Can Canada’s Temporary Foreign Worker Program Be Fixed?

Yesterday the Harper government responded to increasing public pressure and announced significant changes to Canada’s Temporary Foreign Worker Program.

Pressure on the government has been mounting since the CBC broke the story earlier in April of how Canada’s largest bank, RBC, was replacing dozens of its Canadian staff with temporary workers from India who had been hired to take over their department.

minerThis comes on top of news that a mining company in BC had been allowed to bring in 201 miners from China despite the fact that qualified Canadian workers had applied for the positions.

The Rise in Temporary Foreign Workers

The use of temporary foreign workers has dramatically increased since the Conservative government came to power.

Between 2007 and 2011, 30 per cent of all net new jobs in Canada went to migrant workers — during a period of high unemployment in this country.

Since 2008 the number of temporary foreign workers has increased by 60 per cent in Toronto, 70 per cent in Quebec, and 80 per cent in the Atlantic Provinces – all of which continue to have high rates of unemployed Canadians. Last week the Alberta Federation of Labour released a report stating that three out of four jobs created in the province over the last few years were filled by temporary foreign workers instead of Canadians.

The number of temporary foreign workers entering the Canadian workforce each year is now greater than the number of permanent workers receiving visas. And while limits are set for the number of new immigrants admitted to Canada each year, there are no limits to the number of foreign workers that may be approved. Today over 340,000 temporary foreign workers are employed in Canada.

migrant workersTemporary foreign workers do not have the same rights as other workers. They are required to pay into the Employment Insurance Program but are ineligible for any of its benefits. They are not covered under the national health care plan. If they are injured on the job their contracts can be terminated and the employees sent back to their country of origin. And federal legislation allows them to be paid up to 15% less than Canadian workers – even if this falls below the minimum wage.

If temporary foreign workers quit their jobs for any reason, they cannot look for other employment (their work is tied to a specific contract) and they may be deported. Temporary workers are subject to harassment, exploitation, unsafe working conditions and substandard housing with little government oversight to ensure that the terms of their contracts are being honoured.

In 2009, Immigration Minister Jason Kenney announced that his department would publish online a list of employers found to be flouting the rules, and they would be subject to sanctions. Four years later, that bad-boss website doesn’t contain a single name of a single company.

The stated goal of the Temporary Foreign Worker Program is to enable “employers to hire foreign workers on a temporary basis to fill immediate skills and labour shortages, when Canadian citizens and permanent residents are not available to do the job.” However, many employers have used the program to avoid training Canadian workers and to hire labourers in unskilled jobs at less then minimum wage.

Tim Hortons[While] the federal government has granted thousands of fast-tracked work permits designed for employers seeking high-skilled migrant workers … documents show many migrant workers brought in … are actually toiling in fast-food restaurants, convenience stores and gas stations.

Tim Hortons is one of many employers to take advantage of this program. Between 2007 and 2012 it received permission to bring close to 15,000 temporary foreign workers to Canada.

Fixing the Abuses

In response to these and other massive problems with the program, yesterday the Harper government announced some significant revisions to the Temporary Foreign Worker Program. Effective immediately, these changes will ensure that

– employers will be required to pay temporary foreign workers at the prevailing wage offered to Canadians (eliminating the 15% pay reduction)

– the program is not used to facilitate the outsourcing of Canadian jobs

– the government will have increased authority to suspend and revoke the work permits of employers who misuse the program

– employers using the program have a firm plan in place to transition to a Canadian work force over time, and

– fees for work permits are increased so taxpayers are no longer subsidizing the program’s costs.

It is a very good start – especially for protecting Canadian jobs. But the rights of these temporary workers also need to be protected. The government  needs to take further steps to ensure that these workers are not being exploited during their stay in Canada.

E4ZPSME43UBP

Can Canada’s Temporary Foreign Worker Program Be Fixed?

Yesterday the Harper government responded to increasing public pressure and announced significant changes to Canada’s Temporary Foreign Worker Program.

Pressure on the government has been mounting since the CBC broke the story earlier in April of how the Royal Bank of Canada was replacing dozens of its Canadian staff with temporary workers from India who had been hired to take over their department.

minerThis was on top of the news that a mining company in BC had been allowed to bring in 201 miners from China despite the fact that qualified Canadian workers had applied for the positions.

Public anger over these events has finally prompted the government to act.

Foreign Workers in Canada

The use of temporary foreign workers has dramatically increased since the Conservative government came to power.

Between 2007 and 2011, 30 per cent of all net new jobs in Canada went to migrant workers — during a period of high unemployment in this country.

Since 2008, the number of temporary foreign workers has increased by 60 per cent in Toronto, 70 per cent in Quebec, and 80 per cent in the Atlantic Provinces – all of which continue to have high rates of unemployed Canadians. Last week the Alberta Federation of Labour released a report stating that found three out of four jobs created in the provinces over the last few years have been filled by temporary foreign workers instead of Canadians.

The number of temporary foreign workers entering the Canadian workforce each year is now greater than the number of permanent workers receiving visas. And while limits are set to the number of new immigrants admitted to Canada each year, there are no limits to the number of foreign workers than may be approved. Today over 340,000 temporary foreign workers are employed in Canada.

migrant workersTemporary foreign workers do not have the same rights as other workers. They are required to pay into the Employment Insurance program but are ineligible for any of its benefits. They are not covered under the national health care plan. If they are injured on the job their contract can be terminated and the employee seen back to their country of origin. And federal legislation allows them to be paid up to 15% less than Canadian workers – even if this falls below the minimum wage.

If a temporary foreign worker quits their job for any reason they cannot look for other employment (their work is tied to a specific contract) and may be deported. Temporary workers are subject to harassment, exploitation, unsafe working conditions and substandard housing with little government oversight to ensure that the terms of their contracts are being honoured.

In 2009, Immigration Minister Jason Kenney announced that his department would publish online a list of employers found to be flouting the rules and they would be subject to sanctions. Four years later, that bad-boss website doesn’t contain a single name of a single company.

The stated goal of the Temporary Foreign Worker Program is to enable “employers to hire foreign workers on a temporary basis to fill immediate skills and labour shortages, when Canadian citizens and permanent residents are not available to do the job.”The program was specifically set up to alleviate labour shortages in skilled positions where not enough qualified Canadian workers could be found. Yet,

Tim Hortons[While] the federal government has granted thousands of fast-tracked work permits designed for employers seeking high-skilled migrant workers … documents show many migrant workers brought in … are actually toiling in fast-food restaurants, convenience stores and gas stations.

Tim Hortons is one of the many employers to take advantage of this program. Between 2007 and 2012 it received permission to bring close to 15,000 temporary foreign workers to Canada.

Addressing the Problem

In response to these and other massive problems with the program, yesterday the Harper government announced some significant revisions to the Temporary Foreign Worker Program. Effective immediately, chese changes will ensure that

– employers will be required to pay temporary foreign workers at the prevailing wage offered to Canadians (eliminating the 15% pay reduction)

– the program is not to be used to facilitate the outsourcing of Canadian jobs

– the government will have increased authority to suspend and revoke the work permits of employers who misuse the program

– employers using the program have a firm plan in place to transition to a Canadian work force over time, and

– the fees for work permits will be increased so that taxpayers are no longer subsidizing the program’s costs.

It is a very good start – especially for protecting Canadian jobs. But the rights of these temporary workers also need to be protected. The government also needs to take steps to ensure that these workers are not being exploited during their stay in Canada.

E4ZPSME43UBP

Austerity’s Big Fail

Repeatedly one hears the cry in Washington that the federal debt is dangerously high. Spending has to be drastically cut. Seldom is it discussed how the debt got to be so high in the first place (30 years of profligate spending by Republican administrations – with no complaints from the Republican Party itself).

Suddenly, once a Democrat became President, the refrain became: stop the spending. Cut entitlements and social programs. Cut, cut, and cut again. Austerity, not increased spending, is the solution to America’s economic problems.

Austerity-BlythThis weekend I came across an excellent article in the current issue of Foreign Affairs entitled “The Austerity Delusion: Why a Bad Idea Won Over the West.” It is written by Mark Blyth, a professor of international political economy at Brown University, who is also the author of the recent book, Austerity: The History of a Dangerous Idea (Oxford Press, 2013). The article is adapted from material in that book.

Blyth begins his essay stating,

The Eurozone countries, the United Kingdom, and the Baltic states have volunteered as subjects in a grand experiment that aims to find out if it is possible for an economically stagnant country to cut its way to prosperity.

The results of the experiment are now in, and they are equally consistent: austerity doesn’t work.

Austerity measures were applied in these countries to decrease the ratio of debt to GDP. If government debt is cut through decrease spending and GDP remains constant, the debt-to-GDP ratio is lowered. However, austerity measures have instead cut consumer spending, which has cut demand and slowed production. This has lowered the GDP at an even faster rate than government debt. The result:

Portugal’s debt-to-GDP ratio increased from 62 percent in 2006 to 108 percent in 2012. Ireland’s more than quadrupled, from 24.8 percent in 2007 to 106.4 percent in 2012. Greece’s debt-to-GDP ratio climbed from 106 percent in 2007 to 170 percent in 2012. [Even] Latvia’s debt rose from 10.7 percent of GDP in 2007 to 42 percent in 2012.

In addition, he says,

None of these statistics even begin to factor in the social costs of austerity, which include unemployment levels not seen since the 1930s in the countries that now make up the Eurozone.

Why Austerity Doesn’t Work

 Blyth explains that the drive for austerity is particularly seductive because of the common sense nature of its core claim: you can’t cure debt with more debt. And while this is true in principle, it oversimplifies the actual situation.

Blyth maintains that austerity fails for three reasons that are also rooted in common sense truths but often fail to be noticed.

The-Rich-Get-Richer-Income-InequalityFirst is that austerity impacts some more than others. Those in the top income brackets can comfortably absorb the effects of austerity and still have money to spare. Meanwhile, those at the bottom have little to no reserves to cushion the blow and experience the greatest pain. In a society in which the 400 richest Americans own more assets than the poorest 150 million, he says,

trying to get the lower end of the income distribution to pay the price of austerity through cuts in public spending is both cruel and mathematically difficult.

The poor simply do not have the resources to carry this burden.

Second, austerity fails because in an interconnected global economy

eurozone-mapif all states … cut their spending simultaneously, the result can only be a contraction of the regional economy as a whole.

Ultimately, economic growth (increased profits) is the only effective way out of debt. But someone must be buying goods and services for profits to be made. If there are fewer buyers in the market place, there is less profit to be had. It is as simple as that. Austerity fails to promote growth.

YMs_ErdYW_The third reason austerity fails is that

the notion that slashing government spending boosts investor confidence does not stand up to scrutiny.

One of the main arguments given for austerity is that high government debt creates market uncertainty, and that strict austerity to curb that debt it is necessary for restoring business confidence. It is believed that once austerity measures have been implemented, both consumers and producers will begin to “feel confident about the future and will spend more, allowing the economy to grow again.”

Blyth maintains that such a belief is more indicative of wishful thinking than actual fact. He asks whether it is realistic to expect that “this behavior will actually be exhibited by financially illiterate, real-world consumers who are terrified of losing their jobs in the midst of a policy-induced recession.”

 

Lessons to be Learned

great_depression-2Blyth gives a great deal of attention in his article to earlier attempts at using austerity to curb excessive debt in the late 1920s and 1930s.  At that time, he says, the United States, the United Kingdom, Germany, and Japan all tried to simultaneously cut their way to growth. This project didn’t just fail; it gave created such economic hardship and disparity that it gave rise to fascism in Europe and Japan and helped cause World War II.

The lessons from the last major attempt at austerity were stark:

When the world’s four largest economies all tried to cut their way to prosperity at the same time in the interwar years, the result was contraction, protectionism, violence, and fascism.

Surely we would want to avoid a similar outcome.

So if austerity is not the solution, what is? Again the author calls for a common sense approach. Excessive debt must be conquered, he says, but countries should not attempt to shed both massive private debt and massive public debt at the same time. Instead,

governments should get the private sector to pay down its debts while maintaining public spending. … Once that is done, as the private sector recovers, tax revenues will increase, and the accumulated debts and deficits can be paid down.

bridge_repair_1The private sector can effectively be put on the path to recovery through government incentives, such as job creation. “Now would be a good time for Washington to make useful investments” in the public sector, he says. For example,

around a third of the bridges in the United States are badly in need of repair. Fixing them would enhance U.S. productivity and has no downside.

If, on the other hand, the United States were to proceed down the path to austerity there were be a severe downside:

[Under austerity] roads would go unrepaired, students would miss out on gaining knowledge, and the skills of the unemployed would atrophy. … The United States would end up poorer and more debt-ridden than before, and what is most problematic, it would lack the capacities needed to generate future growth.

But, he says in conclusion, you don’t have to take his word for it. Just ask the Europeans how austerity has been working out for them.

Deliberately Dysfunctional

At no time in the last 150 years has the U.S. Congress been as deeply polarized as it is today. Nearly every bill presented by the Democrats in the Senate is filibustered, delaying its passage indefinitely. If a bill survives filibuster and passes in the Senate, it is sure to be killed in the House. Any partisan bill passed by the Republican controlled House is killed by the Democrats in the Senate. Congress has become deeply dysfunctional.

It turns out this dysfunction is no accident. It is intentional, it is willful, and it is deliberate.

mann-ornsteinExactly one year ago, two well-respected non-partisan political analysts, Thomas Mann and Norman Ornstein, published the book It’s Even Worse Than It Looks: How the American Constitutional System Collided with the New Politics of Extremism. They were guests on Moyers and Company on Friday, April 26  and gave an update on the situation in Congress. Watch the interview with Bill Moyers here.

Mann and Ornstein write in a calm, even-tempered, fact-laden and non-controversial style. The book was launched with a lengthy op-ed piece published in the Washington Post. A senior editor there decided to give it the provocative title Let’s just say it: The Republicans are the problem. It caught people’s attention – the column went viral with 1.5 million hits.

These two political analysts are not prone to partisanship; they only reluctantly decided to break form and speak out. In their view the Republican Party has become dominated by a right wing radical element engaged in an extremist no-holds-barred political war against the current president.

In the Washington Post op-ed, the authors express their concern like this:

We have been studying Washington politics and Congress for more than 40 years, and never have we seen them this dysfunctional. In our past writings, we have criticized both parties when we believed it was warranted. Today, however, we have no choice but to acknowledge that the core of the problem lies with the Republican Party.

The GOP has become an insurgent outlier in American politics. It is ideologically extreme; scornful of compromise; unmoved by conventional understanding of facts, evidence, and science; and dismissive of the legitimacy of its political opposition.

When one party moves this far from the mainstream, it makes it nearly impossible for the political system to deal constructively with the country’s challenges.

Dysfunctional by Intent

How did the American Congress reach this dysfunctional state? Mann and Ornstein trace its origins to two main political players: Newt Gingrich and Grover Norquist.

Newt_GingrichFrom the day he entered Congress in 1979, Gingrich had a strategy to create a Republican majority in the House: convincing voters that the institution was so corrupt that anyone would be better than the incumbents, especially those in the Democratic majority. It took him 16 years, but by … recruiting GOP candidates around the country to run against Washington, Democrats and Congress, Gingrich accomplished his goal.

Ultimately, the authors say,

the forces Gingrich unleashed destroyed whatever comity existed across party lines, activated an extreme and virulently anti-Washington base — most recently represented by tea party activists — and helped drive moderate Republicans out of Congress.

Grover_NorquistMeanwhile Grover Norquist was mobilizing the libertarian faction within the Republican Party. He founded Americans for Tax Reform in 1985 and introduced his Taxpayer Protection Pledge the following year. The pledge binds the signers to never support a net tax increase in any form  In the lead-up to the November 2012 elections 238 of 242 House Republicans and 41 out of 47 Senate Republicans had signed the pledge. As Mann and Ornstein note,

The Norquist tax pledge has led to other pledges … that create additional litmus tests that box in moderates and make cross-party coalitions nearly impossible. For Republicans concerned about a primary challenge from the right, the failure to sign such pledges is simply too risky.

It has been said, “Norquist has been responsible, more than anyone else, for rewriting the dogma of the Republican Party.”

The Impasse and Beyond

So, where does this leave Congress? Mann and Ornstein put it this way:

Today, thanks to the GOP, compromise has gone out the window in Washington. In the first two years of the Obama administration, nearly every presidential initiative met with vehement, rancorous and unanimous Republican opposition in the House and the Senate, followed by efforts to delegitimize the results and repeal the policies.

The filibuster, once relegated to a handful of major national issues in a given Congress, became a routine weapon of obstruction, applied even to widely supported bills or presidential nominations. And Republicans in the Senate have abused the confirmation process to block any and every nominee … solely to keep laws that were legitimately enacted from being implemented.

In the third and … fourth years of the Obama presidency, divided government has produced something closer to complete gridlock than we have ever seen in our time in Washington, with partisan divides even leading [in 2011] to  America’s first credit downgrade.

They observe that

Republicans often dismiss nonpartisan analyses of the nature of problems and the impact of policies when those assessments don’t fit their ideology. … This attitude filters down far deeper than the party leadership. Rank-and-file GOP voters endorse the strategy that the party’s elites have adopted, eschewing compromise to solve problems and insisting on principle, even if it leads to gridlock.

To be fair, they also state,

Democrats are hardly blameless, and they have their own extreme wing and their own predilection for hardball politics. But these tendencies do not routinely veer outside the normal bounds of robust politics. If anything, under the presidencies of Clinton and Obama, the Democrats have become more of a status-quo party. They are centrist protectors of government, reluctantly willing to revamp programs and trim retirement and health benefits to maintain its central commitments in the face of fiscal pressures.

So what lies ahead? In the op-ed piece, Mann and Ornstein conclude that

If our democracy is to regain its health and vitality, the culture and ideological center of the Republican Party must change.

In the end, they say,

it is up to voters to decide. If they can punish ideological extremism at the polls and look skeptically upon candidates who profess to reject all dialogue and bargaining with opponents, then an insurgent outlier party will have some impetus to return to the center. Otherwise, our politics will get worse before it gets better.

Republicans and the Millennials

Reince_PriebusRepublican self-confidence was severely shaken in the wake of the Party’s losses in the lection last fall. As Party Chairman Reince Priebus stated  at the National Press Club Breakfast last month,

When Republicans lost in November, it was a wakeup call.

In response, Preibus commissioned what he referred to as the “most comprehensive post-election review in the history of any national party.” It resulted in a 98-page long Growth and Opportunity Project report released last month. Among its admissions:

Our message was weak; our ground game was insufficient; we weren’t inclusive.

Focus groups described our party as “narrow minded,” “out of touch,” and “stuffy old men.”

Opinions differ on whether the Republican Party is up to the challenge of effectively reaching out to the voting sectors that largely went to Barack Obama in the election, namely young voters, young women, blacks and Latinos. The challenge will be especially difficult as Republicans attempt to reach out to younger voters.

Yesterday I came across a very insightful blog by Chad Kolinski posted on policymic.com. Chad belongs to the millennial generation. He describes himself as a political moderate and articulates a message that reflects the views of many other millennials.

Millennials Will Be 40 Percent Of the Electorate By 2020

millennialsWe are the millennials. We are Generation Y. We are the 95 million Americans born between the late 1970s and the early 2000s. We are America’s largest age demographic, we are growing, and we are the future of this great nation. According to The Center for American Progress, by 2020, there will be 103 million of us: 90 million of which will be eligible voters, representing 40% of the electorate. In the landmark 2012 election, for the first time in the history of the United States, more millennials voted than senior citizens.

President Obama successfully won our demographic by large margins in both the 2008 and 2012 elections. In fact, in 2012, President Obama received about 5 million more votes from 18-29 year olds than his Republican challenger Mitt Romney did. Just by looking at these figures, it is safe to say that the candidate who wins the millennials wins the election.

The new, perpetual presence of millennials within the electorate is an extremely important concept that will dictate the future of our nation. We, the millennials, need to grasp how significant the opportunity that lies before us is. We need to wake up and understand the undeniable potential for change our generation can bring about.

We are a radically different generation compared to the Baby Boomers or even Generation X. We are the first generation to grow up in a globalized world and to experience the political, social, and economic transformations brought about by the internet. Most importantly, our generation understands that change is unavoidable, a necessity, to remain relevant within the modern world.

Unlike past generations, we do not partake in the nostalgia of “traditional America values” because American values have been evolving our entire lives.  We look back at the 20th century to see what made our country great, and then look ahead to the future for ways to make our country even greater.

Our familiarity with change and the lack of traditional ideology allow millennials to offer new common sense solutions to our nation’s problems. We understand the need to reform entitlements because the looming burden of retiring Baby Boomers ultimately falls upon us. We see the need to alter our bloated defense spending because taking care of our battle weary veterans and defending against cyber warfare are a greater priority than creating surpluses of fighter jets.

We take a progressive approach in promoting green energy, investing in schools, and supporting government’s role in society. And yet, we do not want the federal government making decisions that should be left to the states, such as the legalization of marijuana, and most recently, gay marriage.

The topic of gay marriage is a surprisingly accurate gauge of where our country stands, and in what direction it is headed. Within the next few weeks the Supreme Court will likely either throw out, or make significant changes, to key anti-gay marriage legislation. In 1996, when DOMA was signed, many argued same-sex marriage was morally wrong and had to be prevented at all costs. Today, over half of the nation believes gay couples deserve the right to marry.

This is attributed, in large part, to the influence of us, the millennials. Seventy-three-percent of 18-29 year olds support gay marriage, compared to 39% of those aged 65 and older. Some surveys even show figures of millennials supporting gay marriage in ratios greater than 4:1. Last week, Senator Rob Portman (R-Ohio), a potential 2012 vice presidential nominee, declared his support for same sex marriage. The national conversation is changing on both sides of the aisle — and millennials are leading the way.

Our generation is finally finding its voice in American politics. The 2012 election was the 3rd straight election in which more than 50% of eligible millennials voted. As we continue to get out and vote, we will elect representatives who embody our generation’s hopes and dreams. The number of millennials in Congress increased 3% from the 112th Congress to the 113th Congress. Today, over 35 house representatives are under the age of 40. These trends will only continue to grow in 2014, 2016, and beyond as our generation becomes more politically active and aware.

Both Democrats and Republicans in Congress should take heed of this coming shift.  The refusal to reform entitlements, change our tax code, or invest in our future will not go over easy. If both parties do not pay attention to the changing political tides, then it is all to likely that we just might put an end to this defunct two party system and create a party of our own. When Congress kicks the can down the road, it lands squarely in our laps — if Washington cannot solve our nations problems, then we millennials will find representatives who will.

A Significant Miscalculation

Reinhart_RogoffIn 2010 two Harvard professors, Carmen Reinhart and Kenneth Rogoff, published an academic paper in which they showed that once the national debt rises beyond 90 percent of GDP, average growth rates fall precipitously to near zero.

rogoffgrowthvsdebtovergdp_zpsc983eb14Their analysis drew on data from 44 different countries over a 200-year period. These findings were later republished in the book This Time is Different, which won numerous awards and became a best seller.

The study was quoted by many Republicans and even a few Democrats as conclusive proof that the U.S. economy (which had reached this 90% mark early in 2010) was at a critical ‘tipping point.’ Comparisons were made to Greece (its debt to GDP ration topped 113% in 2009), and alarm bells were raised about the danger of American insolvency and a looming economic collapse.

The Reinhart-Rogoff report became a chief pillar in the argument against any additional stimulus spending that might expand the national debt. Instead, deep budget cuts and austerity were the order of the day if America was to be rescued from looming catastrophe.

It turns out that Reinhart and Rogoff’s findings were dead wrong.

Thomas HerndonIt took a 28-year old graduate student named Michael Herndon to discover the errors. This spring he was completing an assignment for an econometrics course that required him to replicate the data analysis of a well-known study. He chose Reinhart and Rogoff’s 2010 paper because of its significance, but then found that he was not able to replicate their results.

He repeatedly emailed Reinhart and Rogoff to get an explanation. Reinhart finally sent him the raw data and told him to sort the answer out for himself. He did. In going over the data spreadsheet, he discovered some errors in their calculations.

I clicked on cell L51, and saw that they had only averaged rows 30 through 44, instead of rows 30 through 49.

The missing rows contained data from Canada, New Zealand, and Australia – countries with highly developed economies like the United States – that have sustained solid growth even while maintaining high debt-to-GDP ratios. The inclusion of this additional data seriously undercut the report’s main thesis that high debt prevents economic growth.

rogoffgrowthvsdebtovergdpcorrect_zpsba357786Rather than showing average economic growth plunging precipitously from 2.8% to -.1% when the 90% threshold is reached, the revised calculations show a decline in the growth rate to 2.2%. Significantly, this matches the average economic growth rate in the U.S. over the last three years. Right on target with what one would expect. It is slow – less than what one would like. But the economy is by no means dead in the water.

Yes, large indebtedness does weigh upon an economy. No one disputes that. But the revised data clearly shows that there is no sudden plunge after a certain level. There is no looming cliff. There is no cause for panic. In fact, the cost of paying off the debt as a percentage of GDP is actually less now than it was in in Ronald Reagan’s final year as President. No one was shouting fiscal crisis at that time.

The solution to the high GDP-to-debt ratio is to grow the economy. Austerity will not do this. Austerity slashes government spending, which eliminates jobs, which reduces production, which lowers overall GDP. The goal is to decrease the value of the debt-to-GDP ratio. The smaller the GDP, the higher the ratio. (To use a simple example: a Debt/GDP ratio of 8/10=80% but a ratio of 8/9.5=84%.) Reducing the GDP through austerity does not bring down the overall debt-to-GDP ratio; it has the opposite effect. Growing the economy, on the other hand, does bring down this ratio. (E.g. a Debt/GDP ratio of 8/10.5=76%).

It’s simple math. Unfortunately the economists neglected to do the math properly and our politicians blindly followed their lead. One should always check the facts behind the arguments. Fortunately, someone finally did.

Earth Day 2013 – Getting Subversive

Earthday2013_logo_smallHappy Earth Day!

Yes, Earth Day – a day in support of environmental protection – is being celebrated on April 22 this year in 192 different countries, involving more than 25,000 organizations and millions of participants.

But wait. Didn’t we celebrate Earth Day just last month? Yes we did. There are actually 2 official Earth Days each year.

 Earth Day – A Brief History

earth-day-1970-quotes_1365999847Back in 1969 a UNESCO Conference in San Francisco proposed that the Date of March 21, 1970 (the first day of spring in the northern hemisphere) be set aside as a day to promote environmental protection worldwide. The Secretary General of the United Nations later signed a proclamation to this effect. Since then this date has been observed annually as “Earth Day.”

Perhaps inspired by this development, U.S. Senator Gaylord Nelson set April 22, 1970 as the day for a nation-wide teach-in on environmental issues. It was a huge success, involving “participants and celebrants in two thousand colleges and universities, roughly ten thousand primary and secondary schools, and hundreds of communities across the United States.”

hands-globe2_2pb6The 20th anniversary of Earth Day was marked in 1990 with a series of high-profile events involving some 200 million people in 141 different countries. A similar major anniversary event was held on the 30th anniversary in 2000. This time “5,000 environmental groups around the world were on board, reaching out to hundreds of millions of people in a record 184 countries.”

The Earth Day Network headed by Denis Hayes, one of the original national coordinators of the 1970 Earth Day events, now coordinates these ongoing activities. The network

has grown into an established Washington, DC-based organization that promotes environmental activism and year-round progressive action, domestically and internationally. … Earth Day Network members focus on environmental education; local, national, and global policies; public environmental campaigns; and organizing national and local earth day events to promote activism and environmental protection.

The international network reaches more than 25,000 organizations in 192 countries, while the domestic program engages 10,000 groups and more than 100,000 educators coordinating millions of community development and environmental-protection activities throughout the year.

Why April 22nd?

earth-day-photoGaylord Nelson originally set April 22 as the day for his coordinated “teach-ins” in 1970 in order to maximize participation on college campuses in the U.S. The week of April 19-25 was after the spring break and before exams; it did not conflict with religious holidays like Easter and Passover; and it was late enough to have decent spring weather. To avoid competition with weekend events, he set the day for the middle of the week – Wednesday, April 22.

Coincidentally April 22, 1970 also happened to be the 100th anniversary of the birth of Vladimir Lenin. Time magazine reported at the time that some people suspected the choice of this date was not a coincidence, but “a Communist trick.” The magazine even quoted a member of the Daughters of the American Revolution as saying

subversive elements plan to make American children live in an environment that is good for them.

By all means we must watch out for those “subversive elements” that would plot to create an environment that would actually be good for our children! We have seen how negligent industry has been to monitor and remedy the environmental hazards it creates. We have seen how slow governments have been to respond to environmental pollution and the effects of climate change.

It is time for more of us to join that subversive network of concerned citizens who wish to make out planet environmentally safe for future generations. This Earth Day is a good time to commit ourselves to that task.

Welcome fellow subversives!

earth-day-2013-images-greetings-wishes_8