Tuesday, June 26, 2012

Harper's risky economic theories

There are a few items in the news today that run contrary to the constant spin we get from our Harper government spokespersons about the solidity of the omni-present Economic Action Plan and how all our possible economic troubles stem from abroad. First up: "Moody’s warns on mortgage debt."
After Finance Minister Jim Flaherty announced last week that Ottawa is tightening the rules on government-backed mortgages to keep the housing market from overheating, Moody’s said it is concerned the efforts may not be enough.
High levels of household debt in Canada have left consumers with little flexibility to adapt to shifting markets, the credit rating agency said. “The government’s moves may have come too late, owing to the buildup in consumer debt that has already occurred,” Moody’s said in a research note Monday. “Canadian consumers’ reliance on low interest rates to support high debt loads remains a risk.”
Same old story with the Harper/Flaherty team. Too late in acting and not enough scrutiny being given in Canada to the role they have played in meddling with mortgage rules.

Then there are other broader concerns being articulated: "Conference Board of Canada: Weak productivity, innovation gap pose challenges to Canada's economy."
Mr. Hodgson said Canada’s productivity growth “has been dismal” compared to the U.S. and other major economies. “Thanks to chronically weak productivity growth, Canadian incomes are $8,500 per capita below where they would be if we had matched the U.S. on productivity,” he said.
The Conference Board is not alone with these concerns. The Organization for Economic Co-operation and Development, in a June 13 report, cited lagging business innovation and low productivity as threats to Canadian growth.
These are issues that have been under this government's oversight and don't appear to be faring so well. That economic record is not so ship shape. It might even be the kind of material that is ad worthy, if anyone had the money to do so.