Archive for August, 2012

Resources in the North

Prime Minister Harper is up in the North for his yearly visit and has been promoting the land for future resource extraction especially based on the new law his government passed that necessitates only one environmental study before any new projects. He has been detailing how new resource projects are the key to ending native unemployment in the north and bringing jobs and prosperity to the region.

It got me thinking- is resource extraction something that brings jobs to locals? While the romantic images are of thousands of men staking claims along rivers and panning for gold, or going in and out of mines with pickaxes, I’d wager that in Canada the vast majority of this work is now done by highly skilled engineers with expensive equipment. In many ways that’s great, it means that mining is much more productive and that we can create much more wealth from far fewer working hours leaving more for everyone to enjoy. This is how we moved from a society that spent all of its time farming simply to subsist to being able to diversify and enjoy the wealth that is all around.

The issue is that I doubt that many of these new jobs are actually ones that will directly bring unemployment down. There are just not enough people in the regions to produce the skilled workers need and so instead there will be a large influx of people from the outside. That’s not such a bad thing, these newcomers will need to have housing, food, supplies, and everything else that they can buy with their wages so for those not so inclined to working in the sector there will be other jobs. What I’m interesting in knowing is how much of this extra are the different communities able to capture or if the windfall comes more from the royalties paid with everything brought from the ground.

Who Should Collect the Garbage?

Just recently a part of Toronto had its garbage collecting services changed from the in-house government run and operated to a collection of different privately owned companies. There were complaints on the first few days of garbage not being collected on time, items missed, and a few other random issues which seems hardly surprising given the scale of the operation. It’s silly to base an argument on one data point- akin to saying that Global Warming doesn’t exist because it’s been a cold summer- analysis on how much better or worse things are will have to wait for time to deliver the data.

What should and shouldn’t be a government service? Sectors that already have private companies working in them and are not a natural monopoly (many different companies can coexist providing for competition) are the easiest to argue for conversion to the private sphere. The argument that services will not have the same level of quality can be addressed by setting metrics that all private companies must adhere to that would be exactly the same as with public management. As long as there are more than one service providers then it will always be easy to terminate a contract when these rules have been broken and bring in another.

The most contentious item in the debate revolves around wages and benefits and how the switch to privatization will lower them both. I see this as a part of the much larger issue of increased income disparity and loss of job security that have plagued Canada and other developed nations since the 1970’s. In 2011 (according to Stats Can) the rate of unionization in the public sector was just over 71% while only 16% in the private one. It is therefore very difficult to make an argument that the tax paying members of the private sector must pay part of their wages to keep the other part of the workforce in better conditions, making the debate “us against them.” If the city is keeping these jobs in the public sphere because it feels that the market rates of pay are too low then what is stopping it from running even more services and expanding to other areas that it currently doesn’t cover? I don’t see how this would ever be politically feasible within the current private and public disparity and so the issue of wages needs to be handled on a much broader level.

Fundamentally this is about how much people get paid for doing a job and if it should be set by supply and demand (number of jobs available and number of people able to do them) or with some other mechanism. Or, the government can change the game by instituting a form of guaranteed income paid for by taxing profits which has the possibility of making the switch from public to private a non issue in terms of wages.

Misleading Media Lines

This week on CBC Radio’s The World at Six they ran a sequence of stories about India and how it is now an “economic juggernaut” of the world (Powershift). I think that the series was okay and anything that helps people understand what is going on in other parts of this planet is welcome. However, the first day’s program was fun of example of how certain facts, while completely true, have entirely different meanings when they are placed in different contexts.

In talking about the growing middle class there was a short story about a modest house costing over a million dollars in the middle of the city. Because this story came directly off one of how more people had money it made it seem that the city was perhaps bursting at the seams of people with cash to spare. The truth, which can be found in the fantastic book Triumph of the City by Edward Glaeser, is that India’s cities have fierce laws limiting the heights of buildings which force an expansive population to live at a much lower density that others in the world. This limits the available housing close to the centers and with such a restrictive supply the demand from rich people can be much less to see the same price rises as in other places. It isn’t wrong to cite this as an example of a richer population, but it isn’t being completely honest with those who won’t understand the context.

Another “fact” that was talked about throughout the series was that the English speaking nature of so many in India was bound to be a huge benefit economically. While I have read this many times I have never seen proof that this casual thought was anything but. The Philippines have been saying this for ages and yet are poorer than many of their immediate neighbours. If it were true then how is it that Ghana is not doing better than it is with its English speaking and close proximity to Europe? It would be nice if reporters were able to question just a bit more or at least caution the listeners that these are things that are thought and are not proven facts.

Canadians aren’t much different from Americans

I realize that as Canadians we have a hard time defining ourselves anything but in oppositions to our much larger neighbour to the south. The fact that healthcare is continuously brought up as something that defines us as a nation only serves to illustrate how captivated we are by the Americans- and fail to notice that they are the ones defined by that fact (all other industrialized countries have universal healthcare, Canada is one of the pack). The world’s largest producer of seductive culture is going to be the standard as to which we are different.

However, I wish that Canadians would realize how similar we really are the the Americans and stop believing the simplistic notion that we are always apologizing for everything and simply the nicest folk around. Having traveled across the border on many occasions I can say that things are not much different north to south and if anything people are more friendly down there. Judging by the comments on this CBC site it doesn’t appear that many people are able to consider the fact that maybe there are rude Canadians.

I tend to believe that the North American continent is culturally different north and south but that it does not occur at the 49th parallel. On the west coast, for instance, the cities of Vancouver, Seattle, and Portland are all very similar and could easily find more cultural links between them than their respective brethren on the eastern seaboard (the same could be said of the interior parts of BC, Washington, and Oregon which are all much more culturally conservative and unlike both the coasts). The Southern part of the USA is very different from anything that exists in Canada but it’s no different from the northern US states which are also very different from it.