Toro

That's interesting Argus. It would be interesting to know where the growth in healthcare expenditures over the past 10, 20 years has come from.

Why would it?

That's the Liberal party line - but it's BS. Eureka was uncharacrtristicly wrong on several occasions in this thread, but this is not one of them. At least not if Canadian doctors were allowed to fully utilize these new technologies, as the doctors elswhere are. And also, if they were more prudent in prescribing insurance covered drugs, as the others are. <{POST_SNAPBACK}> I agree. Technology and new drugs are a big driver of costs. Those new technologies and new drugs are extending lives. Because those new technologies and drugs are often applied in the States first, it accounts for part, but not all, of the reason why health care costs are higher in America. The price of older drugs and technologies are not rising, or at least not much.

theloniusfleabag Canada already has a two-tierd healthcare system. If the rich want something right now, they go to the States.

Eureka. My original post was about real wages growing. I'm talking about real wages. I'll re-post what Yaro wrote. This is patently false; wages are determined by a market bare system. People are paid the lowest wages they are willing to accept. No it won't, there is absolutely no evidence of this. There is evidence of this. As the economist in the article you linked stated, http://www.bmo.com/economic/regular/canprod.htm So rising productivity means rising wages. Closing the productivity gap will close the wage gap. To say "there is absolutely no evidence of this" is false.

No pressure from American sources in healthcare are irresistable. The problem is that healthcare costs in Canada, as it is elsewhere around the world, is growing at a faster rate than the economy. Canadians do not want to pay anymore taxes than they are already paying. There is no never-ending source of taxpayer funds. Thus, you either allow alternative sources of funding or cut other government programs, which means welfare and education. When there is insufficient funds, you have rationing. Clearly, its a serious enough problem when the Supreme Court says its so. Maybe if there is a healthcare professional reading this, they can correct me, but as I understand it, In Ontario, certain doctors are not paid much once they have worked a certain amount of hours. Thus, there is no incentive to work more, which is essentially rationing.

This is patently false; wages are determined by a market bare system. People are paid the lowest wages they are willing to accept. http://www.bmo.com/economic/regular/canprod.htm

Since August is acting as the thread police, I've moved the offending quote to the appropriate thread. August, I enjoy your posts, and agree with most of them, but lighten up a bit, man. Now, back to the issue at hand.

Amen to that. For myself, I prefer the American system as I get better treatment than I did in Canada. But I believe that there should be better care for the poor in the US. What gets me is that in Canada, the proponents of medicare frame the argument as if its binary - Medicare or the American system. That's ridiculous. A story. My grandfather moved to Vancouver Island from Saskatchewan. Within days of arriving in BC, he wanted to go see a cancer doctor. He had to wait for 3 months to establish residency before being able to see one. Because he lived up Island, there aren't that many cancer doctors, and so my father had to pull strings to get him in ASAP even after having to wait 3 months to see one.

That's an interesting article eureka. Some points from it. IMHO, Canadian economic performace will exceed US performance for the next few years.

The net worth of US households is $49.8 trillion. That's up 9.4% from a year earlier and from $41.7 trillion in 2000. http://www.federalreserve.gov/releases/z1/Current/z1r-5.pdf

That's great August. This is patently false; wages are determined by a market bare system. People are paid the lowest wages they are willing to accept. The wages paid in a "bare market system" is a function of productivity. There is a clear relationship. A janitor and an aeronautical engineer are not paid the same wage. If an aerospace company wants to build a new airplane, it hires the guy who has the technical skills to do so and bids up his wages above the janitor's. That is because of "productivity", and is a function of the "bare market system". Surely someone with a training in economics understands this concept. No it won't, there is absolutely no evidence of this. Wages have fallen in virtually every country that has opened itself to full free trade, often dramatically. Wages in the Mexican economic zone have fallen by almost 50% since the introduction of free trade. Ilo analysis of Mexican wages This is what you quote as evidence that of "wages falling in virtually every country that has opened itself to free trade?" An article about the minimum wage structure in Mexico? It doesn't prove a thing other than Mexico's economy collapsed because of the peso crisis and Mexico has a minimum wage that didn't adjust accordingly. Real wages didn't rise in the US, Family income did, but that wasn't do to rising wages it was do to a rise in the number of dual income families. Real wages have been falling for a very long time, in fact right now at the height of both the short and long term cycles we have seen the smallest wage growth ever. Bloomberg Article Back it up. All you do is link an article about wage growth from 2001 to 2003. What does that prove? Here are two links that show evidence of productivity and wage growth. The first is the World Development Indicators 2002 published by the World Bank. Sorry, you'll have to buy it. But in it, it demonstrates the link between wages and productivity for a cross-section of 20 countries. In the study, the R-squared between the cost per worker and the value per worker is 92%. The second is a study by Stephen Golub, which you can read about it here. He analyzed 49 countries and found that productivity growth explained most of the variation in wage growth over time. So the idea that wage growth is linked to productivity growth as being patently false is, well, false. This is hardly revolutionary in the field of economics. I didn't think anyone with an economics background questioned this particularly vociferously. This is silly. And misleading. A little history lesson. First, capital flows from 1980 to 2000 into the United States were driven mainly by private inflows. There were times when central banks were the main drivers, in particular from 1985 to 1987 (if I recall correctly) due to the weakening of the dollar after the Plaza Accord. But for the most part, over the previous two decades, it wasn't governments driving flows. Second, though it is true that the central banks of Japan and China have been big buyers of US bonds, you have to understand that in the context of what has happened over the past four years. In an effort to avoid a sharp recession, the federal reserve lowered interest rates to 1% to flood the financial system with liquidity. To avoid their currencies from appreciating too much, and thus jeapordizing their growth since so much of it is dependent on exports to the US, the central banks of Japan and China heavily purchased dollars. That has created imbalances in the economy no doubt, but the policy has worked. (So far.) This year, there has been very little buying by the two central banks and the largest sector of capital inflows have been purchases of corporate bonds by private investors as long-term US bond yields are a full point above many European bonds, and 2 points above Japanese bonds. People who follow the energy business know there is a simply answer to this. I'll let quote Andy Xie, an economist with Morgan Stanley, and let him explain it. Not only that, but competition is picking up. Capital spending is growing 15% this year in the exploration and development while OPEC is producing flat out. You don't push a button and PRESTO!, suddenly there is oil. It takes time to bring new fossil fuels out of the ground, refine it, and get it to the end user. You have just given a broad definition of efficiency AND productivity AND return on investment AND cost effectiveness. The bolded part is a very odd statement. Real GDP has been rising by 3-4% annually the past few years. It has risen by at least 3% per year on average for the last 35 and 70 years in the United States. Printing money creates inflation. But we are not talking about nominal growth. I am talking about real growth. So the idea that the US government is creating this "illusion" does not make any sense.

Link?

You say you have, but you also say that you are not an economist nor a statistician. If that's the case, how do you know what you are referencing is correct? I know nothing about cars, so I know that I would not know what to look for when my car stops running. Why? That sounds like someone with a preconceived notion who dismisses any information that contradicts that person's own dogma. That is false. I can quote and/or link document after document from various institutions staffed with incredibly intelligent Ph.Ds, all of whom are extremely well-trained in statistics and economics, that supports my view. Understand that I do not believe that markets are a cure all for everything. There are times when markets fail. But markets are the single best mechanism for creating wealth. Markets are not perfect, but they create the most wealth for the most people most of the time.

eureka I believe this is World Bank data. I referenced it from a book by Martin Wolf, who has worked for the World Bank and is the chief economics commentator for the Financial Times. The data is on page 149. Why Globalization Works

Three things Sparhawk. First, though China and India are developing, it doesn't mean they will develop (especially India). I believe both countries will do so, but it is not a given. Second, there is no gaurantee that simply because America (and Canada) have this tremendous technological edge that we will have it in the future. However, though technology transfer definitely accelerates a developing country's growth, it shouldn't be overexaggerated either. For example, there is still much of India with terrible infrastructure. My friends who have been there recently tell me of 300 mile trips that take 8 hours over dilapitated highways. Finally, as corporations have become leaner, they have taken out layers of middle management. This may not be an actual transfer of jobs overseas but it certainly comes about because of competition overseas as corporations keep their cost structure down to compete. I will say this though, the returns to labour will probably lag growth in the economy because of that huge pool of labour in Asia. Returns to assets will do better. I have to disagree with your assessment about no jobs. There have been few jobs in western Europe created over the past three decades while the US has created 60 million jobs since 1970. ftp://ftp.bls.gov/pub/suppl/empsit.ceseeb1.txt By protecting jobs, economies fail to adapt. This raises the cost of labour, which stunts the labour market, which is part of the problem with Europe IMO. Certainly there has been a disparity in the US over the past few decades as wages of the poor have not kept up with the middle class and wealthy, but they have still risen. As for the middle class, there is no gaurantee that they will be better off in the future - as there never is. But climbing into a shell and trying to protect ourself from the outside world is almost certainly a recipe for failure.

Well, I'm fairly well educated on the subject of trade as well and I will make the standard classical argument for trade. But since you already know that, why don't you make the argument that a common social and taxation structure is the only way that leads to efficiency. That should be interesting considering A.) such a structure has never existed, and B.) essentially establishes a monopoly across different jurisdictions - and we all know how efficient monopolies are! Essentially, what you are saying is that trade is only efficient within a common political structure. That is almost certainly wrong.

Of course they can. Virtually all industries are not cartels. This is such an odd argument. I have to believe the people who make this argument do not have actual experience in business.

You miss the point. Wages have, and probably always will, be determined by productivity. As the difference in productivity closes between the first and the third world - which is what we want, right? I mean we don't want large swaths of people living in abject poverty, do we? - the wage differential will close. And as the wage differential closes, more engineers will stay in China and India (as if those are the only places that produce engineers.) In fact, the wage differential has closed. From 1980 to 2000, real wages in China rose 440% compared to 60% in the United States. Wages in China rose from 3% of the American to 12% of the American wage during that time. Yet, during that time period, American wages rose. Its simply a false notion that economic growth is a zero sum game. Also, jobs do not move to where they are done cheapest. Rather, capital goes to where returns are highest. And the biggest capital flows over the past decade have been into, first information technology in the United States, then into biotechnology in the United States, where the highest wages in the world are paid. They used to say the same thing about Japan.

Cartman I think you are dead right about its just a matter of time before Iran has nuclear weapons. Look at where Iran is situated. To the east, there are nuclear powers in India, Pakistan and China. In the north, Russia has nuclear weapons. To the west, Israel and America (in Iraq) have nuclear weapons. Iran is a regional power. They too will have nuclear weapons.

Bad idea. Of course, the US is a stupidly large subsidizer of food, so most food could be considered as "dumping". Of course, that makes food - the most important commodity - cheaper in Canada.

Why is this bad? The economy continues to move more towards a knowledge-based economy, and will continue to do so while manufacturing continues to head off shore. There's nothing magical about manufacturing. A couple hundred years ago, people thought manufacturing was bad, as it supposedly would threaten a way of life. It was better, the critics argued, to remain in an agarian economy. Instead, the application of high-end technology moved away from the farm into the factories, which increased the standard of living. This is occurring again today as higher-skilled labour moves towards information and healthcare technology and the ancillary services they provide while manufacturing moves offshore to lower-tech jusisdictions.

North Korea, despite the rhetoric, was never on the radar for America, or at least not like Iraq and Iran. America's biggest worry wasn't that they'd actually use nuclear weapons, but rather, North Korea would sell the weapons to al-Qaeda. North Korea is starving, thanks to the man-made disaster known as communism and autarky. A starving person - or nation - will do whatever it can to get food. The nuclear weapons are a bargaining chip to get food and keep the regime in power. Notice the difference in behavior between Iran and North Korea. Iran has steadfastly denied they are developing nuclear weapons but instead are developing nuclear power - complete lies considering Iran has one of the largest oil reserves in the world. But North Korea is like the kid on the block, jumping up and down, trying to get attention and get people to take it seriously. If you really are trying to develop nuclear weapons, its not a particularly good idea to announce loudly you are doing so and flout international convention.

But most jobs in the United States are not WalMart type jobs. Wages in this country are growing at about 3% per year. That's okay, not great, and will probably lag returns on capital for the next several years. You can see the composition of the labour force here ftp://ftp.bls.gov/pub/suppl/empsit.ceseeb1.txt You can see that there are 134 million employed on nonfarms in the United States. 26 million are in trade, transportation and utilities, while 12.8 million are in leisure and hospitality. Those are where you'll find retail, waiters, etc. The fastest growing sectors are business and professional services and education and health services. America has added about 20 million jobs each of the past 3 decades. And I'll re-iterate - its better to have a low paying job than no job at all and collect welfare.

Yes, and its interesting that at the time, France was more of a steward of sound money than America was. In theory, every greenback was backed by gold. But Americans could not actually exchange the bills for gold. But foreigners could. So in the 60s, when America started to finance the Vietnam war through debt and the printing press, DeGaulle's very strong economics advisor - whose name I can't remember - foresaw the inflation that came in the 1970s. He advised DeGaulle to exchange French holdings of dollars for gold, which America refused since the dollar holdings of France exceeded (or nearly exceeded) the gold stored held the United States. This lead to a chain of events that eventually lead to the collapse of Bretton Woods. Ironically, central banks have been dumping gold the past 15 years and replacing it primarily with dollar bonds since gold doesn't pay a rate of interest.