A Canadian friend (not sure if he wants to be mentioned by name) sent me a link about relative Canadian and US economic performance. I am curious to know whether Canada's economy is showing any signs of starting to close the gap in per capita GDP and productivity versus the US. One would expect NAFTA to allow Canada to achieve higher economies of scale and lower costs. This article paints a bleak picture:
In the financial services industry, for example, Mr. Nixon said the regulatory cost of $1,000 of service output is $10.83 in Canada, which is 154% more than in Britain and 58% more than in Australia. "From environmental approvals to securities regulation, Canadian business is subject to costly and lengthy regulatory processes that are seriously undermining our competitiveness," he said.
One cause of Canada's trailing economy is too many financial regulators:
Canada's securities industry is governed by a patchwork of 13 provincial and territorial securities commissions, all jealously guarding their turf. Because of that, it may be impossible to get agreement on a single regulator for the industry. Instead, Ottawa will settle for an agreement among the commissions to make their rules and regulations equal and to cut down on red tape.
The Western Canadians are not keen on major changes:
The federal government's plan to stick its big fat nose into securities and stock market regulation -- a provincial matter -- could be as damaging to western Canadian business interests as the Liberals' efforts to make us conform to the fatally flawed Kyoto climate change protocol.
Can Canadians use discount online brokers?
Canadian industry sees worsening Canadian federal government economic and regulatory policies:
More companies see a worsening in Canada's federal policy environment than improvements in public policy. Top areas of concern include user fees (46%), environmental regulations (39%), customs regulations (37%), a lack of sensitivity to business interests (30%), health and safety regulations (29%), overall fiscal management (29%) and payroll taxes (28%). There is slightly more confidence in the provincial policy environment, especially with respect to tax reform, but there, too, many more companies see policy conditions worsening than improving. Frequently cited concerns are in areas such as user fees, where 43% expect conditions to worsen, labour regulations (36%), environmental regulations (35%), health and safety regulations (32%) and overall fiscal management (25%), transportation and infrastructure (24%) and sensitivity to business interests (23%).
The event that prompted the first story in this post is the TD Forum on Canada's Standard of Living which happened today in Ottawa. I can't find any conference documents on the web for it (not saying they aren't there somewhere; just can't find them if they are) but here's another National Post article which lists various recommendations made at this conference:
"Several authors noted the current employment insurance system does much to perpetuate reliance on low-skilled, seasonal work, while acting as an employment tax on more dynamic sectors of the economy," it states.
Robin Neill, an economics professor at the University of Prince Edward Island, said regional development policies -- such as the $700-million Atlantic Innovation Fund -- encourage firms to devote energy to creating programs that qualify for government money rather than profitable ideas.
UPDATE: You can find the full text for each of the presentations at the TD Forum on Canada's Standard of Living here.
|Share |||By Randall Parker at 2002 October 08 04:28 PM Economics Political|