Magic Statistics

Even though Canada is a single nation, economic goods and services do not flow freely across the country.  Product specifications, labour rules, and business regulations that differ among the provinces and territories mean added costs and other impediments for companies that want to sell their products outside their home jurisdiction and for skilled labourers who want to work elsewhere in Canada.  Such inter-provincial trade barriers are estimated to cost Canada about $11 billion, or about 1% of GDP, every year.

The various levels of government have long recognised and decried the inefficiencies generated by inter-provincial trade barriers, but repeated attempts to reduce them have achieved only very limited success.  Until now.

After three years of negotiations, BC and Alberta have signed a deal that will effectively erase the border between the two neighbours. The Trade, Investment and Labour Mobility Agreement (TIMLA) will come into effect next spring.  It is already being hailed as the most important Canadian free trade agreement since NAFTA.

Under the B.C.-Alberta agreement, virtually every barrier will be lifted, and everything and everyone from workers to businesses will be able to move and transact freely between the two provinces, creating a new western economic power. The deal is one of the clearest signs of the West's growing confidence over the past three years (fuelled largely by the oil boom), and a signal that the days of "the West wants in" are gone. In a reversal of this once-common western refrain, the deal has other provinces now looking to get in on the West's new-found fortunes.

"We will become the second-largest economy in Canada," B.C. Premier Gordon Campbell said after signing the agreement in April. "This will be noticed across the country." It received ample attention from business lobby groups, who have heaped praise on the deal and premiers Ralph Klein and Campbell . . .

As a result of TIMLA, BC and Alberta are expected to form a dynamic economic union to rival Ontario's economy.

Provincial politicians have hitherto seen little payoff to reducing inter-provincial trade barriers, since most of the benefits flow to producers in other provinces in competition with local companies.  Now that BC and Alberta have taken the lead, however, regional trade deals are being considered in the Atlantic provinces and between Ontario and Quebec, and there is pressure in Saskatchewan and Manitoba to join the BC-Alberta pact.

When I was an economics undergraduate at Simon Fraser University over thirty years ago, the sizeable and completely unnecessary economic losses caused by inter-provincial trade barriers were already well-documented.  At last, something is being done to eliminate them.  From the perspective of Canadian economic prospects, this is immensely exciting and gratifying to see. 

Kudos to premiers Klein and Campbell for pushing the rest of the country to deal seriously with this long-standing source of economic inefficiency in Canada.

Previous related posts:

• BC economy recovering from NDP 1990s slump
• Quebec’s feeble economy is its own fault

Women who smoke cannabis early in pregnancy may heighten their risk of miscarriage, according to a study published in the Journal of Clinical Investigation.

Cannabis is the most widely-used illegal drug among women of childbearing age. Scientists studying mice have found that THC, the active ingredient in the drug, can retard embryo development and prevent it from reaching the womb.

The findings suggest that smoking cannabis may lead to miscarriages caused by embryos developing outside the womb, in the fallopian tubes.

The researchers found that THC inhibits the work of a molecule called anandamide that is necessary to normal embryonic development.  When that happens, embryos are less likely to move down into the womb; rather, they tend to stay in the fallopian tubes, resulting in an ectopic pregnancy.

It was also noted that some drugs taken for weight-loss or appetite suppression have a similar effect on anandamide and so need to be monitored carefully.

Previous related posts:

• Think marijuana’s not addictive? Think again
• But what does it do to the baby?

The Rolling Stones are known to object very strenuously to paying taxes.  No news there: who doesn’t?  The news is the extent they have successfully avoided actually paying them.

With shrewd management, using offshore trusts and companies, Sir Mick Jagger, Keith Richards and Charlie Watts paid only 1.6 per cent in tax on earnings of £81.3 million last year.
. . .
Richards, worth £180 million, told an American business magazine: "The whole business thing is predicated a lot on the tax laws. It's why we rehearse in Canada and not in the US. A lot of our astute moves have been basically keeping up with tax laws: where we go, where not to put it, whether to sit on it or not."

The news emerged only because the three original Stones are writing their wills and applicable Dutch law requires some financial details to be made public.

The three musicians are said to have gone to a Dutch finance house in 1972 to have their earnings managed from Amsterdam because they did not trust British finance houses. Their advisers reportedly use offices in the Dutch Antilles in the Caribbean in order to reduce tax liabilities.

An income tax rate of 1.6%.  I am so jealous.

Previous related post: Keith Richards knows who he is

At one time, Michael Ignatieff was touted as the front-runner in the Liberal leadership race, but my devastating critique of Mr Ignatieff’s Globe and Mail op-ed has the Party faithful panicked.  (Yeah, right!)  Be that as it may, for whatever reason, pressure is mounting on Frank McKenna, former New Brunswick premier, and former Canadian Ambassador to the US, to toss his hat into the ring.

If you ask some Liberals whom, among the 11 candidates, is going to win the leadership campaign, the answer is now the twelfth, Frank McKenna.

But when you point out that he's not in the race, the said Liberals will explain to you that the time to register is not up and there's still the whole month of September open for him to make the move.

This might sound crazy and may be the result of a summer hallucination on the part of some Liberal strategists who've finally been hit by the depth of the destruction their party was plunged into after the Martinites-Chrétienites civil war.

However, the race has failed, up until this point, to provide the name of a person who can unify the party, first, and lead it back into government.

Seriously, Mr McKenna could be a canny choice to head the Liberals into the next election, for he represents a clear break with many Martin-Chrétien policies.  For example, urging his party to support the US ballistic missile defence shield was a clear public break with Mr Martin’s position.

Nevertheless, I’d be very sorry to see Scott Brison lose his bid for the Liberal leadership.

With all the talk among leftish Canadians that our prime minister's pro-Israel position reflects a desire to get on the good side of US President Bush, you'd think the American government is paying close attention to where Canada stands.  Several experts on US-Canada relations doubt that.

"I don't think Canada is following the U.S.'s lead on this," said Chris Sands, senior associate at the Center for Strategic and International Studies in Washington, D.C.  "Even if Canada were to go to a more traditionally unfriendly position vis-à-vis Israel…would it make a difference to the United States? Canada is largely discounted on these things. It has always been a little bit less helpful and so I don't think it would be a big issue.

"You have to remember that Canada is not a global player," Mr. Sands added, "but maybe sort of a small regional player similar to Denmark or the Netherlands, and so Canada's position is one that is somewhat discretionary."

Small regional player?  Similar to Denmark or the Netherlands?  Ouch!  So much for Canada having “a voice that other countries listen to”.

The annual premiers' conference is usually a snore-fest producing very little in the way of real accomplishment.  Last week's was no exception.  The big agenda item was an attempt to negotiate a united front on equalisation payments which, predictably, failed.  The good news was that no attention was given to a national daycare program.  The Toronto Star's Ian Urquhart comments:

Conspicuously absent from the communiqué issued last week by the premiers following their annual conference was any mention of child care.
. . .
Making this oversight all the more curious is that the premiers have good reason to complain about Ottawa's handling of the child-care issue. And complaining about Ottawa is what they do best.

Got that right!

Readers will recall that last year the provinces individually signed deals with the federal government - then still in the hands of Paul Martin and the Liberals. The deals would have provided $5 billion in funding (over five years) to the provinces to establish 100,000 new licensed child-care spaces.

Before the program could be implemented, however, the voters turfed out the Liberals in favour of Stephen Harper's Conservatives.  Given that national daycare was a prominent election issue, with the Liberals promoting national daycare and the Conservatives promising to dump it, the program would appear to be dead for the life of this government, at least.  No surprise, then, that the premiers avoided meeting with program proponents, preferring to spend their time on other, still-live political issues.

Mr Urquhart, however, is not pleased.  He acknowledges that the premiers had many reasons for not discussing the issue, but that's not good enough for him.

Better for the premiers, then, to put the child-care issue behind them. But not better for the cause of public debate.

Excuse me, but we had a "public debate"—before and during the election—and the public spoke.  Mr Urquhart follows a typical liberal tactic: Keep "debating" until you get what you want, and don't take "no" for an answer.

Previous related posts:

• Mothers: Stash those kids in daycare and get back to work
• Universal daycare program hurts children and families
• What does society lose when women choose work over family?