Friday, April 25, 2014

The Canadian middle class has the precise geometric shape of a political football

Impossible to draw any conclusions from "New York Times story" 


The "New York Times story" about the apparent relative decline of the American middle class was delivered as if by providence unto Canadian pundits and politicos who have leaped from all sides of the field to intercept this political football and run it towards their own particular goals.

The obvious problem with this story is that it was based on one specific set of data which, objectively speaking, provides zero basis upon which to draw any meaningful conclusions about the condition of the Canadian middle class. The data used is "median" income, which is, at best, an arbitrary measure of middle class. There are an equal number below and above a median income, however the median gives little insight into the values above and below the line.

While median income over time and in comparison with other countries certainly gives some clues as to the economic conditions in a country, there is no reason to conclude that our middle class is stronger than ever or otherwise. To extrapolate that "Canada's middle class is No. 1" ("or 2 or 3 or 4") and broadcast this on national media far and wide grossly exaggerates the impact of the numbers.

Many people would contest the results purely on the basis of gut instinct. Over the past two or three decades, we have witnessed erosion of union power and influence. We have seen thousands of jobs that used to be secure with benefits and pensions get outsourced to low-paying small companies, to a guy with a truck, or to overseas workers making $1 or $5 a day. Meanwhile, as wages "seem" to have stagnated, costs "seem" to have skyrocketed. Stuff like insurance, bank fees, gas at the pump, school fees, groceries, rent, etc., etc.

However accurate our gut feelings may be, though, our vested interest can play tricks on us, that's for sure.

So I looked at some other figures. Instead of the "Luxembourg" numbers tapped into by the NY Times, I looked at figures provided by the Paris School of Economics.

What happens say, if, instead of using "median" income as the determiner of middle class, we use the average income of the bottom 90% of earners. The problem often cited with using average incomes is that extremely high figures on the top end can throw off results. And, since we already know that the top 10% of earners bring home a disproportionately large share of the income in the country (actually about 40% in Canada), we can safely assume that those below 90% will be about as close to the "middle" as the "median" might be assumed to be.

Here is what I found out:

Since 1940, the average income of the lower 90% essentially increased by 30-50% each decade up until 1980. After that it has basically stopped growing except for in the past few years, with waters muddied by a change in database tabulating systems.

Average Income of Bottom 90% in Real 2000 C$

1940:   4000
1950:   6400
1960:   8400
1970: 12200
1980: 16400
1990: 17800 or 18100*
2000: 15900 or 17500*
2010:   n/a     or 19100*

* second figure based on alternate "LAD" database system

So how do we rationalize this with Andrew Coyne's assertion in the National Post that "In fact, pick any time frame except 30 years — 10, 20, 40, 50 — and the trend is up. The only one that produces relative stagnation is the one beginning in 1980."? Of course, the answer is that it does not rationalize whatsoever.

My own take is that middle class incomes in the past century rose in general until 1980 due mostly to union efforts and socially progressive policies. The rise of Reaganism and so-called supply side economics from 1980 might have amounted to only a minor correction or adjustment in the long run scheme of things. However there was a multiple-whammy in the '80s and '90s, as information technology and overseas outsourcing began to exert huge pressures on wages, as well as on other aspects of the economy.

The result is that the average earnings of the top 10% of earners in Canada since 1980 have risen 37% from $84,000 to $115,000, while the bottom 90% have had their earnings increase far more slowly (a maximum 18% over the 35 years). These are irrefutable facts that clearly support the "gut feeling" most Canadians probably have, that they are falling further behind.  

Still, it is clear that the "median" income figures used in the NY Times also do exist, perhaps in some parallel world, whose relation to the real world could be explained in an in-depth, sophisticated analysis that would go well beyond the kind of shallow political football game being played by all the sundry commentators.

The problem is that "Canada's middle class is No. 1" is the one and only message that our media successfully conveyed and this works to the distinct advantage of the Conservative Party of Canada. Which is no surprise.

Sunday, January 20, 2013

Proportional Representation? *check* Legalize and Tax Marijuana? *check* Carbon Tax? *check* Anyone But Harper Cooperation? *check* -Joyce Murray

Several bold but well-thought-out positions are making Vancouver MP Joyce Murray an interesting candidate for the Liberal leadership.

Murray seemed to attract quite a bit of attention in the debate. She was the only candidate I noticed trending on Twitter today. The majority of the attention positive. Some of the negative reacting to the "woman power" gambit.    

 

Thursday, January 17, 2013

Chasing Ice: The Largest Calving Event Ever Filmed

This film shows a massive iceberg calving event.


Wednesday, January 16, 2013

Michaƫlle Jean Makes Compelling Case for Continued Support of Haiti

In this interview, the UNESCO Special Envoy for Haiti, former Canadian Governor-General Michaƫlle Jean, gives thoughtful, illuminating and thought-provoking responses with the CBC's Wendy Mesley.

Recently, the rebuilding work in Haiti has come under criticism from such quarters as Hockey Night in Canada's Don Cherry and International Development Minister Julian Fantino.

Monday, November 5, 2012

Canadian shot in the butt, dies 11 days later in Guyana - Crime a growing factor in Caribbean

Sometimes it takes an incident that hits a bit closer to home, in order to draw attention to the everyday iniquities and injustice that go unnoticed in many countries around the world.

For example, a person identified in the Guyanese press as a Canadian, Jean Le Blanc, died in hospital just over a week ago, after being shot in the buttocks almost two weeks earlier.

The man was shot in a bar during the assassination of an alleged gangland figure. According to some reports, Le Blanc claimed he was "in the wrong place at the wrong time", although some of the speculation is that he may also have been targeted.

After several days in the hospital, Le Blanc was said to be recovering well and was scheduled to leave the country, but he died quite suddenly on Oct. 26 (2012).

Since then, an autopsy has been delayed, purportedly because "financial arrangements" for storage of the body post mortem were being made, in connection with the Canadian Embassy.

No mention of this situation has appeared in Canadian media that I have been able to find. One Guyanese report mentioned that Le Blanc was a Montreal resident.

There is a photo of a person identified as Le Blanc in the hospital in Georgetown on a few Guyanese websites.

Meanwhile, a UN report recently released has revealed that crime rates in the Caribbean have been rising dramatically, even while they've been dropping in most other parts of the world.

A quick scan of the news items for the past few days in the Guyanese press is enough to informally confirm this, as you get the impression that there are more violent crimes in this small country of only 750,000 people, than there are in most of our big cities in Canada. Crime is bad enough when it occurs in developed countries. In less developed countries, it can destabilize the delicate balance of economic viability and social development. 

As the The Caribbean Human Development Report 2012, prepared by the UN Development Programme (UNDP) says, the increasing crime rate is threatening economies and livelihoods in Caribbean countries.

“Violence limits people’s choices, threatens their physical integrity, and disrupts their daily lives,” said UNDP Administrator Helen Clark at the report’s launch.

Anyone think that more free trade deals and sweetheart corporate tax giveaways will improve this situation? 

Friday, November 2, 2012

A Romney-esque Day at the CHLPA

There has been a flurry of reports over the past two days concerning the CHL Players Association and the mystery surrounding the identities of some of the people purportedly connected with the group.

One of the better accounts is by Sunaya Sapurji at Yahoo Sports.

According to this and other reports, the union's executive director, Georges Laraque, has now announced he will be leaving the union, saying he would like to pass the work done to date on to a person or persons who would have the wherewithal to move the endeavour forward.

Also word that two law firms that were doing pro bono work for the group are bailing.

There is a whole series of clips and interviews that can be seen on TSN.

There is certainly no denying the sketchiness of any of this. On the other hand, I haven't seen much, if any concrete evidence to show that the CHLPA's activities have not been on the straight and narrow.

The sudden appearance of all this "noise", without identifying any concrete transgressions that you can actually put a finger on, all has a kind of "Romney-esque" feel to it. Considered along with other factors, such as the sabotaging of Laraque's car, just as players are starting to vote on union certification, one is left with the feeling that there remains much more to this story than we have yet seen.