Economics

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  The Problem with the Zero Interest Rate Policy

  Jonathan Wellum

  April 23, 2012

  The US Federal Reserve, the most important and influential central bank, has made its objective clear: keep short-term interest rates at this near-zero level through late 2014. If this goal is fulfilled, the total period of time in which the major economies in the world have operated at a near zero rate policy will have lasted six years. This is an unprecedented, extraordinary, and dangerous policy on the part of central banks.

  The major central banks around the world began to cut interest rates in 2007 in response to the impending financial crisis. Interest rates throughout the developed world were lowered from approximately 5% in August 2007 to effectively zero by December 2008....

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  Does Canada have Social Conservatives?

  Robert Joustra

  March 30, 2012

  The term social conservative is beginning to lose integrity in Canada, if it ever had any. In many ways, like evangelical and conservative, it's a term which is coloured almost beyond utility by the American context. None of these labels mean the same things across the border. Or across many borders, as The Economist wrote recently about Rick Santorum's social conservatism.

  With Ontario's provincial, and now Canada's federal budget tabled, there is the inexorable rush of commentary, lobbyist posturing, and interest group press releases. At least some of those will fit into the mould of what many have come to call social con...

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  The Games of Yanks and Canucks

  Robert Joustra

  March 23, 2012

  Not long ago I was enjoying an evening meal with the monks at St. Gregory's in Three Rivers, Michigan, and the text being read for the evening was a cultural history of the Cold War as told through Monopoly. Over their spartan supper, I learned that Monopoly has become one of the most powerful, influential games in the world. The concomitant rise of its narrative, competitive capitalism, has mirrored American cultural and political ascent. It is a game predicated on the fictions of level playing fields, impartial chance, limited intervention, and the ingenuity of market competition. Victory in Monopoly also spells disaster for capitalism, an ironic tension that now seems to be eternally nestled in the American psyche.

  If there are two cultural artifacts that showcase the distinctives between Americans and Canadians, it is surely these two board games: Monopoly and Poleconomy. What the devil is Pole...

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  Time to Stop Doubling Down on Short-termism

  Jonathan Wellum

  March 12, 2012

  Simply stated, none of these jurisdictions have a hope of ever paying down even a portion of their accumulated liabilities, with non-debased money. They are each so strapped with debt and entitlement that none of them can currently service their interest (despite rates being close to zero), without borrowing more money or resorting to the printing press.

  Over the past four decades, the developed economies have gone on the biggest debt bender in history. The current level of global indebtedness, coupled with the massive unfunded government entitlement promises, are conservatively valued at over six times (6x...

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  Vatican Foreign Policy Exposes Fault Lines Without, but also Within

  Robert Joustra

  February 17, 2012

  Vatican foreign policy has a unique position in the global economy: unlike other developed powers it has less of a stake in the maintenance of the financial architecture that led to crisis and disparity, and an increasing interest in reformation and renovation for the developing world. Catholics aren't as rich anymore, or not as rich as they used to be.

  The Vatican is caught between the rock of the rich and the hard place of the poor, and between the work of theology and political advocacy. Its ...

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  The great issue of our day

  Michael Van Pelt

  February 14, 2012

  The great issue of our day is whether we can order our world with flourishing institutions apart from government and markets. This is the key question behind the very taxing challenge facing the Houe of Commons Standing Committee on Finance today. As tax tools go, Canada's charitable tax credit is one of the most successful ever implemented.

  Presented (3:00 pm EST) February 14, 2012, to the Canadian House of Commons Standing Committee on Finance, Pre-Budget Consultations.

  The great issue of our day is whether we can order our world with flourishing institutions apart from gov...

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  Union Metaphors

  Robert Joustra

  January 25, 2012

  In closing: "When you're marching into battle, you look out for the person next to you, or the mission fails. When you're in the thick of the fight, you rise or fall as one unit, serving one nation, leaving no one behind." . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

  President Obama opened and closed last night's State of the Union with a series of auspicious military metaphors. In opening, "These achievements are a testament to the courage, selflessness and teamwork of America's Armed Forces. At a time when too many of...

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  The Instant Super Cities of Oil Empires

  Robert Joustra

  January 19, 2012

  National Geographic dedicated a beautiful spread in its latest issue to the new capital of Khazakstan, Astana, described as "brash and grandiose—and wildly attractive to young strivers seeking success." Lavished with billions of petrol power, the new capital lacks for none of the astounding achievements of modern civilization, including its central monument, the Baiterek. Baiterek, which means "tall poplar tree" in Kazakh, is a 318-foot tower buttressed by an exoskeleton of white-painted steel, designed by Nursultan Nazarbayev, a steelworker become strongman who has run the country since the collapse of the Soviet Union. On its observation deck, from which your 360-degree view is periodically refreshed by cold Turkish beer, sits a malachite pedestal capped by a 4.4-pound slab of solid gold, in the centre of which is an imprint of Nazarbayev's right hand. Absent, one imagines, is the faint echo carried off the Euphrates, "Is not this the Babylon I have built as my royal residence, by my mighty power and for the glory of my majesty?"

  Washington was built on a swamp, Ottawa on an old sleepy lumber town, St. Petersburg on a swampy patch of Baltic seacoast. Imperial exercises in urban planning don't always go wrong, or at least not while the empires which sustain them persist. Dostoyevksy ...

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  How to Tax the Rich

  Robert Joustra

  October 28, 2011

  What and where to cut is for another day, but the best tax to raise in Canada—and to create in America—is one on consumption. It's not as insane as it sounds: Washington wonks are starting to pull out Canadian strategies for the deficit. But if it does happen, history teaches us that the blowback will probably unseat whoever has the temerity to enact it.

  In the decades to come, taxes in most developed countries will go up and services will go down. This is the hard logic of years of overspending, coupled with economic recession and crippling personal and corporate debt. So far the cuts in countries like Ame...

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  Plus ca change one more time

  Peter Stockland

  October 25, 2011

  1) "The conditions which surround us best justify our co-operation; we meet in the midst of a nation brought to the verge of moral, political and material ruin. Corruption dominates the ballot box. The people are demoralized, public opinion silenced, homes covered with mortgages, labor impoverished, and the land concentrating in the hands of capitalists.

  Two citations provide a wonderful historical frame for the Occupy Wall Street movement, now well into its second month.

  1) "The conditions which surround us best justify our co-operation; we meet in the midst of a nation brought to the verge...

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