance of trade to prevent overvaluing the currency again due to the large amount of foreign currency flowing into the country.

And that's what happ3ens to a country that can't afford to pay only one third of its government debt! What happens when it's private debt, and the amount is twice that?

[...]

Part II

And that's what happens to a country that can't afford to pay only one third of its government debt! What happens when it's private debt, and the amount is twice that?

That's where we look to the US. A completely different situation from most other defaults, here private commerce defaulted and threatened to bring down the national economy with it. Had there been no bailout, the default on private debt would have immediately caused the failure of some businesses that depended on that credit (through no fault of their own) and raised the price of credit for others not yet affected. Having already set interest rates near zero and abandoned its ability to lend credit in favour of the private banks, the government had no flexibility to alter credit demand for private companies that were still financially sound. It's like a game of musical chairs - only one seat is taken away, but the resulting scramble when the music stops means a lot of people are knocked over and a lot of damage is done.

That's why Harper is so idiotic when he boasts of Canada's security, as if he had something to do with it. Through laziness and inertia, as well as a modest dose of protectionism, Canada's economy remained sound only through uncompetitiveness. Too flabby to be taken over.....

Now that I have corrected myself, I trust that all will see that rangergord and I disagree only in the examples we used to demonstrate our arguments.

...except...

....except in the first sentence of rangergord's first comment. I think there's a lot of economic sense in this article. And that's what started this whole thing.

coyoteman

In rejecting the bailouts (because they're still going on, and will for some years yet), rangergord postulated a manageable destruction of the financial system in favour of a return to locally-based or national credit, production and consumption. I said it isn't in any way manageable. Your bone ought to be picked with me.

First thing you can do is toss our pensions into the garbage. There wouldn't be enough left for a pack of cigarettes for any of you, and I'm not just talking about the CPP. They're all basing future value on current investments, and you've just incinerated their foundation. It'll take years to rebuild that foundation again, and then to create the value enough for pensions to be paid? Well, maybe for your kids. Maybe.

Then, as something as simple as a financial letter of credit becomes a hideous ordeal to assemble and transfer, international trade comes to a halt. No grapes, lettuce, tomatos, cukes, beef, pork, lamb, sugar, most spices, prepared foods, fast foods, except if you are fortunate enough to be able to bid high enough for the few of those items we do produce limited amounts of. You can live on bread and butter, pasta and milk. No ketchup - we don't produce any of it any more as it all comes in by tanker-car to Hamilton, Aylmer and Richmond from elsewhere.

The only people who might be able to get trade going again quickly might be businesspeople with experience in dealing in riba and sukuk and used to methods of tawurruq that bridge the trust in business dealings normally occupied by banks of all sorts. Won't that just poke Harpo in the eye with a sharp stick!

As private credit collapses, so does business, without access to pay either for imports (to earn income) or to ship exports (and pay the float). As business comes to a standstill, so does the whole economy., This is one situation where old WACky Bennett was right - the economy consists of making those dimes whirl around faster and faster so we all benefit. When those dimes stop whirling around, we all suffer, some worse than others.

And as always, the people who suffer most will be the ones who can least afford it. I'd encourage anyone who owned a home but whose mortgage was underwater as a result of a financial crisis to stay in their home and dare the bank to come a take it. But what about all those renters? They'd just be booted out. The elderly in their nursing homes? Booted out. I don't want to go on - it's too depressing to think about.

I agree, we certainly need a disengagement from the principles of private credit to finance the operation of the country, at least for assets and goals of national ownership. But it has to be very, very carefully done, because if we screw it up, someone will take advantage of us, and we'll only hurt ourselves.

See, we took a good thing...

...and ran it into the stratosphere. David Ricardo's theory of comparative advantage, more than two hundred years ago, said that those communities of interest good at doing something through advantage of access to resources, capital or labour, ought to do what they are best at, and trade the surplus for the other things they need, rather than trying to be self-sufficient in all things.

Every country in the world has specialized in something (even if it's only the enslavement of others), and as a result we are now all massively dependent on each other. It took hundreds of years to get this way, and it can't be unwound in a few days or weeks.

My favourite example of this kind of capitalism is from a novel that I can't remember now (I just went to my copy of Catch 22 and that wasn't it), where a character named Stok says "You know what is capitalism? That's where one village makes a living fishing in a piranha-infested river. They catch enough fish to eat, and a few extra. And the fish they don't eat, they trade to the village up the river that specializes in making wooden legs. That's capitalism."

We've all lost a leg in this economic system of ours. It wasn't our fault, but we simply can't kick it out from under ourselves, or we'll get no more wooden legs to stand on.

The Approaching Intersection 1....

"Now that I have corrected myself, I trust that all will see that rangergord and I disagree only in the examples we used to demonstrate our arguments."

I must be really quick here, as I have a horse I'm needing to run into the vet's in town this morning. ( Another story of economics and capitalism. :-) But...

You will not get an argument from me re the necessity of the bailouts to at least forestall the collapse of capitalism entirely, in a chaotic, people harming kind of way. (Though this may happen anyway.) We, the working class, have ourselves allowed the ruling class of capitalism to construct this global house of cards around us. Ignorance is not an argument anymore than timidity is. And though the capitalist ruling class always decries bailouts and other "public interferences", the fact is, capitalism would not and could not exist without the backing of The State to create and enforce the favourable class and other conditions within which it can function... and to bail it out when the greed system that drives it, gets it too deep into shit.

When it all comes undone, as capitalism has a number of times across its some three hundred year history, it has always been "the people" who have been called upon to make the sacrifices needed to get the ruling class ship afloat again, for one more crossing of the economic waters.

And, strange as it may seem, on one level I accept that necessity, except... there needs to be a price tag attached to that "advance of capital and wage cuts etc." by "the people", in bailing out the "over-valued" private sector again and again. And this no less than there would be a transfer of stock, outright ownership, or board of directors positions etc, in the case of the "capital" relations between corporations/companies themselves. In short, "the people" need to be attaching "demands" for ownership share and "power" over the decision making processes of the economy to their "bailout advances" to capitalism, of "value for money", including our increased taxation share.

Continued next post...

The Approaching Intersection II

Continuing from previous post...

And if that seems unreasonable to anyone, there is no major global corporation , bank or other institution of capitalism that would think for one second of advancing capital or market concessions to any other, especially in its time of crisis, even collapse, without ownership share and decision making powers being exchanged. Without that, "the enterprise" would simply be allowed to fail, and sold off piecemeal. Neither should "the people" be expected otherwise. (Though instead of allowing a "significant" enterprise to fail, I suggest that "the workers" and "communities" simply "democratize" it.)

Be as careful and cautious as you want, for "the people" are as yet insufficiently organized to do otherwise, to say nothing of the mass level of understanding as we come out of the late "prosperity capitalism period" of the postwar. But in the end, it remains my view that a final "power tussle" for "right of way" is unavoidable along this road, approaching that intersection up ahead. For which folks should certainly prepare thenselves in advance, in a defencive driving kind of way.. For in the final analysis, cute analogies and metaphors are only of limited usefulness. :-)

A good day. I must be gone.

Analogies and Metaphors, Cute or Not,

are the only way to get people to understand how the simplicity of an idea can be perverted into complexity.

Simple Capitalism, which is ultimately based upon the single principle of "private property," is a circular system of trading goods for goods, goods for labour, goods for value, and back to goods for goods. Essentially, it is a equable system, of benefit to all participants.

But we have made it into a complex vertical system, a pyramidal tower in which rewards accumulate at the apex, and do not descend back to those in the bottom rows who support it.

There are no "intersections" in a circular system. Can we build a round-about in the middle of that Highway of Destruction that Coyoteman and Zalm see ahead of us?

Mr Dobbin's Confusion

Mr Dobbin is often entertaining with his hatred of any economic activity not government initiated. But, sometimes he appears to forget to consider basic reality. His comment that "The banks get ever richer from outrageous interest rates -- but they sit on the money because businesses aren't borrowing: people have quit spending as much, and there is little new investment." is, quite frankly just plain silly.
Does anyone actually believe that the banks (1) could be getting richer without lending money and(2) could have tons of money in their faults and yet interest rates are high. Has he never heard of the ole supply-demand concept?

Well...

...more to the point, have the banks? Credit-card rates being only one example. Banks make plenty underwriting other transactions that don't involve lending, such as equity trading and debt underwriting for corporations and foreign states. Consumer debt, though major, is not the biggest part of any bank's business, as a brief glance at their balance sheet swill show you.

Hell, even consumer fees at branches make up a significant part of the balance sheet, and the TD admitted more than a decade ago that their fees from branch activity were enough to pay for the labour costs of the whole banking corporation. Yet even after that, I never heard of banks lowering fees for more than a few months at a time. Hasn't anyone else wondered why Davis & Henderson remains so profitable in a paperless banking society?

Outrageous interest rates are the gravy that allow banks to pay the top level bonuses of millions to a thousand so-called "v-p"s each year. Stick up for that kind of behaviour if you like, but be honest about it. Otherwise, someone will suggest that it's not Mr Dobbin that needs a little review of banking practices in Canada.

Harper and the neocon philosophy

Harper is a died in the wool neocon and we have seen what the neocon way of thinking has done to the world economy.He can thank his lucky stars that he was ignored when he tried to deregulate our banking system to be in line with the US.If he ever does get a majority government this country will be unrecognizable.You had better learn to build prisons or work in one because this country will be worse than the united states of amerika.I don't know who votes for this bunch of born again fascist but I imagine it's the same bunch of geniuses that put Gordo and his pack of thieves in power once again.They lie and turn the screws for three years and then they pretend to change for a year and it fools the nether lands yet again