Op-Eds
Published in the Financial Post on April 11, 2012
By Philippe Bergevin and James MacGee
As a percentage of income, Canadian household debt levels are higher than at any point in recent history and now higher than those of U.S. households. This raises concerns over the sustainability of household finances, the risks to the broader economy and the merits of government intervention.
Recent debate has understandably focused on the housing market and on the risks associated with household mortgage debt. But consumer credit, which excludes mortgages but includes household debt such as auto loans, credit card debt and lines of credit, has risen by more than a factor of five since the late 1970s and, at 43% of disposable…
Published in the Financial Post on August 19, 2011
By Philippe Bergevin and Finn Poschmann
In Ottawa Friday, Minister of Finance Jim Flaherty and Bank of Canada governor Mark Carney gave their updates on the Canadian economy. The big question: How does the darkened global picture affect Canada’s economic prospects and the federal government’s ability to return to a balanced budget on schedule?
By most accounts, the Canadian economy is doing well. The United States entered recession, defined as a significant decline in economic activity, in December 2007 (see graph above). Canada entered recession later, in fall 2008.
And Canada’s recession was shorter: the U.S. economy contracted for 18 months, while the…
Published in the Financial Post on June 21, 2011
By Finn Poschmann
In the wake of a housing-led financial-market meltdown in the United States, our federal government has introduced a legislative framework for oversight and regulation of the mortgage insurance market.
The legislation, which forms part of the budget implementation bill before Parliament today, codifies the contractual arrangements, between the government and individual mortgage insurance companies, that now govern the terms for backstopping private mortgage insurers.
As it stands, private mortgage insurers compete for the edge of the market, against Canada Mortgage and Housing Corp., an agent Crown corporation whose liabilities are backed by…
Published in the Edmonton Journal on November 8, 2010
By Stuart Landon And Constance Smith
The government of Alberta's revenue volatility turns ordered plans topsy-turvy. Highly variable revenues make it difficult for the government to achieve a sustainable level of spending. Instead, Alberta's spending tends to follow a boom-and-bust pattern -- expenditures rise when oil and gas prices are high and abate when prices fall.
The rapid expansion of programs and capital spending during revenue booms stretches the capacity of the government to provide services and monitor spending, which can lead to waste and inefficiency. During a revenue collapse, spending cuts are often across the board rather than focused on the…
In Another Meltdown? It’s Only A Matter of Time In
In Another Meltdown? It’s Only A Matter of Time, (The Globe & Mail, June 24, 2009), C.D. Howe Institute President and CEO, Bill Robson, writes that as long as Washington insists on home ownership for people who can’t afford it, economic history will keep repeating itself. See article:
For the OpEd click here.
