Canada Budget 2010 and the economy

Written by  //  October 29, 2010  //  Aid & Development, Canada, Economy, Environment & Energy, Innovation, Natural resources, Public Policy  //  Comments Off on Canada Budget 2010 and the economy

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First Nations group says it’s planning Potash bid
Hands off our potash! Canada opposition building
(Bloomberg) Saskatchewan’s premier says another Canadian province supports his call for the federal government to reject a foreign takeover of Potash Corp.
Saskatchewan Premier Brad Wall said Friday that Manitoba has joined Alberta and Quebec in opposing Anglo-Australian BHP Billiton’s bid for the world’s largest fertilizer company. (Market Watch)  The Federation of Saskatchewan Indian Nations and the Aboriginal Potash Group Look to Enforce Their Right to be Consulted Regarding Hostile Bid for Potash Corporation of Saskatchewan
26 October
Auditor General Fraser slams chopper buys
The federal government did a good job of rolling out the Economic Action Plan and many other services and programs, but failed to properly manage two purchases of military helicopters, says Auditor General Sheila Fraser.
24 October
Saskatchewan’s bluster is all about getting more money
(Globe & Mail) … Rejecting the Potash takeover would undo this carefully nurtured open investment climate. As it is, the province needs tens of billions of dollars, much of it foreign presumably, to pursue its ambitious resource dreams, including becoming a major oil sands producer, developing large-scale carbon sequestration and exploiting new potash mines.
Sometimes forgotten is Saskatchewan’s status as an emerging oil sands player, sharing the same geological formation that covers much of northern Alberta. A 27,000-square-kilometre swath of Saskatchewan – an area roughly the size of Lake Erie – sits atop some of the thick bitumen. Estimates of the recoverable oil there range up to 2.3 billion barrels.
But it’s buried deep beneath the surface. And without foreign investment, that oil will likely stay there.
22 October
Canada urged to block bid for PotashCorp
(FT) Saskatchewan urged the Canadian government to block BHP Billiton’s $39bn bid for PotashCorp on the grounds that the Australian miner had failed to show that the deal would benefit the prairie province.
21 October
Clement Says He Won’t Be Swayed by Saskatchewan Rejection of Potash Bid
(Bloomberg) … Clement said he hadn’t yet decided whether to approve the bid. [He] spoke after Saskatchewan Premier Brad Wall said a takeover would cut provincial revenue, lead to fewer jobs and forfeit Canadian control of an important national resource. Wall ruled out further talks with Melbourne-based BHP and said that if the deal was forced through, Saskatchewan would use “the taxation tools of the province to make sure we are protected.”
Potash politics put Tories on spot
(Globe & Mail) What worries the minority Harper government, as it reviews BHP Billiton bid for Potash Corp is that it risks alienating a provincial Premier on the eve of what could be an election year. The Conservatives hold 13 of Saskatchewan’s 14 federal seats and are facing the prospect that their four-year-old government may be defeated on their 2011 budget.
20 October
Sources say BHP Billiton bid for Potash Corp set to be junked by Saskatchewan
(International Business Times) The anonymous sources, who were not authorised to issue statements on the matter, said that BHP’s offer were simply inadequate to offset the perceived losses in incomes to be incurred by both the Canadian and Saskatchewan governments.
Aside from that, the officials maintained that the provincial government of Saskatchewan remained firm on its position from day one and that is to protect the strategic and economic interests of the province, stressing that “the potash resource doesn’t belong to any company. It belongs to the people of Saskatchewan.”
12 October
Conservatives’ vow to slay deficit sets stage for election battle with Liberals
(Montreal Gazette) The Harper government is vowing to wipe out the federal deficit within six years, drawing a line in the sand for a federal election battle with the Liberals over who is best qualified to manage the country’s finances without killing the economic recovery.
In delivering his latest fiscal update Tuesday, Finance Minister Jim Flaherty said the government won’t be “inflexible” if it becomes necessary to stimulate the economy with more public spending. But the finance minister said he remains “comfortable” with the government’s plan to wind down its $48-billion stimulus program by the end of next March.
11 October
Clement says biggest challenge is boosting Canada’s performance in business innovation
(Hill Times) Industry Minister Tony Clement says Canada stands in the middle of the pack when it comes to private industry adopting new technologies and innovative processes. He promises to change that.
30 September
Bank of Canada Governor Mark Carney Discusses Employment in a Modest Recovery
Governor Carney noted that, with all 400,000 jobs lost in the recession now recovered, the performance of the labour market has been the most striking feature of the Canadian recovery. “However welcome,” he said, “these headline figures mask some important details.” Much of the employment growth is in the public sector, with only half of the new jobs in the private sector. Many jobs are involuntary part-time.
Governor Carney urged Canadian businesses and workers to respond to the shifts in the global economy. “The imperatives for business appear clear: new suppliers need to be sourced; new markets opened; and a new approach to managing for a more volatile environment developed,” he said, adding, “Workers need to build skills and be prepared to shift jobs and even careers, if necessary.” In concluding, the Governor noted that there are signs that some sectors in Canada are beginning to undergo restructurings that will allow them to be more competitive.
19 September
Ottawa loses fiscal hawk, on purpose
(Calgary Herald) Normally, the news that an Ottawa bureaucrat won’t stay an Ottawa bureaucrat wouldn’t actually be news. But it is and should be in the case of [Kevin] Page, who, while simply doing his job has clashed with the Conservative government for merely doing his duties: providing an unbiased, objective, non-partisan, non-political look at the numbers produced by the government.
In that sense, Page’s office is akin to the federal auditor general’s office … , except that unlike the auditor general whose work concerns after-the-fact analysis, Page’s analysis is in real-time and is meant to provide sober second thought about whether the government’s numbers are credible or political. (Globe & Mail) A sad farewell to the parliamentary budget officer
13 September
Diane Francis: Listen to Jarislowsky’s take on Potash deal
In addition to the prospect of one of the world’s most important resource corporations falling into foreign hands, Jarislowsky is appalled, like most Canadians, at the stock option for Potash CEO Bill Doyle, if he were bought out, of an estimated US$445 million — almost as much as the province of Saskatchewan earned in royalties from the world’s biggest and best potash deposit.
9 August
Stimulus projects may miss deadlines
Stephen Harper’s $20-billion stimulus program is not going as well as it should, and there’s a risk some infrastructure projects will not be competed by the March 31, 2011, deadline, according to a new report.
The report by Parliamentary Budget Officer Kevin Page, to be released later Monday morning, examines the progress of the stimulus spending at this halfway point in the two-year program.
Mr. Page says only a relatively “small proportion of the total estimated value of work was completed in the first year.”
14 July
Harper fiscal austerity plan repeats mistakes of the 1930s
(Canadian Centre for Policy Alternatives) Prodded by the financial markets’ whipping up of deficit hysteria, a new government consensus in favour of fiscal austerity is emerging. It is led in Europe by Germany and the U.K., and in North America by the Harper government. It contends that only swift and deep spending cuts will restore confidence among the bond market vigilantes.
This, its proponents argue, is necessary to prompt the private sector to spring into action, invest and spur the recovery. Although there is not a shred of evidence that this tough love approach will work, one thing is certain: It will deepen the suffering of the unemployed.
Draconian austerity measures are now being imposed in Europe and elsewhere: pension rollbacks and wage cuts for public servants, savage spending cuts. Millions are losing their jobs, their homes and their businesses.These measures are guaranteed to deepen and prolong recession and, paradoxically, weaken governments’ ability to manage their debt.

9 June
Maxime Bernier breaking the economic mould
(Financial Post) In recent weeks, the MP for Beauce, Que., has argued for zero-growth budgets and zero corporate tax. During a speech in Montreal, he accused Quebec of being overly reliant on federal equalization money and argued that “many people in the rest of the country perceive Quebecers to be a bunch of spoiled children.”
Now, Mr. Bernier says central banks around the world should take the lion’s share of the blame for today’s economic woes. He argues that the Bank of Canada should lower its 2% inflation target to zero and that there should even be a debate about returning to the gold standard. Maxime Bernier: How the central bank eats your money
26 May
OECD urges Canada to raise rates
The advice comes six days before the bank is scheduled to announce whether it will increase its benchmark lending rate from record low levels.
Many economists had been predicting that with signs of growing economic recovery, the bank would start raising rates on June 1, but that has become less certain amid concerns that the effects of the European debt crisis may spread, slowing recovery in North America and growth in emerging economies.
21 April
Youth unemployment skyrockets: OECD
The most recent Canadian data reinforces the OECD’s findings. The national unemployment rate sat at 8.2 per cent in March, Statistics Canada said recently. Among youths, the rate jumped to 15.6 per cent.
OECD singled out the prevalence of temporary contracts. Young people are more likely to be on temporary contracts and are often the first to go if companies cut staff.
5 March
Steady budget offers few surprises
When he delivered the last federal budget, dubbed Canada’s Economic Action Plan, in January 2009, he pitched it as a two-year plan to pull Canada out of the recession. The latest budget stays largely true to that, continuing to roll out the stimulus spending already announced while winding down other temporary measures and taking initial steps to tackle Canada’s first budget deficit since the mid-1990s. (Globe & Mail) PM gambles that voters care about the deficit, little else
19 February
Kevin Page is gloomy, but Forbes thinks we’re doing fine
Canada’s very own oracle of gloom, Parliamentary Budget Officer Kevin Page, is at it again, warning us that life is just going to keep getting worse.
His latest report comes with all the usual tidings of awfulness ahead:
With an ever smaller percentage of the population working and paying taxes, the federal debt will keep increasing unless the government cuts spending or raises taxes, Kevin Page said Thursday.
2 February
Marc Garneau: Where is Canada’s plan for the digital age?
During and after the Second World War, Canadian politician CD Howe formulated a vision to transform Canada into a leading industrial power in the second half of the 20th century. He began building Canada’s nuclear and aerospace industries, as well as the critical infrastructure needed to support a successful and vibrant economy. Today, a half-century after that success, a renewed vision is required for a digital economy that Mr. Howe wouldn’t have recognized.
22 January
Thousands turn out at rallies to protest proroguing of Parliament
Harper appeared unmoved by the rallies Saturday. He was asked several times about the rallies during a morning news conference.
His repeated answer was basically that the government was busy. “The government has a lot of work to do to get ourselves prepared for the upcoming agenda of Parliament,” he said.
“I would obviously simply urge our opposition to spend their time making constructive proposals. I think we’ve obviously had a successful year rolling out infrastructure projects, but we now have to turn our mind to a broader agenda to some of the economic challenges, including deficit reduction, ahead of us. And I would urge all parties to contribute constructively to that agenda.”

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