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Should stadiums receive public funding?

The renovation has started a familiar debate over whether or not the costs of arenas and stadiums should be paid for by the public, giving the billionaire owners of teams a place to play on the taxpayers dollar. Despite my love of baseball, and my hope that the Expos will return to Montreal, I believe that stadiums should come at the cost of the team owner and not the taxpayer, unless the benefits should equal or outweigh the cost. When former Montreal Mayor Denis Coderre was defeated in the recent Montreal municipal election, many sports fans said that the dream of baseball died with him. However, new Mayor Valerie Plante has said that she won't use public money to finance a new stadium or team without a referendum. Even though Montrealers would likely vote against spending hundreds of millions of their tax dollars to bring a MLB team back, I think Plante has the right idea. According to a 2013 study by the Montreal Baseball project, it would cost over a billion dollars for a baseball team to return, including the project quoting “while 33 per cent ($335 million)would come from government”. Even with the return of the Expos, and the jobs it would create, that is a very high price to pay. I would be alright with paying public money for a new stadium if the municipal government does hold a referendum and the majority votes vote yes. Even if a yes vote occurred, I would need to be convinced by the team’s ownership group that the benefits of a new stadium and team, (an increase in jobs, tourism, economic boom, etc), would be worth the costs. As many die-hard Expos fans know, it wasn't the lack of fan support that killed the Expos. The Olympic Stadium and poor… Read More

Old Age Insecurity

At 150, Canada is getting older, and so is its population. For the first time in our country’s history, there are more seniors living in Canada than there are kids. This new reality puts the very solvency of some of the biggest government programs at risk. While we have known this reality was bound to happen for quite some time, the government has not taken any measure to ensure adequate funding would be available for such programs, choosing to ignore a problem which, every day, is getting increasingly costly to deal with. Among those programs are the three key income programs for seniors: Canada Pension Plan, the Guaranteed Income Supplement, and Old Age Security. The first, Canada Pension Plan, is currently partially funded through a dedicated fund, which leads to a whole other set of issues to be tackled in another article. The second, Guaranteed Income Supplement, while unfunded, only covers seniors living with very low annual incomes and is a much smaller expenditure compared to the third and last one: Old Age Security, or OAS. In 2015-2016 alone, OAS accounted for roughly three quarters of all transfers to seniors made from general government revenue. This program alone costs over $35 billion every year and is funded through the very same year’s taxes! While it is true OAS helps numerous low-income seniors get by every month, it is far from true that every OAS recipient that is in a low-income situation. Currently, seniors making less than $73,756 get full benefits regardless of their pre-retirement incomes. The benefits get clawed back so slowly that one can receive partial benefits up to an annual income of $119,400 per year. That can hardly be described as low-income. Just in 2014, there were nearly a million people eligible for OAS making over $50,000 per… Read More

Trudeau’s approach to the TPP is a good sign for Canada

Negotiating a deal that would secure fair trade with 11 nations, including some of the world’s biggest economies, is not easy. Prime Minister Justin Trudeau, after taking his time to announce any progress with the Trans-Pacific Partnership (TPP), has declined to sign an agreement in principal to finalize the TPP, according to several sources. Trudeau has come under intense scrutiny, from media at home and abroad, for not showing up to a meeting about the TPP in Vietnam and delaying the TPP talks further. Trudeau nonetheless maintains that it shouldn’t have been a surprise to anyone. Despite the reaction from most people, and his stubbornness, I agree with how Trudeau has handled the situation. In a deal that is as far-reaching, and because of how much of Canada’s economy will be effected in this deal, Trudeau should be focused on what is best for Canada. If being stubborn on the terms, and missing out on a meeting, secures Canada a better deal, the negative press is worth it. There have already been changes made to the deal regarding the automotive sector—a vital part of Canada’s economy. I find that Canada has been far too timid in past economic deals, and it is refreshing to see a Prime-Minister, especially one in the Liberal party, take a stand for the well-being of Canada’s economic future. I like Trudeau’s firm stance on the TPP for one specific reason, and it actually goes beyond the reach of the TPP. With ongoing North American Free Trade Agreement (NAFTA) talks becoming increasingly difficult, this can serve as practice for when Trudeau must eventually come to terms with U.S President Donald Trump. Trump has chosen to remove the United States from the agreement, prompting re-negotiations. The NAFTA agreement, should it be reinstated, will effect cross-boarder relations with… Read More

We’ll Deal With It… Tomorrow

Just yesterday, Ontario’s Financial Accountability Office (FAO) released another report detailing how Ontario’s current fiscal policy is unsustainable and that the government is unprepared to face the costs associated with an aging population. There’s really nothing new here. We’ve been saying it for years, opposition parties have been saying it for years, the Big Three (Standard & Poor’s, Moody’s and Fitch) have consistently degraded Ontario’s credit rating and even the current government has found it crucial to give the impression that they have balanced the budget this year. Why are we still surprised then? What is the most shocking about this latest report is it proves just how good politicians are at identifying an issue, but how clueless they are when comes the time to find solutions. For well-over a decade now, we’ve known that Canada has an aging population. We’ve known that there would be fiscal challenges associated with it. As more and more Canadians retire, we’re going to have more people needing more expensive medical care and senior benefits programs, and a smaller working population to support those services. We’ve known all of that for a long time. By now, we’d think we would have figured out a plan to deal with that or, at the very least, started putting money aside for when that day comes. If you expect to get a pay cut, the natural thing to do is to try and put money aside, and reduces your expenses or find new revenue sources. For politicians, though, even those who campaigned on it across the country or those who said they wanted to protect our nation’s future and ensure our prosperity, it seems as though that message never got across. Ontario’s Finance Minister, Charles Sousa, gave us one of the best possible examples in his reaction… Read More

BILL C-44: A silent and tragic defeat for fiscal transparency in Canada

Bill C-44, the Trudeau government's first budget implementation bill, was passed on June 22. It has rightly generated a great amount of controversy among Canada's fiscal conservative community ever since. The reason behind such controversy is none other than the proposed creation of a Canadian infrastructure bank. Such a bank would add more bureaucratic levers to our government spending process, which could drastically endanger the ability of non-governmental organization to track government cash flows, its relationship with both domestic and foreign private investors, and its investment and spending priorities. When the bill was first introduced, The Parliamentary Budget Officer (PBO), the main fiscal watchdog in Canada, raised concerns about the institutional complexity of such a bank, asking the government to separate the proposition into an individual bill of its own to allow both Houses to consider the subject with more detail. Despite the PBO’s concerns, the government not only decided to ignore these recommendations, but it also proposed within the same bill to radically reform the role and responsibilities of the PBO itself. Such reforms have gone undetected among most of the media, who focus their concerns instead on the creation of the infrastructure bank. Nonetheless, such distractions are more than unfortunate to Canadians, as the changes to the PBO represent a major defeat for fiscal transparency. Before speaking about these radical reforms, it is important to present an overview about the nature of the PBO and some of the clashes that have aroused between government and the institution. Currently, the Office of the PBO is part of the Library of Parliament. The Library is a non-partisan organization that takes care of both creating and recording the minutes of all proceedings and legislations that have place within the parliament, crown corporations or any organization that has either a legal or… Read More

Time for Grexit

In the summer of 2015, after weeks of frantic negotiations, European Union (EU) member states agreed to a last minute bailout for the Greek government and narrowly averted a sovereign default. Sadly, despite the best efforts of other EU member states, the bailout has failed to rectify Greece’s deep seated economic problems. The fiscal deficit and accumulated stock of debt remain stubbornly high, while unemployment and poverty have reached unconscionable levels. Another aid package will not fundamentally fix what ails Greece’s economy and will simply continue to defer the day of economic reckoning. To have any chance of reviving economic growth and healing deep seated social fractures, Greece must default on its debt and leave the Euro. Prior to the introduction of the European Monetary Union, Greece was treated by financial markets as a semi-stable middle income nation. Endemic corruption, poor institutions and a bloated public sector kept Greek asset prices modest and yields on public debt high. However, upon adopting the Euro in 2002, investors were overcome by a wave of irrational euphoria. Capital soon flooded into Greece from other Eurozone members and stoked a property bubble and an economic boom. Interest rates plummeted while the Greek government, convinced that the good times were more than transitory, took on unsustainable levels of public debt. Unfortunately, when the property bubble burst and the extent of its fiscal mismanagement became apparent, investors began to realize that unlike in other currency unions, there was no formal mechanism to support a distressed constituent government and that Eurozone members were unprepared to fully stand behind the liabilities of their weakest link. This sparked a rapid outflow of foreign capital and sent Greece into a deep recession from which it has yet to recover.   The depreciating Greek drachma would have rapidly restored competitiveness to… Read More
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