NDP

While I’m in NYC these days, much of my social media still comes from Toronto & Canada. The Conservative Party of Canada is running attack ads against the third party. Not the opposition, but against the Liberal Party interim leader, Bob Rae. This ad came out while the official opposition party, The New Democrats, were choosing a new leader, who was chosen yesterday, Thomas Mulcair. OK, to further complicate things, Rae was once a New Democrat at the provincial level in Ontario and Mulcair was a Liberal at the provincial level in Québec. I know, you probably need a scorecard. Anyway, while there’s no election in sight for years {barring a finding of widespread election fraud from the robocall scandal}, the Conservative attack ad slams Rae’s record from his stint as Ontario Premier in the early 1990s, as an Ontario New Democrat. Last year, I wrote a brief analysis of the Bob Rae premiership on vox.rhizomicon that explains how Rae inherited an impossible situation worsened by a macroeconomic perfect storm. In fact, Rae’s policies had much more in common with—a fiscally conservative strategy.

John Ibbitson of the Globe & Mail thinks the Tories are scared of Rae and the resurgence of the Liberals. There may be something to that. They ran ads in 2009 against then Liberal leader, Micael Ignatieff, framing him as an outsider because of his living abroad in the past. Why not use the wayback machine to do the same to Bob Rae?

One could argue that the Conservatives have more money than good sense right now. While it’s no secret that the Conservatives want to keep the Liberals down and replace them as the “natural governing party of Canada”, the strategy has its risks. Sure, it will get the Liberals to spend money on return-fire ads, which the Liberals vow to do, but the ad concept isn’t fresh and the content is dated. While Andrew Coyne think the Conservatives win either way, I think he’s wrong. It’s not an election and the negative ads on the third party leader can be viewed as playing unfairly, particularly in light of the robocall scandal. The main problem I have with the Conservative ads is they have tipped their hand. Bob Rae has them worried and they’re signaling it. Unlike Ignatieff, Rae is a seasoned politician and a good communicator. Liberal support isn’t dead and the ads allegedly boosted Liberal fundraising by $225,000 and Rae offered this soundbite:

“You can’t just abandon the airwaves to the jerks on the right-hand side of the spectrum.”

While the Conservatives have a majority in Parliament, they know that with Rae and Mulcair opposing them, they’ll have their hands full with a war in the media and the court of public opinion. They’ll want to discredit both, but let’s face some ugly marketing truths. They’re the majority party and should act accordingly. Attack ads now look desperate and mean. The Conservatives’ main ace up their sleeves is “stay the economic course.” They don’t have a hot-tempered firebrand from Québec who makes the news by being the news in a Thomas Mulcair. They don’t have an elder statesman who can effectively sound as if he’s railing at the establishment in a Bob Rae. The Conservatives are selling “stay the course” and they don’t have many degrees of freedom that can really energize the masses, while unemployment remains fairly high and a housing bubble looms. Their current positioning is fairly moderate, which is how they won the last election by taking Liberal ridings in Ontario {assuming election fraud isn’t shown in the robocall scandal, which is probably a stretch}. It makes the most sense to build the appeal to moderates by building a case why the Conservatives are good for stability on positives, even if there isn’t any “there” there.

It will be interesting to see how the Conservatives deal with Mulcair. I’m sure his dual citizenship with France will factor in, as the Tories try to question his allegiance to Canada. Given the NDP strongholds of Québec and urban centers, it won’t matter much to the NDP base and pressing the issue could turn off the new Canadians that the Conservatives are trying to court.

It’s over three years until the next Canadian election and it’s a tad early to start being tiresome.

The Manitoba New Democrats rolled to a 4th straight majority win over the Progressive Conservatives. Canadian election campaigns are mercifully short and while the Manitoba contest was a curt 4 weeks, the advertising and rhetoric was brutal in this battle for the political middle. The Manitoba economy, like parts of the upper Midwest of the US isn’t reeling like the rest of North America, so there wasn’t a great thirst for change. The opinion polls had the Progressive Conservatives up earlier in the year, but the New Democrats rallied under Premier Selinger.

The Progressive Conservatives narrowed the gap in terms of the popular vote, but gained no additional seats. Andrew Coyne of Macleans expressed his annoyance at the current first-past-the-post {candidate with a plurality of votes wins the riding, i.e., district}::

He used the “anomalous” results to plug his articles on election reform. I’m actually in favor of election reform, such as STV, but I have serious doubts if it would matter in Manitoba. The province is divided:: the rural south votes Progressive Conservative by a wide margin, while urban Winnipeg and the aboriginal North votes NDP by a sizeable but lesser margin, on average. The unofficial results are here. Given the geographic party split of the province and the two-party “duopoly”, I’m not seeing a lot of opportunity for vastly different results. If there were larger ridings with more seats per riding, the STV gamechanging math breaks down when one looks at the regional breakdowns for 2007. The NDP and PCs had their respective regional strongholds and it will be interesting to see how the final 2011 shake out.

This doesn’t mean I feel STV shouldn’t be implemented, but that the 2011 Manitoba results might not be the best case to pitch for it. Tomorrow’s Ontario provincial election, well, that’s a different story. Ontario has three strong provincial parties {PC, Liberal, NDP} and strategic voting is likely to be a factor in quite a few ridings.

Notes from north of 49ºN

Update 4 August:: Video on Jack Layton from MSNBC-below.

Jack Layton is the leader of the New Democratic Party of Canada whose riding is the next one over from me, Toronto-Danforth.  Over on the Huffington Post, Jack did a post on the realities of the Canadian health care system.

I have a lot of strong views on health care in the US based on my work in non-profit health and my research on the biotech industry.  It’s worth mentioning that today’s US health care system began as employer perquisites {benefits}, back when health care and pharmaceuticals were cheap.  The private insurance model starts to break down when costs escalate resulting in employers and employees getting squeezed and uninsured rates rising.  Some say a perfect storm of events {recession, rising costs, uninsured rate of 19%, and Obama} is leading to a tipping point in health care.  It should be noted that the US will not adopt a health care system like Canada’s, where the government {provinces} provide health care, but rather a system where the government finances health care delivered by private enterprise.

On the The Huffington Post, Jack makes some compelling points, whether you agree with his politics or not::

“Costs are under control in Canada. We spend similar amounts on public care – around 7% of GDP. For that price, Canada covers everyone, the U.S. just one third of the population. In case you’re worried Canada wastes money on bureaucracy, know that just 2.4% of our total costs go to administration compared to 7% of what your government spends. In end, Canadian care costs $2,500 less per capita – and covers everyone.”

He points out that the system isn’t perfect::

“Our system does have flaws. We need better prescription drug coverage, better remote access to care and better practices in hospitals and clinics. No honest advocate for our health care system would dismiss these things. But Canadian health care works — and works well.”

Does all this mean that the United States should adopt Canada’s health care system?…No. America can no more adopt our health care system than we can swap hockey for baseball as our national pastime. A good health care system reflects a country’s values, and each country’s values are different…But a system with 47 million uninsured, coverage denied due to pre-existing conditions and people thrown off plans when they become ill? That doesn’t reflect American values.”

Unfortunately, there are other competing values in play in the US, making healthcare a contentious issue.  It’s not a simple matter of costs and taxes, but one that also affects innovation and entrepreneurship.  Biotechnology is predicated upon using the human genome to better match diseases, patients, and therapies.  “Pre-existing conditions” and genetic skeletons in one’s closet can thwart innovation in biotech because it adds additional business risk.  If insurance refuses to pay, where are the revenues?

One question on my mind and one I pose to my students, is healthcare a public infrastructure or should it be treated strictly as a business?  The Canadian model is one where the state is the financier and provider, where the provinces oversee a large, integrated health infrastructure.  As stated above, a new US healthcare model is unlikely to be this comprehensive, instead focusing in financing.  The current US model uses market mechanisms heavily, where healthcare delivery, insurance, and pharmaceuticals all having a dog in the healthcare reform fight.  Altering the landscape through healthcare reform will alter business models and likely create windfall gains and losses.  On the other hand, we have that perfect storm of recession, rising costs, uninsured rate of 19%, and Obama.  Another implication of the current model, where healthcare is an employment benefit, is that it limits new business creation, i.e., creates “entrepreneurship lock.”  A recent working paper supports this reasoning::

“Overall we find some evidence that the U.S. emphasis on employer-provided health insurance may be limiting entrepreneurship.  The clearest evidence comes from the regression discontinuity results which create the most comparability in experimental and controls groups.  The finding of ‘entrepreneurship lock’ is important as it suggests that the bundling of health insurance and employment may create an inefficient allocation of which or when workers start businesses.”

Healthcare can also has an affect on the arts in the US in same fashion, necessitating that creatives take on dayjobs with health benefits.  One artist once told me that money {or lower costs} means the freedom to create.  The current system does precious little to create incentives for cash-strapped entrepreneurs and creatives to innovate and create.  Does this matter?  I think it does in terms of sustainable economic growth and treating healthcare as a publicly financed infrastructure, i.e., a social good, paid with {gasp} taxpayer dollars makes more sense than the current system, but the devil’s in the details and good implementation is critical in order for a new system to be successful.  That said, these challenges shouldn’t be reasons not to do it.
Video:: Jack Layton on MSNBC’s The Ed Show, NDP Blog via Twitter

Link

Twitterversion:: Jack Layton of #NDP clarifies healthcare in #Canada. Should healthcare be infrastructure? Implications for innovation & entrepreneurship. #ThickCulture @Prof_K

Song::  Planet Health – Chairlift {Brooklyn, NY of iPod Nano fame}

Notes from north of 49ºN.

I now live in a relatively small country, ranked 36th. in population, at 33.7M {versus 306.7M in the US}, but in the top 10 in terms of economies with a GDP of $1.3T {#9 ranking}, versus 13.8T for the US {#1 ranking}.  I mention this, as I wonder about scale and innovation, i.e., can smaller countries effectively compete in technology in a global environment?  One of my interests in innovation is biotechnology, a “new economy” area focusing on better outcomes for “health, the environment, and for industrial, agricultural and energy production.”  Advances in genetics are creating a race for companies and countries, with the idea of dominating the biotech field in order to enjoying profits and prosperity.

Last summer, I saw on a Canadian network a segment on how Canadian government investments in biotech were getting bought up by US firms, implying that the relatively small Canadian government was, in part, subsidizing innovations flowing south of the border.  The Matthew effect kicks in, as rich get richer and the poor get poorer, given that Canadian firms were being snapped up by US firms with deep pockets, transferring value southward.  According to a Globe & Mail article {click on license option}, another issue is that Canadian venture capital is lacking, so Canadian biotech firms often are capitalized by US venture capital firms that like to keep close tabs on operations and encourage offices/operations in the US.

Well, is Canada even a player in this biotech area?

According to 2006 OECD data, Canada is a player in terms of the number of firms {532}, the number of patents {ranked #6 in 2004}, and revenues {$83M}, along with an 11% compound annual growth rate {CAGR} of revenues from 1999-2005.

Given how collaboration and capital are now global, does it even matter where innovations are incubated?  A study by Bagchi-Sen & Scully {2004} is illuminating.  They divide biotech forms into two categories:: high R&D intensity and low R&D intensity.  Each has a different take with respect to strategies within the context of globalization::

• High R&D Intensity:: Ties to local universities/Canadian researchers & collaboration with pharmaceutical companies, but desire global capital inflows.  Prototypical firm is in health theraputics.
• Low R&D Intensity:: Emphasis on local production and development of Canadian market.  Focus on strategic alliances with foreign firms.  Prototypical firm is in diagnostics or agricultural biotech.

In terms of innovation policy, this brings up interesting food for thought for Canadian politicians in light of this recession.  Thanks to Barack Obama, Canada’s large neighbour to the south is pumping $21.5B of stimulus towards science and technology, which begs the question, how will this affect Canada?

It makes sense that Canadian policy would encourage the projects of low-intensity R&D firms with ties to the US, as these firms:: may be able to capitalize on relationships with stimulus-receiving firms, will develop innovations for the Canadian market, and will be focused on local Canadian production and manufacturing.  The high-intensity R&D firms could use funding {hint:: even more than $1B+CAN stimulus} that focuses on spurring innovations and the building of a sustainable base of Canadian talent and resources.  Dalton McGuinty’s {Liberal Premiere} efforts in Ontario might be a step in the right direction, but I’m not seeing clearly how this all fits together with an economic recovery plan.  Biotech. is not without risks, particularly with respect to agricultural biotech, which consumers are uncertain of.  Activists have alerted consumers with terms like “Frankenfood” for genetically-modified organisms {GMOs} and Monsanto’s lawsuits against journalists and farmers don’t help the cause.  So, maybe ag. biotech is a lose, but developing Canadian competitive advantage in innovations, in terms of other forms of biotech, nanotechnologies, clean energy, and green collar jobs, may provide fertile terrain for politicians and policymakers.

Well, enough of this talk of the “new economy” of biotech and innovations, what about the old economy, still prevalent in many parts of Canada?  Globalization has drawn Stephen Harper’s {Prime Minister} Conservative government into bailout fever to the tune of $9.5B, in order to secure that 16% of GM’s production remains in Canada.  This includes $3.1B that the Province of Ontario ponied up by Dalton McGuinty’s government.  Unfortunately, this might only save 4,400 jobs, after projected layoffs, according to CBC::

Given how the Tories and the Grits have played their cards in this {along with playing a current game of Federal “chicken”}, I see an opportunity for the NDP to make inroads with their platform based on developing new technologies and saving jobs.  Alas, more on “GMfail” and job losses in Canada in a future post.

So, it looks like nation matters, but in a global milieu.  Nothing surprising.  If you were to advise Canadian politicians, should new technologies {e.g., biotech, green, energy} be developed more aggressively {or at least explored} and does it make sense to commit billions to save jobs with an untested GM restructuring?

Twitterversion:: #newblogpost How should Canada compete {bio}tech, given globalzatn, US domnce, & recession? #GMfail bailout, good idea? http://bit.ly/18bBq8 @Prof_K

Song:: Genetic Engineering – Orchestral Manoeuvres In The Dark

Video::

It was May Day here in Ontario.  I just Tweeted about a program I saw on TVO with socialism as a theme with Ontario NDP leader, Andrea Horwath, and political scientist at York University, Leo Panitch.

The discussions were interesting, but what really stuck with me was whether or not good politicians follow the votes or get the electorate to see things differently.  For example, given the anti-corporate climate, will politicians pander to where they think the electorate is or will they try to shape thinking about the economy?

Sell the sizzle, not the steak

In a shameless attempt to drive more pageviews, I included a pic. and cartoon of Ségolène Royal {Ségolène is a ThickCulture crowd-pleaser, according to our Google Analytics}, a French socialist {Parti Socialiste, PS} centre-left politician who ran for President in 2007 {losing to Sarkozy} and may run in 2012.    Say what you will about Ségolène, she manages to capture attention.  She has been known to have a quirky, evangelical style and has been accused by some as having a Joan of Arc complex.  Well, this sounds familiar (see Glenn Beck video from last fall).

The comparison isn’t accidental.  Obama with his power of persuasion, thus far, and the state of the economy may be providing a perfect storm for a change in the political zeitgeist. Will the Democrats see this as an opportunity to embrace that dreaded third-rail word, socialism, in terms of either rhetoric or implemented policy -or- would that just bring about a Gingrichian revolt akin to 1994?  Change?  What kind of change?  New Deal change?  New Frontier change?  Great Society change?  Is it a matter of the public looking for it -or- will savvy politicians frame a “new” economic order for them?  I think we’re in for seeing plenty of sizzle sold, but at some point, steak will have to be on the table, specifically, in terms of economic recovery.

The upcoming election in British Columbia is pitting the centre-left  (NDP) versus the centre-right (BC Liberal) {e.g., see blog on the BC Carbon Tax issue}, where the centre-left has a shot of controlling the provincial government.  Nationwide, the NDP support has risen 1 point since December to 13%, while the Liberals and Tories swapped positions and are polling 36 and 33%, respectively.  Perhaps regionally, there may a shift to the left {Canada has had NDP provincial governments in the past}, but I wonder as joblessness continues and bailouts persist, will national-scene politics in Canada and the US move towards a more socialist agenda?  While Barack is far from a socialist, he’s gaining comfort in his centre-left stance::

“The economic philosophy that Mr. Obama developed during the presidential campaign drew from across the ideological spectrum even as it remained rooted on the center-left. As that philosophy has been tested in practice through his early months in office, the president has if anything become more comfortable with an occasionally intrusive government as a counterweight to market forces that are now so powerful and fast-moving that they cannot be counted on to be self-correcting when things go wrong.”

–“Obamanomics: Redefining Capitalism After the Fall,” NYT, Richard W. Stevenson

So, are you ready for some socialism?  Will we see the selling of socialism?  Sounds like an oxymoron, but it may be a matter of time before we see something like this.  What’s Springsteen up to this summer?

I welcome any and all thoughts.

OK Ségo fans, while not entirely flattering, the following cartoon should help you with your fix. 

Twitterversion:: EpicFail for capitalism? Given current econ & political climate, is US/Canada ready for socialism? Will politicns pander or reshape thinkng?

Song::  

Notes from north of 49ºN

While the Vancouver Canucks advance in their bid for the Stanley Cup, the British Columbia provincial election is heating up, as the NDP has pulled within 2 points (39/41 +/- 3.4) of the not-so-liberal BC Liberal Party.  The Green Party is running a distant third at 13%.

One of the big election issues is the Carbon Tax, which is a tax on pollution.  It puts a price on the social costs of environmental degradation {negative externalities}.  The carbon tax was initiated last year in BC, which should give Obama insights into his plans to address carbon reduction.  {Obama’s already talking of a nationwide “cap and trade” policy.}

BC Carbon Tax & The Economic Sociology of the Environment

The BC carbon tax claims to be revenue neutral, meaning it returns the tax in the form of lower personal and corporate income tax.  The tax shuffles funds around in the following manner where one-third of the carbon tax revenues are paid by individuals and two-thirds by industry, while two-thirds of the tax reductions benefit individuals and one-third benefit business.  A fairness issue arises, as some businesses can pass the tax along to consumers, depending on the elasticity of demand.  The carbon tax is initially (effective 7/1/08) $10 per tonne of carbon dioxide equivalent (CO2e) emissions (2.41¢ per litre on gasoline), but will increase each year after until 2012 to a final price of $30 per tonne (7.2¢ per litre).  For US readers, this is currently 7.68¢ US per gallon of gasoline and will go up to 22.9¢ in 2012 (4/30/2009 exchange rate).

One of the issues brought up is that while the BC Liberal Party is imposing a tax on pollution, it’s allowing the export of carbon-producing fuels to leave the province untaxed.  In addition, the government is allowing offshore drilling for oil as part of their energy policy.  This is opening up the BC Liberals to charges of hypocrisy.

So, in the past 10 months, what has been the effect?  I think it’s impossible to gauge the results, given that gasoline prices have gone down and the BC economy is in a recession, although with lower unemployment than Washington, Oregon, and California.  I have to admit I am skeptical that the BC Liberal’s  carbon tax policy will actually reduce carbon emissions.  Why?  This Canadian Dimension editorial introduces a paradox::

“By way of comparison, the average retail price of gas in Canada, adjusted for inflation, has risen forty percent in the past five years. The increase is the equivalent of $120 per tonne of emissions — four times as much as the maximum tax proposed in B.C.

But consumption did not decline. In fact, during the same period both gasoline sales and greenhouse-gas emissions rose to record levels…

In short, the B.C. carbon tax is regressive, shifting ever more of the province’s tax burden onto working people, while reducing taxes on corporations. It will do nothing to cut emissions or slow global warming.”–“B.C.’s Carbon Tax: A Regressive Hoax” from Canadian Dimension (4/30/2008)

How can this be?  Are the economists that off-base?

As an economic sociologist, with a BA in the dismal science, I know at least some of the answers.  Increasing prices through a Pigouvian tax without consumption/production alternatives offers no incentives to alter behaviour away from carbon emitting activities.

A Northwestern sociologist, Monica Prasad, offered this interesting observation::

“The one country in which carbon taxes have led to a large decrease in emissions is Denmark, whose per capita carbon dioxide emissions were nearly 15 percent lower in 2005 than in 1990. And Denmark accomplished this while posting a remarkably strong economic record and without relying on nuclear power.”

—“On Carbon, Tax and Don’t Spend,” NYT (3/25/08)

How did Denmark do it?  According to Prasad, Danish policymakers subsidized environmental innovation by businesses and investing heavily in alternatives.  The idea here is to give incentives to move consumers and businesses away from carbon emission generating technologies towards renewable ones.  As a sociologist, I’m wary of talk of “pricing” carbon, as it attempts to reduce natural capital (i.e., the environment) with financial capital and the assignment of property rights, politicizing economic activity along the lines of power and wealth.  I’d much rather see policy aimed at moving towards a different technological curve, away from carbon, along with an increase in investments in public infrastructure (e.g., mass transit in cities/suburbs) that offers alternatives to carbon-heavy practices.

The Politics of Carbon: “Axe the Tax”

Carole James, leader of the NDP, has been advocating dumping the carbon tax in favour of a “cap and trade” approach, the direction Obama is leaning towards.  The NDP “axe the tax” stance was costing them politically, despite the tax being unpopular, as environmental groups criticized the move.  In this election, there are 85 seats up for grabs.  While the Green Party may siphon off votes from the NDP, it is very unlikely that a single seat will go to the Greens.  Given the overall BC Liberal Party stance on the environment, environmentalists may have a tough choice on May 12.  The carbon tax may fade away as a key issue, as the economy and issues of ethics and integrity might come front and center, but perhaps the economy and the environment will become an intertwined issue.

I’d like to see policies in BC and elsewhere move towards weaning citizens away from carbon.  A recent Wired Magazine article  goes over many of the issues involved in green technologies, including who will pay for the costs of innovation.  I think the BC Liberal carbon tax isn’t the best policy, as I don’t see it reducing carbon emissions and is mute on carbon-emitting fuels being exported and untaxed.  Whichever party wins, I see the BC government as playing a key role in spurring behavior changes through investments and incentives, but who will foot the bill, particularly given a tight budget?

• What are your thoughts on a carbon tax?  (In BC or even in the US)
• What are your thoughts on policies that create incentives for businesses & residences to adopt new greener technologies or retrofit carbon-based ones?
• Should policy focus on investing in new green technologies?  How much should government foot the bill? Should green be linked to economic recovery plans?
• What would the candidates & the “Fake Tweeple” candidates say?