Sunday, November 23, 2014

The Reich Stuff

For those who watch CNBC, Robert Reich is a familiar figure ... generally because he's a punching bag for much smarter people, be they hedge fund managers, economics commentators, bankers, or other economists. As a result I got a chuckle out of CTVs introduction to him in a recent piece they did.
A prominent U.S. political economist says Canada is moving toward American-style inequality, and believes austerity economics and tax cuts for corporations are making the problem worse.

Robert Reich, the secretary of labor during Bill Clinton’s presidency, now writes extensively on income equality and was in Canada this week speaking at an event for the Broadbent Institute.
Poor Robert has convinced himself that Canada and the USA are on parallel courses ... he obviously has no idea that while America's middle class is descending, Canada's is ascendent. And, while the USA is slowly losing its global economic ranking in virtually every single metric, Canada holds steady near the top dozen or so.

But, CTV journalists know the obvious (as expressed so elegantly by Jonathan Gruber), that low brow voters tend to herd to the left side of the aisle, and will take most anything uttered by "prominent" leftists as gospel, so they trot out the likes of Reich to push the Canadian left adgenda.  After all, what better way to stir up the "folks" than to bash the wealthy and suggest more spoils for the cockroaches.

The reality is, that in a global economy that has sputtered along since 2008, Canada has more than held her own.  What's even more impressive, is that while many European countries have held their own since 2008, it's come through massive increases in public debt, while Canada has grown with comparatively little federal debt expansion. Furthermore, Canada boasts an expanding middle class. In the context of a weak global economy this is an impressive feat.  
A new study shows Canada’s middle class as a world leader in income, but before we get too excited it’s worth noting we are just leading a shrinking class around the globe.

An analysis by the New York Times, using data from LIS which runs the Luxembourg Income Study Database, found that as of 2010 Canada after-tax middle-class income earners had passed their U.S. counterparts after being well behind in 2000. The study shows median per capital income in Canada even ahead of countries like Norway or The Netherlands.

“What the story shows is relative to middle class Americans, Canadians did better,” said Craig Alexander, chief economist with Toronto-Dominion Bank.
Robert Reich's America, on the other hand, has the lowest labor participation rate in decades, has a steadily increasing number of people living in poverty, and a shrinking middle class. But, can we expect an intellectually lazy Clinton era hack like Reich to know this?  So lazy between the ears is he, in fact, that Reich is bashing on CTV the United States of Barrack Obama and Hillary Clinton ... two people at whose feet he worships.  Since Obama took over, the gap between rich and all the others has never grown so rapidly.

The fact is, that Canada is one of the few first world countries with a growing middle class.  How long that lasts with Ontario's skid into the left ditch remains to be seen.  For now though, Canada's two most conservative provinces keep churning out middle class jobs at a rate so fast that they struggle to fill openings.  

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