[dino_bobba_renno]

Lemmy Lemmy:

A high dollar is a blessing and a curse to Ontario manufacturers. The appreciated dollar does help to improve business efficiency rather than operating with the crutch of a 65 cent dollar. And commodities' prices do cause short-term fluctuations in the value of the dollar, but only within a very narrow range. Interest rates, domestic economic stability and export demand are still the determining factors of a currency's value and oil only represents about 10% of total export value. The Canadian dollar, in short, is too many things to characterize it as a "petro dollar". If we stopped exporting oil altogether, it would have little impact on our currency's value.

The reality is that manufacturing was in decline before the US dollar started going south. So we can't blame the decline in Ontario on currency value. Globalization has been the culprit and until the Chinese stop exploiting labour, the environment and their own currency's value to attract manufacturing, that trend will continue...even if our dollar goes back to 65 cents US.

As for austerity in provincial spending, it's a tough pill that needs to be swallowed. If Dalton isn't up to this task, then he needs to be replaced before we venture any further down the Greek garden path to bankruptcy. However, the way to reign in provincial spending is by slashing at all the ministries and agencies that provide special interest services only. Healthcare and Education need to be sacred. Those two areas of provincial spending are the ones that provide greatest external benefits and need to be protected (and after all, Healthcare and Education the two things that provincial governments were entrusted to provide under the Constitution). It's the plethora of other provincial government agencies that ought to be gutted. If Dalton makes the same mistake Harris made and attempts to balance the budget on the backs of teachers and nurses then he really needs to go. We've seen that film before and it was a horror-show.

Good post,I'd rep ya but I can't right now

[eureka]

I suspect that you do not have that quite right, lemmy. Canada was one of the few countries where manufacturing was not in decline before the dollar began to tank. All the factors you mention play a role in decreasing manufacturing but the absolute number of manufacturing jobs should not have declined where the population was growing.

But, in fact, it has, and dramatically. The manufacturing sector was growing in Canada until 2004. The devastating loss has occurred entirely since then and in a very few years. No matter what effect the other factors had, Canada did not experience the slow decline that most OECD countries did. The loss was rapid and crippling and precisely correlated with the decline of the dollar against US currency.

Ontario and Quebec are the major sources of that loss. As for whether this is a "petro dollar," there are many economists who agree with what I say. They also agree with that being the major cause of Canada's situation. Canada is not quite the same as other countries in this. It is the only OECD member that has a currency that is so exposed to commodity fluctuations while being almost totally dependent on the one market against whose currency Canada's has had such appreciation.

Losses are not onlt from shrinking manufacturing exports tot he USA. They are also to the significant transfer of jobs to the USA - not merely overseas - since there is no longer an advantage through currency rates.

[QBall]

eureka eureka:

If you can't, then you should get out more! McGuinty has done a fair job of righting the train wreck of Harris, Flaherty, Clement and Baird. But, he can' do enough while the manufacturing sector in Ontario is being devastated by the petro-dollar. This government inherited a alrge deficit from Harris and had eliminated it with annual surpluses until the 2008 financial meltdown. The deficit now is from the stimulus and the near permanent recession that the Ontario hostile economic policies of the federal government have created.

Wow, I would love to live in the fantasy world you live in. A world where facts are irrelevant and all that matters is partisan spin. Unfortunately in this world facts rules, and the facts are thus: When McGuinty came into power the deficit was $5.6 billion, now it's $16 billion. When McGuinty came into power the debt was $148.7 billion, the debt in 2012-2013 will be $289.3 billion. McGuinty has increased spending 65% since coming into power. And the best the left can come up with is to blame people who haven't been in power for almost a decade or to blame the federal conservatives (while conveniently ignoring the federal Liberal when they were in power during this time). It's garbage thinking like that which booted the left from power federally and will soon cause them a quick exit from Ontario provincial politics as well.

[OnTheIce]

Lemmy Lemmy:

You can't call the war Harris declared on education "reform". He slashed and burned at the profession he was run out of for incompetence. It was personal vengeance.

War on education? I'm sorry, I just don't buy that.

The big issues were standardised testing, teacher testing, regulating class sizes, educational property taxes, etc. Control was shifted dramatically from school boards and teachers to the Ontario provincial government.

McGuinty has very little to change that. He's added some prep time to elementary schools only.

So the question remains, why no more changes? Is it working? Did the war suddenly end, even though the changes remained?

It must be, because we haven't heard a peep from the teachers or the government regarding those issues in Bill 160.

Dalton's educational legacy is full day kindergarten. A overpriced daycare program for Ontarians and a golden goose for the Unions.

Dalton has raised the average teacher salary 34% during his tenure and given only the elementary school teachers more prep time (Funny, because his wife is an elementary teacher).

Now the teachers are in negotiations and the "war" is back on. Dalton is trying to remove the banking of sick days. “It’s laughable. It’s a joke,” say the teachers unions.

[Lemmy]

OnTheIce OnTheIce:

War on education? I'm sorry, I just don't buy that.

The big issues were standardised testing, teacher testing, regulating class sizes, educational property taxes, etc. Control was shifted dramatically from school boards and teachers to the Ontario provincial government.

Yes, control was switched to the provincial government. The other issues you mention were mistakes.

OnTheIce OnTheIce:

McGuinty has very little to change that. He's added some prep time to elementary schools only. So the question remains, why no more changes? Is it working? Did the war suddenly end, even though the changes remained?

You're right. That's a McGuinty lie that he didn't undo what he promised to.

OnTheIce OnTheIce:

It must be, because we haven't heard a peep from the teachers or the government regarding those issues in Bill 160.

Largely because there's nothing in their power to negotiate any more. Teachers have sucked it up.

OnTheIce OnTheIce:

Dalton's educational legacy is full day kindergarten. A overpriced daycare program for Ontarians and a golden goose for the Unions.

I agree. Full day kindergarten is a red herring. When my 5 year old gets home from kindergarten, she's a bear all evening. If she went every day, I'd have to move her bedroom into the garage. I don't want my 5 year-old in school every day.

OntheIce OntheIce:

Dalton has raised the average teacher salary 34% during his tenure and given only the elementary school teachers more prep time (Funny, because his wife is an elementary teacher).

The top of most teacher pay grids in 1995 was around $70K. Today, it's slightly over $90K. Take $70,000 and multiply it by 1.015 (a 1.5% increase per year) 17 times. That's the raise that teachers have gotten since 1995. 1.5% per year, which doesn't even cover the costs of inflation. Like I said, teachers haven't gotten a raise, except cost of living, during McGuinty's time in office.

OnTheIce OnTheIce:

Now the teachers are in negotiations and the "war" is back on. Dalton is trying to remove the banking of sick days. “It’s laughable. It’s a joke,” say the teachers unions.

If the province goes after sick day credits, they're bigger fools than I could have imagined. The biggest incentive to not take sick days is to let people bank them. They just disappear on retirement.

[eureka]

QBall QBall:

eureka eureka:

If you can't, then you should get out more! McGuinty has done a fair job of righting the train wreck of Harris, Flaherty, Clement and Baird. But, he can' do enough while the manufacturing sector in Ontario is being devastated by the petro-dollar. This government inherited a alrge deficit from Harris and had eliminated it with annual surpluses until the 2008 financial meltdown. The deficit now is from the stimulus and the near permanent recession that the Ontario hostile economic policies of the federal government have created.

Wow, I would love to live in the fantasy world you live in. A world where facts are irrelevant and all that matters is partisan spin. Unfortunately in this world facts rules, and the facts are thus: When McGuinty came into power the deficit was $5.6 billion, now it's $16 billion. When McGuinty came into power the debt was $148.7 billion, the debt in 2012-2013 will be $289.3 billion. McGuinty has increased spending 65% since coming into power. And the best the left can come up with is to blame people who haven't been in power for almost a decade or to blame the federal conservatives (while conveniently ignoring the federal Liberal when they were in power during this time). It's garbage thinking like that which booted the left from power federally and will soon cause them a quick exit from Ontario provincial politics as well.

You ignore the rest of my post and cherrypick for something that pleases you.

When you say that this government increased spending by 65%, do you think of what the increase entails? Do you relate it to the growth in the province in revenues and population? How much of that increase was related to the essential stimulus spending?

Before the meltdown, this government had eliminated the inherited deficit; It was producing balanced budgets with surpluses. Some of the increased spending was for expenditures on matters downloaded by the federal governments of both Chretien and Harper.

Parroting mantras of the Conservatives, the National Post and the Fraser Institute is not very instructive.

[Regina]

eureka eureka:

Parroting mantras of the Conservatives, the National Post and the Fraser Institute is not very instructive.

Pot........meet kettle.

[Bruce_E_T]

Lemmy Lemmy:

The reality is that manufacturing was in decline before the US dollar started going south. So we can't blame the decline in Ontario on currency value. Globalization has been the culprit and until the Chinese stop exploiting labour, the environment and their own currency's value to attract manufacturing, that trend will continue...even if our dollar goes back to 65 cents US.

Granted that globalization is the primary problem but the rise of the Cdn.$ is certainly an accelerator in the process. Simply because the US is such a giant trading partner the effect was rapid and severe.

The volatility/uncertainty also places additional stress on the managers of whatever. i.e. it's difficult to manage a business if you cannot tell where currency prices (costs/revenue) or supply prices are going to be down the road. You now get currency speculators and/or commodity speculators instead of managers.

Going back to a 65 cent dollar is now, at least short term, useless as the economy that it created does not exist. Once a system is taken apart it can only be recreated at some considerable expense.

[Lemmy]

Canada is certainly an export oriented economy, but we're also a GIGANTIC domestic economy. Don't go over estimating the importance of the foreign sector (USA or elsewhere) as determining factors in our economic performance. Currency values might...MIGHT represent a couple of percent as a cause of the decline. Compared to the impact of globalization, the currency effect is minimal.

[BeaverFever]

I think OTI and qball need to admit that much of whats happened to Ontarios economy is outside of the government's control and you cant blame the government of the day for it. McG's austerity budget has been well received even by austerity advocates. To answer an earlier question, the forecasted economic growth and reduced future liabilities will be how the current austerity plan leads to the projected balanced budget. Of course, all it takes is another tax cut give-away to businesses to return us to square one...thank god the libs scrapped that idea.

I think McG has done more for health and education than any other premier in recent history. Nearly 20 shuttered hospitals were reopened or rebuilt, our education was ranked best in the English speaki.g world, a chronic nurse shortage was eliminated, new schools were opened and teacher-student ratios were massively reduced.

[Yogi]

dino_bobba_renno dino_bobba_renno:

Lemmy Lemmy:

A high dollar is a blessing and a curse to Ontario manufacturers. The appreciated dollar does help to improve business efficiency rather than operating with the crutch of a 65 cent dollar. And commodities' prices do cause short-term fluctuations in the value of the dollar, but only within a very narrow range. Interest rates, domestic economic stability and export demand are still the determining factors of a currency's value and oil only represents about 10% of total export value. The Canadian dollar, in short, is too many things to characterize it as a "petro dollar". If we stopped exporting oil altogether, it would have little impact on our currency's value.

The reality is that manufacturing was in decline before the US dollar started going south. So we can't blame the decline in Ontario on currency value. Globalization has been the culprit and until the Chinese stop exploiting labour, the environment and their own currency's value to attract manufacturing, that trend will continue...even if our dollar goes back to 65 cents US.

As for austerity in provincial spending, it's a tough pill that needs to be swallowed. If Dalton isn't up to this task, then he needs to be replaced before we venture any further down the Greek garden path to bankruptcy. However, the way to reign in provincial spending is by slashing at all the ministries and agencies that provide special interest services only. Healthcare and Education need to be sacred. Those two areas of provincial spending are the ones that provide greatest external benefits and need to be protected (and after all, Healthcare and Education the two things that provincial governments were entrusted to provide under the Constitution). It's the plethora of other provincial government agencies that ought to be gutted. If Dalton makes the same mistake Harris made and attempts to balance the budget on the backs of teachers and nurses then he really needs to go. We've seen that film before and it was a horror-show.

Good post,I'd rep ya but I can't right now

Done!

[eureka]

I an afraid that I cannot agree, lemmy, and neither do many economists. I gave the dates and degree of decline in manufacturing and showed the correlation between tnem. Correlation may not be causation but, when there is an enormous parallel movement in a short period of time and other factors have not altered very much, then the correlation is quite revealing.

A drop of 20% or so in Canadian manufacturing employment in a space of four years that the dollar appreciated by more than 40% is, I think, quite conclusive.

Economists like Jim Stanfors and Hugh Mackenzie would agree, And, I think you have more integrity than to dismiss them as `Left Wingers.

To me, it seems that the only ideological position is that of Right Wingers who, by and large, offer nothing but theory for their calculations. Against the empirical evidence of declines in all economic performance since the `Conservative`counter revolution swept the Western world.

[Lemmy]

You're ignoring the cause of the Candian dollar's appreciation: the collapse of the US economy. The war, debt then the financial crisis are what caused the US dollar's decline. The Canadian dollar didn't rise. Parity came because of US decline, not Canadian "rise". That collapse in export demand accelerated the exodus of Canadian manufacturing that globalization started a decade or more earlier.

Sure, you'll find economists that will disagree with me on this (or anything else I may say), but you have to use some common sense. Blaming manufacturing loss on the value of the dollar seems to me to be ignoring the elephant in the room. In my professional opinion, you're noticing correlation, not causation. And I don't dismiss economists (nor anyone else) on the basis of "right-vs-left". BTW, where do you presume I fall on that continuum? It sounds like you're calling me right wing when really I'm just plain right.

[andyt]

You're both plain right. Lemmy, you're not really saying that Alberta oil has had no upward effect on the dollar, are you? Here's a guy who disagrees with you: "Respected economist Robyn Allan, former CEO of the Insurance Corporation of B.C., says the country’s move towards an oil-based economy will have severe effects on other sectors like manufacturing" OTOH, that's not all that's going on in the world, so it's not all due to the effects of oil.

$1:

“I think definitely in part we are suffering from the situation where the export of our natural resources, particularly crude oil, leads to upward pressure on the Canadian dollar. And as a result, that makes other sectors of the economy less competitive in terms of the exports,” said Allan, echoing McGuinty’s sentiments.

[Lemmy]

andyt andyt:

Lemmy, you're not really saying that Alberta oil has had no upward effect on the dollar, are you?

No, I'm saying that the value of the dollar is affected by many things. One of those factors is export demand. Export demand likely accounts for about 10% of the total determination of the currency's value. Among our exports, oil's value represents about 10%. 10% of 10% is 1%. 1% certainly makes oil production an important factor in our currency's value, but far from overwhelming. That's why I think the term "petro dollar" is a misnomer.