Tuesday, September 27, 2011

On the Minimum Wage... to our elected leaders

I watched some CNN today. I didn’t get the author’s name but a university prof wrote a book about the economy and argues that they should raise the minimum wage.

Of course this was jumped on by the right as killing jobs and how the corporations would be against this.

Her point was that the corporations are currently sitting on their wallets and not spending which would in turn create jobs because the economy is stagnant. Increasing the minimum wage would inject money into the economy with increased spending and create an opportunity for the corporations to open their wallets and start investing in industry again.

This would in turn create better jobs and (hopefully) better pay as these jobs would need to attract employees. The issue in her mind is not that there are not enough jobs, but there are not enough quality jobs.

The novelty in this thought is not that a minimum wage increase benefits the working poor, but that it would benefit the corporate elite.

There is a rule in business sometimes referred to as the 30/30/30 rule or the 1/10 rule. They are basically the same, 30/30/30 is the breakdown of costs for a business. 30% each for wages, operating expenses and “profit”. Profit is in quotes as this also includes the money that needs to be reinvested to maintain and increase business. 1/10 is that an employee needs to generate $10 for each dollar they are paid.

Now the anti wage increase side maintains that the cost of a cup of coffee will be too expensive to buy if you pay the server more.

But let’s really look at that.

If that server is making $10.50/hr, the minimum in Ontario, s/he is likely generating $105.00 in sales for that hour. So a One Dollar increase would increase the cost of a $2.00 coffee by less than 2¢. So the nay sayers go “See! Price Increase!”

Now, we aren’t going to give the increase to just one coffee server, but to everyone in the area who is currently making $10.50/hour. If they are working 40 hours a week they’ll see around $30 extra in their pay. If they are barely making ends meet now, they might have an extra couple of bucks left at the end of the week. Some of them might stop in for a coffee now and then, increasing sales and helping to justify the increase. Some might pick up a few extra groceries with it, or buy the kids something or maybe just save it.

Each of these actions helps the economy. The coffee shop may need to add a server, increasing employment. The grocer may do the same. The bank will loan that money out to someone to buy a car or a house or start a business or maybe build an expansion on their coffee shop.

The governments at all levels have been insisting that tax cuts for business is the answer. They’ve been doing it for years, decades, and it’s not helping. The corporations are seeing bigger profits from this but doing nothing with the money.

One argument is that we are too expensive. We insist on wages that are too high and that wage increases make the problem worse.

At least three Japanese and one Korean automaker have North American plants. There has to be a reason for this, a business reason. They pay competitive wages and have similar benefits. These plants arose when they sold enough cars to make these factories viable.

So why do the corporations not spend all this money and create jobs? The demand for their products is not there. We need to create the demand.

Think of it this way. These corporations are flush with cash. The only way to get the money back is to make it profitable for them to spend it. A business tax cut will put more money in their hands but doesn’t create a demand for their products. So, they put the money in the bank at whatever the interest rate is. The only way to get them to spend it on upgrading equipment, building new factories, creating new jobs is if the investment into these things gives a better return than the bank.

This is like priming the pump. Pour water in from the top so that it can draw water from the bottom. But that only works if there is water in the well. If the water is too shallow you end up sucking air.

We’re sucking air folks.

Low wage earners, the working poor, spend their money locally. They don’t take trips to the Caribbean and they don’t drive hours to the outlet malls. They are economically tied to their area and they spend in their area.

When they spend in their area, the local businesses do better. They may decide to carry better products or a more varied selection. They may need more staff.

When more people are working, the wages offered to attract and retain employees needs to move as well. At each level, if wages move, spending increases.

We’re seeing the opposite right now. People take decreases to keep their jobs so they have to spend less. If wages are frozen, the amount you spend may stay the same, but the amount that you get in return is less due to inflation. Gasoline is up, groceries are up. Every cent spent there is taken from somewhere else.

Maybe you buy one coffee a week instead of two.

If the house is falling down, you don’t put new shingles on. You fix the foundations. With a solid foundation you can deal with fixing the framing on up to the plaster and the shingles.

Minimum wage is the foundation. Let’s improve it.

Sunday, September 25, 2011

On the Ontario Election

This isn’t what I intended to talk about today.  It was intended to be a small part of a different discussion but it has been gnawing at me and getting bigger by the day.

We are suffering through a provincial election here in Ontario and it is annoying me more and more.  Politics in Ontario is reaching the same levels of nonsense that the Federal election employed.  Or should I say depths?

I will admit that when I look back, my vision is clouded by time and things may not appear the same as they did then, but what has happened to our political system in Canada?

I’m sure there was pettiness and lies all along, but there were people of vision.  The Twentieth Century belongs to Canada!  A Canadian Made Bill of Rights!  A Just Society!  I’ll even toss in the original Free Trade Agreement.  You may not agree with the individuals belonging to these ideas, but at least they were offering a path to the future.

Even the lesser aims of these leaders throughout our history offered us a choice of direction.  Stanfield, Trudeau, Clark, Pearson, Diefenbaker... they all argued policies, they stood FOR something.  Now that is gone.  Now we get smears and attacks.  Now we get sound bites and talking points.

What I’m looking for is “Vote for ME because...!” and I’m not seeing it.

Ontario is still reeling from the economic turmoil of the last few years and more is quite possibly on the horizon.  The candidates have an issue that needs to be addressed, how will you steer this boat through the uncharted waters ahead of us?

What do we get?  Dalton is the tax man.  Andrea voted the same way as Tim 183 times.  Get the picture? 

Locally it is just as bad if not worse.  I will has been replaced with WE will and THEY are.  The backbencher has been relegated to the marionette theatre.  When the leader stands, you stand.  Here’s your script, don’t mess it up. 

It used to be a joke that a constituency was so secure you could run a rock and win, now it’s becoming the truth.  They don’t have to attend All Candidates Meetings.  They don’t even have to knock on doors.  I can count on one hand the number of times in the last 20 years that I have personally met a campaigning candidate and that includes Local, Provincial and Federal races.

I seriously doubt any candidates give a rat’s patoot about whether I vote or note.  They certainly aren’t showing it.  But then again if they DO show up they might have to answer a question or two and I may not follow their script.

Now, just for fun.... You come home and your spouse sits you and the kids down.  Your spouse tells you that you can have ice cream for dessert every day (everyone loves ice cream) but you have to give up the sports channel and the kids have to give up their Kid channel because the cable is going to basic service.  You consider this and say “No, I’d like to keep my channel” and the kids consider and decide the same thing.  The next day your neighbours all think you’re an idiot because you hate ice cream and evil because you made your kids hate ice cream as well.

Now...  To get your neighbours off your back, you decide to take the bus to work.  The government is going to subsidize the buses, so it will be cheap.  You can keep the cable and get ice cream at the same time.  Well that’s no good because you don’t live in a metropolitan area and the buses stop before you get off work meaning a long walk home.

So... You march into the boss’ office and demand a pay cut.  Less pay means less tax and the taxes are killing you.  It didn’t help the last time, think it will help this time?

Finally we’re back to the ice cream or the cable.  At least I am.

It’s probably too late for this time around, but we the voters need to put the candidates feet to the fire.  If our local members in the legislature are unwilling to stand up for their constituencies first, we need different people regardless what colour their sign is.  This will probably annoy more than a few people but think about it.  If you support the Purple Party (Red/Blue/Orange combined, sort of) and they (the leadership) decide to go for a Bill that is bad for you and your community, what good is a Purple Rep that votes for it because the leader says to?  They are supposed to be our voices in the legislature.  If it’s a good Bill vote Yes, if it’s bad vote No- irrespective of who enacted the Bill in the first place.

The leaders of the respective parties need to provide a vision.  Where are we going?  How will we get there?  Stop saying “Me Good They Bad” and tell me what the plan is.  Tell me in your advertisements why it’s a good plan.

I want to see the leaders and the candidates explaining why I should choose them over the others.  If you have an issue with what was done, what would you have done instead?  What will you do in the future to improve my life and the lives of all Ontarians?

The bottom line is that it is up to us.  We, the voters need to tell our candidates and their leaders that we want to hear the truth and the whole truth.  Then individually we make our decision on who should receive our votes.

For anyone who wants to point out there are Red Books and Change Books and Orange Books, that’s wonderful and I am aware.  But that does not mean that everyone will bother to look at them.  Or anyone for that matter. 

Tell me what the plan is.  Tell me why the plan is good.  Let me judge it so I can vote intelligently.

Finally, when you’ve finished reading this, take the time to find out where the parties stand.  Go to their websites and look at their stances.  Grab the candidates and ask questions. Think about what they offer and decide.

Then show up and be a voter.

Sunday, September 18, 2011

Support the Canadian Wheat Board

What happened to Minister Ritz?

Last week he was telling farmers that their Canadian Wheat Board plebiscite meant nothing.  Now he is quiet.  Is this part of the strategy?  Did someone higher up yank on his choke chain?

Maybe, just maybe the fools on the Hill have realized they stirred a hornet’s nest.


Maybe they think if they become quiet, the farmers will become quiet.  Please don’t become quiet.  Keep their feet to the fire, let them know they are accountable to the people and the people will push back.

In his interview Minister Ritz said that farmers could keep the CWB, but now I find that’s not true.  You might be able to try and gather up the pieces after it gets blown up, but there will be others grabbing for the pieces too, I don’t see a good future for the family farm on the prairie, and this bothers me.

So why does a Cat in Ontario care?  I see this as an injustice against family farms on the prairies.  We all need to stand with you on this.  If the government was truly interested in helping they would be in serious talks about how to address this issue and how it can be resolved.  Not trying to destroy 70 years of cooperation, 70 years of success.

Isn’t that what Canadians do?  We work together for the betterment of the whole.  At least we used to.  And we look out for the other guy.

I include a link.  If you have not already shown your support for the farmers of the Canadian Wheat Board, this link will take you to a petition asking that the farmers be given the choice of what happens to the CWB.  Support the farmers, they support you.

It is the least that we can do.

My thanks to Shelley Cooper-Stephenson for the link.  I am using it without permission, I hope you don’t mind.

Edit.. I need to add another link.  This will send a message to the Agriculture Minister and your MP letting them know that you support the CWB farmers.


Sunday, September 11, 2011

CWB vs the Harper government, why does democracy scare you Stephen?

What is it about democracy that scares Stephen Harper and his merry band so much? 

Right now, I’m thinking about the west.  As an Ontarian and city folk, I don’t know all the ins and outs of the Canada Wheat Board, but I do hear farmers in the West calling to save this institution.

The Canada Wheat Board (CWB) was instituted some seventy odd years ago to help Canadian farmers compete on the world stage and reduce the risk of a single bad crop or a severe price drop from wiping out our farmers.  It also evened the playing field so that smaller producers could get their crop to market and get a reasonable return for their produce.

The CWB has in excess of 68000 members, many of whom wish to save the CWB, many wish to see it dismantled.  The question is how many is “many”?

These 68000 members have received ballots to vote on whether to save the CWB or not.  That will tell us how many.  The conservative government says they don’t care how many.  Agriculture Minister Gerry Ritz said that the results of this plebiscite will not affect the decision of the Harper run government to kill the CWB.  He says “many” farmers want it killed to end.

So, in other words, the government’s position is that they don’t give a rat’s patoot what the majority of the farmers want.  Gerry says he “believes” that “many” farmers want this to happen.  Why not wait a bit and you will Know what Most of the farmers want.

I don’t want a vote in this issue nor do I deserve one.  I’m not a grain producer.  As long as the CWB does its job and doesn’t cost the tax payers anything, it’s a CWB membership issue.

From what I do see from here, is that Some farmers want to sell their grain outside of the CWB.  I’m willing to bet these are large producers and Corporate farmers that have the means available to compete, and removal of the CWB would give one less major competitor in the market.  They aren’t afraid of family farms.  The family farms will blow away with the CWB.  It is the same reason that Mom and Pop stores are withering under the influence of the chain stores.  As an added bonus, then the family farms wither and die, the Corporate farms will just suck them up the same way Walmart takes the former customers of the Mom and Pops.

Before the CWB, farmers were at the mercy of the capitalists.  They produced the product, but had to rely on the rail ways and grain handling firms to get their goods to market.  The capitalists made sure they got their money, the farmers got the squeeze.  The CWB evened the playing field by banding the farmers into a unit that could compete with the capitalists.  The bonus being that the CWB being run by farmers was it was only expected to cover its costs and the profits would go back to the farmers.

So why is the government meddling in a working situation?  The “right” people complained.

We know the voice of the majority carries little weight with the government.  Polls tell us what the people think, we favour the gun registry, we don’t want the government snooping in our emails, but the Harper run government has its agenda and the CWB is on it.

A sensible alternative would be to sit down with the two sides on this and reach an agreement.  Surely there has to be a way that farmers could opt out and compete that would satisfy both sides. 

But that would require listening to the people. 

Something that our current government doesn’t seem all too interested in.