A letter to the Canadian Prime Minister, with two suggestions for next steps in dealing with #COVID19

Prime Minister,

I certainly hope you and yours are well.

I was in New York City up until last weekend. Earlier in the previous week the university where I work announced that it was moving all courses online, and closing the campus. There was really no further need for me to stay in the City, but my initial thought was to wait it out, and decide later on when to return to Canada.

I started to have second thoughts when a student emailed me for advice just after President Trump announced that travel from Europe to the United States would be banned. He’s from Mexico, and said that he trusted the Mexican health care system more than the American, and wanted my advice on whether he should return home.

If that wasn’t enough to give me pause, when I saw the twitter feed of the Minister of Foreign Affairs  on Saturday evening recommending “that Canadian travellers return to Canada via commercial means while they remain availableI immediately bought myself a ticket for a next day flight to Canada. I arrived last Sunday evening, and have been in self-isolation since. I’m glad to be home given the events of the last week.

It is certainly time for government to step up, and history will judge the fall out of this pandemic in terms of how well societies govern themselves: professionally and efficiently, scientifically and socially, and with a sense of reciprocity and trust that strengthens community. I hope you and your cabinet take to heart a message that one of my colleagues has written in an article called “The Real Pandemic Danger Is Social Collapse.”

… the main (perhaps even the sole) objective of economic policy today should be to prevent social breakdown. Advanced societies must not allow economics, particularly the fortunes of financial markets, to blind them to the fact that the most important role economic policy can play now is to keep social bonds strong under this extraordinary pressure.

Good governance, not just a good health care system, is one of the reasons I’m glad to be home. I have been watching your daily press briefings with a good deal of admiration. And I am also impressed with both the design and speed with which the government has been able to roll out the package of reforms earlier this week, an effort that has no doubt been supported by legions of professional public servants working around the clock.

You promised that these reforms are just the first step in a fast moving and dynamic situation. I can’t pretend to understand the complete situation, hardly have full information, and can’t offer wide-ranging suggestions on what the next steps might be. But here are two suggestions that come from my limited areas of expertise. Continue reading “A letter to the Canadian Prime Minister, with two suggestions for next steps in dealing with #COVID19”

Intergenerational mobility between and within Canada and the United States

Intergenerational mobility is lower in the United States than in Canada, but the border only partially distinguishes the two countries with mobility varying significantly within each. The within-country differences and similarities hint at some of the reasons why the United States has lower social mobility than many other rich countries.

This is the main theme of a study released by the National Bureau of Economic Research, based upon Canadian data my co-authors and I constructed with the cooperation of Statistics Canada. Our research offers a more accurate comparison between these two countries than any cross-country comparisons made in the literature to date: tax-based administrative data, used to define similar measures of income, and coming close to covering the total population of similarly aged young people and their parents.

We cluster more than 1,000 communities in these two countries—709 American Commuting Zones and 288 Canadian Census Divisions—into four broad regions according to their similarity across a comprehensive set of five different measures of intergenerational income mobility, all referring to the strength of the tie between parent incomes and child adult incomes.

Source: Connolly, Corak, Haeck (2019, Figure 7). Click on image to enlarge.

Continue reading “Intergenerational mobility between and within Canada and the United States”

The “middle class” is within easier reach for low income Canadian children, than it is for low income Americans

Upward mobility is more likely in Canada than in the United States, with the middle class within easier reach for Canadian children raised in low income families than for low income American children.

Canadian children raised by parents with incomes at the bottom 10 percent can expect to be earning enough as a young adults to place them much higher, above the 40th rung of a 100 rung income ladder, and significantly higher than their American counterparts. To reach a similar point on the income ladder an American child would have to have parents who ranked as high as the 39th percentile. Continue reading “The “middle class” is within easier reach for low income Canadian children, than it is for low income Americans”

If there is such a thing as the “Canadian Dream,” it would look very much like what Americans say is the “American Dream”

Public opinion polls suggest that Canadians and Americans share basic attitudes toward inequality and opportunity, and toward the underlying drivers of upward mobility. If there is such a thing as the “Canadian Dream,” it would look very much like what Americans say is the “American Dream.”

The Pew Charitable Trusts conducted a number of public opinion polls asking Americans what meaning they attach to the phrase “The American Dream,” and these have been adapted and conducted in Canada with remarkably similar responses.

In these polls respondents were asked to indicate the degree to which they agreed with a series of possible definitions of the American Dream. Sixty percent of American respondents ranked “being able to succeed regardless of family background” eight or higher on a ten point scale, while 59 percent of Canadians did so. The percentage indicating that the statement “Your children being financially better off financially than you” represents the American Dream was 64 percent in the United States, and 57 percent in Canada.

These two options relate most directly to social mobility as measured by social scientists, and the country differences in responses to them are not statistically significant. In fact, this was the case for the ratings given to all but one of the other ten options presented to these representative samples, Americans ranking “Owning your own business” more highly.

Source: Connolly, Corak, Haeck (2019) using data from Corak (2010).

Continue reading “If there is such a thing as the “Canadian Dream,” it would look very much like what Americans say is the “American Dream””

Equality of opportunity is a choice

Tony Atkinson, the great British economist, encourages us to think of inequality as a choice, something that can be influenced by public policy.

If this is the case for equality of outcomes, then it is surely also so for equality of opportunity; the significant differences in social mobility between the rich countries hinting at the role governments play in determining the degree to which family background is destiny, the rich raising the next generation of rich adults, the poor seeing their children face low chances of upward mobility.

Some of these differences may simply reflect different social priorities, but others may teach us about the power of different policies. Continue reading “Equality of opportunity is a choice”

Canada’s Poverty Reduction Strategy adopts the United Nations Sustainable Development Goal to end poverty

The targets to reduce income poverty in Canada’s Poverty Reduction Strategy take an important step toward the first UN Sustainable Development Goal addressed to ending poverty, but progress will fall short without all Canadian governments—not just the federal, but also provincial, and municipal governments—adopting coordinated policies to eliminate deep poverty.

The first UN Sustainable Development Goal is to “End poverty in all its forms everywhere,” and has explicit targets associated with it.

Two of these targets are particularly relevant for Canadians. They speak to ending income poverty, and are:

By 2030, eradicate extreme poverty for all people everywhere, measured as people living on less than $1.90 a day

By 2030, reduce at least by half the proportion of men, women and children of all ages living in poverty in all its dimensions according to national definitions

Canada’s Poverty Reduction Strategy is informed by both of these targets, setting a nationally appropriate poverty line, and using it to explicitly adopt the second target. However, it addresses the first UN target only partially: offering an appropriate definition of extreme poverty, but not adopting an explicit target.

Eradicating extreme poverty will require all governments in the Canadian federation—not just the federal—to pursue consistent and coordinated policies. Significant progress will only happen with the partnership and commitment of the provinces and municipalities.

Continue reading “Canada’s Poverty Reduction Strategy adopts the United Nations Sustainable Development Goal to end poverty”