The Equalization Scam: Ontario the “Have” Province Gets $963M

February 6, 2018 Leave a comment

The School for Public Policy published a useful review of the 2018-2019 equalization payments.

Let’s take a look.

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Looks pretty typical in a lot of ways. West (+Newfoundland) pays East.

Also, while Quebec gets a lot of flak for getting the biggest payment, they are far from the biggest recipient on a per capita basis.

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But wait a second, didn’t Ontario just become a “have” province? Why are they getting a big cheque?

And that leads to the most interesting part of this year’s equalization:

This brings us to Ontario. The $963 million it will receive in equalization is entirely composed of adjustment payments. Absent these payments, the total equalization program would cost $17.2 billion and Ontario would receive nothing. But at $70 per person for receiving provinces, the adjustment payments add $1.76 billion, which brings the total cost of the program to the $18.96 billion dollars paid in 2018/19.

A Costly Quirk?

Why should adjustment payments be made at all? And why should they be paid to Ontario, a “have” province prior to this stage of the formula? The limit was put in place by the previous government in 2009 to keep costs under control and limit uncertainty. But why does it also act as a floor? And… must it? The Fiscal-Arrangements Act is somewhat ambiguous on this point.

Nope, this doesn’t appear to be a redistributive scam at all. It’s not like Canada already has the federal health and social transfers, or that the federal government already spends money in provinces at different rates.

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Filed under CMR, Ontario, Politics, Quebec, Welfare Tagged with

Canadian Author “Impressed” by More Subsidies for Canadian Authors

July 21, 2016 Leave a comment

Without public schools forcing students to read excruciatingly awful novels like The Stone Angel on a massive scale, Canadian authors like Margaret Atwood would probably sell far fewer books.

We should remember this when we read stories about Margaret Atwood’s approval of a new Ontario government policy that will force public school students to read even more boring books by Canadian authors.

Assuming no more than self-interest, artists, like most people, will tend to welcome subsidies that benefit themselves. It’s the model of corporate welfare applied to the artistic world. When they say it will “strengthen arts and culture,” remember there is no reason to believe that “good” arts and culture will prevail as the new learning material for children. Likewise in the corporate welfare scenario, subsidies to, say, the auto industry will be claimed to “strengthen the economy and domestic industry” even though economics tells us the opposite is true.

To the extent it survives on government money, art is a welfare program. The entire process of deciding what novels should be studied in public schools is completely political and thus likely to produce bad outcomes. Sometimes you get lucky and a real treasure comes out of the system, but the results tend to be bad. By relying on the government to “strengthen arts and culture”, you can be assured the arts and culture will be get worse while kids consider drinking bleach to avoid being forced to read books like The Stone Angel.

 

 

Filed under Arts, CMR, Education, Ontario, Welfare Tagged with , , ,

Public Healthcare = Not Enough Healthcare, Then You Die

February 8, 2016 Leave a comment

A young Ontario girl with cancer recently died even though she had donors available for her needed bone marrow transplant.

The bureaucracy stuck her on a waiting list because the public healthcare system could not provide her with a hospital bed when she needed it.

Typical public healthcare.

CMR Law 22: Public healthcare means less healthcare. The system comes with a built-in incentive that favors dead patients — after all, when you’re dead, they don’t need to take care of you any more.

 

Filed under CMR, Healthcare, Ontario Tagged with ,

Ontario Government’s Centrally Planned Electricity Debacle

December 3, 2015 Leave a comment

“One of the most devastating audit reports on government bungling and malpractice in Canadian history,” says Terrence Corcoran.

The AG reports that consumers have transferred billions of dollars to companies supplying green renewables on the basis of contracts awarded at grossly inflated prices. Because of the lack of competitive pricing for new power sources, nominally to replace coal generation, Lysyk estimates the extra burden on ratepayers at $9.2 billion — to pay for contracts at double to triple the going market price.

Over the next 17 years, she says consumers are expected to shell out about $133 billion in adjustments to cover the cost of the Liberals’ massive and scandalous restructuring of the electricity supply industry. Many of the dollars will go to pay companies to not produce electricity.

Read more.

Filed under CMR, Energy, Ontario Tagged with

A Different Take on the Rob Ford “Crack Mayor” Story

November 16, 2013 2 Comments

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Rob Ford should resign, but not for the reasons that are very popular right now.

Claim #1: Rob Ford smoked crack, so he should resign.

The tendency of government is always to grow. It is an insatiable beast that becomes bloated by feeding upon the wealth of its subjects. Anything that distracts politicians from trying to pass new laws, new taxes, and new regulations should be welcomed.

Weirdly, that includes smoking crack. The more time a politician spends smoking crack, the less time they can spend trying to do “serious work” like using the law to take more of the peoples’ wealth.

If the entire city council of Toronto was high on crack all the time, they would be high on crack all the time. So they would be pulsing with inflated confidence and sensory stimulation, but they would be unable to do their normal job — which is exercising power over their subjects, generally making their lives worse.

Look at how much energy is being expended to deal with a mayor who apparently smoked crack one time. Instead, they would be working on “fixing problems” in Toronto (read: making Toronto worse).

Normally, crackheads don’t have jobs because they can’t keep a schedule, they can’t concentrate on anything, and they are always desperate to smoke more crack. That would be a far less threatening politician.

Wouldn’t you rather have politicians smoking drugs instead of raising property taxes or creating exploitative regulations that make life difficult?

Claim #2: Rob Ford lied, so he should resign.

I am sure you’ve heard this joke before:

Q: How do you know a politician is lying?

A: His lips are moving.

The term “lying politician” is completely redundant. Politicians lie all the time. If they were actually elected, it is guaranteed that they lied profusely to achieve office. The best politicians are the best liars. The entire premise of democratic politics is people competing against others with one outlandish deception after another.

Mencken said of politicians:

They will all promise every man, woman and child in the country whatever he, she or it wants. …. They will all be curing warts by saying words over them, and paying off the national debt with money that no one will have to earn. When one of them demonstrates that twice two is five, another will prove that it is six, and six and a half, ten, twenty, n. In brief, they will divest themselves from their character as sensible, candid, and truthful men and becomes simply candidates for office, bent only on collaring votes. They will all know by then, even supposing that some of them don’t know it now, that nonsense, and they will apply themselves to the job with a heart yo-heave-ho. Most of them, before the uproar is over, will actually convince themselves. The winner will be whoever promises the most with the least probability of delivering anything.

If people were less selective with their outrage and instead demanded that all politicians resign if they lie, they would seriously require all politicians to pack up their stuff and retreat from public office immediately.

Which would probably make the world a much better place. But people aren’t demanding anything like that at all. So their whining about how Rob Ford lied to them seems extremely contrived and arbitrary.

— Read more at CTV.ca —

Filed under Ontario, Politics Tagged with , , , , , , ,

Windsor and Detroit: What’s the Difference?

July 31, 2013 1 Comment

Detroit has declared bankruptcy. The images and descriptions of the city evoke a wretched ghetto. Meanwhile, if you cross the border to Windsor, Ontario you find a relatively nice place.

Both cities have economies heavily invested in automobile manufacturing. Both cities also have various welfare systems available. They are both rife with municipal regulations. Canadian and American cultures are fairly similar.

So what’s the big difference?

Detroit’s bankruptcy filing lists about $18-20 billion worth of debt. Even if you low-ball it, this amounts to debt of about $26,000 for everyone in Detroit. This is a city where the average per capita income is a pathetic $14,700 per year.

Windsor’s debt is around $115 million. They have about a third of Detroit’s population. Windsor’s debt per capita is $545 only.

Debt is not bad. The key is to use the debt for something productive. Since all government spending is inherently wasteful, cities should spend as little as possible and minimize their debts. Otherwise they will become Detroit.

Filed under Banking and Finance, Ontario, Welfare Tagged with , , , ,

Australia to Join the World’s Orgy of Currency Debasement?

April 19, 2013 Leave a comment

Australia’s mining boom is fading. Demand from China is slipping. The economy is going to contract. Yet their dollar is strengthening.

Central bankers are Keynesian-mercantilists that get bent out of shape when their own currencies are “too strong.” Especially when the economy is threatening to slow down. The bureaucrats at the RBA are no different.

What are they going to do? Try to hold down the price of the Australian dollar. They will join Europe, Japan, China, America, and the Swiss in the frenzy of currency debasement.

This is… a bad idea. Yet it is to be expected, as are the negative consequences it will create.

It might be best to start trading your Aussie dollars for something better. For other currencies, few good choices exist. I used to like the yen before Abenomics. Now I like the Singapore dollar.

Hardly any central bank  can resist racing to the bottom. I don’t think Australia’s can resist.

— Continue reading at Sunday Morning Herald —

Filed under Banking and Finance, Central Banks, Commodities, Currencies, Inflation, International, Intervention, Investments, Mining, Ontario, Trade

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