May 20, 2005

• Non-electionFilter - huzzah!
• So, what happens in Canada, then?
• SSDD, eh?
• Just about died when Cadman stood up - I was so happy. Chyren, we hopefully return to something akin to normal, aka having regular sessions of the House of Commons wherein everyone yells at each other and the minority Liberals get pushed around. But at least we don't have to spend two straight Junes in an election, and the same-sex marriage bill can be debated and hopefully passed. And then after the Gomery inquiry is over, then we'll have an election, probably.
• I see. Is it nice up there, then? What's it like with those neighbours?
• It was lovely here in Ottawa today, sunny and warm. The neighbours can be a bit rowdy, what with their funny space weapons stuff and reactions to our beef and lumber, but mostly they keep out of the way.
• Sounds nice.
• *Uneasily waits for other Chy shoe to drop*
• This is really very good news. We've averted a pointless election that could well have produced yet another minority government while wasting two or three hundred million bucks. Now, as livii said, we can get back to our gay marry'n, pot legaliz'n, multi-god acceptin', free health-carin' ways that seem to annoy the southern neighbors so much.
• And let's not forget the poutine catapults - to the border!
• Ah, at last, I can vent about politics. The vote was actually a tie, broken by the speaker of the house, which shows how fragile this government is. The Bloc is determined to bring them down, confident they can win more seats in another election. The Conservatives, hopefully, will be more cautious next time around, but the poll printed up in today's Star shows the NDP could profit from an election so maybe the next unholy alliance will include them. In any case, I very much want the Liberals not to completely lose their credibility only because they are such an important factor in making Canada what it is today. And, you know, I like Canada. If the Liberals lose we turn the country over to the lunatics - the Bloc or the Conservatives - it would appear.
• Here on the west coast we use geoducks and BC bud in our catapults.
• Har! Flying geoducks would be *most* disconcerting. Fetchez la vache.
• I love the fact that despite the Amero-centricity of MoFi, the political posts are fairly evenly distributed around the world.
• >our gay marry'n, pot legaliz'n, multi-god acceptin', free health-carin' ways that seem to annoy the southern neighbors so much. Will you KEEP IT DOWN up there! Decent people are trying to sleep! (bangs on northernmost edge of United States with broom handle) !@#&^% Canadians... SOME of us are annoyed by alla them ways you got up there because we don't got 'em down here so much.
• In any case, I very much want the Liberals not to completely lose their credibility only because they are such an important factor in making Canada what it is today. I think it would be better if the Liberals could hold on to their credibility because they deserved to keep it. If the Liberals lose we turn the country over to the lunatics - the Bloc or the Conservatives - it would appear. *rolls eyes*
• I don't think there *is* Amero-centricity, at least not to the overwhelming extent one might expect, looking at the wiki map. Which, btw, could use a front page link?
• We've averted a pointless election that could well have produced yet another minority government while wasting two or three hundred million bucks And all it cost us is a $4.6 billion NDP buyoff. Good deal.
• Behemoth, you may have noticed that the NPD are doing pretty well in the polls. I think saying it was an NDP buyoff is simiplifying things a bit. Historically minority governments in Canada tend to be populist and socialist I think this is pretty normal. And a lot of people I know are happy about the arrangement. I'm going to withold my judgement for a year and see how much of all this actually sticks.
• and furthermore- where are all the Canadians on the monkeymap? Come on, outrigger, livii, (calimehtar?), moneyjane, Behemoth Cat, and you dang lurkers - git mapped, eh? jb- I guess you're off the hook - a gadabout. :-)
• For someone who calls the Conservatives "lunatics," I am surprised you care about matters of semantics.
• fish tick, I looked up my lat/long and added it to the list there, but I don't know how to make it show up on the map. Will it do it automatically? I'm brain dead tonight.
• Hi livii- I believe that monkeybashi or #2 adds it manually. /Dal alumna babble
• The "4.6 billion NDP buyoff" consists of: $1.6 billion for affordable housing construction, including aboriginal housing $1.5-billion increase in transfers to provinces for tuition reduction and better training through EI. $900 million for the environment with one more cent of the federal gas tax going to public transit $500 million for foreign aid to bring Canada in line with a promise of 0.7 per cent of GDP. $100 million for pension protection fund for workers. All within a still-balanced budget. I can live with that.
• $4.6 Billion - because we had something better to spend it on rather than keeping our population healthy and helping them to be more educated. Personally, I'm really pissed we didn't spend it joining in on the U.S.'s Star Wars, because I really wanted to be part of the militarisation of space. Names are manually added by michaelh, as far as I know. He just edits the image. There are several Canadians up, but we really need some more Northern members, because Skrik is still winning the top of the world contest.
• It (updating the map) is something #2 has to do, so he does it when I bug him about it. I'll poke him tonight. :) Oh yeah, what jb said.
• Dal alumna too? What did you take there? I was at Weldon High - whoops, I mean Weldon Law School. Thanks for letting me know it wasn't just that I'm completely incompetent, heh. I don't think anyone will beat Skrik at that contest, unfortunately.
• Behemoth, I care about nothing more than semantics. I'm not accusing conservatives (with a small c) of being lunatics, I'm accusing the current iteration of Canada's Conservative party of being run by lunatics. Harper actually made a good first impression on me in the last election - he seems calm and intelligent on television, but his actions as a politician are rash and ill-considered. He really doesn't make much of an effort to seem like a social moderate - put an awful lot of effort into that anti-gay marriage stunt that pretty much everyone knew would fail. It's almost like he's intentionally trying to drive away Ontario voters. And couldn't he wait another 9 months before trying a vote of non-confidence so as not to appear to be a political opportunist? His advantage in the polls, huge for about a week when he first got the idea of forcing an election, sure vanished quickly.
• Harper's opposition to gay marriage has actually been a boon for Martin. I really don't like Martin, mostly for his slash and burn and dump it all on the provinces past, but dammit, his speech on why he had to uphold the Charter and the judges decisions on same sex marriage boosted him way up in my respect. That was just a blow away speech - not so much in delivery (he's no George Galloway, who could talk the shoes off a horse reading the phonebook*), but the words were powerfully moving. *Off-topic, but I was just talking to someone today who had exactly the same reaction as I did to Galloway at the sub-committee - neither of us really had been following what was going on, but his speaking still blew us away. He seems a bit too power hungrey sometimes (I don't like parachute candidates who push out locals from their constituencies, like he did coming into London), but he's got the chops, by God. But maybe the sign of his sincerity is that if he were just about the power, he would have stayed in the party and worked his way up. Actually - slightly back on topic - listening to the Tommy Douglas speech (it is better to just listen, rather than to read), I wasn't quite sure how to evaluate his delivery. Part of me found it a bit old-fashioned, the delivery a bit obvious. But at the same time, it's not a great recording, and I was also remembering my grandmother telling me that he was absolutely astouding in person. Perhaps he had a power that just doesn't come off on the radio quite - I've seen tv clips of him that are really impressive. Certainly, the audience was with him all the way - and it's the funniest political speech I've ever heard.
• Harper has an almost magical talent for repelling votes and squandering political opportunities, I'll give you that. islander: what do you think will happen to the Canadian economy if we continue to make every effort NOT to attract business? Where will that balanced budget go?
• Harper's icky schtick: fearmongering. I'm a fiscal conservative myself but seeing him stand up and *support* the railroading of Maher Arar during question period in Parliament. Christ. Not voting for him in this lifetime. A politician who either doesn't know or doesn't care about due process. Hooray. That being said, having Martin hand out $4.6 billion not out of principle but out of expediency doesn't thrill me...
• Jeez, Behemoth, I hadn't thought of that but you're right. Investing in affordable housing, providing a better educated workforce, being more environmentally responsible, increasing foreign aid and improving the likelihood that retirees might actually have some kind of pension to look forward to is just gonna drive business right outta here.
• run-off trickles down, confidence, no confidence -- ripples cross the pond
• Kindly explain how those will help retain and attract business larger than Pop's Pizza Shop. The educated workforce is the only thing you mentioned that has any sort of immediate relevance, only it won't matter if the educated can't find professional work.
• From Walmart's or Exxon's perspective, those initiatives probably don't have any immediate relevance, no.
• When leaves fall we vote Trust us to stand up and lead Canada is strong
• The NDP amendment finally brings some investment in infrastructure, something that the Liberals have been campaigning on for years. And we have Harper to credit for it. It was his threat to oppose the budget that he originally favoured that forced the Liberals into the NDP's arms. This article was written after the recent UK election. Conservative food for thought.
• Businesses do care about having a relatively happy populace. Happy populace correlates with more profits. Government spending per se isn't going to drive out business. High corporate tax rates would. As would high production or labor costs. I'm guessing here but I don't think either of those are high compared to the U.S. On the other hand, high personal tax rates drives away mobile professionals. That is something i've seen firsthand in the tech sector, a dozen or so former colleagues are in the U.S. now.
• The NDP-inspired budget amendment included spending on very noble and worthwhile programs, but it was paid for by delaying a planned corporate tax reduction. That's what makes it bad for business investment. We'll have to wait and see what the economic implications are.
• The corporate tax reductions were to come into effect in 2008 and 2010. That they weren't included in this budget makes little difference. Besides, Harper rejected Martin's offer to reintroduce them in another bill. What does this guy really want?
• He want free frosty.
• I'm accusing the current iteration of Canada's Conservative party of being run by lunatics. I don't quite get the fear of Harper's views on gay marriage. There's no way a Conservative government would introduce legislation to ban it. It would be difficult, divisive, and stupid. They'd junk the Liberals' bill, that's true, but that does nothing to stop marriages in provinces that already allow them. In this respect, the Conservatives basically match the John Kerry (or Andrew Sullivan) position. This is barely controversial, let alone crazy.
• We need to tax businesses more, not less. And a goddamn anti-scab law. And to move the gov't to some office tower in Toronto, where it really is.
• And Duceppe is just misguided, not a lunatic. He saw the light in his youth, but now he's lost in reformism.
• We need to tax businesses more, not less Then who will we work for when they're gone?
• It's not like you can remotely exploit natural resources.
• Tax 'em more? Collectivise the lot!
• Non-electionFilter - huzzah! LOL
• I love the fact that despite the Amero-centricity of MoFi, the political posts are fairly evenly distributed around the world. We Canadians might yet bring you down.
• From Walmart's or Exxon's perspective, those initiatives probably don't have any immediate relevance, no. So, in other words, you have no real argument and are content to stick to empty insinuations. Fine by me. Moving on. I don't particularly like Harper, and what worries me here is that a government would so easily reallocate billions of dollars just to avoid an election for a few months. I'd doubt there'd be too many voices of approval here if, say, the Liberals bought Conservative support by signing up for missile defense or cutting social services to the tune of 4.6 billion. I see dirty politicking aimed solely at remaining in power, and I think you can guess how easily that sort of thing can turn on you.
• You say "dirty politicking;" others say "compromise." I actually like to see this sort of thing, even if I don't love this particular deal.
• A compromise is usually made with your opponent with concessions on both sides. The official opposition party is called that because it got a large number of votes, indicating the will of many in the country - something that should be considered, especially in a minority government. This deal is the exact opposite of a compromise - it's catering to the party with the least seats in government after the independents. You'll say that it was the only way for the Liberals to survive the vote, and I'll agree, but it was not a Liberal budget or a compromise budget they passed - it was an NDP-dictated budget. As a result, I see it as nothing but a desperate grasp for power. How can one trust a government that appears ready to submit to anyone's whim to prolong itself?
• I would love to see the Liberals and the Conservatives work out a compromise. In fact, this was pretty much the basis of the original budget. But the Conservatives screwed it up by threatening to bring down the government. It's understandable that they did this -- they were up in the polls -- but they can't really blame anyone else for the way things turned out. Yes, the NDP has the least number of seats. Yes, it's a bit of a fringe party. But imagine what the budget would have looked like if we were dealing with a Liberal majority. Do you really think it would have been so friendly to the military? So many tax cuts? We can't know the answer, but I suspect it would look a bit more like what we've got now. I don't know. At any rate, I think it could have been worse.
• No Behemoth, there would not be much assent if the Liberals had compromised with the Conservatives, because I, certainly, do not support their policies. I have never actually seen any evidence that high corporate taxes drive off business, nor evidence that high personal tax drives away professionals. Sure, lots of people give anecdotal evidence, and lots of economists go on long standing dogma, but no one does the research. First off, federal income taxes are not lower in the States - they haven't been in a long time, and I think even our highest bracket is lower than theirs. States vary - all I know is that I owe more tax in CT than I would in Canada on the same income (about $1500 USD rather than $1500 CND). Some high tech people will move to the States, because that's where the industry is; film actors also move to the States, well, except for those that move to Canada to film, and all the geologists working in Canada, etc. Academics move randomly, Americans to Canada, Canadians to Britain, Brits to the US. Skilled professionals often have to move around the world to where they have work, and it often has nothing to do with taxes. Because even in the EU moving country is a big deal, let alone moving farther. Mst of the brain drain is media myth; there is no actual evidence of "brains" draining out. Skilled workers move out, but they also move in - in fact, there was some study showing that more skilled workers were moving in than out. But the media keeps harping on the taxes. I actually remember reading an article all about how high taxes were driving off professionals - only all the professionals they interviewed had jobs in the states because government cut backs had taken money away from universities and libraries (they kept talking to librarians). Sample bias is one thing - they chose a sample that didn't even support their point! University and research cut backs will lead to some people leaving, but that's exactly what is cut when you cut corporate taxes. It's also a lot more complicated on the business side. Sure, if property taxes are lower in Missauga than Toronto, a factory will be in Missisauga. But international trade isn't so simple that companies just up and leave. And if our high taxes are so bad (after all, it's a tax cut that's been delayed, not an actual tax height), then why has our economy been growing at a faster rate than the States lately? Why aren't all the companies fleeing there?
• But, without any evidence that tax cuts actually increase business (rather, in fact, may act as a break on an overheated economy, due to the cuts in government spending, all of which feed the economy), the Conservatives demand even lower taxes, when businesses do not yet pay their fair share. Even when they are assed for taxes, they avoid them - perfectly legally, as when TD deferred millions of dollars of property taxed owed to Toronto, claiming they needed the money to reinvest, even when they made record breaking profits. In all my study of economic history (several hundred years worth), I see that profit does not not lead to better lives unless society steps in to force some restraint on profit and power. And that is one of the greatest purposes of our government - to act as the power of the people against the powers of industry and business. Business and the economy exist to serve society - policies should be set that will keep them going, but never at the expense of quality of life of the people. A high GDP is nothing without a high quality of life. Where I live now, in the States, the GDP is much higher, and the quality of life still lower (some stats from a mefi discussion), because the government does not minister to its people correctly. They have no sense of what it means to look out for the commonwealth of the nation. Nor do many Canadian politicians, because we keep believing the cats when they tell us they know what's best for us. I'm not voting for any more cats.
• Oh - Smo reminds me of the most perfect burn I once saw. So Stockwell Day came to visit my university, and was going on about how much he cared about the military and security and how we should have gone to Iraq (Is he still foreign affairs critic? This was a while back). And this grad student in international studies gets up and says (in a much more eloquent way than I am paraphasing from memory), "Mr Day, I'm very happy to hear that you support our military and believe it should be more active, particularly to protect the soveriegnty of our coastal waters and the Northwest Passage. So, please tell me how you plan to support the military (which is of course currently underfunded) after you have gone through with your proposed tax cuts?" Day sputtered something about a "more efficient economy" which was a load of bull - he had no idea, because the two policies are outright contradictory. It didn't matter to him - it was all rhetoric. But that rhetoric turns into people's lives - military people, elderly, sick, poor, students, your children, you.
• And furthermore - (sorry lots of comments but disorganised) - the NDP might have the fewest seats, but they had more of the popular vote than the Bloc, and a lot more votes per seat than the Conservatives. No wonder they support proportional representation - it would benefit the NDP most of all, because they aren't the fringe you claim they are. I would never support proportional for the only house, because minority governments are too unstable. But proportional would be a good idea for a new second house.
• No Behemoth, there would not be much assent if the Liberals had compromised with the Conservatives, because I, certainly, do not support their policies. There certainly would not be much assent here, given the apparent political leaning of those participating in this thread. Fortunately, that doesn't speak for Canada as a whole. I have never actually seen any evidence that high corporate taxes drive off business, nor evidence that high personal tax drives away professionals. Sure, lots of people give anecdotal evidence, and lots of economists go on long standing dogma, but no one does the research. I, by contrast, have seen and heard lots of this anecdotal evidence, which jives well with my own sentiments and experiences, and never found evidence to the contrary. Also, while it has been pointed out numerous times that personal income tax is similar across the border, I was under the impression that the combined tax burden on an individual (including property tax, sales tax, etc) is significantly greater here. And if our high taxes are so bad (after all, it's a tax cut that's been delayed, not an actual tax height), then why has our economy been growing at a faster rate than the States lately? Why aren't all the companies fleeing there? There's more room for improvement when the economy is so much weaker overall, no? Besides, given how much we depend on the States, our economy growth can never outpace theirs for sustained periods of time. As for the companies, they aren't fleeing there because most of them are already there. What's far more important is that they're not coming here. Speaking from the perspective of my field - engineering - there is precious little work here as compared to the States. The only reason I stay here is because I prefer Canada as a place to live, at least for now, and like being close to my family. If an NDP government ever forms in Ottawa in my lifetime, it's a good bet I'll go elsewhere. Finally, don't mistake my words as support for Harper or Stockwell Day. I am, however, sufficiently disappointed with the Liberals to be willing to give someone else a shot.
• Mostly because I think that, ultimately, it's all going to be crap.
• I, by contrast, have seen and heard lots of this anecdotal evidence, which jives well with my own sentiments and experiences, and never found evidence to the contrary. Anecdotal evidence is often very suspect, especially in issues of social and economic development. There is a ton of anecdotal evidence for social mobility in the States, for instance, when in fact it has a lower rate of social mobility than Canada and many European countries. I have anecdotal evidence that the U.S. has insanely bad health care, which makes Canadian look like a trip to a fine spa (and this is private US health care at a university with a suposedly good medical school) - and it gives very well with my own sentiments and experience - but I do realise that this just anecdotal. (Though higher infant mortality in the States isn't.) Maybe it's because in my field of study statistics and actually methodologically sound research tend to prove anecdotal evidence wrong (families in the past were nuclear, women married late, the occupation shifts of the industrial revolution happened a hundred years or more earlier than most everyone has thought based on anecdotal information), but I really think this needs research. Do skilled people emmigrate due to high taxes? Or is there something else they are looking for? Are they really the most skilled? Or are certain professions moving for different reasons - ie. tech sector because of a critical mass in the US. Do companies make their decisions solely based on the tax situation, or are there other factors? Before we start beggaring our government through tax cuts around left and right, let's actually find out if they even so what they are suposed to do. It's bad enough to think about eviscerating the social democratic system that makes Canada that place you (and I and just about everyone I know) wants to live in, but to do it on dogma and mere assertion with no actual research to show it works? That's worse.
• jb, with all due respect, your economics is very weak (not that mine is great). You talk about very basic principles of taxation as if they're mere dogma. They aren't, otherwise you wouldn't have such a wide consensus within the academic community. And while it's true that tax rates vary by state and by provice, and that the situation is not quite as unequal between Canada and the US as some claim, it is true that Canadians pay more tax than Americans. It's also true that the Canadian regime is more progressive than the American one, which is probably why you pay more in the US than you did in Canada. There's an argument to be made that our tax regime is better (Is it better to pay an HMO or the government for health care?); there's also a solid argument against it. And while many on the left like to talk about how much better the government is at providing services than the private sector, I have had plenty of experience to the contrary. In my experience, government workers are some of the rudest, unresponsive people I've ever met. Businesses, on the other hand, generally bend over backwards to keep you as a customer. Finally, while a small difference in tax rates won't necessarily intice a business to move elsewhere, a large enough gap will. To wit: Outsourcing. This will only get worse as the forces of globalization continue to work. I do agree with some of your positions, but Conservatives are not economic idiots. On preview: Economics is not a religion. Really, it isn't. It's not totally scientific, IMO, but your sweeping generalizations reveal a huge lack of knowledge of the subject.
• If an NDP government ever forms in Ottawa in my lifetime, it's a good bet I'll go elsewhere. Not likely, as long as there are voters in Ontario who still remember their own provincial NDP "experiment". I like the NDP's ideals...they're ideals I share, and think more people should. Their hearts are in the right place, but they're not the right paty to manage a massive economy. The current situation where they have power to influence the Liberals is the most power I'm comfortable with them having.
• Freemarket Economics is my Religion and Friedman is my Prophet.
• Oh, and Smo, you're quoting a wikipedia article. A pretty bad one, at that.
• Smo - yes, my formal understanding of economics is poor - I've never taken an economics class. I have read lots of economic history and done a lot of thinking, but that is in a pre-modern context. (e.g. advantages of large estates over small peasant farms, tendancies towards engrossment, etc.) I do do a lot of thinking about the contemporary economy based on my knowledge of economic and social history, but it tends to be in concrete realities than theories. I didn't say lower taxes didn't attract businesses - I just want evidence, not theory, that they do before charging ahead. Because businesses are run by people, and people are not cogs in a great economic model. As far as I can tell, economic theory is not very good at understanding actual economic choices, which are often not entirely rational, or affected by non-economic factors. Some do claim that tax cuts can slow down an economy - it's not because of the tax cut, but because of the subsequent cut in government spending. Governments do not keep money in savings, nor do they ship much overseas (our foreign aid is very low). What do they do with it? They pump it straight back into the economy. It goes to pay doctors and nurses, to pay pensions and disability support, teachers, police, etc - no matter how inefficient the government worker, none of that goes out of the economy, because they are just going to go spend that wage in the economy. So my question would be - theory aside, what happens to economies when governments cut taxes and government spending? This is, of course, complicated by the trade cycles - which if I remember right, have sent the world economy up and down every decade or two for the last 125+ years. I never really understood how the trade cycles worked - just that they started really clearly in the 19th century and have continued to now. But I remember being told in a high school economics class that the way the depression was ended was not by cutting taxes, but by increasing government spending (in the war). It's taken me a bit to figure out this "dead loss concept" from the graphs (which are very poorly explained). It seems to say that because taxes raise the price on X, fewer people buy it, so that not only will the producer make less money (loosing some of the surplus), and the consumer, but there is over all surplus lost, because fewer Xs are sold. But many purchase decisions are not made like that. It wouldn't matter if my bread had no tax or 100% tax, I would still end up buying as much. Perhaps that would cut into my other spending. However, if you cut the price on my bread (or toothpaste, etc) by taking away tax, I would buy no more - it would just go moldy. If you cut the price on something like a CD, perhaps I would buy more, but it would have to a very drastic cut, like to 25% of the original. Whereas the reality of a little price saving from cutting taxes (a few cents, even a dollar) would not entice me to buy any more than I do. My other question would be - this applies to taxes applied at the time of sale - but do corporate income tax cuts actually result in lower prices? Or, since the customers have already adjusted to purchasing at the higher price, do the companies just take the money and add it to their own profit? Or perhaps spend the money creating advertising to keep the demand up?
• Supply and demand really aren't related that simply. One of the biggest problems I have with much economic theory behind prices and profits is that for so many things (food, housing, to some extent health care) the "free" market is not really free - it is driven by human needs that can put all of the power into the producers' hands. Housing is a particularly striking example. I went looking for apartments recently only to find that rents were well beyond what I'm "willing" to pay - they are damn near unaffordable for me, and most people in my city. But they won't go down, because the population has gone up; demand for housing is not a choice and thus inelastic (like many other things suposedly in a "free" market). (As it is, I have to move to England - unless my husband and I can split a two-bedroomed flat with someone else, we will be paying as much in rent as our income for the year.) An economist could argue that if the prices are too high, people will just either not buy (not possible without freezing to death) or look for something less - but this might not exist, or the landlords may not allow you split an apartment too many ways. The producers are able to force a price much higher, because demand is high, but demand won't go down until rents are way, way out of whack, if then. As for the personal income tax - it was a few years ago that the Globe and Mail printed an article showing how the average Canadian family was not paying more than the States. I think they were just comparing just federal and federal; but considering the wide variety in both provincial and state tax, is there anywhere that shows that most Canadians pay more, that you assert it so? I would have no idea how to figure this out. I just find the claims a bit laughable about how much more wonderful the the "low-taxed" States is, only to move here and find myself paying more tax. If I weren't a student, I would have $2000 more a year (more than my whole tax bill) in health care premiums. last thought - yes, I make sweeping generalisations about economic theory - it affects my life profoundly, often in very bad ways. And it just doesn't explain the economic history I study (c. 1500-1800) at all. By theory, a free market should be open to competition and keep prices down, making everyone richer; by history, it appears to often lead to engrossment, as the bigger producers (whether it be farm or factory) can squeeze out the smaller, which aren't as robust to bad times. The nineteenth century heydey of free market led to poorer living and working conditions, until collective labour action and the government they lobbied forced a change.
• (Also - bigger producers aren't particularly interested in having a free market of competition, and will do everything they legally can to squish the competition.)
• Another question - Outsourcing: is it driven by tax rates, or huge wage differentials which are made possible not just by lower prices overseas, but substantially lower real wages? At least in manufacturing, it is real wages far below what would be acceptable in the first world that is driving the outsourcing. Outsourcing of skilled jobs are benefitting from lower wages overseas which are good wages where they are, because of low prices (eg India), but those low prices are again butressed on a very low standard of living for the majority of the country.
• Ok, a couple of comments here: I wish I'd been able to get to this thread earlier... 1. That supply and demand model is invalid for a couple of reasons. People have said both of them above, although it's kind of burried, so I'll enumerate them. A) Supply and demand doesn't work that simply. Commodoties vary in elasticity, and other things that can be bought are not comodoties at all. The best the most right wing economist can reasonably say is that these kind of economic principles describe weak tendencies in the economy. That's the theory. In the real world, however, these effects are seldom actually observable, because any effects like this that might arrise are lost in the statistical noise. Basing large scale decisions on such ideas would clearly be a dangerous proposition even if it were not the case that... B) The model takes no account of government spending. While, conceivably, this model might mean something to you if you were running Plato's Lemonaide Stand, it's totally meaningless on the scale of a national economy. Why? Because that money isn't routed 'out' of the system. It just gets routed through the government. I don't really want to get involved in this little model, because it's missleading, but by way of example imagine the people in the demand line getting richer commensurate with the money being routed out of the supply line. All of a sudden, the graph just moves up and there's no more "dead wieght loss". 2. There is no historical evidence to support the assertion that cutting taxes improves the economy, except under certain, very specific, circumstances none of whic apply to Canada right now. This idea of historical evidence is important. Since Galileo, we've known that the world is so complicated that reasonable sounding models have to be tested against observation to be accepted. Observation of the real world has shown that these models are too simple and have no predictive capacity. Now this is where things get complicated, because if you want to design your economic system by figuring out what gets you the best observed results, you need to pick your goals in advance. I would humbly suggest that quality of life is a better goal than economic growth. After all, the only real point of economic growth is to improve quality of life anyway. 3. Even if tax cuts stimulated economic growth (which they do not) there is a very good reason we might want to not stimulate the economy. There is an observed tendency for the economy to cycle. Why, we don't really know, but it does. The thing is, when the economy has been really strong, it tends to collapse with a great big bang, and the subsiquent economic harship is very great. Right now Canada's economy is very strong. We're doing very well. But the next recession is coming, and we would be doing well to prepare for it by bolstering small business (by redistributing wealth), building solid industry (by increasing govt investment), and shoring up our national infrastructure (spending on healthcare and education and the army, etc) so that we buy now what we won't be able to afford when the economy goes down the toilet.
• 4. Despite what people think, the NDP government in Ontario did a lot better than the Tory one. Wait, wait, I know you're about to shout and scream here, but think about it: The NDP took over right at the beginning of the biggest depression since the Great Depression. However, while things were bad in Ontario, they weren't as bad as they were in the States or in neighbouring provinces. The Tories took over right at the start of the biggest economic boom in history. Despite this, a) the Ontario economy wasn't nearly as strong as its neighbours (possibly, and ironically, the reason we aren't suffering as much now) and b) life for many ordinary Ontarians got much, much worse. Government finances were messed up beyond recognition, corruption was rampant, homelessness skyrocketed, emergency rooms became clogged and the performance of graduating high school students got measurably worse. So which 'experiment' should we emulate at the national level: the socialist one that helped us weather a terrible economic storm, or the neo-liberal one which systematically destroyed quality of life in Ontario? Ok, that's me for now. Come on! Fight with me! :-)
• It seems to me there are plenty of convincing arguments on both sides. Having a good standard of living (including such things as affordable healthcare) is more important than having strong GDP growth. But it's tough to find money to spend on raising the standard of living if the economy is stagnant. There does seem to be a correlation between GDP growth and low taxes, but affordable healthcare, for example, is a boon to employers as much as is to employees. The thing that I don't like about the NDP is that they're very old-school socialists and seem to think that the solution to every problem is to increase government spending. Say if the NDP somehow managed 10 years of solid majority governments. The federal government could be expected to be involved directly in many places that it is not involded now. Spending and taxation rates would be higher. In short the government would have a lot more money to spend than it does today. What makes anyone think they could resist misspending and corruption any better than the Liberals? The economic and political situation in Britain ought to be interesting - Tony Blair is very much a social liberal. His economic policy is moderate, in British terms which means maintaining a pretty high personal tax rate, but he's not really a tax-and-spend liberal. The British economy has, from what I have seen, been the only first-world economy that could compete with the USA in terms of GDP growth, to use one very narrow measure, over the past 5 years. Mind you, Canada has also been close to the front of the pack over the same time.
• Supply and demand...The best the most right wing economist can reasonably say is that these kind of economic principles describe weak tendencies in the economy. I'm not a right-wing economist so i can say it's more than a weak tendency.:-) Sure S&D isn't absolute, but here's a test of "weakness". Get a gas station to lower its price to $0.50c a litre. Observe result. Galileo would be satisfied. When it comes to allocating resources, competitive markets are still the most efficient mechanism around. Interestingly enough, former Ontario NDP Premier Bob Rae has recently parted ways with NDP economic orthodoxy. He thinks that more trade and globalization are needed. Not less.
• StoreyBoard - yes, competitive markets are the most efficient means of allocating resources. But that doesn't mean that they are very good, they are just the best of some very poor choices. Theoretically, a planned economy should be more efficient than a competitive market. But national economies are so insanely complicated that no single human or group of humans can possibly hold all the factors in their heads, get material where it's needed etc. (I don't know about the human motivation issue - people from the European Communist block talk about lack of motivation in work affecting production, which I would totally believe, but in China's Great Leap Forward, there was a ton of motivation but still no production because of the terrible, terrible planning - and the lying about surpluses and the drought and starvation (a natural disaster coincided with the economic problems). But the capitalist economy is still highly inefficient, supports the growth of the market over human welfare, and appears to naturally tend towards inequality (profit accruing to those with the most money and power to start with). As far as I can tell from the last 500 years, capitalism tends to fuel inequality in society, until checked by concious human (such as government, labour collectivism, etc.) actions to check the tendancies of the market. It's like having a really big, and really dumb dog who likes to go on the carpet - he protects your house, but you still don't let him mess on the carpet.
• Jb, i agree that unbridled capitalism is going to result in some messy carpets :-). The thing that bothers me is that though capitalism may be "inefficient" sometimes, government is often grossly wasteful. How much of the revenue that's collected actually gets used effectively? ...rather than say, fuelling a massive bureaucracy, pet pork projects (hello to the Shawinigan tax centre), pointless regional development initiatives (hello, subsidies to Western farmers and Eastern fisheries). The argument for lower tax rates is that more money in taxpayers' pockets means they get to spend it on improving their own quality of life according to how they see fit.
• The other 16-ton weight i'd like to drop on this topic is that there is the notion that more money spent by government automatically means an improvement in an area no matter whether it's health care, roads, or subsidies. In Ontario, we're spending more money on education than ever. So why are test scores lower than in other countries than spend considerably less than we do?
• I would humbly suggest that quality of life is a better goal than economic growth. After all, the only real point of economic growth is to improve quality of life anyway The only reason why we have high quality of life today is because of economic growth. Try feeding 6 billion people using a peasant economy. It works the other way too, it is through people seeking higher quality of life that economic growth happens. Write a great novel that people love to read, economic growth happens.
• StoreyBored - Partly because our curriculum has problems, and partly because our culture does not educate to tests or feel that high test scores are more important than other aspects of children's lives. And because a good life is possible without high test scores - we benefit from our own wealth. I can tell you, having been a student with people from different countries, that in the humanities there are no differences (in fact, a western education is probably as asset, because you are better trained in speaking and criticising). Chinese students do dominate science at my university, but considering that they are a very large population and thus simply have more talented people, this makes sense. But I do wonder, national competition aside, how high test scores are suposed to help a country. Indian students learn a lot of math (much more than we do in highschool), but the country is stil very poor. Education can grant social mobility to individuals, but how is it thought to raise overall welfare? (I'm not snarking, just confused - I don't understand the proposed mechanism.) ---- On the quality of life issue - our high quality of life is based on poverty elsewhere. We get many things cheap because other people outside of our country are paid very very little. The industrial revolution began on slave labour in the Carribean and continued on cheap imports from the rest of the empire, such as the grain forced out of India at the height of El Nino famines there. It's not all poverty - we also have a high standard of living by stripping natural resources, both our own and those of other nations. Our current quality of life is not sustainable.
• One truism about capitalism that is likely false is that potential for personal gain motivates people to work harder. A teacher of mine, speaking of employees within an organization, said that it's been proven that job satisfaction and self-improvement are motivators but higher salaries don't result in better performance. However, jb, I disagree that a planned economy ought to be more efficient. I can't picture a government body with enough foresight to realize, for example, that old factories could be renovated and turned into residential housing that would be in higher demand than completely new buildings. That's the power of capitalism, that it allows room for the genius of the common man multiplied by the number of people out there while planned economies constantly rely on the intelligence of a few beaurocrats.
• err, make that bureaucrats.
• calimehtar - my point was that by theory a planned economy ought to be more efficient because there is no skimming of profit off the top (efficiency is just a measure of how much in, how much out) - it looks good on paper. However, reality is exactly as you point out - whatever efficiency might be gained is lost in the sheer problems of trying to have a few bureaucrats trying to run something so complex - not only do you loose innovation, but you have trouble getting even the simplest needs fufiled - at least it was so in the Great Leap Forward. So, yes, my point was that theory does not equal reality, and the capitalist market is currently the most efficient of many very inefficient choices to run our economy. Governments are not by nature more inefficient than businesses - badly run government initiatives are less efficient than well run private, while well run government are better than badly run private. They have all the same people, and while there is more pressure/incentive to reduce costs in privately run services than government, reduced costs != better run. I lived in an apartment building that went from badly run government to private - at first we were all happy with the private because they seemed more responsive. Then we realised they had plenty of smiles for the "customers" and absolutely no intention of doing any maitenence or keeping the building up, because they got their, and there was nothing we could do about it. Things ended up being worse under the private, and they weren't good to start with. I've worked in the non-profit sector and in the private sector, and I found that service and efficiency is all about who is managing and the institutional culture. I've worked under terrible private managers, and wonderful public (who also worked their own butt off) - I'm sure people can say they have experienced the opposite. So the question for us as citizens (and critics of our government) is that, given that some services are run by the government because they will never produce enough of a profit to be run well by private interests without undermining what they are about (subsidized housing, universal health care, education, roads, police, military - oh, we so don't want to privatise the military, that would be bad bad bad :) - what kinds of checks and balances can be put in place to try to make sure these services are run as well as possible? What kinds of oversights, what kinds of goals? How do you create an institutional culture which promotes efficiency and good service? Of course, one of the first essentials is a staff which is behind you, and this is where management is very important - the good public place I worked had a staff who respected and admired the head, and who believed strongly that their work was both valuable and appreciated, and it made a difference in the way the unit functioned. Sorry - I'm going all novel like all over this thread. It keeps branching out into things I'm interested in. I'm shutting up now, for real, and won't post again until at least 20 other people have posted. : )
• [this is good.] Bananas all round!
• [I'm not gone. I want to defend and clarify a few of my earlier assertions, and I'll try to do so, but work has been crazy. Until then, let me just say that everyone has been great in this thread. This is a large part of why I love MoFi.]
• The other 16-ton weight i'd like to drop on this topic is that there is the notion that more money spent by government automatically means an improvement in an area no matter whether it's health care, roads, or subsidies. Wow, this is really cool. We're actually getting into the really subtle and sophisticated parts of the debate. Well done monkeys! Now to address the above point: I for one wasn't suggesting that government spending == money well spent. Far from it, I can think of lots of examples of governments spending money on dumb stuff. I was merely pointing out that the argument that government spending shrinks the economy is falacious. The sad fact is that a lot of people have spent a lot of time and a lot of money trying to convince the Canadian people that government spending is 'inhearently less efficient' than the private sector. This has become such an established idea that I even talk to left wing people who say 'well we know the right is fiscally responsible, but sometimes there's more important things than a strong economy...' It's an uphill battle to even convince people that money doled out by the government doesn't just magically dissapear. But that's not what you were arguing. If I can repeat back what I think you were saying (so that you will know if I'm not understanding you), I think you're arguing that tax cuts work like a kind of super-smart spending program. People know what they want, and will spend money on it. The market has an internal wisdom that will spot counter-intuative ways of improving people's lives (like the loft-appartment example). Why run a program yourself, when you can distrubute a bunch of money and have other people run it for you? I think this is true... sometimes. Sometimes, however, it isn't. I have _____ reasons why: 1. Sometimes the market makes dumb choises. My brother once said, to me, something like this: "I find it astounding that people will use MS Word, running on a Windows PC, to write a letter to their MP telling them how the market always picks the best option." There's a lot of wisdom in that little observation. Now it would obviously be silly to have the government dictate Betamax over VHS, but there's lots of areas in our life where we do benefit from government programs or regulation. 2. There are lots of things the market is unwilling or unable to provide. Example: several Canadian provincial governments have cut back on social housing programs on the basis that the market will just step in and provide it for them. Big mistake. There's simply no money to be made in cheap housing in Canada. The result has been a dramatic increase in homelessness as people find themselves unable to afford accomodation. These policies have literally cost lives as people freeze to death.
• 3. Some areas are characterised by natural and unavoidable monopolies. Example: hospitals. It's practically impossible to set up competition between hospitals, so every hospital acts as a little monopoly. As we all know, businesses tend to do a crap job when they are in a monopoly possition, because that way they maximise their profits. However, if hospitals are run by the government, the government works much harder to make sure the hospitals are ok, because governments are in competition (with other political parties) to stay in power. 4. Some areas are characterised by a critical need for public accountabilty. For example, the armed forces are too powerful to be run by the private sector. If we hired a mercinary army, it would give that company's owner, a private individual, the abilty to decide whether or not we went to war. This would clearly be wrong. 5. There are some things that everybody wants but that nobody wants to pay for. For example, everybody agrees that we should maintain the Winnipeg Floodway. But nobody is going to go to the supermarket and buy a weekly ration of protection-from-flooding. That kind of large-scale project requires collective action, massive investment, and the desire to do things that won't 'pay dividends' for many, many years. Now, it's true, back in 1950 there could have just been this massive grass-roots movement to set up some kind of Floodway collective action corporation or something, but this would have been a lot less efficent than the government doing it because the government was already set up for that kind of thing. I'm sure there's more, but it's kind of late here and I need to get to bed. The bottom line is that it's invidious to say 'government should be small' or 'taxes should be low' for the same reason it's invidious to say 'taxes should be high' or 'government should be strong'. In real life, what we should say is 'government should be just the right size' and 'taxes should be just the right level'. In order to find those optimal setpoints, we should slowly and carefully tweak what we're doing and see whether things get worse or better. We should also look around us in the world and emulate societies that are dong a good job. But, and this is the critical bit, we should be very careful to make sure we know what we're aming for, or we'll end up adapting our society to the wrong goals (eg. a state in which a few are rich and the majority are miserable).
• [sorry, that should have said 'I can think of five reasons' not '_____ reasons'. Obviously I was waiting to see how many reasons I thought of! In my defence, it's three am here :-) ]
• Actually, most homeless people are mentally ill. But we can't afford care for them.
• I know I said I wouldn't post, but this is short: I'd heard that many homeless are actually families with children - you don't see them on the street, they are in hostels and motels, but still suffer from the dislocation of homelessness. Anyone know any more about that?
• no work ... no pay such things leave scars the throwaway people huddle under bridges or new ones try to live inside their cars
• Lots of food for thought in this thread! JB, you said: "On the quality of life issue - our high quality of life is based on poverty elsewhere. We get many things cheap because other people outside of our country are paid very very little." Correct me if i'm wrong but it sounds like you're saying that trade is a zero-sum game. Four hundred million people in China have been raised above the poverty level in the last decade *because* we keep buying their cheap products. The evidence of the power of trade to make poor countries better off is Galilean if i can borrow Dreadnought's term. Contrast N. Korea vs S. Korea. Consider India during the stagnant government-planning years in the 70-80s, versus the booming free-trading India of the last ten years. Every time someone complains about trade "exploiting" poor countries, we slam the door on their future.
• The neat thing about this discussion is there is broad agreement on some things: I agree with you Jb, about the need for finding ways to make gov't more efficient. Also that test scores may not give the complete picture in schools. You said: Indian students learn a lot of math (much more than we do in highschool), but the country is stil very poor. Education can grant social mobility to individuals, but how is it thought to raise overall welfare? India is still poor, but the trend is the good news. They've had 4-5% growth in the last decade if i remember right. There's a white hot demand for those Indian math students - Tata, Wipro and other Indian software companies are snapping them up. Wages in this sector are rising by 10-20% per year. How does education benefit overall welfare? It gives you the skills and attitudes to be productive. When you're productive you can increase overall welfare, by helping other people and yourself. But then you also need to be given the opportunity to help. So education is necessary but not sufficient for improving welfare.
• Dreadnought, i agree with all of those areas you've listed where government has a legit role to play. I would actually argue your first point though where you cite MS Word as a failure of the market. It's true that MS Word may not be technically the best product but there's more to it than that. The market has also factored in compatibility, availability and durability of the supplier. Add it up and MS Word is the best product. :-( Markets do sometimes fail, but i think a better example might be the tech bubble in the stock market.
• StoreyBored - No, I was not referring to trade as a zero-sum game. I was referring to the history of colonization and how the industrial revolution was fuelled in Britain (which I do know quite well), and how certainly my lifestyle is supported, since I could never afford to live as well asI do were what I purchased produced by people receiving decent real wages (see comment on outsourcing above). The lifestyle of the developed west is based on exploiting workers and resources in other places. As whether this needs to be so, that's a good question. Certainly, trade is not a zero-sum game, but most resources we base our lifestyle on (especially fossil fuels, metal, productive ground) are - I don't see how we could ever possibly develope the world to western lifestyle without killing the planet, or having a deus ex machina-like technological change to a sustainable world. But we don't live in a badly scripted SF book, and the reality of history is that exploitation (of both people and resources) is more profitable than fair trade - from forced cotton production for slave wages in Mozambique (where people grew cotton at gun point) to today's many many sweatshops, trade can mean money for the country (or in Mozambique's case, Portugal) that never reaches the actual people doing the work. In China some people are getting very very rich. Many other people are not, and they include the people working in the Special Economic Zone factories. Abiezer_Coppe will know much more about this than I do, but in the Chinese history I have studied, I have learned that while China's economy has grown, this growth has been extremely uneven and inequality grows just as rapidly. Including that female rural education rates have gone down in the 80s and 90s.
• (sorry - broke the comment box again) How does education benefit overall welfare? It gives you the skills and attitudes to be productive. This seems more like jargon than reality. I'm a grad student - I now have 7 years of tertiary education - most of my friends are graduate students. Trust me, we have no more skills or attitude to be productive than anyone else. What we have a very specific skills that we hope someone else will find useful/interesting and pay us to play with. How is a mathemetician more productive than a farmer? A computer programmer more useful to society than a cook? Yet one more engineer (who have terrible job hiring rates) more productive than a talented adminstrative assistent (which is like gold in our world and never paid as much as they should be)? I can see that in India's case, mathematics (through computer programming) is bringing in outside trade. But that is answering a need for a specific skill, not education per se. The reason I brought it up is that I had been reading about Sri Lanka, where good education for the region had done very little to deal with massive poverty and under-employment, so Sri Lankan women were working as maids under terrible conditions in other countries to send money to their families. There clearly, increasing education was not enough to deal with what is happening there. I read on the bathroom wall, someone had put up the saying "If you teach a man to fish, he will be fed for the rest of his life" - to which someone had scrawled "Nonsense - if he doesn't have a boat and a rod and access to the fishing area, he's still starving - give him a damn fish already". In the West, education gives you skills and, often more importantly, the credentials to move into a higher status and thus usually higher paid job - but that doesn't mean more productive. I look at Canada, and we have an entire generation of people who think education is this magical salve and will make the whole country rich. They go to university expecting to have this magic "education" poured into their brains, and don't really understand what they are suposed to be doing there. And most come out only to do jobs they perfectly well could have done without university. I loved doing my BA (which is of course why I'm in grad school), but I would never claim I was more productive because of it. I would have been more useful to society if I'd gone to cooking school - certainly would have contributed more to the GDP. There is a reason we have shortages in skilled labour in Canada, and it's because we've prized formal education above all else. Personally, I think it just reflects an on going clearly classist attitude in our country - we don't respect the work done by labour, not because it isn't valuable (because it is - nothing would get by without it, including unskilled), but because we don't respect it for being low status.
• jb, I agree with everything you said in your last comment, but I disagree that this is justification to 'give him a damn fish already'. (I don't know if that was your point, really, I'm just using it as basis for my own point.) In this hypothetical scenario it'd be better to give the guy a fishing area and lend him money at reasonable interest rates so he can buy a boat and a rod. I don't believe in minimizing desperate social and environmental problems, but the free market is a powerful outlet for human ingenuity. capitalism has been used as a tool of environmental destruction and destructive greed but there are, arguably, more cases where capitalism has had the opposite effect. Government regulation can help to ensure that there are more positive outcomes than negative ones.
• is there anywhere that shows that most Canadians pay more [taxes], that you assert it so? It's hard to find overall stats from nonpartisan sources, but here's one. The US compared to Canada on middle class income tax. That site has a bunch of similar statistics. As for this debate about the effect taxes have on the economy: I never claimed that theoretical models perfectly describe the real world. They don't, quite obviously. But there is evidence to suggest that they describe general trends. As for the evidence itself, I think the emergence of branch-plants at the end of the ninteenth century suggests that taxes (tariffs, in this case) do influence the way in which businesses operate and where they choose to set up shop. More recently, I think the Martin tax cuts of the mid-to-late 1990s, along with the moves made to control the deficit, and the resulting economic boom (which remained reasonably healthy compared to the US) show that "conservative" policies can stimulate the economy. And while I think it's correct to attribute outsourcing to the lower wages paid in poorer countries, and in turn to attribute these to a lower standard of living, I think this proves my point. These people don't have the social safety nets we do, but they don't pay the taxes for them either. Like it or not, we have to compete with them, and while I don't want to see the welfare state disappear, I don't want to see us lose all of our business and jobs either. I think it's quite right to argue that the government has a legitimate role in the economy, and that unfettered capitalism produces undesirable effects. I'm having a hard time disagreeing with most of the points made in this thread, actually. But I don't think the government has to provide many of the services that it does; in some cases, I'd go further and argue that it has no right to do so. Daycare is probably the most recent example. I don't think the government should take tax money -- money people have earned -- and spend it on a program to babysit kids that parents have chosen to have. This program forces people who don't want to have children to subsidize those who do. I don't see why we couldn't just have parents pay for their children (and if they can't afford it, they shouldn't have kids). (Plus, I have problems with a regime that creates an economic incentive to have kids; this encourages people who should not have children to do so). And I don't think that inequality, even fairly substantial inequality, is necessarily a bad thing. Certain people, by their choices, deserve more money, a better life, etc. than others. There are problems with the way this works in real life, and with the way the market assigns wealth, but I don't think inequality per se is necessarily a problem. On preview: Higher education takes many forms. People who believe that only university-educated people are worth lots of money are elitist. But that isn't the way the market rewards people. People learn trades -- and can make very good money at it. Others start their own businesses, sometimes with no education -- and make very good money. It's true that retail jobs and others (like mine, while I go to school) are low-pay, but that's because they're relatively easy to learn and do. You're free to argue that economic rewards ought to be a function of contribution; it's a view I disagree with, but it's a valid one.
• To emphasize, then, what I'm not saying. I'm not saying that a market distribution is a just one. And I'm not arguing that government = bad for the economy. Government-run handouts are generally bad for the economy, but even then sometimes that's an acceptable cost.
• And I don't think that inequality, even fairly substantial inequality, is necessarily a bad thing. Certain people, by their choices, deserve more money, a better life, etc. than others. There are problems with the way this works in real life, and with the way the market assigns wealth, but I don't think inequality per se is necessarily a problem. See, this is where we fundamentally disagree. Certain people, by their choices, do not deserve more money, a better life, etc. than others - because our world is not and never has been equal. Certainly, individual choice does affect your life, but that does not negate the very real effect that birth and priviledge grant. Too many people just don't understand the reality of inequality of opportunity, even in places like Canada with good social mobility. For a child who grows up in a middle class home to be middle class, they have to be competent. For a child who grows up in a poor home to be middle class, they have to be more than competent - they have don't have the same advantages, they don't have the same connections, they may not even have the same emotional support. Yes, there are people who succeed from poor circumstances - they are remarkable people and I admire them. But it would be a fallacy to say that lack of success only follows poor choices. My mom did what she was suposed to - she got married - and then was dumped by her husband with two small children with no way to support herself. Funny, she couldn't work outside the home when we were little because she couldn't afford day care, so she did fulltime daycare in her home for the goverment subsidized program - it wasn't enough to live on, but it reduced her welfare, and let three other single mothers go to work rather than be on welfare. Later she worked full-time in an office, which she still does. My mum is smart and worked every day harder than I ever have in my life - and this year I made more working part-time than she made working fulltime for years. But the difference is that I've had a hell of a lot more opportunity than she ever did - and largely thanks to her. But more than that - there is a moral choice to be made here. I think it is immoral to support inequality. I know I cannot eliminate it, but I will always support its amelioration. I was blessed by God with a stable home and some brains - they aren't working so well anymore, but they got me to grad school. Now I get a nice scholarship, and have the potential for a much better life than the rest of my family. But that doesn't make me a better person than my cousin who is slightly retarded, and will always struggle, or even than my brother, who has made some very poor choices, but faced different challenges than I did (including learning disabilities and chronic depression). They are human beings, just as worthy of enjoying the bounty of the planet (you know, that thing which is still the backbone of our entire economy) that was given to us all as I am. Things will never be equal - there will always be people who are better parents, people who are naturally happier, people who are smarter, people who are more charming. But that is no justification for saying that people "deserve" to have inadequate housing while someone else has a huge house, that some people "deserve" to work long hours just to get by, while others can afford to take 4 week vacations, that one person "deserves" to not have enough food while others throw it away. The levels of inequality in our society are a priori immoral. Michael Young's Rise of the Meritocracy is a far more eloquent expression of why even in a perfect "meritocracy" (which we most certainly do NOT have), inequality is still evil.
• I don't see why we couldn't just have parents pay for their children (and if they can't afford it, they shouldn't have kids). Hold up, think about what you're saying here for a second Smo... Are you suggesting that poor people shouldn't be allowed to breed?
• In this hypothetical scenario it'd be better to give the guy a fishing area and lend him money at reasonable interest rates so he can buy a boat and a rod. 100% agreed. This is, in fact, how many aid programs work. But the free market often isn't so good at this stuff. Why give a guy a boat so he can feed himself when you can take advantage of his desperates situation to cut an unfair deal? Grants of fishing rights, loans with reasonable interest rates... these are things that the free market won't provide unless investers think they can't get away with less.
• JB, you said that since I could never afford to live as well as I do were what I purchased produced by people receiving decent real wages . Hmmm, we are living well for sure. But the majority of what we buy comes from our own country and from within North America. In other words, if trade with the third world were to disappear tommorrow, it would be the poor countries who would be far worse off than we here in N.A. Incidentally even if our incomes are low, it does not follow that you can only afford goods from people who are paid badly. Mass/smart production means you can buy stuff made by people being paid middle class salaries. Then of course there's all the things we buy from people in our own country. So we are even now buying things from people who are paid quite decent wages. If you have a telephone, water, hydro, if you've bought a newspaper or watched television. All this stuff is provided by folks paid quite well.
• We are even now having problems using the preview box. Sorry about that.
• It'd be fun to put all these arguments on a whiteboard, complete with red arrows and green dotted lines.
• Trust me, we have no more skills or attitude to be productive than anyone else. What we have a very specific skills that we hope someone else will find useful/interesting and pay us to play with You *do* have specific skills from your education. The question on whether there is a strong market for them is a separate one. Which is what i meant when i said that education is necessary but is not sufficient for improving overall welfare. The same thing applies to Sri Lanka. There is an endemic problem in third world countries where higher education is encouraged even though there's little opportunity to use it. How is a mathemetician more productive than a farmer? The good thing about markets is that they don't try to answer this impossible question.
• There is a reason we have shortages in skilled labour in Canada, and it's because we've prized formal education above all else. I think the tide is starting to turn on this. Enrolment in community colleges increased almost twice as fast as enrolment in university during the past decade in Canada.
• I have learned that while China's economy has grown, this growth has been extremely uneven and inequality grows just as rapidly. Including that female rural education rates have gone down in the 80s and 90s This is true and their government needs to take the sharp edge off their ultra laissez-faire policies. Ironically this Communist country is more capitalist than any Western country. Nevertheless there are still 400 million people who have been raised out of poverty that wouldn't have been otherwise. In sheer numbers, it's an unprecedented historic event. Before trade liberalization China stewed in poverty for decades. There is a middle way. South Korea had the GNP of a third world country in the 1960s. After trade liberalization, its economy grew 7% per year for 25 years. You could say we were exploiting their cheap labor along the way. But look at the incredible transformation: Third World to First world in one generation. Along the way, the Gini coefficient, the measure of income inequality at first increased, but then later decreased and is now lower (fairer?) than that of Canada's. South Korea's record is not unique. Singapore and Taiwan, also both followed the same trade-driven route with equally astounding results.
• Okay, jb, now where into an area in which I'm more comfortable, and on which I've done a lot more reading: social and political philosophy. I think you're right that accidents of birth, both positive and negative -- products of what is sometimes called the "natural lottery" -- are undeserved. But -- and this is a big but -- it does not follow from this that all the products of these natural lottery talents are undeserved. People choose whether they want to utilize their advantages given to them at birth. An inborn talent (or advantage) in the hands of a person lazy enough to waste it is useless. Also, I think it's important to see the distinction between equal treatment and treatment as an equal. I think that the latter is required for any just society, while the former is not. The latter, I think, requires equality of opportunity (which any meritocracy worth a damn should strive for) but not equality of outcome (i.e. strict egalitarianism). Lazy people do not deserve to be propped up by everyone else; welfare systems in Saskatchewan, at least, do this. I've seen it firsthand. (Some philosophers have claimed that willingness to work is itself always a matter of the natural lottery -- I think this is determinism). To illustrate the difference, imagine the government offered the exact same education for everyone. This would be equal treatment, but I contend that it would be unjust. Some people need more help than others, and if this is not their fault (a mental handicap, say), then I think we have a duty to help them. But sometimes people put themselves in worse positions by their choices. People who deliberately engage in dangerous activities might need more health care than others, for example. In these cases, I think we can and should treat them differently. Not doing so, I would argue, is paternalistic. So long as people have the ability to climb up into upper classes -- and, as you note, this is mostly the case in Canada, where social mobility is higher than the US -- there is no a priori reason why egalitarianism should be the result. Now, I contend that someone who has chosen to have kids has also chosen to accept the consequences. If that means his or her economic well-being will be affected, tough; that's part of the choice. The reason I don't think the government ought to provide incentives to parents to have kids is this: I believe that too many very bad parents have kids and more will do so if there is an economic incentive to do it. This isn't to say that "poor people shouldn't breed;" it's just that people should think about it before they do it, and plan for it. Remember that lower taxes mean that people get to keep more of their money and then they can decide how to use it, so people will have more money to pay for daycare if they want to. This is as it should be, IMO. I've read Young's book. I've also read Norman Daniels's essay on meritocracy in which he sets Young's arguments into a more philosophical context. But I agree with people like the late James Rachels who, in his essay, "What People Deserve," argues that desert should play a role in economic distribution because otherwise we're not respecting choices. All that said, we have a ways to go before we have true equality of opportunity. And I think it's worth it. But egalitarian results are not always going t follow from it, and we need to recognize that.
• Sorry, I would like to reply to this at length immediately, but I'm afriad I have to go to bed right now. However, before I go: Remember that lower taxes mean that people get to keep more of their money and then they can decide how to use it, so people will have more money to pay for daycare if they want to. Ah, but this does not apply to the poor. The poor don't pay much tax anyway, and cannot afford to pay for childcare. Free childcare benefits the poor, because it frees them up to get jobs. I ask again, do you think it's reasonable to make people choose between making a living and having kids? Before you answer, keep in mind that most people will always choose kids, due to our overwhelming instinctual drives in this area. Is this a choise we should force on anyone?
• I agree with you that you cannot make all things equal - for one thing, just a simple ability like organisation can make a huge difference in quality of life. But I believe in a strong welfare program because I believe that every human being deserves food and shelter and the necessities of life, simply by being himan beings. This isn't a logical position - it is a moral one. If you don't have that moral belief, there are good social utility reasons (if only because welfare is cheaper than jail). But having lived on that welfare system, I have first hand knowledge that the mere necessities of life are far from a comfortable lifestyle. The fact that welfare is more comfortable than many jobs is a crime - not that welfare is that high, but that pay for those jobs is so relatively low considering the wealth of our society. Currently, we pay hardworking people wages they cannot live on because their work is low status. Those people, for whatever reason they have low status work (lack of opportunity, lack of ability,doesn't matter because it certainly isn't lack of effort, as anyone working at many low paid jobs can clearly see), are the exactly the ones who need subsizized day care. So would you deny them the right to have children, a strong biological drive and recognised human right, because they dared to be willing to work for low pay? They could have gone on welfare, and needed no day care. Subsidized day care is actually a way for the government to subsidize wages. (Same with subsidized housing). Recently, my mom got a new job with a better wage - all the way up to $29,000 a year for skilled full-time work. Except that she had to pay $9,000 a year in unsubsidized childcare (before rent or food) for her granddaughter (whom she took custody of so she had a good home and didn't bounce around foster care, and who now has a much better chance of not being dependent in the future). Those people who need subsidized day care are: administrative assistents, bookkeepers, carers for the elderly, people who pick in distribution centres, people who serve you at any store or restaurant you go to, janitors, (ironically enough) daycare workers - thousands, maybe millions of people across Canada who do important but low status work. Some of this work is even very skilled - but still low paid. None of these people have a right to have children, or to keep their children if they fall on harder times? What will you do with the abandoned children? What right do the power holders and all those people who are rewarded well beyond their merits as measured by ability or effort or the value of their work to society (aka B-ship) but merely for having the right connections, the right background to get the right jobs - what right do they have to deny other people the human right of having a family? Frankly, sometimes at times like this I think maybe 1789 has been forgotten too quickly. After all, if they can't afford bread, they just shouldn't be so hungry.
• It's true that MS Word may not be technically the best product but there's more to it than that. The market has also factored in compatibility, availability and durability of the supplier. Keep in mind that the example was about Word/Windows, not just Word. With this in view, I beleive the market picked the product that was best marketed, and that product quickly became a market-wide standard, at which point users became 'locked in'. In other words, competition was stiffled very early on, and thus market forces 'decided' on a standard that was a bad one. Another good example: the Philips vs the Robertson screw. Most people use the Philips, even though the Roberson is obviously better, because Ford used the Philips and it thus became the 'standard'. One deal caused the market to swing towards an inferior product, whereupon it became locked in. In areas where standards have to be set, pure market forces are very bad at picking standards.
• Frankly, sometimes at times like this I think maybe 1789 has been forgotten too quickly. Well that statement worries me, because if you're thinking that now, then how are you going to feel when the next recession hits? Actually maybe i already know. The future ain't pretty folks.
• Dreadnought, i think marketing was part of Windows success, but i think the major reason was price. PCs were a heck of a lot cheaper than any of the competition. When IBM launched their open standard PC, other companies could clone it, prices started to plummet and pretty soon PCs were flooding the marketplace. So in this sense the market made the right choice: they chose cheap computing over stylish innovation (Apple).
• Actually maybe i already know.... Sorry about that JB, that was uncalled-for glib arrogance on my part....
• I ask again, do you think it's reasonable to make people choose between making a living and having kids? Well, when you put it that way... yes, sometimes. You're oversimplifying my position to the point of misrepresentation. I'm saying that the choice isn't as simple as you make it out to be. First, how many people really have to choose between survival and having a family? Second, and far more importantly, you have to consider why these people are in the situations they're in. You have to consider desert, and desert is a concept rooted in history. The money the government uses to fund these programs doesn't just come out of the sky. It is taken from other people, many of whom have worked hard to earn it, and so many of them can claim to deserve it. You can't just violate these claims with impunity. To pretend that all wealth belongs to some social pot to be distributed later ignores this. I'm going to borrow an example from Robert Nozick's (brilliant -- in the same way that Nietzsche's work is brilliant) Anarchy, State, and Utopia to illustrate. Nozick asks us to consider the example of student grades. Suppose you have a room full of students who are given the opportunity to divide a pool of grades amongst themselves, and suppose that you had to get everyone to agree on the distribution. In this situation, you're going to end up with a distribution that makes the worst off as best off as possible (strict equality, in this case). But of course the students who have worked harder and performed better will complain about this. And so they should. Nozick claims that these people are entitled to better grades; I would say they deserve them; but the distinction doesn't matter much for our purposes. His point is that ahistorical principles of distribution will necessarily produce egalitarian results, but that this is not always just. jb writes: because it certainly isn't lack of effort, as anyone working at many low paid jobs can clearly see Yes, sometimes it is, or it's the result of bad choices. People make all kinds of decisions throughout their lives, and they should be prepared to face the consequences. A student caught plagiarising gets kicked out of a university, losing the opportunity to make lots of money later -- are we supposed to feel sorry for this person? A retail clerk sleeps through his shifts -- can he complain when he gets fired? A couple decides to have kids -- can they complain about all the ways in which this will change their economic stability? There are all kinds of choices we all make that determine how our lives will play out. Insofar as it is these choices that affect our life, we can't complain about the inequality that results. jb writes: Some of this work is even very skilled - but still low paid. Then why did these people seek out useless skills? Sometimes majoring in English lit is a bad idea It's probably a bad idea if you want to make lots of money. People know this going in. If they decide to get a useless degree, then they shouldn't expect to be able to use it to make money. Sometimes people just make bad choices. (I say this as a philosophy student working a low-pay retail job).
• That said, the market doesn't always allocate wealth commensurate with the principle of desert. Limited redistribution is perfectly okay with me. But egalitarianism is not the default position, unless you ignore history and desert. And I don't think you can do this. Again, this doesn't mean that economic redistribution and our safety nets get thrown in the trash. There is nothing wrong with helping a single mother whose ex-husband refuses to pay child support. There is something wrong with forcing people to surrender their wages (and therefore, their time) to help people who don't have made bad choices. But even this isn't to say that this kind of charity is wrong per se, but forcing people to work for it absolutely is. It's slave labor by another name. IMO, YMMV, etc.
• Ick. Please excuse the typos. One more. jb writes: I believe that every human being deserves food and shelter and the necessities of life, simply by being himan beings. Really? Every human being? How about a murderer? Many murderers don't deserve to live, let alone freeload off of people who actually possess a moral compass. I think this is why you have people support programs that force inmates to work. Now, if the principle of desert is acceptable in the one case, why not in the other? If people who make bad legal (moral) choices deserve to pay for them, why don't people who make bad economic choices?
• The money the government uses to fund these programs doesn't just come out of the sky. It is taken from other people, many of whom have worked hard to earn it, and so many of them can claim to deserve it. But many people who work equally hard, and often harder, receive far less money for their work. Then why did these people seek out useless skills? Sometimes majoring in English lit is a bad idea. I was not talking about the English lit majors, though perhaps you might appreciate them when they are teaching your kids how to write an English sentance. I was talking about the people who care for our children, for our parents, who do essential healthcare, who clean offices and schools and homes, who stock our stores. Many of them never had the chance to choose to go to university - to go to university you have to have the support of parents who are at least willing to let you not work for several years, and it certainly helps if they are willing/able to pay tuition. Certainly, one could take student loans, but these do max out, and if you have lived your whole life among people for whom a little bit of debt could mean loosing your apartment, then you just don't take the risks of a student loan. Frankly, I was shocked to find out that OSAP won't even tell you how much your loan is for until you have enrolled - but I coudn't possibly afford to enroll anywhere without knowing how much OSAP would cover. As it is, I'm from Toronto and I was able to live at home for my whole undergrad. My mum was able to let me live with her for two years without paying rent; her finances changed then, and I had to pay rent to support the family, but fortunately I had lucked out into a very good job (though a friend's middle class family connections). If all of these things had not happened, I would not have gone to university or grad school, but be working in some unskilled labour, because I took what seemed to me to be the most rational economic choice - you don't spend more than your parents earn in a year on a degree with no guarentees. But more importantly, what kind of messed up society do we have where choosing to care for elderly people constitutes "a bad choice" - we need these people and their dedication! Frankly, I think people willing to work with children and the elderly should be paid more than lawyers anyday - They are far more valuable to society. As for other work, like fork-lift driving - already the work is harder and less rewarding than many high paying jobs. Why shouldn't they be compensated more?
• Wages are in no way correlated with hard work or dedication or ability. They are only correlated with credentials (which you have to have a certain capital to gain in the first place), social and cultural capitol that get you into a good job and the prestige of the occupation. Just the sheer fact that women consistently make less money than equally qualified men should alert you that wages are just about the most piss-poor measure of merit that I can think of. (Pissing contests reflect more "merit".) As far as I can see, most people with high wages don't deserve them. I'm not talking about two people in the same job, one of whom has received a raise for working harder. I'm talking about how CEOs make hundreds of times what their lowest paid worker makes. That company can't function without those workers either - and those workers can their butts off with none of the intangible benefits (rewarding work, autonomy, etc) that people in many higher status professions receive, let alone wages worthy of their work. If people who make bad legal (moral) choices deserve to pay for them, why don't people who make bad economic choices? Bad economic choices, like not being born into a family where mom and dad can coach them through highschool, pay their way through university, and then set them up with jobs through their social network. Yeah, I hate people who make bad choices like that - even as zygotes, they should know better. There may be an "equal playing field" but the starting points are different, and the middle class have much better shoes. (The upper class aren't even running - they are in the box, watching and laughing.) Really? Every human being? How about a murderer? Yes. I would not deny a dog food and shelter, why would I a human being, whose life is far more sacred to me, if I can prevent it?
• Also, I don't consider myself the judge of the decisions of another person's life. That's up to God, if he exists.
• Of course, if I had paid more attention to my early English lit teachers, I might actually know how to spell. There are so many mistakes in the above posts that I don't feel like counting them.
• jb, either I'm not making myself clear enough, or you're not listening to what I'm saying. You write: Bad economic choices, like not being born into a family where... I have said repeatedly that accidents of birth and circumstance can and should be corrected. That's why I support limited redistribution of wealth. It's why I support fair equality of opportunity. It's why I think we should have social safety nets. I have said that the market sometimes fails to allocate wealth fairly. And while I think that doctors and lawyers deserve more money than, say, cab drivers, I agree with your assertion that health care workers and teachers deserve to be well paid. The point of my "English lit" comment was not to say that these people are worthless. My point is that people who want an English lit degree, or any humanities degree (including philosophy or history), shouldn't expect to make a lot of money off of it. If you want to make money, get an MBA. Or go into the sciences. Or learn a trade. It's not like this is secret knowledge -- everyone knows this -- it's why everyone always asks me why I take philosophy! Yes, student loans max out. Yes, the system sucks the way it currently works. But I don't think that someone who simply prefers to avoid student loans gets to escape the responsiblity for that choice. Sometimes you have to take on debt to make money in the future. Sometimes you need to take risks. Education is an investment, and insofar as people choose whether they want to invest in it, they should accept the consequences of that choice, either way. Of course my argument hinges on the existence of fair equality of opportunity, but, as I've said, Canada is relatively good with respect to social mobility. It's not perfect, but that just means there's more work to be done. My argument is against egalitarianism as the default position for a fair economic distribution, that's all. And you didn't really answer it, so I'm not sure whether you agree or disagree with me there. We disagree on a bunch of things: whether wages are at all commensurate with desert; whether it's right for us to judge others; whether desert is an adequate basis for the allocation of reward punishment; and even the possiblity of the existence of God! All of this is fine, and I'm happy to agree to disagree on these points, but please don't misrepresent my arguments to be weaker than they are.
• I hesitate to add this because I don't want to cloud the debate, but lest you get the idea that this is easy for me to say because I come from an upper class family and therefore have no idea what I'm talking about, I should say that that's not the case. I come from a lower-middle class home. My parents split up when I was in elementary school. My mom is a recently diagnosed schizophrenic (they figured serious postpartum depression before that), and went undiagnosed for over a decade. I lived with her and my two younger brothers as I went through high school. At that time, she was off her meds (for a seven year stretch), which meant that she retreated to her own private world in which, at her best, she talked to herself in a corner; at her worst, she was on a God-given quest to save the world from the Devil. Which, quite often, was me, especially when I told her to get her act together and get help. This meant I received no help or encouragment during my high school years; I was embarrassed to have friends over because of the stigma attached to her illness; I even had to do the grocery shopping and bill-paying for a while. At its worst, I came home late from work one night to hear her jumping and screaming, cackling hysterically. Luckily no one else was home. At that point I called the police and moved myself and my brothers out of the house, which is something I would have done a lot earlier if the alternative had been better. Now I'm in university and my life has a lot less drama in it, although it's certainly not perfect. But I have a good shot at getting into any law school I apply to in a couple of years. Some of this is due to help from others, I don't deny that; a lot of it is the result of my choices, both the paths I choose to follow and those I resisted. The reason I like the idea of desert so much is that it gives people a lot more control over their lives. So, if you have fair equality of opportunity, how well you do (and how you measure this) is totally up to you. Again, this ideal breaks down in reality, but not completely, and it is the ideal I think we should strive for, not strict equality.
• There are so many mistakes in the above posts that I don't feel like counting them. Yeah, I'd better stop for the day. It's not looking pretty.
• But how can you talk about "bad choices" when you fully admit that opportunity is not equal? All of these things add up. Maybe I have misconstrued you. But you seem to be arguing that just because someone chose not to go to university (and indeed, may have faced far more barriers than a middle class person, though not insurmountable barriers if they are of normal intelligence, but which are insurmountable if they are not), then they deserved to be paid a wage which currently in Toronto is not enough to keep a roof over your head? That's the reality of minimum wage. Without subdized day care, a great many people not on minimum wage are forced to live and support their children on the equivalent. Actually, what if they are mentally handicapped? In our current world, people of significantly below average intelligence are relegated to unskilled work. But then the justification for very low pay for this unskilled work is that they really should have worked harder. What if they have exceeded all the expectations of them, really excelled? Don't they deserve to be able to buy nice clothes? To eat in a nice restaurant? How is their fate the fault of their "choices"? (No, I am not speaking purely hypothetically. I happen to know a developmentally disabled person who works for $8/hour cleaning a mall. Considering her disability, I'm really proud of her - she does a better job than some normal people. That doesn't help the fact that she has no one who can provide for her - she isn't disabled enough to be supported by the gov't - and struggles to keep a roof over her head. But she deserves a chance at a good life too.) I know why I am against inequality. Partly because opportunity is not equal, and so inequality in our current world is just reward for those who already have wealth and power. But I realised, particularly reading The Rise of the Meritocracy that inequality was itself a priori wrong. No amount of merit, whether it be IQ or economic choices, is enough to justify our society's level of inequality in my mind. In my ideal world, I think we would all be paid per work hour, the same amount; it could go up for effort or competence, but it wouldn't vary as it does by job.
• I realise this is just an ideal and not applicable, I'm just making my moral position clear. Our entire heirarchy of work is based on classist assumptions about what is important and what is not. An MBA provides no more value to our society than the secretary that keeps him organised and functioning - but his is the high status occupation, and hers is not. (The gendered language is intentional). These aren't actual concrete positions for Canadian political policy, since I realise my ideas are far from shared by the majority, and I don't know if they would work. I'm just talking about my ideals. But it does influence my political choices. I would support subsidized day care because it would lesson the burden on people who I feel should be paid more. I support progressive taxation, and an increased minimum wage. I think I would like to pass a law setting a maximum ratio between the highest salary (including all perks) and the lowest in one organisation/company. Because I believe inequality is bad for our society (for a whole host of reasons). Because so long as it exists, we will never have equality of opportunity. And because even if you believe that a person should answer to the economic choices they make in a fictional world of equal opportunity, it would be unjust to visit these "deserts" on their children. So I can see no good reason for inequality. Whatever useful purpose it might serve as an incentive can be served by a very narrow range of incomes. But it does not currently serve as an incentive - it serves as a reward for having the luck and brains and connections you need to get ahead. Well, except for all those people for whom it just serves as a reward for having luck and connections.
• Also, if we just keep saying "Oh, you should have gone for the high status job", what will we do in a society of doctors and lawyers and computer programmers with no one to clean their offices, sort their files, watch their children? The high status people cannot live their lives without the low status jobs. They are essential to the functioning of their society, just as much as no medieval noble could survive without his peasants. It's just our modern myth that somehow we deserve our status, because our swords are more subtle, and because occasionally we let a couple of bright peasants join us. They did that in the medieval period too. But at least they were honest about their inequality. But it still doesn't make it right.
• it would be unjust to visit these "deserts" on their children. Before I go to bed, I just want to say that I absolutely, wholeheartedly agree with this. And I definitely agree with a lot of your concerns, including your assertion that a great deal of inequality in our country is unjust. My conclusions as to how to fix things that quite obviously differ from yours, but I don't think we're that far apart, really. (But I really, really have to go to bed!)
• Ok, before I get heavily into the above points I want to quickly note that the following assertion is false: My point is that people who want an English lit degree, or any humanities degree (including philosophy or history), shouldn't expect to make a lot of money off of it. If you want to make money, get an MBA. Or go into the sciences. Or learn a trade. There's been a lot of research in this area, and the consensus view is that the conventional wisdom on this is wrong. Back in the Harris period, the U of T did a study of their graduates. They found that hiring rates in engineering were in the sixties range, hiring rates for the sciences were (if I recall corectly) in the seventies and eighties, and hiring rates in the humanities were in the ninties. Interestingly enough, the undergraduate discipline with the best hiring rates and pay prospects was philosophy. Why? Because once you've learned to read Kierkegaard you can read anything and that's a skill the 'market' really, really wants. Also, it doesn't make sense to say 'get an MBA for a good career'. MBA's are mid-career degrees in Canada. You have to be pretty successful to even get into the program.
• Wages are in no way correlated with hard work or dedication or ability It's not a perfect correlation, and CEOs are overpaid but within any given job occupation there is a definite correlation. In the tech company i used to work for there were annual performance reviews and your salary would be determined using exactly those three factors: work ethic, dedication and ability. We had no choice. If you do not pay your good workers well, they go elsewhere. Doing anything different would have been suicide.
• Also, if we just keep saying "Oh, you should have gone for the high status job", what will we do in a society of doctors and lawyers and computer programmers with no one to clean their offices, sort their files, watch their children? The market answers this question easily. When there are too many doctors, their wages fall. When there are too few childcare workers, their wages rise. The reason why there are low salaries for childcare workers is simply that there are too many people chasing those jobs.
• But more to the point, you do *not* have to have a "high-status" job to be comfortably well-off. Anyone who works in the trades will do as nicely as an engineer. Anyone who starts a successful small business, even someone who works as a waiter, if they're careful with their money can build up serious upper class wealth in their lifetime.
• I think we would all be paid per work hour, the same amount; it could go up for effort or competence, but it wouldn't vary as it does by job. This was tried in various communist countries. Um, so why didn't it work? In the former Soviet Union, what happened over five decades? A new aristocracy composed of Party bureaucrats emerged. Social conditions in this "equal" world were awful. Life expectancy plunged. In the end, the system collapsed because even the insiders gave up on it. Given the historical evidence, why would you want to revisit this nightmare?
• Here's some statistical fuel for the fire. From a survey done by Stats Canada. "In December 1996, nearly one-third of Canadian workers, or about 1.7 million, were in low-paying jobs. By 2001, 47% of these low-paid workers, around 800,000, had moved out of their low-paying jobs.....Low-paid workers in 1996 tended to be young and female, with an education of high school or less. In addition, they often worked part time in service occupations or in the consumer services industries...Individuals with a university degree or working in a large firm were twice as likely to have moved up as those with only high school education or less....In addition, men were twice as likely to move up as women. Nevertheless, women greatly improved their odds of moving up if they obtained a university degree, worked in a large organization, worked in the public service or worked in professional or science occupations and industries". Upward mobility does thrive in Canada. The study also shows a correlation between education and mobility.
• Dreadnaught, do you know if this study is online? While I can see people who hold humanities degrees doing well, my intuition says that this might be because they tend to go on to get further education after their degree. Most students admitted to the U of T law school, for example, major in philosophy or political science. I just wonder if the data are skewed because of this. But it's certainly possible that I'm dead wrong. Anyway, I'll shut up and let you answer.
• The market answers this question easily. When there are too many doctors, their wages fall. When there are too few childcare workers, their wages rise. The reason why there are low salaries for childcare workers is simply that there are too many people chasing those jobs. The market does not work this way. We have lots of doctors in Toronto; their salaries do not fall (the Doctor's association makes sure of that). We don't have enough homecare workers, but their salary does not go up, we just don't provide enough homecare. Similarly, it isn't that there are tons of people doing childcare - it's a skilled profession, and once you have your degree, you have a very good chance of a job. But no daycare centre will pay above a certain maximum - they just can't afford to, because then the parents wouldn't be able to afford the day care. My mum can find no higher paying work as a bookkeeper, it just doesn't exist. But there is no more competition for her job than for a lawyers' (very likely less). The difference is status. If I try to have a profession as a professor, there could be hundreds of applicants for each job; the position will still be paid more than $40,000 a year. (Where I am, beginning professors average $70,000 a year.) When I first started working at a donut shop, they were desparate for clerks - they were overworking their existing people. But they never did and never would offer more than $7/hour - that's $14,500 a year. You can barely live as a single person on that, let alone raise a family, but I knew women who were trying. I don't actually care if this is the market at work or not - people deserve to be able to make a living wage. About the Stats Can study - that is very interesting, though I notice you didn't quote the lead sentance:

  Less than one-half of Canadian workers who had a low-paying job in 1996 had managed to climb out of it by 2001, according to a study profiling individuals who experienced upward mobility.

  . Or the following parts:

  Individuals who moved up between 1996 and 2001 tended to be young, university-educated men, in professional occupations and industries. More often, they worked full time in large unionized firms and lived in Ontario or Alberta.... The 53% of workers (around 900,000) who remained "trapped" in low-paid work in 2001 tended to be older women and those who had only high school education or less. Such individuals were more likely to be working part time for small, non-unionized organizations.

  But changing income in five years, while good, is not the same as upward mobility, not, at least, the same way it is used colloquially. Most people (including me in this dicussion) mean social mobility in the sense of changing eventual class or income level from what your parents had. The vast majority of young people, regardless of class, will pass through a period of low income. The question is: which ones are more likely to move out of that low income? Are the children of middle class families far more likely? If so, why are they more likely? And if people born into the lower class have a much worse chance of getting out, then how can anyone claim they "deserve" a low income?
• This was tried in various communist countries. Um, so why didn't it work? In the former Soviet Union, what happened over five decades? A new aristocracy composed of Party bureaucrats emerged. Social conditions in this "equal" world were awful. Life expectancy plunged. In the end, the system collapsed because even the insiders gave up on it. Given the historical evidence, why would you want to revisit this nightmare? I didn't say I wished to revisit the Soviet Union. I was talking about my ideals, in an ideal world. That said, I don't know as much about the Soviet Union as about China, but I can say that in China, land reform and the raising of low wages in the first five year plan increased quality of life for the majority of the country - peasants - substantially. Quality of life went down again substantially in the Great Leap forward, due to the failures of central planning combined with a severe drought. I am fully aware of the problems with the emergence of a Party Aristocracy in the Soviet Union. I am curious about the life expectancy stats, especially considering they were terrible before 1917 - do these statistics include the many many deaths of both world wars and those that came in Stalin's forced collectivisation and the purges? If so, what would that have to do with the effects of lowering wage inequality? Whereas, lower GINI in free countries is strongly associated with better life expectency. Central planning = BAD. Muderous dictatorship = really bad. Reduced inequality in wages? The jury is most certainly out. I don't exactly see people on kibbutzes starving.
• I notice you didn't quote the lead sentence: "Less than one-half of Canadian workers who had a low-paying job in 1996...." I didn't because "less than half" is not as precise as 47%. If we're going to be talking about important issues I like to use the exact number if they're available. The rest of my quote also mentioned that men are at an advantage, the importance of large firms and of education....
• My mum can find no higher paying work as a bookkeeper, it just doesn't exist. But there is no more competition for her job than for a lawyers' (very likely less). The difference is status. Not sure what you mean by status here. The reason lawyers make more than bookkeepers is that 1. It is far tougher to become a lawyer than it is to become a bookeeper, therefore supply is restricted. 2. Law firms are paid large sums of money by the people who employ them because a victory in court is worth plenty of $. The law firms in turn can pay more money in salaries to their lawyer. How much money do you think Michael Jackson is paying his defense team, compared to say, his book-keeper? Why's that? Isn't it because staying out of jail is more important to him than making entries in a ledger? I don't think this has anything to do with "status".
• The question is: which ones are more likely to move out of that low income? Are the children of middle class families far more likely? If so, why are they more likely? I think we'd be tempted to say that middle class families (MCFs) are more likely to be mobile. But even that might be fallacious because what is the dividing point between MCFs and UCFs? It may actually be easier for an LCF to become a MCF, than an MCF to become a UCF. The reasons why LCFs may not be as mobile: You've put forward the valid point that MCFs have better access to resources and contacts. But one generic thing that keeps some LCFs down is, as Smo has said, bad choices. My father was a first-generation immigrant with poor language skills and a grade 6 education. We were a classic LCF. He worked six and a half days a week for forty years to support our family of five. Here are the good choices that he made, they are fairly obvious: * didn't smoke or drink or buy lottery tickets * saved a portion of his paycheck * did not drive a car * always bought stuff on sale or second-hand * encouraged his children to read and learn and do well at school As a result of these choices, we are now MCF. He had zero "contacts" to help us get our jobs. He had no idea how to help us (the kids) through high school let alone university. He had no "luck", just a lot of long hours. Though, thinking about it, that was how he helped - by showing us the example of hard work. Now my question, heartless as you may think it to be is this: How many of the non-mobile LCFs follow similar habits? How are government handouts going to help LCFs if they *don't* have these habits? I'm reminded of the lottery winners who are bankrupt and penniless within a year of their winning the jackpot.
• That's what schools are for, helping you make winning choices. And discipline you so you can work in a factory for 12 hours straight. The labor market is far from a free market. If you lower the wages, instead of getting less candidates so that wages go up, you'll get worse candidates. That's why north american high school teachers, except for the really motivated ones, mostly suck. Bunch of self-hating prolétaires in this thread.
• StoryBored - there certainly are LC people who make excellent choices, and better things for themselves and their families. There are LC people who make not so good choices. But the fact is that your dad had to be extraordinary to get your family ahead. He is a remarkable man, and you should be proud of him. It's interesting also that he is an immigrant - there has been some interesting sociology research on how immigrants really are different from non-immigrants of the same socioeconomic status in terms of how sucessful they are. But this still does not justify punishing LC people who are not remarkable. Nor does it justify the very great disparities in income between different jobs, all of which are important to society. And wages do not go up just by skills. I will be far more educated than any lawyer when I graduate, and will have the potential of either full-time work at a decent middle class wage, or part-time work at a very low wage in my field, if I am not hired on full-time. And lawyers are paid a huge amount of money because they have a monopoly. You don't dare go to even a non-criminal court without a lawyer, because the other side will have a lawyer. And all lawyers charge thousands of dollars. My mum had to pay a lawyer $1000 for talking to us for 1/2 hour and about an hour at an eviction hearing (a schizophrenic neighbour claimed we were having wild parties when we were sleeping) that in the end went to negotiation. That was not a fair wage, but there were no lawyers who would work for less, and my mother was so afraid she would be evicted if she didn't have one. That lawyer preyed off her fear. Frankly, I'd happily ban the whole profession. Have some government counsel, some for defense, some for prosecution, get rid of the rest of the bloodsuckers. They serve no social utility - but they have helped to create a system in which they are "invaluable".
• It does have everything to do with status. Your babysitter keeps your (hypothetical) children from DYING when you are gone each day. But we pay them a tiny fraction of what we pay a doctor or an accountant. If you own a business, your bookkeeper keeps your accounts payable and receivable up to date so your customers pay their bills and your creditors aren't knocking down your door. Without good accounts, your business is sunk, just as it would be without a good salesmen. Why then is an incompetent salesmen paid so much more than a good bookkeeper? And no matter how good your salespeople or product, if you can't keep your payments coming in and going out, you will loose your business. There are set ideas in our society about what is valuable work and what is not, and these influence wages a great deal. You need all of these people, but once expectations are set, you just think, well, I have to pay this guy this much. And the people who are good at the jobs, valuable jobs without which our society cannot function, cannot get higher pay, because there is collusion among the employers. It's not concious collusion, it's exactly the kind of attitude as in this thread. Oh, this job is paid more because it's harder. (Harder than caring for disabled people? Harder than working in a 100 degree F warehouse with no fans? Harder than serving at a donut shop during the morning rush?). This job is more skilled (more skilled than a Ph.D.? than the soldier who is both a mechanic and has infantry training? than the actor or musician or poet?). High paid jobs are skilled and often do take more training than many low paid jobs, but not so much of either to justify their wages, and many, many low paid jobs are equally skilled - some might not be as formally trained, but they are equally skilled. Unskilled labour is also necessary, and part of our society. They already take the boring jobs, the difficult jobs, the low status jobs - why do they need to struggle to keep their families in housing? How is this moral? I don't think you can erradicate inequality. I've said that several times. But that is a long way from justifying it. --------- Oh, just to pre-emp people freaking out about the dictator-ship sounding idea of "government counsel" - I was thinking of government paid counsel, which all poor people have to use anyways. Why keep the disparity?
• And the people who are good at the jobs, valuable jobs without which our society cannot function, cannot get higher pay, because there is collusion among the employers. I'm skeptical of explanations that rely on false consiousness and unconscious collusion in this way. They're very difficult to falsify (or prove). Ultimately, I think most people do low-pay work because they lack the ability or drive to get the training that is required for higher skilled work. Or they don't want to spend more years in school. That, or they have made choices that close those opportunities to them. Sometimes other factors play a role, and these can be problematic, but I don't think that this is the case generally. Why keep the disparity? Doctors need to be well paid because they spend years living in poverty. Fewer people would want to be doctors if wages were lower; other options would look better. Lawyering takes a great deal of specialized knowledge and a great deal of talent and drive to be able to acquire that knowledge. Pay lawyers a lousy government-granted wage and you will get lousy lawyers; the talented and the driven will choose to do something else. I agree that there are problems, especially when the government is the sole employer. Teachers, for example, don't make a whole lot of money, and paying them more would probably attract better ones to the profession, so maybe we should pay our teachers better, if that's something we think we need to improve. But then we should probably look at the negative effect unions have on forcing employers to keep lousy workers. Anyway, I'm open to that conversation. But as for unskilled labor, it's easy to do, by definition. And it's easy to do reasonably well. It might be important, but anyone can do it. You don't need years of training. You don't need to make any sacrifices today for future rewards. Lots of people will happily do it and do it well. Some Ph.D.s are worth less than others, but all of this is because the situation is influenced both by supply and demand. I don't really see the problem: if people know that X probably will not lead to tons of wealth, and if wealth is an important consideration, then maybe they shouldn't choose X. Get enough people avoiding X and X will become scarce and wages will tend to go up. The government's job, in my view, is to keep the market competitive so that it will work in this way.
• the fact is that your dad had to be extraordinary to get your family ahead. He is a remarkable man, and you should be proud of him. That's nice of you to say that. He would be happy to hear that (and I thank you too, just realizing that i have not told him that and need to). It was exceptional but needn't be. What i mean to say is that a large majority of LCFs could do the same as he. It is not nature here but the nurturing of simple practices. I can actually agree with the argument that a wide wealth disparity is bad. But the assumption that the way to fix it is through government subsidy is what i find troublesome. Not when there's a way out that improves *everyone's* welfare. A way that raises LCFs into the middle class but leaves tax rates unchanged. Let's roll some numbers. What is the division line between LCF and MCF? Can we say that a hallmark of a middle class family is that they have their own home? Here is a bad LCF habit - a pack-a-day of cigarettes. Cost per pack = $7. Cost per year = $2555. Cost over 45 year work life assuming savings invested at 5% = $408,033. That's enough for a modest home in a small city. What does this mean? Any LCF that quits the cigarette habit makes the jump into MCF in one generation. I'm not even talking about saving extra money from your paycheck or any of the other "good choices" I gave in the earlier post. But if you did adopt all of those choices, you'd get into MC even faster. You don't need high IQs or connections or luck. (Actually i forgot a final "good choice" - staying out of debt as much as possible).