This is the 50th anniversary of the Canadian Economics Association, and it is natural to wonder how Canadian economics has changed, even if there is such a distinct thing as “Canadian Economics.” The annual meetings kicked off with a session on “Fifty Years of Canadian Economics.”
Inequality is increasing in Canada. Or is it?
A short report on the topic released by a major Canadian bank includes the bold heading “Income inequality has been unchanged in Canada — say what?”. This apparently contrarian finding has been seized upon by at least one influential pundit in a way that only serves to obstruct constructive public policy discussion.
A debate is in order, not over whether inequality has increased—because it has—but why this is important, and what could, or for that matter should, be done about it.
But this sort of discussion requires the best of our public commentators, and in this post I offer three rules for good pundit behaviour. Economic statistics can be confusing and they can be used in confusing ways, purposely or not, and so these rules might also be a set of general guideposts for the average reader to help separate fact from fiction, since after all we can’t expect pundits to always follow them.
Inequality has increased in the majority of rich countries, but the share of income and earnings going to the top has increased most in the anglophone countries. McMaster University economist Mike Veall says Canada has not escaped this trend, and argues that a public policy response is needed.
The underlying causes of, in his words, “the surge” in the shares of the top 1%, one-tenth of 1% and even the top one-hundredth of 1% in Canada remain elusive. Even so these changes should motivate at least three policy responses that could be supported across the political spectrum.
Professor Veall was the 2012 president of the Canadian Economics Association, the professional association of economists based in Canada, and presented his presidential address at the annual meetings of the Association held last June at the University of Calgary.
The twitter hash tag is #S17, and using it will connect you to all those preparing for the first anniversary of the Occupy Wall Street movement, which of course is today, September 17th.
You will find tweets encouraging your participation: “If you feel that the world is on the right track, stay home. If you know things are bad, Join your local #OWS.”
But whatever your level of engagement, there is a message that this anniversary has for us all, a reminder of the real price of inequality.
Inequality has been increasing in most countries, in part because top 1% are capturing a higher fraction of all earnings but also for other reasons. I made a presentation to the Occupied Ottawa conference “Take Back Democracy!” on June 2nd, 2012. The presentation explores three issues in search of intelligent conversation, and in order to accomplish something constructive: description, explanation, and prescription.
You can download it as a pdf here: Understanding inequality and what to do about it .
The Occupiers have their facts right.
There has been an unprecedented increase in earnings inequality in the United States, with significant shares of total earnings increasingly going to the very top.
Let’s be clear on this: we are not talking about inherited wealth, but rather “earnings”, the stuff we get from being an “employee”.
The only group to see their average earnings rise over the course of the last three decades or so are highly educated, older, men. And this is driven by the select few. It is not an exaggeration to say that it is the top 1%.