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Former member of C.D. Howe’s Monetary Policy Council appointed as Deputy Governor, Bank of Canada Congratulations to Jean Boivin, newly-appointed Deputy-Governor of the Bank of Canada. Professor Boivin’s research focuses on monetary policy, macroeconomic forecasting and finance. He has collaborated on research with U.S. Federal Reserve Chairman Ben S. Bernanke. At the time of his appointment, Bovin was an Associate Professor at HEC-Montreal. In an interview with Reuters, Finn Poschman, the Institute’s Vice President, Research, stated that “he is a superbly strong academic. He's been writing for years in the company of absolutely top-flight economists in the monetary and macro-economics field.” To read the Bank of Canada’s announcement click here. To read a Reuters article on the appointment click here. Bank of Canada Should Watch Money Growth, Head Off Inflation Risks: C.D. Howe Institute Toronto, March 11 – The Bank of Canada should have a hard look at growth in the money supply and offer guidance on its thinking on the behaviour of monetary and credit aggregates, according to a study released today by the C.D. Howe Institute. In “Taking Monetary Aggregates Seriously,” author Pierre Siklos argues that current levels of money growth suggests a rebound in economic growth and inflationary pressures for the near future. The author argues that the Bank should take this evidence seriously and provide guidance on what it entails for future inflation and economic growth. For the e-brief click here. To read a post-budget analysis by Finn Poschmann, VP Research of the Institute click here. To watch a Lang&O’Leary Exchange Panel discussing the budget, featuring Stanley Hartt of Macquarie Capital Markets Canada, Roger Martin of the Rotman School of Management and Bill Robson of the C.D. Howe Institute, please click here. To watch a discussion of the federal budget on TVO's "The Agenda" featuring Andrew Coyne of Maclean's, Susan Delacourt of the Toronto Star, Finn Poschmann of the C.D. Howe Institute, and Erin Weir of the United Steelworkers union, please click here. Reform Rules that Punish the Poor for Saving: C.D. Howe Institute Toronto, March 2 – Reform is required for social program rules that prevent the poor from saving in Registered Retirement Savings Plans (RRSPs) and Tax Free Savings Accounts (TFSAs), according to a study released today by the C.D. Howe Institute. In “Down but Not Out: Reforming Social Assistance Rules that Punish the Poor for Saving,” author John Stapleton says that encouraging asset accumulation, even in small amounts, is crucial in helping to lift people out of poverty. Yet most Canadian welfare, disability and social service programs deny or cancel benefits if applicants or recipients place a modest level of savings in an RRSP or TFSA. Barring a province-led effort at reform, says Stapleton, the federal government should take the lead by calling on provinces and territories to exempt meaningful RRSP and TFSA amounts from their welfare asset rules, leaving individual jurisdictions to decide the appropriate levels. For the study click here. To read a Financial Post article on the study click here. C.D. Howe Institute’s Monetary Policy Council Calls for Bank of Canada to Maintain Overnight Rate at 0.25 Percent, With Increase to 0.75 Percent in September 2010 Toronto, Feb 25 –The C.D. Howe Institute’s Monetary Policy Council today recommended that the Bank of Canada hold its target for the overnight interest rate at 0.25 percent at its next announcement on March 2, 2010. The Council further recommended keeping the target at 0.25 percent at the Bank’s next announcement in April, consistent with its conditional commitment to do so until mid-year. The MPC’s recommendation for September, the second announcement date after the Bank’s conditional commitment expires, was for a target of 0.75 percent. Looking one year ahead, the Council’s recommendation was for a target of 2.00 percent in March 2011. The MPC is a panel sponsored by the C.D. Howe Institute to provide an independent assessment of the monetary stance most appropriate for the Bank of Canada as it seeks to achieve its 2 percent inflation target. William Robson, the Institute’s President and CEO, chairs the Council. For the Monetary Policy Council release click here. To read an article on the Monetary Policy Council release in BusinessWeek click here. Bank of Canada Should Raise Key Lending Rate Sharply, Beginning in Third Quarter: Leading Economist Toronto, Feb 23 – The Bank of Canada should implement sharp, 50-basis-point increases in the overnight interest rate starting in July, according to economist Michael Parkin. In “How Soon? How Fast? Interest Rates and Other Monetary Policy Decisions in 2010,” Professor Parkin examines key policy questions facing the Bank as the July expiry date approaches for its conditional commitment to keep the overnight rate at 0.25 percent. The author argues the Bank should keep its conditional commitment, but should thereafter raise the overnight rate sharply by 50 basis points at every announcement date until mid-2011. For the e-brief click here. To read a CBC News report on the study click here. To read a Vancouver Sun report on the study click here. 2008 e-brief on essential services designation moves back into spotlight A 2008 C.D. Howe e-brief was spotlighted in several news items on proposed legislation to designate the Toronto Transit Commission as an essential service. The e-brief by Benjamin Dachis found that while designating public services as ‘essential’ may be intended to protect public safety, doing so can be very costly to the public purse due to a greater reliance on arbitrated settlements. For the e-brief click here. To read a Globe and Mail column citing the C.D. Howe e-brief and points from an interview with Benjamin Dachis on transit policy click here. To read a Toronto Star article on the proposed legislation citing the study click here. Spending Restraint Key to Balancing Ottawa’s Books: C.D. Howe Institute Toronto, Feb 18 – Spending restraint is key to achieving a balanced federal budget over the next five years and should form part of Ottawa’s March Budget, according to the C.D. Howe Institute. “Back to Balance: A Shadow Federal Budget for 2010” demonstrates how to limit the rise in the federal debt by prudently reining in spending growth rather than raising taxes, so that past and pending improvements to the nation’s tax competitiveness are not erased. For the study click here. To read a Globe and Mail editorial citing the Shadow Budget click here. To read an article in the Wall Street Journal citing the Shadow Budget click here. To read an article in the National Post citing the Shadow Budget click here. To read an editorial in the Windsor Star citing the Shadow Budget click here. Globe and Mail Op-Ed: Ottawa should show spending restraint Toronto, Feb 18 – In a pre-budget op-ed, William Robson, President and CEO of the C.D. Howe Institute, calls on the federal government to bring out “a clear and compelling program of spending restraint” in the March 4 budget. To read the column click here. David Longworth, Deputy Governor of the Bank of Canada, spoke at an Institute Roundtable in Toronto on February 17, 2010 on “Bank of Canada Liquidity Facilities: Past, Present, and Future." To read his speech, please click here. To read an article on his speech in the Financial Post, please click here. To read an article on his speech in The Globe and Mail, please click here. Ottawa Should Take “Easy Steps” to Help Retirement Savers: C.D. Howe Institute Toronto, Feb 11 – Ottawa has an opportunity in the 2010 Federal Budget to improve retirement saving prospects for many Canadians, says William Robson, President and CEO of the C.D. Howe Institute. In a paper released today, “Cutting Through Pension Complexity: Easy Steps Forward for the 2010 Federal Budget,” Robson outlines straightforward, no-regrets ways Ottawa can facilitate more saving and make cost-effective risk-pooling available to the majority of Canadians in defined-contribution (DC) plans and registered retirement savings plans (RRSPs). For the study click here. To read an article on this study in the National Post click here. Toronto Star Op-Ed: City of Toronto Budget Process Inhibits Planning and Accountability In a Toronto Star Op-Ed, Institute analysts Benjamin Dachis and Colin Busby argue that the City of Toronto’s current budget process makes it difficult to easily reconcile Toronto's budget promises with audited year-end results, blurring the ability of citizens and the city itself to undertake any evaluation of the city's financial performance. They recommend a greater emphasis on performance budgeting, greater integration of the operating and capital budgets, and the development of a multi-year budget framework. For the article click here. To read a Toronto Star editorial citing the op-ed click here. C.D. Howe Institute and Washington-based Peterson Institute host conference on US-Canadian environmental policy The C.D. Howe Institute and the Peterson Institute for International Economics in Washington, DC, held a half-day conference in Washington on February 3, 2010, to examine US and Canadian climate change policies and prospects going forward in light of the outcome of the Copenhagen summit in December 2009. The conference had two objectives: to examine each country's efforts to reduce greenhouse gas emissions and to assess the potential costs and benefits of coordinating those efforts more closely, including through an integrated North American carbon trading regime. Canadian Ambassador to the United States Gary Doer delivered the keynote address on current climate change efforts in Canada and provided a Canadian perspective on evolving US policies. For a Canadian Press article on Ambassador Doer’s speech click here. For a recording of Ambassador Doer’s speech click here. Competition to Benefit Debit Card Market; Level Playing Field Needed: C.D. Howe Institute Toronto, Feb 4 – As new entrants arrive in Canada’s debit card market, rule changes are needed to ensure a level playing field, and to enhance the potential benefits of competition for consumers and merchants. In “Change is in the Cards: Competition in the Canadian Debit Card Market,” a study released today by the C.D. Howe Institute, policy analyst Philippe Bergevin assesses the implications of the rapidly changing debit payment landscape. Bergevin makes recommendations for action to ensure that consumers and merchants are protected and that the system can evolve to serve them even better. For the study click here. C.D. Howe Institute Hosts Prime Minister Harper for Economic Discussion Toronto, Jan. 20 – Prime Minister Stephen Harper today held consultations at the C.D. Howe Institute on major economic issues facing Canada. Chaired by Institute President and CEO William Robson, the session allowed for an exchange of policy ideas on such topics as the Government’s Economic Action Plan, getting Canada on the path to balanced budgets, and ensuring the country’s future prosperity. Prime Minister Harper praised the Institute’s work in his remarks and expressed appreciation for the opportunity to canvass the participants’ policy ideas. “We were delighted to host the Prime Minister for such a full and stimulating discussion of the country’s fiscal and economic challenges,” noted William Robson.