In a speech, Greta Thunberg stated: “all you can talk about is money and fairy tales of eternal economic growth”. Continue reading “Greta Thunberg was Wrong about Economic Growth”
Category: Economics
What is 1 + 1? It depends who you ask!
Donald Trump
“Glad you asked me this question. I am a very stable genius and math is one of my specialties. When I was on the Howard Stern show, he asked me a very difficult math question, “What is 17 times 6?”.
What will it take for Canada to eliminate its use of fossil fuels?
- Gasoline/diesel vehicles will have to go electric
- Railways will have to be electrified
- Heating will have to go electric
If this were to happen, Canada’s demand for electricity will increase. In this blog, the increase in electricity generation capacity is estimated.
The results show that Canada will require 31 new nuclear plants or 202 new hydro plants or 1413 new wind farms or 15167 solar plants or a combination of the above
First look at current consumption of energy from fossil fuels in Canada:
- Coal 33.2 106 tonnes/yr
- Petroleum products 1.9 mmbbl/d
- Natural gas 8.9 Bcf/d
Continue reading “What will it take for Canada to eliminate its use of fossil fuels?”
What Would a Corbyn–Led British Government Look Like?
There is a lot of fear-mongering in the British press about the disastrous consequences if the Labour Party won a British General Election and Jeremy Corbyn became Prime Minister.
One approach to see how disastrous this would be is to compare it to what happened when the last left-wing government was in power. The closest analogue is the Labour government from 1945 to 1951 under Clement Attlee. Continue reading “What Would a Corbyn–Led British Government Look Like?”
The EU after Brexit – A Vision for Success
Much has been written about the effects of Brexit on the UK, but there has been little thought given to the future of the EU itself.
The problems of the EU are well known. What Europe needs is a Julius Caesar, Charlemagne, Napoleon or a Bismark (or all of them). Angela Merkel showed hints of European leadership, until her disastrous error in allowing unlimited numbers of “refugees” into Germany. Even though there is the lack of leadership, clear common goals and periodic crises, the EU muddles through, in spite of the British press gleefully predicting the imminent break-up of the EU and the collapse of the Euro
Continue reading “The EU after Brexit – A Vision for Success”
Trump’s Achievements
No president has divided public opinion more than Donald Trump. Many find him personally obnoxious, irresponsible and harmful to the U.S. and the world. His supporters however, see him as a breath of fresh air who is “making America great again”.
Personally, I am not an admirer of Trump but I think that it is beneficial to play the “devil’s advocate” and try to look at his record in his first two years in as positive light as possible. Continue reading “Trump’s Achievements”
Get Canada Moving Again – Streamlining the Resource Development Approval Process
In Canada resource development projects must go through a lengthy approval process. This is necessary so that all the factors are taken into consideration including, of course, environmental concerns.
However, radical environmentalists have used these approval processes to stop all resource developments, whether it involves pipelines, oil and gas development, hard rock mining or forestry.
The Financial Post has identified 35 projects valued at $129 billion that have been held up or stopped by extreme environmental extremists. Continue reading “Get Canada Moving Again – Streamlining the Resource Development Approval Process”
Canada’s 2018 budget: virtue signaling all the way
Canada’s 2018 budget was released on February 26th. It projects an estimated deficit of $17.8 billion for 2018. In subsequent years the budget deficit is expected to decrease, but only to $13 billion.
Canada’s economy is currently strong. Unemployment is at record lows and GDP growth is as high as could be expected.
Conventional Keynesian economics would expect a budget surplus under these conditions. Admittedly the budget deficit is lower than had been expected a year ago due to the strong economy. This was seen as a signal for the Trudeau government to increase spending and introduce new programs.
Continue reading “Canada’s 2018 budget: virtue signaling all the way”
U. S. Tax Reform – Wrong Policies, Wrong Reasons, Wrong Time
The tax reform bills which have recently been passed by the U.S. Senate and House of Representatives potentially introduced significant changes to U.S. tax law. This has been strongly pushed by Donald Trump. Here is a summary of the changes:
- Reduce corporate tax rate from 35% to 20%
- The highest personal tax rate has been reduced
- Inheritance taxes threshold has been raised from $11.2 million $22.4 million
- Some tax reductions which affect the middle class, but which expire in 2026
There is no doubt that the U.S. tax system needs reform. Although the corporate tax rate is 35%, in practice, the average tax rate actually paid by U.S. corporations is only 18.7% (by one estimate). The difference is due to all the deductions, exemptions and loopholes embedded in the tax code. Many of these are industry specific and are the result of years of successful lobbying by particular industries. As a result, the tax code introduces distortions in the economy which are not in the best interests of the country.
The tax reform has been sold as a needed stimulus for the economy, which will increase investment, hence increase productivity and lead to increased job creation
The reality is quite different:
- No need for a stimulus at this time
- Tax cuts for corporations will not flow into productive investment
- Changes will raise the deficit by $1.3 trillion over 10 years
- Tax cuts for individuals will not spur consumption or investment in the U.S.
- Inheritance tax threshold will have a negligible effect
I shall now expand on these in greater detail. Continue reading “U. S. Tax Reform – Wrong Policies, Wrong Reasons, Wrong Time”
Can Raising the Minimum Wage Boost the Economy?
There has been much discussion about raising the minimum wage, with proponents claiming it will improve the lives of the working poor and reduce “inequality” and opponents claiming it will reduce employment, making the poor worse off.
Classical economic theory claims that raising the minimum wage (or instituting it where there is none) will lower employment.
Closer examination suggests that a higher minimum wage will lead to increased inflation, some job losses, increased economic growth and reduced inequality. Continue reading “Can Raising the Minimum Wage Boost the Economy?”