Canada suffers from Dutch Disease

[CPCFTW]

Yah Reuters has been writing that same article for a year or 2 now. That doesn't make them right, which might be why our interest rate hasn't gone up even though the same article keeps being written. Don't let your lack of knowledge stop you though.

Just for fun here is an article from the right wing crazy's about inflation being right around the corner with those record low interest rates in the US.

http://www.nytimes.com/2011/02/10/business/economy/10fed.html?_r=2&gwh=69509BA102D4A5B4052B4DB2ACE841D2

By the end of that year inflation was still under the target set by the central bank. Now in normal times inflation and the interest rate are linked. We aren't in normal times which is why everything you are saying doesn't apply and you don't know what you are talking about.

Listen, the fact is that prices would be higher if the dollar was weaker. That is an undeniable fact and I won't argue facts with you anymore. I'm not going to waste any more time explaining away every little anecdote that you can come up with to support your fantasy-world. Have fun in wonderland.

[punked]

Listen, the fact is that prices would be higher if the dollar was weaker. That is an undeniable fact and I won't argue facts with you anymore. I'm not going to waste any more time explaining away every little anecdote that you can come up with to support your fantasy-world. Have fun in wonderland.

It just isn't a fact. Market forces play a much larger role in buying power then the strength of the dollar. We only have to look to your American example for this. As the dollar has fallen inflation HAS NOT gone through the roof. Why is this? Well weakening demand and lower purchasing power of course. If people wont buy your computer for 500 dollars because 1. Why buy a computer now when you have a phone that does the same thing, and 2. Why buy a computer when you haven't a raise in 5 years and you have less to spend. Your company has a choice expand the market by depressing prices, or shrink your company to tailor to those who want the computer.

This along with many other reasons are why the US can lower interest rates, pump a huge amount of dollars into the market though quantitative easing and still have record low inflation.

I am sorry you are wrong. A high dollar does help in a lot of ways. Fact is though if HP can sell a lap top for 500 dollars here but can only sell it for 400 dollars in the US, those will the prices that are paid no matter how strong the dollar is.

This might be why I can give real world examples and post evidence while you can only remake your claim over and over again with no evidence then say you wont talk about it any more.

One last point. If a high dollar is so good why is every country in the world besides Canada taking steps to make sure their dollars don't get to high on the world market? We must be the only ones in the whole world who get it. OR everyone else learned their lessons in the past that an unregulated over inflated currency is just a ticking time bomb.

Edited May 21, 2012 by punked

[Moonlight Graham]

Ah, the wonders of the imperial mentality! It goes in and out of style, but never quite dies.

Let me be clear that I'm not advocating what I've been saying, I'm just pointing out how to grow our economy and that it is exactly what has been happening, and what will continue to happen unless there is some kind of change in our attitudes.

What we are doing raises our standard of living, but at the expense of exploiting people in developing countries and letting them work in conditions and wages that we in Canada would consider immoral and disgusting and a violation of human rights and certainly laws we already have, such as health/safety laws and minimum wage.

We exploit labour and resources all over the world from developing countries because we can, and it's disgusting, and Canadians clearly have a double-standard about human rights (those we secure for us, those we crap on for "them"). We should ALL greatly thank those in developing countries because we owe our high standard of living in great part to them & the price they pay.

[madmax]

You're clueless.

You must be dumber than I thought.

[madmax]

Let me be clear that I'm not advocating what I've been saying, I'm just pointing out how to grow our economy and that it is exactly what has been happening, and what will continue to happen unless there is some kind of change in our attitudes.

What we are doing raises our standard of living, but at the expense of exploiting people in developing countries and letting them work in conditions and wages that we in Canada would consider immoral and disgusting and a violation of human rights and certainly laws we already have, such as health/safety laws and minimum wage.

We exploit labour and resources all over the world from developing countries because we can, and it's disgusting, and Canadians clearly have a double-standard about human rights (those we secure for us, those we crap on for "them"). We should ALL greatly thank those in developing countries because we owe our high standard of living in great part to them & the price they pay.

Well said... and accurate.

But now what lol...

Edited May 21, 2012 by madmax

[bleeding heart]

Let me be clear that I'm not advocating what I've been saying, I'm just pointing out how to grow our economy and that it is exactly what has been happening, and what will continue to happen unless there is some kind of change in our attitudes.

What we are doing raises our standard of living, but at the expense of exploiting people in developing countries and letting them work in conditions and wages that we in Canada would consider immoral and disgusting and a violation of human rights and certainly laws we already have, such as health/safety laws and minimum wage.

We exploit labour and resources all over the world from developing countries because we can, and it's disgusting, and Canadians clearly have a double-standard about human rights (those we secure for us, those we crap on for "them"). We should ALL greatly thank those in developing countries because we owe our high standard of living in great part to them & the price they pay.

Ah. My fault, then; I sure didn't think it sounded like your usual opinions.

[dre]

Let me be clear that I'm not advocating what I've been saying, I'm just pointing out how to grow our economy and that it is exactly what has been happening, and what will continue to happen unless there is some kind of change in our attitudes.

What we are doing raises our standard of living, but at the expense of exploiting people in developing countries and letting them work in conditions and wages that we in Canada would consider immoral and disgusting and a violation of human rights and certainly laws we already have, such as health/safety laws and minimum wage.

We exploit labour and resources all over the world from developing countries because we can, and it's disgusting, and Canadians clearly have a double-standard about human rights (those we secure for us, those we crap on for "them"). We should ALL greatly thank those in developing countries because we owe our high standard of living in great part to them & the price they pay.

What we are doing only raises our standard of living in the short term, it guarantees a reduction in our standard of living later.

[dre]

By the end of that year inflation was still under the target set by the central bank. Now in normal times inflation and the interest rate are linked. We aren't in normal times which is why everything you are saying doesn't apply and you don't know what you are talking about.

Inflation is a personal phenomenon not a national one. The only reason core CPI doesnt show more inflation is because it excludes many of the items hardest hit by inflation. It also includes a bunch of non-durables that ARE coming down in price.

Inflation rates are very high for things like food, energy, healthcare, and realestate for example. So if you spend the bulk of your income on those things then inflation is already killing you.

Thats why theres a disconnect... The central banking is telling consumers that inflation is in check, but when they visit the grocery store, or the gas station, or try to put their kids through college they know its a lie.

[Moonlight Graham]

Ah. My fault, then; I sure didn't think it sounded like your usual opinions.

No my fault since i never made that clear before.

[dre]

Well said... and accurate.

But now what lol...

Now nothing... this will all sort itself out, through exchange rates as long as currencies are allowed to float. The west will stop importing all of its goods and start producing again once our currencies have lost most of their real purchasing power. This happening slower than it SHOULD because theres lots of currency manipulation going on, but it will happen.

[bush_cheney2004]

Ahem....the world's top ten exporting nations:

1  Germany
2  China (PRC)
3  United States
4  Japan
5  France
6  Italy
7  Netherlands
8  Russia
9  United Kingdom
10 Canada

[madmax]

Ahem....the world's top ten exporting nations:

1  Germany
2  China (PRC)
3  United States
4  Japan
5  France
6  Italy
7  Netherlands
8  Russia
9  United Kingdom
10 Canada

Thats only 1/4 of the story. China imports raw (Gold, Oil, Ore)and exports value added. Canada exports raw and imports value added.

The list of Imports is nearly identical in order because that is the nature of trade.

What we are seeing is Canada moving in the direction of the US where it imports more then it exports.

[Smallc]

Canada exports raw and imports value added.

Canada exports both, actually. A great deal of both.

[madmax]

Canada exports both, actually. A great deal of both.

Yes, it does, however, it is not lost on anyone that the vast manufacturing capacity has drastically hollowed out. Those value added manufacturing goods that were once exported as well as used domestically are now imported.

As little as 6 years ago, there were 7 major White Product Manufacturers within 1hours drive of my location. Today there are zero. Operations were then Consolidated into a single warehouse facility.

So while you look at exports , I look at the unemployment lines of the past 5 years.

--------------------

Central Canada hit harder

Quebec and Ontario make up Canada's industrial core. Outside these two provinces, there are generally proportionately fewer manufacturing jobs. In 2008, manufacturing jobs in Quebec and Ontario represented 14.0% and 13.5% of jobs, respectively, whereas the national average was 11.5% (Table 4). Together, these two provinces account for more than 1.4 million (73.3%) of the manufacturing jobs in Canada. Manitoba also has a significant manufacturing presence, with 11.3% of its jobs depending on it. The proportions for all the other provinces are below the national average. Saskatchewan, which is more natural resources-oriented, is the province with the fewest jobs in manufacturing (6.0%).

In six provinces, at least one in ten manufacturing jobs were lost from 2004 to 2008.3 The largest drop was in Ontario, where 198,600 jobs, almost one in five (18.1%), disappeared in only four years. Significant drops were also seen in Newfoundland and Labrador (-18.0%), New Brunswick (-16.0%), Quebec (-13.8%), British Columbia (-11.3%) and Nova Scotia (-10.3%).

----------Prelude---------------

From 2004 to 2008, more than one in seven manufacturing jobs (322,000) disappeared in Canada. The majority came from Ontario, but drops were also evident in other parts on the country. In six provinces, at least 1 in 10 manufacturing jobs disappeared from 2004 to 2008. These losses occurred during a period of economic turbulence in the country as the exchange rate fluctuated widely

[Smallc]

Yes, it does, however, it is not lost on anyone that the vast manufacturing capacity has drastically hollowed out.

In pretty much every wealthy country on the planet.

[madmax]

In pretty much every wealthy country on the planet.

Those wealthy countries have all adopted the same Liberal (neo Liberal) vs a "smallC" economic vision.

Canada is no different, in that the Conservatives have embraced Liberal economic Policy and unregulated, deregulated, market based theory.

For better or for worse, a choice has an impact.

Accellerated decline for growth in another area/sector.

Its as old as Sir John A who tossed out market based economics for small c Conservatism and nationalism.

This was tested in the 1920s with open markets and little regulation of stocks.

Had things continued to be unregulated and left to the markets , North America could well have revolted, as each boom and bust would oscillitate greater then the previous one.

50 years of relative stability was changed with the fall of communism and their are some who believe it was open freemarket that won the battle. whereas restricted, regulated, markets won the war.

Since then, with the adoption of these Market based solutions from 1990s onwards the rush to deregulate will lead to more changes, challenges and larger boom and bust scenarios including unstability of exchange rates as shown previous in the stats canada report.

I am not disagreeing with your small c. Things are what they are.

I am suggesting that the US has moved to lower their currency through economic policy.

The Canadian Currency has been cited as being artificially high because of the oil sector.

The government can choose to ignore this, continue to deregulate the energy market, subsidize oil and rush a deal with china and ignore the short and long term environmental impacts in Alberta and the short and long term economic impacts in the ROC or they can address some of the foundations of the dollar and make changes accordingly.

No one says any of this has to be done.

But there is nothing wrong with the discussion and what goes on around it.

Some would think Canada can be stronger with a regulated policy.

And others don't.

We have seen deregulation dominate for the past 20years.

With that same deregulation and freemarket freedom , comes the decision to ignore national security.

It is no different with anything else if markets are left to their own whim.

SmallC vs small L neo Liberal policy which has been the mainstay of PC and Conservatives as well as Liberals over the past 20 years. One might believe the Liberals controlled the move a little more balanced. Others might contend its the wrong direction in its entirety.

It is NOT unusual for a country to analyze its currency.

It is NOT anti west, or leftwing.

Is dutch disease real? Yes.

Is it affecting industry? Apparently 30%

Is the net benefit greater or lesser if we maintain the course or change directions.

[TimG]

I am suggesting that the US has moved to lower their currency through economic policy.

You mean with massive deficits that will eventually lead to an economic collapse? It is like burning the furniture to heat the house.

The Canadian Currency has been cited as being artificially high because of the oil sector.

The high currency also allows Canadian manufacturers to invest in productivity improving equipment for less.

The government can choose to ignore this, continue to deregulate the energy market, subsidize oil

Oil is NOT being subsidized by any stretch of the imagination. The

"subsidies" claimed by environmental groups are largely BS where they count standard tax deductions that all businesses get as 'subsidies'.

they can address some of the foundations of the dollar and make changes accordingly.

Or they could make Ontario manufacturing more competitive by cancelling the brain dead renewable energy policies which increase the costs of electricity. Ontario choose to sacrifice its industry in order to be politically correct.

We have seen deregulation dominate for the past 20years.

A we are richer today than in the past. Countries that tried the heavily regulated approach were mired in poverty for decades and only started to experience growth once they loosened regulations. Edited May 22, 2012 by TimG

[madmax]

You mean with massive deficits that will eventually lead to an economic collapse? It is like burning the furniture to heat the house.

Perhaps you missed that Adopting the NeoLiberal over SmallC Conservative requires running high deficits to kill the modern state. It was used by Reagan, Bush, Clinton, BushII and Obama. That is without question, and it is not a wise choice (IMHO) that said, in all circumstances, the US has trended to allow its dollar to float with minor input, and a focus on keeping inflation low. With the economic collapse through deregulation, the government is grasping at straws and in hopes that a lower dollar will aid them competitively.

The high currency also allows Canadian manufacturers to invest in productivity improving equipment for less.

Yes it can. It is a benefit of a higher dollar if importing equipment or technology from a foreign source. My experience of the past 12 years was massive investment in equipment when the dollar was floating to between 70cents and 80cents.

There was significantly less investment when the dollar was lower then 70cents, and profits could be easliy made while competing with Mexico who, happened to be getting the benefits of NEW EQUIPMENT and technology.

What I have seen is alot of that new hightech equipment was used for 3 to 7 years and then exported to China, Korea, Mexico and some back to the US as our dollar hit 90cents and upwards. The fact is that foreign owners are not branded to staying in Canada with a high dollar if access to market is easy and capital raised from Canadian productivity benefits can be invested offshore.

Oil is NOT being subsidized by any stretch of the imagination. The

"subsidies" claimed by environmental groups are largely BS where they count standard tax deductions that all businesses get as 'subsidies'.

If Oil is NOT being subsidized, then there is little to fear from Mulcairs proposal to reduce the subsidies that are claimed in the study to be inflating the price of oil without regard for its real costs.

I am very open to the debate that Oil is not being subsidized.

Or they could make Ontario manufacturing more competitive by cancelling the brain dead renewable energy policies which increase the costs of electricity. Ontario choose to sacrifice its industry in order to be politically correct.

Well there is the truth and their is politics. Green Energy makes SFA to the manufacturing industries, especially heavy manufacturing (in which primary levels have been very much reduced). Energy was deregulated by the PCs in order to have Open Free Markets to Energy. The Enron Philosophy. Luckily for Ontario, half in half out, but still created a bad taste for manufacturers. They purchase hydro on bulk and hedge in long term alotments.

Its more about open energy markets and NOTHING to do with the Green Energy debacle of the Ontario government. That is a separate kettle of fish.

However, I look to the PCs to mislead the public and capitalise on the Green Anger, but it will not make a bit of difference to manufacturing. The PCs are just as lost as the Liberals and I have no faith in Hudak.

A we are richer today than in the past. Countries that tried the heavily regulated approach were mired in poverty for decades and only started to experience growth once they loosened regulations.

Canada was never mired in Poverty through regulation of the industrial sector.

Neither was the US.

Nor any other industrial nation.

Deregulation allows for Gold Rush symptons. Not cures.

Or OIL BOOM if you prefer.

Once a Mine goes empty and the boomtown turns to dust.

The deregulation that Canada is experiences is to lower standards and checks on imported goods.

Deregulating the securities market created the biggest recession since the great depression and costed BILLIONs.

There is necessary regulation and unnecessary regulation that is politically driven.

There is regulation that is a net benefit to the country.

Not all deregulation is good.

And it isn't always good to have an overinflated dollar.

Edited May 22, 2012 by madmax

[TimG]

With the economic collapse through deregulation, the government is grasping at straws and in hopes that a lower dollar will aid them competitively.

I reject your premise that deregulation is the cause of the current problems. If anything, free markets have made the slump less than what it would be otherwise.

If you want to make the case that deregulation is the problem the state specifically what you would like to see changed and we can discuss the inevitable consequences of such regulations. In almost all cases people assume that we can restrict our market while maintaining free access to other country's markets. This is a false assumption very few arguments for regulation can stand up once you assume that others will respond with similar regulations.

If Oil is NOT being subsidized, then there is little to fear from Mulcairs proposal to reduce the subsidies that are claimed in the study to be inflating the price of oil without regard for its real costs.

Actually there is a lot to fear because Muclair does not care about facts. He only cares about demagoguery. So he will likely impose punitive taxes on the oil industry and the oil industry will respond by reducing investment. In the worst case, we could see another crash like in the 80s.

I am very open to the debate that Oil is not being subsidized.

Then state specifically what you call a subsidy and the amount of dollars involved. If you cannot point to some specific program with a dollar value then cannot claim that oil is subsidized.

The deregulation that Canada is experiences is to lower standards and checks on imported goods.

Deregulation creates opportunities for exporters and cheaper costs to Canadian consumers. For example: which would you rather buy: an iPhone for $400 that is made in China or a Canadian made version that costs $800+? The fact is the gains made by doing production in the country will more than wiped out by the increased costs.

Deregulating the securities market created the biggest recession since the great depression and costed BILLIONs.

You are taking a complex problem and blaming in one factor. The reality is the meltdown could have been avoided (or at least made much less of the problem) by any one of the following policy changes:

1) End political pressure on banks to make loans based on racial profiles;

2) End No recourse mortgages which encourage people to walk away from a house;

3) Mortgage interest tax deduction which discourages people from paying back debt;

4) Severely restrict the creation of securitized mortgages;

You cannot have a reasonable discussion unless you consider all factors.

And it isn't always good to have an overinflated dollar.

What you are missing is EVERYONE wants a lower currency: from China to US to Japan to India and Canada is a drop in the bucket compared to the big players. It is naive to assume that we can do anything about the currency other than committing economic suicide like Greece.

BTW: I am an exporter: my CAN$ sales have dropped by 50% in ten years. So I would benefit from a lower dollar. I am only arguing because I think the country will be harmed much more by policies designed to somehow control the dollar than the dollar itself.

Edited May 22, 2012 by TimG

[bush_cheney2004]

...There was significantly less investment when the dollar was lower then 70cents, and profits could be easliy made while competing with Mexico who, happened to be getting the benefits of NEW EQUIPMENT and technology.

This is the major reason why Canadian productivity lags other nations to this day. Manufacturing doesn't exist just to give high paying jobs to the great unwashed masses. If Canada can't/won't produce more finished goods with less labor costs, then multinationals will find places that will.

[Fletch 27]

Its very clear that Mulcair is waaay out of touch with the rest of Canada.. from border to border..

"Canadian employers went on a hiring blitz for a second consecutive month in April for the best back-to-back job creation in over 30 years, adding almost six times more net new jobs than expected driven by a record increase in the goods-producing sector"

Sound like Dutch Disease?? No, Mulcair simply wants to divide the country from east to west.. What is it they say about "divide and conquor"? This guy is simply out to get power... The FACTS alone point directly to that..

Mulcair was not available for comment when the Jobs figures came out.. NOR has he commented on them to date.. Wonder why

[Canuckistani]

This is the major reason why Canadian productivity lags other nations to this day. Manufacturing doesn't exist just to give high paying jobs to the great unwashed masses. If Canada can't/won't produce more finished goods with less labor costs, then multinationals will find places that will.

Same is true for the US. And, when those multinationals find countries with lower labor costs, they also gut their best markets. It's a short term strategy that will collapse in the end.

[madmax]

I reject your premise that deregulation is the cause of the current problems. If anything, free markets have made the slump less than what it would be otherwise.

I will hedge my bets against you, then hedge my bet against me, and then hedge against those who I believe won't be able to pay up when I fail. On a larger scale this will cause trillions in losses, not billions as I was wrong to say. And in the past this practice was illegal if now outright immoral with respect to mortgage lending and speculation which I will addres below.

If you want to make the case that deregulation is the problem the state specifically what you would like to see changed and we can discuss the inevitable consequences of such regulations. In almost all cases people assume that we can restrict our market while maintaining free access to other country's markets. This is a false assumption very few arguments for regulation can stand up once you assume that others will respond with similar regulations.

When you deregulate and cause a loss of consumer confidence, you lose your market. Ask a cattle rancher. When corporations are parking all their lobbyiests at the gates to get their imports into Canada with less scrutiny, it leads to lead coming back into childrens toys. When we allow companies to purchase techology and elimate competition to gain complete control of market and then allow that company to relocate with the technology and the cash cow, to shaft the employees (that is middle and upper management that gets shafted if you didn't know) and relocate offshore then this deregulation and non enforcement creates economic hardship for the country. I have no intention of being specific for the industrial sectors are vast and I believe that each sector knows what needs to be done. What they cannot control in Canada is the foreign decision making that often overlooks Canadians.. (if any are allowed to run the operations) .

I do believe that regulation is needed when Harper hands out Millions to Electro-Motive for his Political Grandstanding and sits back and does nothing when a year later the company leaves courtesy of Canadas Economic Action Plan.

Actually there is a lot to fear because Muclair does not care about facts. He only cares about demagoguery. So he will likely impose punitive taxes on the oil industry and the oil industry will respond by reducing investment. In the worst case, we could see another crash like in the 80s.

Perhaps he does care about the facts and the fear mongering is coming from a connected few. I believe he is using studies from Canada and other nations with regards to a known economic occurance termed Dutch Disease. And some countries handles this transition better then others.

Then state specifically what you call a subsidy and the amount of dollars involved. If you cannot point to some specific program with a dollar value then cannot claim that oil is subsidized.

1st off its not my claim. It is the claim of various economists and its not out of the norm for massive corporate welfare. It has been in existence since Canada was a country and the Corporations were the 1st "welfare bums". You suggest that there are no subsidies. If I take your word for it, there is nothing to worry about.

http://actionplan.gc.ca/initiatives/eng/index.asp?mode=3&initiativeID=207

However, from what I can read on "CANADAS ECONOMIC ACTION PLAN" the Harper government suggests their ARE subsidies and like Mulcair is not only set on Reducing them, but eliminating them in their entirety by 2013.

Also the Harper Government

Budget 2011 builds on this change by proposing to reduce the deduction rates for intangible capital expenses in oil sands projects and align them with the rates applicable in the conventional oil and gas sector.

These changes will improve fairness and neutrality of the taxation of oil sands relative to other sectors of the economy. They constitute further action by Canada in support of the commitment by G-20 Leaders to rationalize and phase out over the medium term inefficient fossil fuel subsidies.

-------

Essentially the EXTRA subsidies are going to be reduced to the level of Conventional Oil Subsidies.

Subsidies to oil and gas amounted to 1.4 Billion.

You can say that this corporate welfare is not a subsidy to an industry that has strong profits. But I will leave that to the economists and government to call it that.

So this whole discussion is hardly radical scarey stuff. Its standard fare.

Deregulation creates opportunities for exporters and cheaper costs to Canadian consumers. For example: which would you rather buy: an iPhone for $400 that is made in China or a Canadian made version that costs $800+? The fact is the gains made by doing production in the country will more than wiped out by the increased costs.

There are many people who are realizing that the quality of Canadian made goods was superior to a long held myth. I have purchased a very good looking BBQ made in China and for a very reasonable price. I will be scrapping it after 1 year as its garbage and I have learned my lesson. Those options to purchase Canadian Manufactured goods are reduced with each foreign purchase of a Canadian Company and its closure. Then the choice is removed and yes we get alot of cheap crap. I see a dollar store filled with it. We can buy more of it too.

I am interested in balance and it does not appear that we are very well balanced, when our operations can be aquired and dismantled with such ease.

I also take issue that we cannot produce a good in Canada that is Competitively. I think my Toyota made here is just fine, thank you very much. And yes you can get a Hyundai for less money.

Right now I am sick of the Crappy Toilets, hardware, poor doorhandles, found in bigbox stores and homehardwares. its all you can get...its cheap affordable and the chrome falls off, the enamal flakes off.

I recall very affordable cheap carbide inserts purchased that cost less then the materials to make them. Its great if you want to throw out every 3rd or 4th shipment and lose production.

Somethings are worth paying for and people will pay for it. I also believe its possible to produce a product here cheaper for market and it is still about preventing the competition from taking your cheap affordable mousetrap.

You are taking a complex problem and blaming in one factor. The reality is the meltdown could have been avoided (or at least made much less of the problem) by any one of the following policy changes:

I do believe it is a complex problem, however, monetary policy is not so complex, its not like its never touched, discussed or moved upon in one way or another.

I will address your comment below regarding the solution.

1) End political pressure on banks to make loans based on racial profiles;

Canada does not make loans based on Racial Profiling but has been unregulated in the US as mortgages have been shown to be denied or accepted based on race.

2) End No recourse mortgages which encourage people to walk away from a house;

3) Mortgage interest tax deduction which discourages people from paying back debt;

4) Severely restrict the creation of securitized mortgages;

So you want regulation. not Deregulation.

You cannot have a reasonable discussion unless you consider all factors.

What you are missing is EVERYONE wants a lower currency: from China to US to Japan to India and Canada is a drop in the bucket compared to the big players. It is naive to assume that we can do anything about the currency other than committing economic suicide like Greece.

Greece is a nation that doesn't like to pay tax, likes to borrow money, and their loans have been called. This is not Canada, nor can one compare Greece to Canada, unless they simply wish to divert attention away from the Trillion $ meltdown that did affect Canada and was caused in the US through massive deregulation and greed.

BTW: I am an exporter: my CAN$ sales have dropped by 50% in ten years. So I would benefit from a lower dollar. I am only arguing because I think the country will be harmed much more by policies designed to somehow control the dollar than the dollar itself.

The dollar does not control itself but is subject to Market Speculation, manipulation as well as government policies designed to influence or control the above.

If the dollar falls to low or climbs to high, there are consequences and effects.

I have companies affected and not nearly as effected by the higher dollar. It depends on the contracts and the currency of transactions.

That said, being an exporter is NOT being an manufacturer.

There are far more variables involved.

Thus, I find it rather amusing if not outright absurd that there are people saying we shouldn't be having a conversation about the dollar and about what is affecting it.

[madmax]

This is the major reason why Canadian productivity lags other nations to this day.

Canadian Productivity is just fine. It definitely fell when the dollar was 70cents and lower and I can tell you that many American firms ramped up purchasing Canadian Companies and then invested nothing in technologies. Until the dollar hit the 80s and it was market forces that moved them back into technological solutions.

I recall one US firm was described as moving a hightech Canadian firm back into the 1970s and pen and paper. It was something to see, but that was how the US firm ran its operations and the superior Canadian firm, instead of being emulated, was dismantled and gutted.

Manufacturing doesn't exist just to give high paying jobs to the great unwashed masses. If Canada can't/won't produce more finished goods with less labor costs, then multinationals will find places that will.

Interesting perspective of people who work for a living. I can't see $10.25 to $14 as being all that much money in Ontario, for general manufacturing and assembly. But yes the Engineers wages are dropping but it is difficult to believe they can compete with $600/month Engineers. US and Canadian Engineers just sign off anymore.

Yes Even Ford had to overcome what others said about him paying good wages to his employees.

Seems the Liberal Freemarket Economic Movement has done everything in its power to undermine the Ford Vision and the middle class.

[TimG]

I have no intention of being specific for the industrial sectors are vast and I believe that each sector knows what needs to be done. What they cannot control in Canada is the foreign decision making that often overlooks Canadians.. (if any are allowed to run the operations).

The reality is there are many Canadian companies that are active in foreign countries and their success depends on them being treated fairly by foreign governments. In fact, once of the biggest investors abroad is the Canada Pension Plan:

http://www.theglobeandmail.com/globe-investor/cppib-passes-caisse-as-biggest-pension-fund-manager/article2435986/

How can we expect our companies to be treated fairly if we don't treat foreign companies fairly?

I do believe that regulation is needed when Harper hands out Millions to Electro-Motive for his Political Grandstanding and sits back and does nothing when a year later the company leaves courtesy of Canadas Economic Action Plan.

Please get your facts straight. The subsidy was for electromotive customers. The IP owned by the the company was developed by its American branch. It was the workers who drove the company out.

Budget 2011 builds on this change by proposing to reduce the deduction rates for intangible capital expenses in oil sands projects and align them with the rates applicable in the conventional oil and gas sector.

So the government brought in tax measures to encourage the development of the oil sands when no one thought they would be economic. The Harper government phases them out because they are no longer necessary. Seems to be that the decision to provide the tax credits was right at the time as is the decision to phase them out.

Subsidies to oil and gas amounted to 1.4 Billion. You can say that this corporate welfare is not a subsidy to an industry that has strong profits.

Canada exports $50 billion worth of oil every year. 1.4 billion is a drop in the bucket. I say eliminate them if there is not a good reason for them. The trouble is there are many times when there are good reasons for the 'subsidy'

Then the choice is removed and yes we get alot of cheap crap. I see a dollar store filled with it. We can buy more of it too.

People have made their choice with their wallet. How exactly would you stop this?