Early warning signs for Canada from U.S. debt downgrade – Financial Post
Fitch’s recent downgrade of U.S. public debt, dropping it one notch below “AAA,” is good reason to examine the relationship between U.S. debt and the dollar’s future as a reserve currency. The greenback is just the latest in a series of preferred currencies that have been used for foreign exchange reserves and to denominate other assets. But reserve currencies, unlike diamonds, aren’t necessarily forever, and that affects their issuers’ capacity to manage their public debt.
The British pound was the world’s reserve currency in the 19th and early 20th centuries, with a typical exchange rate a century ago of around US$5, vs. US$1.25 per pound today. The pound faded after 1945 because of Britain’s massive war debts, the…
What’s Behind the Cost of New Single-Detached Homes?
This Graphic Intelligence breaks out the various components of the total cost of new single-detached homes in Canada’s six largest Census Metropolitan Areas (CMAs). A recent C.D. Howe Institute publication calculates the total construction cost using three components: the physical cost of construction (which includes labour and materials), an assumed amount of developer profit, and […] Charles DeLand – A Nuclear Blueprint for Alberta
To: Brian Jean, Alberta Minister of Energy and Minerals From: Charles DeLand Date: August 14, 2023 Re: A Nuclear Blueprint for Alberta Fans of Canadian nuclear energy have much to root for these days. Two recent Ontario announcements, one about small modular reactors and one for a new large-scale project, indicate meaningful commitment to nuclear energy to meet […] The productivity problem in Canada’s economy is really a marketing and sales problem – Globe and Mail
Our national “productivity gap” has spurred analyses, reports and media articles for decades. While public debate in Canada has focused on productivity improvement for more than 50 years, we have made limited progress. Fresh thinking is required.
While innovation through research and development (R&D) is certainly important to productivity growth – and has preoccupied the federal government over the past half-century – there is also a connection between firm size and productivity. The larger the firm, the more productive it typically is. Logically, then – and the research supports this proposition – one way to increase our productivity is to increase the size of our companies from small and medium to large. Something we have…
Andrew Kaufman – Pooling Piggybanks: Ontario Municipalities Can Better Deploy Their Spare Change
To: Ontario Municipalities From: Andrew Kaufman Date: August 11, 2023 Re: Pooling Piggybanks: Ontario Municipalities Can Better Deploy Their Spare Change There is a long – 103-year – history of investment managers supporting the supervision and investment of public funds in Ontario to provide increased revenue for public coffers while reducing the costs associated with the duplication of […]Booze & Cigarettes and Interprovincial Trade with Ryan Manucha
Double the Pain: How Inflation Increases Tax Burdens
by William B.P. Robson and Alexandre Laurin Inflation and taxation are a painful combination. Money losing its purchasing power hurts on its own, but tax provisions that ignore inflation can multiply the pain for earners, savers, and recipients of benefit programs as well. This E-Brief identifies problematic interactions between inflation and taxes and highlights some […] The Double Burden of Inflation and Taxes
Inflation and taxation are a painful mix. Money losing its purchasing power hurts on its own, but tax provisions that ignore inflation can multiply the pain for earners, savers, and recipients of benefits, says a new C.D. Howe Institute report. In “Double the Pain: How…Alberta’s renewable energy pause goes against conservative free market fundamentals – Globe and Mail
Alberta’s move last week to pause approvals for new renewable electricity investments sends a strong signal: The conservative, free-market fundamentals underpinning the province’s approach to electricity are no longer as strong as the past few decades might suggest.
Whatever happens between now and next February, when the moratorium expires, Alberta’s electricity industry is at a crossroads: Does the province continue to embrace its quarter-century as a free, open market, or will the government and regulator take more interventionist control over the type and location of generation investments?
In 1996, then-premier Ralph Klein’s Progressive Conservative government decided to let market forces govern…
Munn, Laurin – Productivity Increases Start with Tax Reform
From: Duncan Munn and Alexandre Laurin To: Finance Minister Chrystia Freeland Date: August 9, 2023 Re: Productivity Increases Start with Tax Reform Canada’s labour productivity decline is making headlines across the country and raising concerns about our economic prosperity. In real terms, per capita GDP has been stagnant since 2017. Ontario’s output per capita is now on par with Alabama’s, […] William B.P. Robson – Where Did All the COVID Spending Go?
From: William B.P. Robson To: Government spending observers Date: August 8, 2023 Re: Where Did All the COVID Spending Go? Canadian governments’ lack of transparency is a high-profile concern – and for good reason. Alongside such problems as bureaucratic circumvention of freedom of information laws and ministers responding to questions in legislatures or from the media with mechanical talking points, government […] Ben Brunnen – A Critical Raw Materials Strategy for Canada
From: Ben Brunnen To: Jonathan Wilkinson, Minister of Natural Resources, Chrystia Freeland, Deputy Prime Minister and Minister of Finance, and Steven Guilbeault, Minister of Environment and Climate Change Date: August 4, 2023 Re: A Critical Raw Materials Strategy for Canada Canada has undertaken significant efforts to take advantage of strategic manufacturing and supply chain opportunities in the face of […]