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Wednesday, July 16, 2014

Faking it!

Don't Be Fooled By Harper's "Surplus"

Stephen Harper continues to have the worst economic growth record of any Prime Minister since R.B. Bennett in the 1930's, and the most recent employment statistics, for June, confirm yet again that most of the Canadian economy is stalling.

About 16,000 new people entered the labour force nationally last month, but actual employment moved in the opposite direction. Over 9,000 jobs were lost, driving overall Canadian unemployment up by some 25,000 (not including those who have given up looking for work altogether). The situation for young Canadians is especially bleak. There were 44,000 fewer jobs in June for those under 25.

Conservatives dismiss these numbers as mere "monthly volatility," but that doesn't wash. The picture over the long-term is no better and, in fact, it's getting worse.

Last January, Statistics Canada revealed the national job market had generated a paltry 99,000 new jobs in all of Canada in all of 2013 -- well below what's required to keep pace with normal population growth. Worse still, according to the Canadian Chamber of Commerce, 95 per cent of those jobs were only part-time.

Now, six months later, the total number of new jobs created in Canada over the past year (June-to-June) was an even more paltry 72,000, and virtually all of that was in just one province (Alberta). The national economy is in the doldrums.

As Justin Trudeau has been saying for months, Canada needs a growth agenda. Mr. Harper's fixation on austerity, to the exclusion of everything else, is weak and wrong-headed -- it's solely to feed his political vanity by concocting the appearance of a balanced budget on the eve of a federal election.

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Former Bank of Canada Governor David Dodge says it's fiscally irresponsible to fail to invest in essential infrastructure at a time when interest rates are cheaper than ever, and that short-term advantage can be converted into long-term capital assets.

The provinces all agree. So do municipalities. And the Canadian Chamber of Commerce. And private sector think-tanks. Only the Harper government is off-side. They've actually chopped their flag-ship infrastructure investment fund this year by 87 per cent. They've delayed three-quarters of it until after 2019. And they've complicated the rules to make it slow and hard to access.

Why? All to help concoct the impression of a federal surplus for 2015.

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