Op-Eds
Published in the Financial Post on December 2, 2011
By Philippe Bergevin And Daniel Schwanen
Is Canada open for business? Many people asked that question, here and abroad, after the November 2010 withdrawal by Australia's BHP Billiton Ltd. of its $39-billion bid to acquire PotashCorp of Saskatchewan. More than a year on, the question still needs an answer, and the federal government needs to act.
After the controversy that surrounded BHP's withdrawal, Tony Clement, then Minister of Industry, said that the foreign investment decision-making process in Canada, under the Investment Canada Act, should be reviewed to "provide greater clarity to Canadians and greater certainty to international investors." A…
Published in the Financial Post on August 17, 2011
By Philippe Bergevin, Pierre Duguay and Paul Jenkins
Standard and Poor’s recent rating downgrade of the United States’ long-term sovereign debt sent shivers through financial markets already nervous about the state of government finances. Financial turbulence such as we are currently experiencing can have far-reaching economic implications. But the complex and multifaceted channels through which the economic impacts of these shocks are propagated make their assessment difficult and diagnoses uncertain.
As sovereign-debt problems unfold and volatility grips financial markets, a question: What have we learned from four years of global financial crises about the links…
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 Financial Post on March 16, 2011
By Philippe Bergevin
Visa and MasterCard, the two biggest credit cards companies operating in Canada, are currently targets of serious allegations. The Commissioner of Competition alleged in a recent referral to the Competition Tribunal that these companies, through rules they impose on merchants, have limited competition in the marketplace, resulting in increased costs to businesses and, ultimately, consumers.
These allegations have been vigorously disputed by the two targeted companies. Further, some of the economic arguments underpinning the legal case are, in my view, flawed and the solutions prescribed by the commissioner are unlikely to foster, and may…
Published in the Financial Post on Jan 31, 2011
By Finn Poschmann
Governments can’t leave housing markets alone. And it’s easy to see why — shelter is a necessity, some people even think it’s a right. Others believe that not only is shelter a necessity, but that home ownership is a positive good for society, and one that governments should therefore encourage.
Many western countries have public policies that support home ownership on the grounds that homeowners contribute to a stable society through positive ties to community, family and work. That may be so, but the transaction costs of home ownership also make people less mobile — less likely, for instance, to move for a job.
Yet whether you…
