The fade

So much for lower rates. Stocks fell. Bond yields rose. The US dollar gained. Ours lost. Gold crashed thirty bucks an ounce. All because of jobs.

The Trumpian economy turned out 224,000 new hires last month. Yuge. Economists had expected 160,000, after a lacklustre May. But even with 335,000 new people streaming into the labour force, the unemployment rate stayed solidly in the 3% range.

Equity markets had been counting on a rate cut and more economic stimulus from the Fed. Not so certain now. Why should the central bank drop the cost of money when there’s no recession on the horizon? When so many new people are working? Meanwhile in Canada, we lost some jobs in June. Two thousand of them. Unemployment is 5.5% – still a good number for us. And so far in 2019 it’s been a boffo six months for creating work. There are 247,500 more working now than at the end of last year, most of them in full-time jobs. Wages are up. And look – we have a trade surplus with the States. First time in 10 months.

So the Bank of Canada won’t be cutting its rate this month. Maybe not this year. Bond yields have swelled again. And those cheapo mortgages now available may be gone in a month or two. A new survey finds 93% of economists think the central bank will not take action, even if the Fed chops in the US. Says RBC’s analyst: “…The BoC’s policy rate is already slightly more accommodative than the Fed’s, Canadian inflation is closer to target, and the BoC faces less political and market pressure ease…I don’t think financial conditions will tighten enough for the BoC to need to offset that with rate cuts of their own.”

The inevitable conclusions: if you want mortgage money, lock it up now. If you’re shopping for a house, take your time. If you’re selling, be aggressive. And I hope you dumped your gold and bitcoins.

Two days ago I invited Blog Dogs to share thoughts with us in the form of guest posts. The response has been epic. Even if your momma and your spouse think you’re a tedious blowhard, you have a home here. Let’s bark together.

First, a dude named Jeff posting as Sunshowers. “Your resident socialist,” he says. Great. Just what we need.

I read the blog every day, but try not to be too much of a pest, so I typically don’t comment unless there’s a succinct point to be made. With this, I’m hoping to give a simple and easily digestible explanation as to why capitalism is doomed to fail. Ready?

I’m sure you’re all familiar with the profit motive that underpins capitalism. So how does one go about maximizing profit? You raise prices or lower costs. Easy. We’ll come back to prices, but as far as costs go, they can be (crudely) broken up into fixed costs, material costs, and labor costs. By far, the easiest of the 3 to control are labor costs.

So you pay your workers a little bit less. Maybe you lay some people off and replace them with machines. So what? You make more money now. Capitalism, baby! But there’s a problem. To quote penitent billionaire Nick Hanauer: “The thing about us businesspeople is that we love our customers rich and our employees poor.” The problem is: They’re the same people.

This is supposed to be easily digestible, so the only required reading I’m assigning is Game Theory, and The Tragedy of the Commons. I bet you all know those already anyhow! If you’re the only employer cutting pay and/or automating, you’re the equivalent of the guy “cheating” in Game Theory while your competitors play by the rules, or the only farmer with cattle grazing in the commons. You win big, everyone else loses.

But what happens when others do the same? Then we move to the lower right Game Theory quadrant (both players cheat, both players lose), and a barren commons with no more grass. If every employer underpays their workers, those workers no longer have money to spend at OTHER employers’ businesses, forcing THOSE businesses to lower prices (by cutting labor costs!), resulting in a race to the bottom that ends with the engine of consumption that drives capitalism grinding to a halt. Maggie said the problem with socialism is that eventually you run out of other people’s money. That’s actually the problem with capitalism. (This is also why raising prices to boost profit is a non-starter).

It would be less scary if it wasn’t already happening. Nearly all wealth generated since the 80s has gone to the rich, real wages have barely risen since the Reagan administration, we’ve gone from 1 income households to 2 income households and nobody batted an eye, and we STILL need to use debt to make up the difference! This is an internal, irreconcilable contradiction within the very nature of capitalism.

There ARE viable alternatives to capitalism, and I’d be happy to explain, but I’m coming up to the 500 word limit, it’s 11:00, and the wife and dog want to go to sleep, so it will need to wait for another day (should Garth entertain this notion once more.) Thank you and goodnight, blog dogs!

Now here’s Jake. With Sasha, six years old, who was was runt of the litter so, J says, “she tries to be alpha of the pack. The world needs more dogs and less people.” And, apparently, more biz taxes.

   I’m a big fan of your blog; been reading it for little over a year now and it’s part of my daily routine. I can honestly say that I feel much wiser because of it. Anyways, you asked for “What’s right or wrong with the world” in 500 words or less, so here’s my opinion.

I think that businesses are what is wrong with the world. All of them. At least here in Canada. I’m no expert on tax law, GDP, or anything like that, but I think that corporations have bullied their way into making it extremely difficult for citizens to get by. Here’s why: In Ontario, a person making a decent wage can expect to pay 9 – 11% in taxes to the province (depending on how much they’re making), and between 20 – 26% in taxes to the feds. If we lowball on both ends, that’s roughly 29% in taxes (I know, I know, it’s laddered so it’s not really that, but bear with me). Now if a corporation exists in Ontario, they only pay somewhere between 38% to the feds (not including all the reductions/rebates they can get), and 3.5% to 11.5% to the province. If they’re a small business, the feds chop that to 9%, effectively making it less than the average person would pay. I understand that businesses give people jobs, grow the GDP, and are generally the reason we have a functioning economy, but I don’t agree with hw companies pay less in taxes than people do (Yes, I’m assuming the average person doesn’t have kids or get any tax breaks and actually pays their full share, so a little one-sided here).

Instead of big tax breaks to companies, I think it should be the other way around; if you’re going to tax one party higher than the other, the business should get the short straw while the person gets a break. Now tax rates aside, most large companies have lawyers that find loopholes so they don’t pay anything anyways. Remember hearing about how Netflix, Google, and Amazon paid 0 in taxes? That’s literally billions of dollars that could/should be going back to the people. Is it wrong to think that there should be a flat rate that no matter how you maneuver your company, no matter what loopholes you find, you still pay at minimum a set amount? Just think of what useless things the government could do if they received 1% of Netflix’s revenue in Canada. Or Google. Or Amazon. Now I know that those are giants, and what about the little mom and pop shop?

Well, to be honest, tough love as far as I’m concerned. I get that this would likely tank several small stores, but in my opinion, people shouldn’t need to prop up businesses by giving them tax breaks; businesses should be supporting the people via paying more in taxes. I’d love to hear your take on this, as I’m not educated on this content whatsoever and would like to hear someone with more experience/knowledge/wit than I have weigh in on it.

 

157 comments ↓

#1 Mike in Calgary on 07.05.19 at 3:38 pm

Interesting thoughts. I run a small business. I have 2 other partners and 15 staff. After having done that for almost 25 years, I would hazard a guess that Jeff and Jake have never done anything like that and have no idea what it’s like. It chills me to know that people like that walk amongst us. But they are entitled to their opinions.

#2 Tater on 07.05.19 at 3:38 pm

Wow. Jeff could not be more wrong. While wages may not have risen in Canada or most of the developed world, they sure have in the developing world. If the only skill you have to offer is manual labour (and yes, banging out crappy computer code is now the same as manual labour), I’m sorry to say, the future isn’t that bright.

Your competing with EVERYONE

#3 Jeff G on 07.05.19 at 3:40 pm

Jake makes an interesting argument.

As a small biz owner, if businesses paid the lion’s share of taxes, I’d just pay out all profits as salary and enjoy the lower personal income tax as he suggests should be the case.

His tax regime argument perhaps would be more effective if applied to publicly traded companies but they would pass the cost to customers increasing prices and/or reduce investment and/or hire fewer people.

I’m a proponent of flat tax for individuals and corps. One rate applied to every person and entity with few (or no) exemptions. Think of all the money saved from having to hire professionals to figure out how much we owe the government – that alone is compelling enough.

#4 crowdedelevatorfartz on 07.05.19 at 3:44 pm

@Sunshowers
“Nearly all wealth generated since the 80s has gone to the rich, real wages have barely risen since the Reagan administration, we’ve gone from 1 income households to 2 income households ”
++++++++++++

Sorry but I wasnt wealthy in the 80’s and while I’m doing ok I’m certainly not “wealthy” now.
My wages helped .
I’m earning 6 times what I earned annually in the 80’s….. because I have 35 years of experience, more education and I still work hard….

The “system” doesnt owe you a fair wage and a comfortable existence .
You should work for it …that way you’ll appreciate what YOU have.
If someone just gives you everything…… whats the point of getting out of bed?

@Jake
More taxes is the solution?
Yeeesh.

Would the last company to leave overly regulated and overly taxed Canada please turn out the lights……….

#5 500 words not needed on 07.05.19 at 3:45 pm

Jeff: Alternatives to capitalism are worse. Capitalism self corrects.
Jake: Companies are people.. yer just taxing yer self.

#6 Leftover on 07.05.19 at 3:52 pm

To Sunshowers, who sounds likable, the problem with game theory and socialism is that it assumes wealth is a zero sum. What if the common gets larger and feeds more cows?

Not that conservatives are any smarter since they assume that rights are a zero sum, for example that somehow same sex marriage hurts other people.

Ho-hum

#7 BC Renovator on 07.05.19 at 4:00 pm

Hey Jeff- please move to Venezuela and report back.

@Jake, as a small Business Owner higher Taxes would cripple me and put me out of Business (as well as others), which would drive up prices of remaining competitors as demand for Construction services would rise even higher. If I had to guess I would peg you as a Government employee/Union man? They all seem to have the same argument.

Scary, that these are our Neighbours…

#8 McSteve on 07.05.19 at 4:07 pm

Have a year and a bit left on my mortgage at 2.95%. Maybe now is the time to “blend and extend”(?)

#9 Flop... on 07.05.19 at 4:13 pm

I can’t deal with this level-headed discussion.

It’s affecting my ability to think about what nonsense to write about…

M45BC

#10 Less government & grow the common on 07.05.19 at 4:13 pm

How about … less government, eliminate gov DBs (many companies have already even insurance cos.) …. then lower taxes for everyone.

AHHH … then we can work hard and grow the commons. We all prosper … or at least those who work.

#11 X on 07.05.19 at 4:19 pm

My issue with sunshines comments are the assumptions that are made. I guess it depends on the business, (as you don’t mention what type of business you own andoeprate) but in the sector I am in, labour may actually be the most difficult to manipulate. Either you pay the wage or don’t have the employee. And good employees are valuable.

Jake, to raise business taxes, lower personal rates, and see how many people then decide to take on the financial risk of starting a business and providing jobs may prove to be a financial decision we regret.

#12 Basil Fawlty on 07.05.19 at 4:28 pm

Can someone tell me why the inflation rate is targeted at 2%? Who decided that it is economically prudent to reduce our purchasing power by 2% per year? Am I the only one that smells a turd?

#13 adam on 07.05.19 at 4:31 pm

Wow. I think the best quote I know on socialism is this one:

“If you aren’t a socialist by age 20, it means you don’t have a heart. If you are still a socialist at 40, it means you don’t have a brain.”

I will assume Jeff and Jake have never run a business and hopefully aren’t 40 yet.

Just wrapping my head around the BC NDP’s new employer health tax as our business just had to make its first installment payment.

https://www2.gov.bc.ca/gov/content/taxes/employer-health-tax/employer-health-tax-overview

If your employment wages are under $500K you pay nothing. If $500 to $1.5 million you have to pay almost 3% of wages to the provincial government. If over $1.5 million it is only about 2% of wages. The tax is actually regressive in that small business pay a higher rate than large business!!!!

Just about to do employee reviews. A number of staff have expressed their desire that they want more money because of rising costs and I want to pay them more but hard to do that when revenue is flat and you have to send another $10,000 to the govt.

#14 Doug in London on 07.05.19 at 4:35 pm

Stocks dropped today? I looked at my portfolio this morning and saw no difference. Some stocks up, and others down but only by 1 or 2 cents. I think the level in Lake Superior dropped by more, percentage wise, when I scooped out about 4 litres to put out a campfire than stocks dropped today. A tempest in a small teapot in a doll house.

#15 crowdedelevatorfartz on 07.05.19 at 4:44 pm

And as if there was another reason to run screaming from the Lower Brainland Condo ponzie……..

https://business.financialpost.com/personal-finance/taxes/condo-flippers-beware-the-taxman-is-watching-you-and-has-new-tools-at-his-disposal-to-take-action

#16 Gravy Train on 07.05.19 at 4:51 pm

And look – we have a trade surplus with the States. First time in 10 months. — Garth

Careful, Garth. We don’t want Trump putting more tariffs on our U.S. exports. :)

#17 Keith on 07.05.19 at 4:53 pm

The middle class is made from government regulations:

1. Minimum wage laws
2. Laws that foster unions
3. 40 hour work week, down from 80
4. Government run and regulated health care
5. Mortgage insurance.
6. Health and safety regulations
7. Etc, etc.

We can have a society like the Scandinavian countries, which provide a somewhat larger social safety net than Canada did at its peak. They routinely lead surveys of happiness and quality of life. It’s clear from our election results that people don’t want that kind of country.

I think that an enormous middle class with low unemployment is a very stabilizing force for society. Almost everyone in the workforce, putting time in for a pension, able to afford a home and some nice things. People with significant economic and community connections to each other buy into a mutual loyalty.

It’s clear from our public policy, changes in the economy and our electoral results that we are trending away from those good old days. When 90% of us are a gig and contingent labour force, with a subsidence income and no benefits, the circle back to feudal times will be complete.

#18 A Dollar is a Dollar is a Dollar on 07.05.19 at 5:04 pm

“…people shouldn’t need to prop up businesses by giving them tax breaks…”

Well said, but this is so entrenched in our system that few politicians will have the guts to offend business donors and level the playing field. In Toronto for example, until this past year, there was a “vacancy rebate” on property taxes for business locations. Millions of dollars were being gifted away each year, for decades, for store owners who would board up their properties and do nothing with them for years. You still see the remnants of this all over Toronto, where so many streetscapes are in need of improvement.

We need to abolish all such tax scams, and treat all dollars equally.

In fact, as some have suggested, a flat transaction tax across the board may be the most efficient way to accomplish this. It would reduce headaches for tax filing for everyone as well.

#19 Barb on 07.05.19 at 5:07 pm

Jeff and Jake are proof some socialists are educated, yet remain socialists.
A skewed picture if ever there was one.

#20 AGuyInVancouver on 07.05.19 at 5:09 pm

#5 500 words not needed on 07.05.19 at 3:45 pm
Jeff: Alternatives to capitalism are worse. Capitalism self corrects.
Jake: Companies are people.. yer just taxing yer self.
_ _ _
Really, beacuse it’s been 40 years since the errors of Reaganomics began and the wealthy continue to get wealthier, at the expense of everyone else. What’s “trickling down” isn’t pleasant.

#21 Dolce Vita on 07.05.19 at 5:11 pm

Labour Force Survey May to June 2019 = Voodoo ad absurdem.

StatCan turned this:

+155,000 jobs (Unadjusted, raw data gathered)

into this:

-2,200 jobs (Seasonally Adjusting the Unadjusted data with Lord knows what?).

Both sets of numbers from StatCan:

https://i.imgur.com/7IzjxE4.jpg

To get the above, slice & dice on your own:

https://www150.statcan.gc.ca/t1/tbl1/en/cv.action?pid=1410028701

StatCan has not responded as to why they changed the March 2019 GDP numbers in the April GDP Report (inflated April GDP by +0.1%):

https://i.imgur.com/A2p0i9J.jpg

Submitted for your approval StatCan:

https://www.youtube.com/watch?v=XVSRm80WzZk

————————————-

Well Garth, StatCan now reigns supreme in Frankenumber reporting easily beating out RE Boards across the Country. No small feat.

#22 BobC on 07.05.19 at 5:19 pm

Jake, simple question. Every penny paid in taxes by any business comes from where?

#23 Debtslavecreator on 07.05.19 at 5:21 pm

These two posters show why we are headed into an era of radical mostly left wing / socialist politics in the 2020-2030s
You have it backwards friends. 90 % of the reason for the average persons problems lie with that crown Corp Bank of Canada and other direct govt intervention (CMHZ/Tax credits , zoning laws etc)

They are artificially subsidizing credit and the resulting fake growth means that over time your housing related expenses and general cost of living are rising much higher than the typical wage
Over time the disposable / discretionary income is effectively captured and redirected into the pockets of senior execs in the FIRE sectors
These sectors become , along with the huge public sector unions, lobby and buy off government to subsidize their profits
Divide your estimated house price by 1) Canadian gold price and/or 2) the costs you must endure every year (groceries / insurances / prop taxes and user fees etc)
And tell me how much “money “ or profit you made on your house when u sell it one day
Then take your year end pay stub and divide all those non CPP and rsp/Pension amounts and what % is taking the largest bite from your gross ?
You will see it’s government!
Raising taxes to confiscatory levels on large corporations or the “rich” will not help
It does NOT work and helps accelerate the eventual collapse
You must fix the monetary policy to ensure positive real rates of return for savers and properly priced credit , eliminate all credits and government “insurance “ schemes , dramatically simplify the tax code and limit political terms and all lobbying / donations
This will not happen as the political damage of fixing the system is too great
Unfortunately we must crash and burn eventually before some real reform happens
Not a doomer , we will survive but it’s not going to be pretty
It’s the money and the government stupid !!
Why is it the narrative is always about increasing taxes or fees in this country ???

#24 Dolce Vita on 07.05.19 at 5:27 pm

I know that yesterday I said you were being too hard on the BC NDP and tonight I read your 2 tongue ‘n cheek responses.

I am penitent and yes Garth, even I surrender (Lefty Liberal Me).

On the 2 Kinda Socialist Blog Dog posts, no words necessary; rather, applicable themed music (as before for StatCan):

https://www.youtube.com/watch?v=XVSRm80WzZk

——————————–

PS:

Gave the wrong link in the prior post about the “Tale of 2 different March GDP’s” by StatCan, my bad:

https://i.imgur.com/Hns2CoS.jpg

#25 SunShowers on 07.05.19 at 5:39 pm

#2 Tater on 07.05.19 at 3:38 pm
While wages may not have risen in Canada or most of the developed world, they sure have in the developing world.

——————–

I actually made a comment discussing this before. As I said, I don’t comment often so I can’t blame you for not seeing it. Capitalism hasn’t done much for wages in the developing world, to be honest.

“But wages have doubled!” some might say. Well, what’s double an intolerably meager pittance? If a business owner offshores a job, and as a result, someone in the developing world makes $4 per day instead of $2 and the business owner pockets the $150-200 difference, are we supposed to think the business owner is the magnanimous good guy in this scenario? Notta chance. Capitalism isn’t good for the developed world or the developing world. It’s good for capitalists.

And the preceding dollar figures are in 2011 USD PPP, so please Google that before you object on the basis of exchange rates and purchasing power. I’m not trying to be demeaning or anything, but it’s like the #1 response I get, so I just wanna nip it in the bud.

~

#7 BC Renovator on 07.05.19 at 4:00 pm
Hey Jeff- please move to Venezuela and report back.

——————–

Why? Venezuela isn’t socialist. Workers don’t control the means of production, and private property laws are enforced by the state. Far too many people think that “socialism is when the government does stuff.” Don’t get me wrong, the government doing stuff is good most of the time, but it won’t solve everything.

And thanks AGuyInVancouver for saving me a post!

#26 Flop... on 07.05.19 at 5:52 pm

Flop’s Deal of the week.

Any value to be found?

Probably not, so here’s the next best thing.

Still crazily elevated from what someone purchased it for in 2013, although anytime you can find a turn-key house inside the Second Velvet Rope for less than a million, you’ve done better than most people buying more house than they need.

The details…

11519 Kingsbridge Way, Richmond

Originally asked 1.09

Assessment 1.16

Just sold for 930k

If you think prices are going back up anytime soon, then I’ve got a Kingsbridge to sell you…

M45BC

https://m.youtube.com/watch?v=u4re5doe2Bc

#27 Maiku Che "Shine Bright Like a Diamond" on 07.05.19 at 5:53 pm

I’m a freelancer. I might be charging my clients in USD if Poloz makes our Loonie the Peso of the North.

#28 Hello miscreants on 07.05.19 at 5:56 pm

“If you’re selling, be aggressive.” – Garth

————————————————-

Why? To be quick and strike while the iron is hot? Is it going to be more difficult to get a good price for GTA RE in the future?

#29 Sail away on 07.05.19 at 5:57 pm

Well, I tried to stay away from commenting… but as predicted, am addicted and can’t do it. Especially after today’s two guest posters.

First a question for Jeff: are you an employer? Are you speaking from experience, or is this your interpretation of theoretical capitalism based on books you read? Reading your post is a bit like listening to my insufferably entitled millennial nephew pontificate about the raw deal he and all his comrades have inherited from the privileged classes (read: everyone who has something he wants).

Second for Jake: Wow. Just wow. A major problem in society is when people with your mindset are elected to public office. Do you actually understand companies? Don’t you know that money removed from a company by a person is taxed at the personal rate? A company is not an individual that spends money willy-nilly with no repercussions. Company profits are first taxed at the corporate rate, then any monies removed are taxed at the personal rate, so corporate rate plus personal already goes for taxes. If, and it’s a big if, there is profit in the first place, the company uses it to improve operations, hire new people, pay dividends, or retain it in the company to build a moat against hard times. If you think companies have it so easy and get so many breaks, then why don’t you start a company and reap the benefits? It must be easy, right?

Garth, your posts are great. These two guest posts in my opinion are nothing more than uninformed verbal diarrhea. A little embarrassing for a financial blog, actually.

#30 SNOOP DOG on 07.05.19 at 6:00 pm

And the PENDULUM swings…..

#31 Alessio on 07.05.19 at 6:06 pm

Interest rates going up. Interest rates going down. Recession. Boom. Housing softening. Housing not softening. This blog used to be insightful now there’s way too much flip flopping on daily news events. Rinse repeat. The one constant is stay in a balanced portfolio so I’ll give you that Garth! This comment will likely get deleted anyhow which further reinforces my points. Cheers all! Alessio is outta here:-).

#32 DollarDragon on 07.05.19 at 6:07 pm

As a CPA, I have to say that the second guest post makes me want to scream.

You know why corporations pay less tax? Because when you pay money out of a corporation, the person who receives the money also pays tax. This is double taxation. The corporation pays tax on the money, they pay the net cash to a person, the person ALSO pays tax on the money.

In order to make a fair tax system, yes, small business corporations need to pay less tax than a person, otherwise the mom and pop who own the business will pay ridiculous amounts of taxes. This is called integration, and its how the Canadian tax system works.

#33 Wallflower on 07.05.19 at 6:14 pm

Garth is on pseudo vacation.
I hope Bandit is getting better, bigger, longer walkies out of this. Doogies should rule.

#34 JettaFlair on 07.05.19 at 6:14 pm

Jeff:
Capitalism as it is practiced currently is irresponsible and does not care about defecating in its own backyard. The tide only raises a select few ships.

Jake:
Your issue is related to Jeff’s issue as the game is “rigged” in such a way that if the businesses suffer the consumer (employee) will suffer. A case for “trickle down” actually working. ;)

Garth’s choices today are cool as they are related overall. As someone nearing forty I’m starting to move closer to a more balanced view that you need an economy and people to work and consume it. Keep out of the extremes and grow, or die in gluttony.

#35 Islandgirl on 07.05.19 at 6:21 pm

I understand Jeff’s point to some degree, and at the same time, do believe that capitalism can work, I think my biggest issue is that at some point there really needs to be a ceiling on how much money one person/company needs to make. Small business (anything up to say a million or so a year profit for one person, after their business expenses) seems reasonable and necessary to ensure that that person wants to continue managing that business, but when you look at something like Amazon, all that money going to one person, or small group of people is ridiculous. No one needs that much money. It’s the loopholes that allow those at the very top to take it all, and I’m talking the top earners, not the people making a couple million a year.

#36 MF on 07.05.19 at 6:22 pm

#23 Debtslavecreator on 07.05.19 at 5:21 pm

-Umm

Lost in that diatribe was any mention of the real reason monetary policy, taxes, and the political system are they way they are:

Demographics.

Where do you think most government spending goes towards?

Hint: it’s not young people.

This is the crux of the problem. And there are no easy solutions to it. You can blame whoever you want, including the big bad government, but the reality is its our way of life (having fewer kids) that is the problem (immigration notwithstanding).

MF

#37 Damifino on 07.05.19 at 6:23 pm

#12 Basil Fawlty

Can someone tell me why the inflation rate is targeted at 2%? Who decided that it is economically prudent to reduce our purchasing power by 2% per year?
———————————–

Do this thought experiment. What would happen if purchasing power increased by 2% per year?

#38 Billy Wong on 07.05.19 at 6:39 pm

DELETED

#39 Hello Miscreants on 07.05.19 at 6:43 pm

I can’t believe that anyone really thinks that GTA RE is in danger of collapsing. In any shape or form. Demand is destined to continue to rise. Along with prices. There may be some hiccups along the way, but in 10 years time GTA RE prices will be much, much higher.

#40 TurnerNation on 07.05.19 at 6:43 pm

All letters/manifestos but one thus far I find truly
horrifying. Do not want.
That Gartho has to read their emails and comments…

#41 Out Of Work CEO, Will Travel on 07.05.19 at 6:55 pm

Jeff has not read Russian history or how “serfdom” was not abolished until 1861 or how poor the people were or has never picked up a book by Tolstoy or Chekov. There is the “elephant in the room” which is espoused endlessly by touts; politicians; fed speakers; bankers; economists; etc. being “low rates”. Low rates has transferred huge wealth to the 1% in the last decade but has done zip for workers. Workers are ignored to no end as companies by back stock with low or zero rates. Are federal banks really helping that poor indebted worker with zero rates? The only identifiable winner in this low rate environment are the 1% and companies. Low rates are not a fix for the worker.

#42 Prairieboy43 on 07.05.19 at 7:01 pm

Man, I am happy sold my business 5 years ago. Government Regulations have taken the power out of the motor (enterprise). I think these two dudes would like to be in the Investor class. Perhaps they are. However they May like Cooperatives, as opposed to individual businesses. They want no risk of their Capitol. Ninety percent of businesses won’t make it 5 years. I Agree with Mike in Calgary.

#43 Millennial on 07.05.19 at 7:05 pm

Jake is a complete idiot, I hope there aren’t so many people like him in Canada.

#44 Yanniel on 07.05.19 at 7:12 pm

RE: Jeff

“So you pay your workers a little bit less. Maybe you lay some people off and replace them with machines. So what? You make more money now. Capitalism, baby!”

Think of the typical tech company. Fat, always increasing salaries. More open positions than people to fill them. These companies make a bundle; yet the pay well, very well. How does this fit into your narrative?

I think life is about choices and effort. Find yourself a gig in which the human factor is esencial. Then you will be paid accordingly.

“There ARE viable alternatives to capitalism,”

Jeff, do you like just to talk about these “alternatives” or have you tried to go live in a country offering an alternative to capitalism? I lived in Cuba for 27 years. I was the best of my class in secondary, high school and university. I did a mater in applied computer science. I was a professor at the main tech university in Cuba. Above all, I could not provide the necessities of life for myself. I did not have any freedom of expression. I was just existing.

Next time you think about an alternative, gather some courage and relocate. You will miss capitalism, I assure you.

“Nearly all wealth generated since the 80s has gone to the rich, real wages have barely risen since the Reagan administration, we’ve gone from 1 income households to 2 income households and nobody batted an eye, and we STILL need to use debt to make up the difference! This is an internal, irreconcilable contradictiogn within the very nature of capitalism.”

I came from Cuba to Canada, a socialist country, with 50 bucks in my pocket. 10 years forward my house hold is easily a 5%ter.

I had to put a lot of effort. I worked in construction, farms, all kind of labor jobs. Eventually I got an entry level (underpaid) office job. Years passed and became a Senior Engineer.

I never incurred in any debt or got help from the government.

My story is not unique.

Again, life is about choices and effort. Make the right choices, make sacrifices, work hard and who knows, you might be rewarded. (This is only true in capitalism though)

#45 Socialism and Taxes on 07.05.19 at 7:17 pm

Interesting posts. Some counter points.

Taxes: Any taxes a corporation pays is part of the cost handed down to the final consumer. If you increase taxes on corporations, the cost in part or whole will be reflected in what you pay as a consumer. The final consumer HAS to pay for all costs of a product plus the profit margin. Is there wriggle room in many successful cases? Sure, but costs will likely rise for many, affecting the poorer amongst us the most.

Socialism: if employees under socialism are all owners and share the profits, that by definition also means they share all liabilities. Not enough sales this year? No-one gets paid. Need to invest in equipment? That is coming off your paycheck. Perhaps someone can explain how this would work under socialism if I’m incorrect. People seem to think they’ll get all the profits and non of the costs and liabilities.

#46 Yanniel on 07.05.19 at 7:18 pm

RE: Jake.

No corps in Cuba. No taxes either. Relocate there and see if your hypothesis about corps being the true evil holds.

#47 the ryguy on 07.05.19 at 7:25 pm

Well, to be honest, tough love as far as I’m concerned.
—————————————————————–

Hey Jeff, staunch capitalist and business owner here. Id be fine with a raise in taxes if we could take the same ‘tough love’ approach to the expense side of the ledger.

You said “Just think of what useless things the government could do”..dude you name the real problem is in your blurb and you laugh it off? This is textbook cognitive dissonance.

In the last two years alone Canada has given $12 BILLION in foreign aid. Thats $350 from every single man/woman & child in Canada. Even with Canada running huge deficits we still give foreign aid…and you want to pretend me giving away half of my money is the problem? Id re-asses the target of your scorn comrade.

#48 Asterix1 on 07.05.19 at 7:37 pm

CIBC came out with a report titled « Lower Job Quality Curbing Income Growth ». Canadian job creation is nothing to write home about, lots of public sector jobs and low paying private sector ones.

Wage growth! Not really. It’s not beating inflation and going nowhere. The situation is not great in Canada, i can definitely see a Canadian recession (not in USA) as consumers are tapped out. Real estate will keep falling and destroy any positive consumer vibe.

#49 Dogman01 on 07.05.19 at 7:45 pm

17 Keith on 07.05.19 at 4:53 pm & Jeff

I have theory:

After WW1 and WW II ; our leaders realized they had an entire contingent of the population that:
1. Offered to take a bullet for the system.
2. Familiar with violence.
3. Recognized the value of cooperative coordinated team effort.
4. Made a sacrifice of many years of their lives.

There was no way it was going back to the way it was before.

So the TPTB had wages increased, full employment a goal; recognized the pie of prosperity need to be sliced more fairly.
Healthcare, Public Education, Social Supports, Unions OK

Otherwise they would be looking into the jaws of a revolution.

But in the 1970’s they looked around , saw the Greatest Generation ageing and now satisfied – the threat as over.

Things changed; once they lost the threat of the Communism system in the 1990’s it was full on race to the bottom bare knuckle economics.

Where we find ourselves now.

“Power concedes nothing without a demand. -It never did and it never will. Find out just what any people will quietly submit to and you have found out the exact measure of injustice and wrong which will be imposed upon them, and these will continue till they are resisted with either words or blows, or with both. The limits of tyrants are prescribed by the endurance of those whom they oppress.” -Frederick Douglass

#50 crowdedelevatorfartz on 07.05.19 at 7:51 pm

@#39 Hello Realtor
“I can’t believe that anyone really thinks that GTA RE is in danger of collapsing……”
++++++

You like Vancouver?
Because it’s different there?
The unprepared Realtors out here are now swapping cat food recipes……
Lemme know when you get tired of eating the same old boring canned food…..

#51 Wilt Chamberlain on 07.05.19 at 7:56 pm

The Canadian jobs picture is so good, and rates so low…

It only makes sense that people would not be out buying houses, with sales and prices falling.

1. Credit due. 2. Spending stalls. 3. Jobs drop. 4 Recession kicks in.

You are here = 1. Credit due.

#52 Hawk on 07.05.19 at 8:06 pm

What’s wrong with the world?

================

That’s easy, I’ll spell it out:

T_O_O M_U_C_H

“G_O_V_E_R_N_M_E_N_T”

#53 T on 07.05.19 at 8:07 pm

“Well, to be honest, tough love as far as I’m concerned. I get that this would likely tank several small stores, but in my opinion, people shouldn’t need to prop up businesses by giving them tax breaks; businesses should be supporting the people via paying more in taxes. I’d love to hear your take on this, as I’m not educated on this content whatsoever and would like to hear someone with more experience/knowledge/wit than I have weigh in on it.”

——

It’s unbelievably scary how many people feel this way. Cherry picking giant corporations as the norm, feeling all businesses have so much profit to tax.

Businesses create jobs, save for capital investments, make capital investments. The best way to stop this is to tax more. It’s bad enough already. Many of us small to medium sized businesses have had to move, sell, or close altogether as it’s just not worth the hassle. Every other day there is some new tax levied against us and increasing the costs of our services and / or products to compensate often isn’t viable as those we are servicing or selling our products to are dealing with the same challenges of ever increasing taxes. There isn’t enough capital to go around.

Keep on disincentivising business by ever increasing taxes and there will be no businesses left to employ and create all the products and services we take for granted today, nevermind the great products and services of tomorrow. Then, suddenly, you will also find you don’t have a job and will face challenges paying for food and housing.

The general public just can’t think beyond their own jealousy and ineptness.

#54 Karlhungus on 07.05.19 at 8:08 pm

Ya you’re right sunshowers – Venezuela isn’t socialist, they are only run by the “socialist party of Venezuela”

#55 Flop... on 07.05.19 at 8:15 pm

Hey WULLY, I see it’s Stampede time.

Did you go with spit or polish on the boots…

M45BC

#56 Tyberius on 07.05.19 at 8:24 pm

“Gold crashed thirty bucks an ounce. All because of jobs.”
$ $ $

I don’t see the connection. Anyone care to explain this?

#57 Jon on 07.05.19 at 8:24 pm

The difference between Canadians and Americans is apparent in these posts. Canadians trust the government, Americans not so much.

Governments good at wasting money and inherently inefficent. Business much more productive with allocating capital.

#58 crossbordershopper on 07.05.19 at 8:33 pm

canadians arguing amongst themselves about taxation levels, fair share etc. instead of talking about the most important thing, which is productivity in canada is poor, the access to capital is low, the actual amount of income is low in us $, customers have no income so you cant charge them too much and sales are low, then you cant pay your worker too much since you have little money
we all know the truth, canada is a relatively poor country, yes people live in 600K houses on average but dont have 20 bucks in their pocket.
canada has a small tax base,thats why were at above 50% marginal in most places, pushing on a string, governements wont get more money regardless of the system, millions of canadians own nothing, pay no tax actual negative tax, they only receive benefits from the government and contribute nothing . i see it , i know you see it too, yes they are consumers but with governement debt or taxation, they only recieve a cheque period. someone on the other end has to give it to them to go out and buy from the shop keeper who then spins his wheel, rent, employees etc, and spins it back to government its just a dumb wheel, no innovation in canada no real growth no real money being made just shuffling it around.

#59 Nonplused on 07.05.19 at 8:35 pm

Jeff, or Sunshowers, should read “The Wealth of Nations”, which he clearly has not. Capitalism is about investing in plant and equipment to improve productivity. The phenomena of wage pricing is a market result of supply and demand. If there is not enough labor in a particular field or area the wages will rise as they did in northern Alberta during the oil boom. If there are more laborers than jobs wages will fall as they also have now in northern Alberta. Capitalism has nothing to do with it, except as building capital infrastructure increases demand for labor.

Capital is a truck or a tractor or a machine or a building or a piece of computer code. It has nothing to do with the supply and demand equation for labor except how those expenditures increase the efficiency of labor. It is the reason we are all so rich compared to our forefathers (and mothers) today. It must be remembered that the “poor millennials” of today are all carrying around a computer in their pocket of such processing power a desktop couldn’t have done what it does 25 years ago and 100 years ago people would have burned them for being possessed by a devil. Things have gotten better due to capitalism, not worse. Without great investments in plant and equipment, and engineering and coding, these things would not just be prohibitively expensive, they would not exists at all. Even the very richest person in the world in 1920 could not have commissioned one cell phone for himself. Years of capitalism made that product possible, and available to the masses. And there are so many products around the average “poor” person’s house of similar creation, without capitalism we would all still be working the fields by hand or possibly with the assistance of oxen.

People today under capitalism are “cash poor”, but materially they are very rich. So stop sulking about your bank balance and realize you are living better than a king did a few hundred years ago.

————–

Not surprisingly, I disagree with Jake as well. It does not matter what tax rate you apply to businesses, it will be paid for by the price the business charges you for their services. You will pay for the tax. What Jake is advocating is that all goods and services should have a higher price. There is no other magical place for the money to come from. Small businesses, especially small businesses, don’t tend to have much money. Instead, they have something, lets use a suck-truck as an example, and they drive around cleaning out septic tanks. All of the costs the suck-truck operator must incur, including the cost of the truck, his living expenses, the fuel, the cost he has to pay to empty into the city facilities, AND ALL OF HIS TAXES, must and always does appear in his hourly fee. So if you have a septic tank you are going to pay it. There is no way around it. Most people don’t have septic tanks so maybe looking at a tow truck driver would be a better example. Someday your car will break down, and you will have to get it towed to the shop. ALL OF THE TAXES that the tow truck operator and the mechanic has to pay will be applied to your bill(s). You will pay ALL OF IT.

There is no way to tax someone else. We all pay the same effective tax rate.

————-

For those of you, like Jeff, who are concerned your wages are too low, there is a simple solution. Become a dentist. Or a Doctor. Both of these fields have a shortage of labor due to the requirements to become certified. But if you can do it, you will be relatively wealthy with little to no risk. Or if you are not up for that you can go work up north when oil prices come back, assuming they will. That is a whole another conversation.

#60 Blessed Canadian Millenial on 07.05.19 at 8:39 pm

Garth, I normally don’t comment but I had to this time around. So many misinformed statements by these two well-meaning gentlemen.

“Nearly all wealth generated since the 80s has gone to the rich, real wages have barely risen since the Reagan administration, we’ve gone from 1 income households to 2 income households and nobody batted an eye, and we STILL need to use debt to make up the difference! This is an internal, irreconcilable contradictiogn within the very nature of capitalism.”

Umm… what is not stated here is that it is not the same people who were in the top 1% back in the ’80s. The “wealthy” folks change.

Don’t believe me? Then how do you explain the fact that 80% of the millionaires are self-made? Also, 80% of billionaires are ALSO self-made.

Unfortunately, 2/3rd of the population think along the lines of these two gentlemen. Well meaning, but oh-so wrong.

#61 Yukon Elvis on 07.05.19 at 8:39 pm

#43 Millennial on 07.05.19 at 7:05 pm
Jake is a complete idiot, I hope there aren’t so many people like him in Canada.
……………………………
We elected one. There is a complete idiot occupying the PMO in Ottawa right now.

#62 MF on 07.05.19 at 8:39 pm

#53 T on 07.05.19 at 8:07 pm

“Keep on disincentivising business by ever increasing taxes and there will be no businesses left to employ and create all the products and services we take for granted today”

-Not as simple as just taxes.

Other things that matter for businesses: stability of government, size of population, education of population, climate, security, and infrastructure are also important.

I agree high taxes are “generally” uninviting for businesses, but they are only part of the story.

MF

#63 MF on 07.05.19 at 8:45 pm

#58 Nonplused on 07.05.19 at 8:35 pm

No.

Dentists and Dr’s make good money mostly because their respective colleges artificially limit the number of new entrants into their professions.

There are thousands and thousands of qualified applicants every year.

MF

#64 Blessed Canadian Millenial on 07.05.19 at 8:46 pm

So, did amazon really pay no taxes?

Some context please.

Read this and be enlightened: https://www.france24.com/en/20190216-fact-check-does-amazon-pay-no-us-federal-income-tax

For the lazy:
Amazon had $3.4 BILLION in tax (actual expense reported, as per accounting rules & regulations) in the last 3 years.

#65 Stoph on 07.05.19 at 8:46 pm

#13 adam on 07.05.19 at 4:31 pm
“If your employment wages are under $500K you pay nothing. If $500 to $1.5 million you have to pay almost 3% of wages to the provincial government. If over $1.5 million it is only about 2% of wages. The tax is actually regressive in that small business pay a higher rate than large business!!!! ”
++++++++++++

Between $0.5 M to $1.5 M the rate is 3% on the amount above $0.5 M, and not 3% on the whole amount. So at $0.5 M, the overall rate is 0%, at 1 M it’s 1.5% and at 1.5M it’s 2%, so the little guys actually don’t end up paying more than the big guys.

#66 BlogDogRon on 07.05.19 at 8:47 pm

#29 Sail away on 07.05.19 at 5:57 pm

I couldn’t have written responses any better than yours. Bravo. But please keep in mind that the purpose of having guest bloggers is to give others a chance to express their opinions in an open and civil forum.. Without the fear of any reprisals…regardless of whether you agree with their philosophies. Remember, everyone is different and each of us have unique perspectives. We all can agree to disagree.

#67 Cow Man on 07.05.19 at 8:49 pm

Jake:

You are missing the massive taxes paid by businesses to Municipalities, through property taxes. Businesses pay many multiples of the residential mill rate. Yes it can be expended against income. But just the same there is a major flaw in your thesis.

#68 MF on 07.05.19 at 8:50 pm

#58 crossbordershopper on 07.05.19 at 8:33 pm

“we all know the truth, canada is a relatively poor country, yes people live in 600K houses on average but dont have 20 bucks in their pocket.”

-That stinks of projection and is complete BS like everything you post about Canada.

I look at my parents. Successful and enjoying their retirement.

Wanna see a poor failure? Maybe look in the mirror.

MF

#69 Nineteen84 on 07.05.19 at 8:54 pm

I’m halfway reading The Gulag Archipelago by Aleksandr Solzhenitsyn.

Anyone who thinks Socialism is a viable alternative (to some version of free-market capitalism), hasn’t a clue of human nature.
I used to be more sympathetic to ‘socialists’ as they appeared to have genuine interest in alleviating human suffering. It’s a facade folks – ideologues are the most dangerous of all!

1984

#70 Chimingin on 07.05.19 at 8:55 pm

Jake, your opinion is ill-informed enough to be virtually meritless. As a small business owner for the last 10 years, I can tell you that –and you nailed it!–you’re no expert. Here are a few stats:

According to the federal government: “as of December 2017, there were 1.18 million employer businesses in Canada. Of these, 1.15 million (97.9 percent) were small businesses, 21,926 (1.9 percent) were medium-sized businesses and 2,939 (0.2 percent) were large businesses.” So 98% of the businesses you purport to hate are small. As in not Imperial Oil, not Loblaws, not Google. As in less than 100 people, and less than $500 000 in income (and believe me, that’s generous). Small businesses employ almost 70% of the Canadian population. Educate yourself at this link:

https://www.ic.gc.ca/eic/site/061.nsf/eng/h_03090.html#point2-1

Our business, like all others, exists due to client demand. Simple as that. I can’t speak for everyone, but can tell you we did not start our business in order to exploit or otherwise dominate the world. So let me tell you a couple more things. The CRA waits on no one for their share of taxes, including ours. The tax rate may be low, but I can assure you that it still bites, just like your income tax. Instead of buying vacations, though, we hire more people. Oh yeah, the people! The bad guys, who, according to you, perpetuate the corporate villany being exercised at large across the country…who in turn, pay taxes to fund Canada’s existence.

In our example, our staff get paid every week regardless of corporate cash flow–which fluctuates, but not because we bought yet another private jet. Sometimes our personal line of credit has been used to cover payroll in the odd situation. We have government red tape out the yazoo to contend with in order to get the job done. We work every day in one way or another–rare is the small business owner who does not find this to be the case. We are not a faceless monolith that millennials (and yes, you totally are one) have learned to hate. In this small example, we are a group of nine people, almost half from other countries, working to make our client’s lives better, at their request. The jobs are blue collar, full-time, with benefits, vacation time, and a bunch of other stuff because we happen to think our staff deserve a decent living. We aren’t the problem. Three guesses as to who is. Hint–it ain’t Garth.

#71 islander on 07.05.19 at 8:56 pm

https://www.theglobeandmail.com/canada/british-columbia/article-its-absolutely-heartbreaking-to-see-such-stupidity-about-vancouvers/

and on it goes…..talk about ‘eating’ your young!

#72 SrySmallBiz on 07.05.19 at 8:57 pm

I’ve run a successful small business since 2009 and today we have 14 employees that I treat like family.
I retain them and honour them by paying ABOVE market and I have made more money each successive year.

Cutting cost isn’t the way to profit. Small thinking. I have been able to expand and each marginal dollar contributes to the well being of my extended family. Not all business people are selfish, maximize-at-all-cost robots. In fact, the more employees I hire and the better I pay them, the more my bottom line swells. Where did you accept that cost cutting is the only way to riches!?

We are all gonna meet our maker soon. What will you say you did with your time? Maximized profits or shared bread with your extended family?

Capitalism allows us to lift each other with respect. No handouts necessary.

Re second post: I pay six figures in taxes each year. I find that whether I take money straight out of my business as income or as dividends it’s about the same thing and my tax obligation doesn’t shrink because I have a corporation.

I’d suggest you build a corp that surpasses SBD limit and see for yourself.

If big tech corps don’t pay tax it’s likely they are bleeding money into r&d, like Netflix spending $12 BILLION on original content. Not much profit left to pay tax on.

Build a small business into a medium business and pay your crew well (they lift the business every day), then come here and post about taxes and privilege of the rich

I am an immigrant (landed in this fine land at age 13) and what we have here is opportunity and respect for the individual and respect for life. Fair taxes and mostly fair authority. Run up against red tape at some other corners of the world and you will see what disrespect means.

I love Canada. I love our system. I love our people.

Oh and I love Mr Turners mostly selfless daily service.

#73 Leo Trollstoy on 07.05.19 at 8:58 pm

Nothing funnier than ignorant blog dogs giving tax advice

#74 DeplorableDude on 07.05.19 at 9:00 pm

Islandgirl on 07.05.19 at 6:21 pm

What am I missing? You too can share in the profits. Call your broker on Monday morning and order as many shares of AMZN as you can afford. No, wait…the share price could go down and you’d lose your shirt. Best you just go to work on Monday, pick up some treats at SBUX on your way… And earn your hourly wage. Repeat for 50 years. It’s your choice!

#75 Shawn Allen on 07.05.19 at 9:04 pm

Who Pays Corporate Taxes

Damfino at 59 said:

It does not matter what tax rate you apply to businesses, it will be paid for by the price the business charges you for their services. You will pay for the tax.

And a few others above said about the same.

*****************************
It’s true in theory. That should be the case in a competitive market.

But then when the U.S. lowered the federal corporate tax from 35% to 21% it was as far as I could see universally accepted and on Wall Street that basically all of that would lead to higher net profits. Virtually none of it would go to lower prices.

Warren Buffett explained that he tax man was like a partner in pre-tax income. Less for him, more for share owners.

I could not believe it. I was sure competition would lead to a good chunk of that going to lower prices.

I was dead wrong. Profits surged in 2018 by over 20% for the S&P 500. Very little of that went to lower prices. A bit went to higher wages.

So much for the theory. So much for competition.

As Yogi Berra apparently said: In theory, practice and theory are the same, in practice they differ.

What is the right level of corporate tax? I have no idea. It’s not zero and its probably not the near 50% that applied in Canada to most businesses around 1990.

The notion that we need a race to the bottom with corporate taxes is suspicious to me. Shall we lower taxes on grocery stores in Canada so that we don’t drive across the border to buy groceries?

Canada has actually lowered federal corporate taxes by nearly half since about 1990. Have you heard any real thanks from the corporate or investor world? Me neither.

#76 Trojan House on 07.05.19 at 9:06 pm

Oddly enough, people don’t look at themselves and what they demand from the government which, in turn, means a never ending spiral of trying to fund (aka raising taxes) to pay for what people want from them.

#77 oh bouy on 07.05.19 at 9:19 pm

so many misinformed folks on here.
Not just jake and jeff.

#78 Loonie Doctor on 07.05.19 at 9:22 pm

#45 re:socialism and downside risk

One of my friends lived in communist Poland and one of his favourite sayings from that experience is: “They pretend to pay us and we pretend to work.”

-LD

#79 Robert Ash on 07.05.19 at 9:30 pm

Rather than try to convince Jeff, and Jake, about the benefits, of Capitalism… I would like to know where or how they formulated those ideas, and convictions.. That is the scary part. If you want to include Philosophy of Work etc… Jeff and Jake, …look at China’s example… Pure Communism… 100% Socialism, in 1940’s … then Failing and Fast..Millions starve to death… . Now China embraces Capitalism, with a Command and Control Government… But the Profit Incentive, with a firm grip policy wise to get there… Just lifted 650,000. to 950,000 Souls out of Poverty… Socialism, failed with the inital idea of the Communist and Community farm strategy… Now these Developing Countries are eating our lunch… Oh Canada, good luck… Finally Jeff and Jake… Take McDonalds, Corp… just one we all recognise… This Integrated Restaurant, employs, all types of People, Young first hires, New Canadians, or Students, to our Country, Seniors, and the good work they offer a Community.. Ronald House for Sick Kids… Donation Boxes, Timmies.. Camps for Poor Kids…. Jeff and Jake, start considering opening your minds, and develop a realisitic outlook on the World.. if you lived in the other 80% of the Globe… I would be very worried for you both..Back to Mcdonalds, this is a Global Company that is actually owned by Millions of Investors, people just like you Jeff and Jake… They believe in the Company and profit by participating, in owning Corporate Stock Bonds, etc.. Accounting 101 should be mandatory .. but the Teachers Union, will not support this.. Not enough Commerce focused Teachers.

#80 Yuus bin Haad on 07.05.19 at 9:33 pm

So, when do the guest posts start?

#81 Ace Goodheart on 07.05.19 at 9:43 pm

Just finished watching the HBO series “Chernobyl”. If you think socialism works, you have to watch this.

Why did they put graphite tips on the control rods, even though they knew that if they were ever used in an emergency situation to calm an out of control reactor, it would create the equivalent of a nuclear bomb?

Because they were cheaper….

In other more important news, our boat went off kilter over the last weekend. It was quite the mess. Out in the middle of the lake, about 6 miles from home, and we couldn’t get it to go more than at idle. Put power to it, and it cut out. We limped back to the cottage, and then found a tow about half way there.

Tragedy. What to do? The boat is broken! We discussed options. Buying a new boat. Very expensive. Finding a used boat. More problems, and not enough solutions. What a total catastrophe. The neighbours commiserated with us. It was like a funeral.

So I took a walk down to the dock, popped open the engine cover and had a look at the old beast. 1986 technology in all its glory. A two barrel carb, mechanical linkage, thunderbolt ignition box, plug and play (need a screwdriver to remove it, attached to one of the cooling headers), and a fuel pump, mechanical Carter, attached to the crank. With a sight tube, full of gasoline.

I wondered.

Why is there gasoline in the sight tube?

A quick bit of internet research told me this was not good. A major catastrophe?

No. Just a bad fuel pump. It’s a job you can accomplish in one beer’s time. New pump is $135.00 on Amazon.

So the boat is working again. Of course it is. The boat is about as complicated as a child’s duplo lego set. A ten year old could understand that engine. It has so few replaceable parts that I could build one in a weekend.

Ahhhhh 1986. Take away my computers, take away my self driving cars that crash themselves into semi trucks, but don’t take away my 1986 V6 engines. I could not survive as a person……..

#82 MeryEn on 07.05.19 at 10:02 pm

It’s difficult to explain briefly, especially with my English, but let me tray…

1. I did my Master based on Elinor Ostrom’s work and didn’t find her as a socialist. Her focus was on common-pool resource (CPR) that is not applicable on whole economy. However, even in these specific matters, her research shows that government mostly did the worst job managing CPRs comparing with local communities or private ownership. Also, game theory with zero result is the simplest game and isn’t at all applicable on whole entire economy. As you can see, never in the human history was a population on the planet Earth larger but in the same time people have never lived better then now-days thanks to innovations and productivity. So, Capitalism did a great job comparing with alternatives.

2. Laffer curve illustrates very nice how more taxes at some point result in less Government revenue. E.g. due to newest taxes, my family physician decreased his working time from 5 to 3.5 days per week. If he moved to USA instead, who would you tax?

#83 millmech on 07.05.19 at 10:05 pm

#41
Ah you see the logic and answer to your issue of the 1% is actually right in your very post.
The 1% and companies know that buying into/back business shares is the true path to wealth. The other 70% of the working class buy real estate and thus stay poor, would you not agree that the worker would be better served to buy equities with tax deductible loans/tax free accounts.
Yet the masses(70%) buy assets that cost at least 2% per year to own,depreciate and will usually over the life of that asset pay double for it with interest without it being tax advantaged. Yes I agree that primary residences are tax free but who downsizes, not anyone I know, if anything they upsize.
Look at the 1% and see how many got wealthy by real estate and see how many got wealthy by equities.
It is not that hard to become wealthy, just do what they do.
If everybody in Canada was not blowing their collective wad on real estate, I bet you it would be a lot more affordable and available for the masses.
This would leave more disposable income to invest in equities, making their wealth grow even faster.
Seems we have lost our way!

#84 Sail Away on 07.05.19 at 10:10 pm

#66 BlogDogRon on 07.05.19 at 8:47 pm
#29 Sail away on 07.05.19 at 5:57 pm

I couldn’t have written responses any better than yours. Bravo. But please keep in mind that the purpose of having guest bloggers is to give others a chance to express their opinions in an open and civil forum.. Without the fear of any reprisals…regardless of whether you agree with their philosophies. Remember, everyone is different and each of us have unique perspectives. We all can agree to disagree.

————————————

Being a business owner, employer and significant taxpayer, I found the posters’ messages to be sanctimonious and ungrounded in experience. They say businesses and capitalism are wrong without knowledge or feasible solution. This blog generally provides an informed and mature perspective on finance, and these two posts gave neither.

Garth can definitely do as he chooses; it’s his blog, after all. Opening the door to these two essays turns it to amateur hour.

#85 Freedom First on 07.05.19 at 10:25 pm

Smart people rarely need advice while the stupid/ignorant people do not even know how much they really really really need it.

Freedom First.

#86 Oh Canada, I weep. on 07.05.19 at 10:32 pm

Canadian Climate Scientists proven hysterical and lying for political goals unrelated to science. “Canadians” are said to be pushing a financial model unrelated to credible consensus.

http://virtual-strategy.com/2019/07/03/italian-scientists-reject-global-warming-hysteria-while-canadian/

The power of propaganda being puked out by our fanatical Liberal Party and American “replacement equipment” ( windmills and white elephants) providers being forced on our small population has made the idea of a climate emergency real to Canadians while in fact it’s a giant tax and spend tax and profit grab at our taxpayers expense.

#87 IHCTD9 on 07.05.19 at 10:39 pm

#29 Sail away on 07.05.19 at 5:57 pm
Well, I tried to stay away from commenting… but as predicted, am addicted and can’t do it. Especially after today’s two guest posters
———

Glad to have you back!

#88 IHCTD9 on 07.05.19 at 10:41 pm

Garth is throwing the steerage section some red meat today!

#89 IHCTD9 on 07.05.19 at 10:43 pm

#82 MeryEn on 07.05.19 at 10:02 pm
——-

Excellent!

#90 SunShowers on 07.05.19 at 10:49 pm

#54 Karlhungus on 07.05.19 at 8:08 pm
Ya you’re right sunshowers – Venezuela isn’t socialist, they are only run by the “socialist party of Venezuela”

——————

This just in: The Democratic People’s Republic of Korea is democratic, hot dogs are made from dog meat, and State Farm insurance is also a real farm.

~

#59 Nonplused on 07.05.19 at 8:35 pm
Jeff, or Sunshowers, should read “The Wealth of Nations”, which he clearly has not.

——————

Maybe you could tell us what Adam Smith has to say about rent, as it compares to the other factors of production such as labor and capital? Once you crack open your book, consider that capitalism is essentially just capitalists renting use of the means of production to workers.

~

#60 Blessed Canadian Millenial on 07.05.19 at 8:39 pm
Also, 80% of billionaires are ALSO self-made.

——————

Show me a single billionaire that amassed their fortune without hiring a single employee (or inheriting it). You can’t. It is currently impossible for any single person’s labor alone to generate a billion dollars. The ONLY way to get a billion dollars is to hire a bunch of people and sponge off the surplus value THEY create with THEIR labor.

Also, ~60% of all wealth is inherited (Alvaredo, Garbinti, Piketty: 2015), so you’re probably not even correct anyway.

~

#79 Robert Ash on 07.05.19 at 9:30 pm
…look at China’s example… Pure Communism… 100% Socialism, in 1940’s … then Failing and Fast..Millions starve to death

——————

Millions are starving to death under capitalism right now. What’s your point?

You REALLY don’t want to compare capitalism’s body count to other political or economic ideologies. It will not end in your favor.

#91 IHCTD9 on 07.05.19 at 10:52 pm

Reading the comments section on today’s post should be mandatory for all Socialists looking for healing.

#92 IHCTD9 on 07.05.19 at 10:56 pm

You REALLY don’t want to compare capitalism’s body count to other political or economic ideologies. It will not end in your favor.
———

You have got to be kidding me.

Communism won that one decades ago.

#93 the ryguy on 07.05.19 at 11:02 pm

Millions are starving to death under capitalism right now.
——————————————————————–

Bravo Sierra. Obesity & obesity related illness is the #1 cause of death for women at the bottom of the socioeconomic ladder. Why do bleeding hearts lead to a total lack of brains?

#94 Blackdog on 07.05.19 at 11:03 pm

@IHCTD9 #87, yeah, sure am glad I got too lazy to enter the contest.

Has ‘anyways’ become a word?

#95 Smoking Man on 07.05.19 at 11:27 pm

Another 5.0 earthquake 100 miles from Vegas.
Everyone freaking out. I’m buzzed and thinking this is so cool..

I have issues

#96 Al on 07.05.19 at 11:32 pm

Looks like the steerage section is getting owned by sunshowers…

#97 n1tro on 07.05.19 at 11:38 pm

#56 Tyberius on 07.05.19 at 8:24 pm
“Gold crashed thirty bucks an ounce. All because of jobs.”
$ $ $

I don’t see the connection. Anyone care to explain this?
———–
Bad thing happen, gold go up.
Good thing happen, gold go down.
More jobs than expected = good thing.

#98 Not So New guy on 07.05.19 at 11:41 pm

I liken business to a three-legged stool. One leg serves the customer. One leg serves the worker and one leg serve the owner/shareholders. If any of the legs are weak (underserved) then you can see what happens. The stool will be wobbly or fall down. Each leg needs to get value for being there or that leg will be weak and the business will be underserved and not meet its intended purpose for existing. That purpose is to serve people (three types), not profits

#99 WUL on 07.05.19 at 11:52 pm

#55 Flop… on 07.05.19 at 8:15 pm
Hey WULLY, I see it’s Stampede time.
Did you go with spit or polish on the boots…
M45BC
rodeo…rodeo…rodeo

FLOP,

I couldn’t decide which pair of boots to wear so I went with my flip flops from Walmart. I took a page out of Smoking Man’s book.

Stayed away from the hay burners though because, believe me, it is no fun having an 800 pound horse step on your bare toes. It’s safer to dance with clumsy women.

Cheers,

WUL

M63Famous Stampede City in the Valley of the Bow

#100 Hawk on 07.05.19 at 11:57 pm

#90 SunShowers on 07.05.19 at 10:49 pm

=========

Where are millions starving to death under capitalism?

There are very few countries in the world that are meaningfully capitalist at all and they are the most prosperous places on the planet.

The only places on the planet where people are starving are socialist and communist basket cases like Venzuela and fat boy’s hermit kingdom.

Its clear you have no clue what capitalism is.

#101 T on 07.05.19 at 11:58 pm

#62 MF on 07.05.19 at 8:39 pm

I completely agree on your points and how they relate to large enterprises.

When it comes down to small to medium sized businesses, however, if they can’t create a profit because taxes are too high then they will cease to operate or never start up at all.

Take EHT for example. $400k / year in revenues (not profit) and a business is hit hard. $399k, no problem. But if you go over $400k you better hope you clear it by leaps and bounds and save a large portion of all your revenues for the tax hit. That’s just one example. It’s a ridiculous system. I know of businesses hit with EHT audits which have had to close shop. They never knew there were these types of thresholds, no one informed them, and the penalties are terrifying.

#102 Leo Trollstoy on 07.05.19 at 11:59 pm

Today’s contributors are examples of dumb ppl trying to solve problems

#103 Ponzius Pilatus on 07.06.19 at 12:05 am

Horgan’s socialist paradise still has the lowest unemployment rate in Canada.

#104 MaryEn on 07.06.19 at 12:06 am

@SunShowers

I didn’t get your point. Thanks to capitalism, the gap between rich and poor people has never been smaller (yes, smaller!) as today. Compare an average worker in any developed country with Bil Gates or any other billionaire and see what we gonna find? A both have place to live, food as much as they can eat, cars, possibility to travel, access to medicine, opportunity to learn, develop their interests, skills, hobbies… I can’t find any such a huge difference that bothers me. We (employees) probably have even more time and far less responsibilities. Sorry, but I can’t find anything so unfair here and have to agree with Margaret Thatcher :

https://m.youtube.com/watch?v=rv5t6rC6yvg

#105 Ponzius Pilatus on 07.06.19 at 12:14 am

#69 Nineteen84 on 07.05.19 at 8:54 pm
I’m halfway reading The Gulag Archipelago by Aleksandr Solzhenitsyn.

Anyone who thinks Socialism is a viable alternative (to some version of free-market capitalism), hasn’t a clue of human nature.
I used to be more sympathetic to ‘socialists’ as they appeared to have genuine interest in alleviating human suffering. It’s a facade folks – ideologues are the most dangerous of all!
———–
Educate yourself.
Learn to differentiate between communism and socialism.

#106 Smoking Man on 07.06.19 at 12:17 am

So I walk into the bathroom at the flamingo after the earth qauke , the guy who changes the toilet paper says No Moking in here.

The building was ready to fall on his head and hes still following the rules. No wonder multinational companies want to import this kind loyally.

The straight family man who may have a gun scares the shit out of the elite trust fund millionaires who never took a risk.

#107 Jon B on 07.06.19 at 12:42 am

Just imagine the sorry state of the world if people like these two socialists ran the place.

#108 Karlhungus on 07.06.19 at 1:20 am

Sunshowers
You are joking right? you want to compare body counts of socialism/communism to capitalism ? wow……..

#109 Two-thirds on 07.06.19 at 1:39 am

I had an epiphany, thanks to these posts:

If increasing taxes is good and paying people more is also good, why not combine both for an amazing win-win?

To wit: all businesses need to increase pay for all their employees, while the government increases taxes for all. Since people will have more money, they will all be able to pay the increased taxes, with $ left to spend on everything else.

The more employees are paid, the more the nation will prosper! Let use then raise the minimum wage to $50/hr and taxes to 50% and show some true economystical leadership to the world!

I am so pumped now that I feel like starting a hobby project: recovering enough energy from my EV’s motor to recharge a battery that can keep the car going! I just need to harvest all of the wasted energy and feed it to the battery, repeat, and then I will never have to charge the car again!

Thanks to the posters for the inspiration!

(There, got it out of my system…)

Garth, this guest poster strategy will perhaps boost up the as-of-late flagging comment rate, but what about your reputation?

#110 OffshoreObserver on 07.06.19 at 1:49 am

Smart persons’ resource

https://residencies.io/

#111 Nonplused on 07.06.19 at 2:17 am

#63 MF

Certainly it is not easy to become a dentist or a doctor. But is it restrictions? Or qualifications? Both my doctor and my dentist are immigrants. There are some things, like say computer coding is the best example, that you just can’t do unless you are of above average intelligence. I don’t know if that applies to the medical professions, but I would hope they are not idiots.

The average person is nowhere near able to program a computer. Use it sure, but program it? Nope. I hope if I ever have to go under the knife my doctor will be equally smart.

#112 Nonplused on 07.06.19 at 2:31 am

#90 SunShowers

#59 Nonplused on 07.05.19 at 8:35 pm
Jeff, or Sunshowers, should read “The Wealth of Nations”, which he clearly has not.

——————

“Maybe you could tell us what Adam Smith has to say about rent, as it compares to the other factors of production such as labor and capital? Once you crack open your book, consider that capitalism is essentially just capitalists renting use of the means of production to workers.”

————–

You need to read the book. Renting is not capitalism. Although it can be capitalism when someone uses capital to build a something, say a structure or a tractor, that they cannot inhabit or use themselves, and need to employ a worker. If you own a farm, say, going back a few hundred years, building places for your workforce to live would be a capitalistic thing to do. But letting them live there for free would not. Some portion of their labor has to cover the cost of building the structures.

Folks, there is no way in any economy for you to get up in the morning and go to Tim’s and get a doughnut and a coffee unless somebody did the work to produce such things. That means you are going to work too to produce something of equal value to those who work at Tim’s. Otherwise the system just cannot work.

#113 Gravy Train on 07.06.19 at 7:44 am

#112 Nonplused on 07.06.19 at 2:31 am
[…] That means you are going to work too to produce something of equal value to those who work at Tim’s. Otherwise the system just cannot work.” No, I don’t work; I take the ‘surplus value’ of workers in the form of dividends and capital gains from my low-cost equity index funds and pay for my Tim’s coffee that way. I think you need to rework your theory of how the system works. :P

#114 TurnerNation on 07.06.19 at 8:03 am

Once again crossbordershopper nails it.
Kanadians’ idea of making the money is by asking their government for more taxation.
The latest crop of SJW will redouble these efforts.

#115 Oh Canada, I weep. on 07.06.19 at 8:48 am

#114 Turner N, and the head ” person thingy” in Canada is none other than an indescribably weak individual who won’t allow murderers to face justice out if some sick twisted notion of how to count votes . Trudeau says, on the subject of prosecuting child rapists, slavers and murderers ” It’s hard”. ‘Its hard’?

Really, when witnesses abound where battlefields are still wet with blood? The Iraqis and Syrians are having no problem finding evidence. Even the feeble Swedes are gunning for war crimes trials. To be weaker on terror than a Swede is saying a lot. But Trudeau….Mr. Justin Trudeau will not prosecute the most hienous criminals in history. I have to ask….’Why’? The future if Canada is in your hands. Trudeau has abrogated all human decency for the sake of buying votes in a half dozen ethnic ghettos.

https://capforcanada.com/justin-trudeau-issues-caveat-against-rcmp-charging-isis-terrorist-returning-to-canada/

#116 dharma bum on 07.06.19 at 9:36 am

“With this, I’m hoping to give a simple and easily digestible explanation as to why capitalism is doomed to fail.” – Sunshowers
——————————————————————–

Capitalism is not just “doomed” to fail.
It already has failed. Over and over and over and over.

Capitalism is like a game of musical chairs. Every now and again, the music stops, and someone is punted.

There is not enough for everyone to go around.

Someone is “eliminated”, another chair gets removed, the music starts up again, and ’round and ’round we go!

Like rats in a maze.

Until the next time.

Over and over and over and over.

Or, it’s like the game of Jenga. Build the structure, and then start removing one little piece at a time. No problem. The structure seems sound. A little bite out of it here and there won’t affect it.

As more and more pieces are removed, the structure becomes a bit wobbly, until eventually it comes crashing down. Then, some time is taken to rebuild, and the whole process begins again.

Over and over and over and over and over.

We ride along fine for years. Business picks up. Demand grows. Consumption increases. Wages increase. Prices increase. Inflation ramps up. The party is fuelled and the attendees are giddy. Spend spend spend, borrow borrow borrow, buy buy buy.

Until the music stops.

Recession. Depression. Bankruptcy. Insolvency. Poverty.

Another player is eliminated. Another chair is removed.

Temporary misery for all.

But then it’s time to set up the remaining chairs, restart the music, and here we go around in circles to begin the entire facade again.

One failure after another.

If you’re making any money now, save it and invest it. Eventually, your seat will also be eliminated and you’ll need that dough to survive.

Capitalism is like all forms of casino gambling games. Eventually, you’re going to lose. So, quit while you’re ahead, and bank your cash.

#117 50 YEARS OF MAPLE LEAF INCOMPETENCE! on 07.06.19 at 9:44 am

DELETED

#118 crowdedelevatorfartz on 07.06.19 at 9:45 am

@#114 Turnernation
“Kanadians’ idea of making the money is by asking their government for more taxation.
The latest crop of SJW will redouble these efforts.”

“”””””””””

Ahahahaha.
Touche’

All the more reason to get out and vote this Oct and make your friends do the same.
The Liberal “social experiment” needs to end.

Sunshowers is just a fancy way of saying… rain.

#119 Expat on 07.06.19 at 9:46 am

It is inevitable that the young want socialism and the old want capitalism. When you are young you want it easy. When you old and having saved all your life you want to keep your hard earned money.

To the socialists. Living in drab grey concrete buildings paid for by the state working all day punching out solar panel frames in a state owned factory for 300/month salary that can’t be sold because we only need so many is not the option you will like when you are 50.

It’s easy to take the easy route. It’s much harder to get off your butts and create wealth for you and your family.

Instead of whining, start a business, work hard, save your money and soon enough you will live capitalism. Our generation did and it paid off.

Btw socialism and it’s evil twin communism are failed States and ideologies because they inevitably create an oligarch class.

Do your research before you listen to your teachers and professors. A small group takes power and uses the State power to keep it.

They disappear those who disagree.
Soviet Union, Venezuela, Nicaragua, Cambodia.

The list is endless.

#120 dharma bum on 07.06.19 at 9:50 am

For the record, I would like to state that although capitalism is an imperfect system that continually fails and restarts, leaving victims in its wake, it is still by far the best economic system available and I wouldn’t want it any other way.

It at least affords everyone an opportunity to succeed. Although it’s a bit Darwinian (smarter, harder working, more intuitive, and clever adaptive people tend to succeed), isn’t the existence of all living things Darwinian?

Natural selection.
The strong survive.
That’s just the way it is.

#121 crowdedelevatorfartz on 07.06.19 at 9:56 am

And the latest real estate tactic on the Left Coast.

https://globalnews.ca/news/5388549/hong-kong-protests-bc-expats/

I cant wait for the “helicopters full of investors” story in a week or two.
Not to worry Sunshowers.
Apparently they are all millionaires…should be able to pay lots of taxes.

#122 crowdedelevatorfartz on 07.06.19 at 10:09 am

Another tax refugee flees Canada….

https://www.citynews1130.com/2019/07/05/kawhi-leonard-is-leaving-the-raptors-for-the-los-angeles-clippers-multiple-reports/

I’m more upset when it’s doctors leaving due to excessive over taxation and regulation but I guess sports fans in Terrana will be seething.

#123 Vampire Studies (doctoral thesis) on 07.06.19 at 11:00 am

111 Nonplused – computer coding?? did lots at university in the 80s. Found it the biggest impediment to actually learning and understanding the material.

#124 Keith on 07.06.19 at 11:11 am

#104 MaryEn

The gap is not technology or gadgets, it’s income and wealth. Google income inequality, Gini coefficient. Or imagine a one income family of six with a blue collar employee with a house, a car, benefits including dental and eight weeks vacation per year, and a pension on retirement. Then think about what workers have today.

#125 jess on 07.06.19 at 11:14 am

…”sunshowers : There ARE viable alternatives to capitalism” i hope it is not this! Trump was praising this guy Bolsonaro and what of his absolutely corrupt “justice” minister

even the right ring media admits truths?

In sum: “the communications analyzed by the Veja reporting team are true and the story shows that the case is even more grave than previously known.”

several of Brazil’s most mainstream journalistic outlets – including its largest newspaper, Folha of São Paulo, and a long-time right-wing journalist, Reinaldo Azevedo of the Band News radio network – to jointly report on these incriminating revelations.

https://theintercept.com/2019/07/05/scandal-for-bolsonaros-justice-minister-sergio-moro-grows-as-the-intercept-partners-with-brazils-largest-magazine-for-new-expose/

Where Do You Turn When the Anti-Corruption Crusaders Are Dirty?

Brazil’s Operation Car Wash was supposed to overthrow the country’s culture of graft. Instead, it’s brought corruption into the heart of the state.

https://www.nytimes.com/2019/07/05/opinion/lula-moro-brazil.html?smid=tw-nytopinion&smtyp=cur&fbclid=IwAR3OtgbTC5VTtNzJ2hQPRmvJF_oQ0tiQ10ikp5Ov3HoSL_a0ZQ8e4mRkioA

#126 Flop... on 07.06.19 at 11:23 am

I wrote the other week that I realized that I am the Kawhi Leonard of the blog.

Never too high, never too low.

I realize now I have another similarity with the guy.

Couldn’t wait to get out of Toronto…

M45BC

#127 crowdedelevatorfartz on 07.06.19 at 11:23 am

Well.
Its official.
Boomers love the environment.
Go Boomers!

http://daymak.com/boomerbuggy-x.html

We refuse to go quietly into the night when we have heated, covered, scooters with horns.

Fear the Boomerbuggy millennial…its coming for you…..

#128 SunShowers on 07.06.19 at 11:25 am

#81 Ace Goodheart on 07.05.19 at 9:43 pm
Just finished watching the HBO series “Chernobyl”. If you think socialism works, you have to watch this.

—————–

This is silly. If you think any single political/financial system or industry has a monopoly on cutting costs at the expense of safety, you’re simply delusional. Just look at Boeing and the 737 MAX 8.

https://www.nytimes.com/2019/03/21/business/boeing-safety-features-charge.html

~

#92 IHCTD9 on 07.05.19 at 10:56 pm
#93 the ryguy on 07.05.19 at 11:02 pm
#108 Karlhungus on 07.06.19 at 1:20 am
Communism won that one decades ago.

—————–

Thanks to modern technological and scientific innovations (developed mostly through publicly funded government agencies), the world as a whole currently produces enough food to feed 10 billion people. So, how is it that 10 million people worldwide die of hunger every year?

It’s because to the ostensibly most efficient way of allocating resources (capitalism), it’s more efficient to let food rot in grocery stores in developed nations or die on the vine, than to feed starving kids. Because starving kids don’t have money. And yes, the nations that these starving kids live in ARE capitalist. The means of production are privately owned, and the state enforces private property rights. QED.

So in 10 short years, capitalism is responsible for more deaths than even the most hilariously inflated estimates for socialism/communism (did you know that the 100 million estimate from the black book counted Nazis killed by Russia in WWII as “victims of communism?” Crazy!) from hunger alone. We don’t even need to count all the people killed in wars explicitly fought for capitalism (Korean, Vietnam), and all of the coups and death squads orchestrated and funded by the CIA to overthrow democratically elected socialist governments (Chile, Nicaragua, etc).

~

#104 MaryEn on 07.06.19 at 12:06 am
Thanks to capitalism, the gap between rich and poor people has never been smaller (yes, smaller!) as today.

—————–

This is simply not true. Inequality is getting worse internally (within developed nations), and on a global scale as well, as it has since the 1970s.

~

#112 Nonplused on 07.06.19 at 2:31 am
Renting is not capitalism.

—————–

Aha! Now we’re getting somewhere. As Smith states, Labor + Capital + Entrepreneurship = Progress. However, nowhere is it said that “capital” explicitly requires a “capitalist.” The workers who provide the labor, could also provide the capital as well if they own it, lending to a more equitable distribution of the value produced. This relegates the capitalist to the position of a mere rentier. Smith had an awful lot to say about rentiers, didn’t he?

#129 Ponzius Pilatus on 07.06.19 at 12:12 pm

McCartyism is alive and well on this blog.

#130 millmech on 07.06.19 at 12:24 pm

#35 Island Girl
What loopholes, Bezo took all the risk and should be rewarded. You could have bought into Amazon and shared in the wealth, oops I mean you can have that taken from you because it is too much wealth for one to enjoy.
Imagine where we would be if that was the ceiling for corporate wealth, do you think Microsoft, Amazon ,Apple etc would be around if they were only allowed to get so big before being restricted.
To carry that thinking forward in our society then you should only have a house worth $100k anymore than that it should be taken/taxed away because that is “too much” real estate success and it is not fair to all the others who have not taken the risks to participate in the market, right?. The same with sports also should be only four goals in hockey because anymore than that is too much success in scoring and is not fair.
The amount of people who believe in punishing success is astounding, our flag should have the maple leaf replaced with a bucket of crabs.

#131 Stan Brooks on 07.06.19 at 12:26 pm

Kawhi chose Clippers, of course, it is weather + taxes question, he will actually net more with a smaller salary there.

It is interesting that NBA salaries are in USD, it seems no one is interested in the northern scheisse peso.

Speaking of it:

https://ca.finance.yahoo.com/news/bank-of-canada-to-cut-rates-in-october-then-twice-more-economist-150049565.html

Yep folks, we are to enjoy very low rates with stellar inflation.
Note: There was not deleveraging here yet from debt, we are on a sure path to destruction of the currency.

You need no hyperinflation for it. Just stellar inflation for a decade or two combined with zero rates.

But the economy ‘is strong’ and ‘they’ have ‘confidence’ in further improvements, but rates are about to hit zero.

Lie after lie after lie.

They meant ‘con’ not confidence.

Cheers sheeple, keep trusting the thieves. Combine that with higher taxes.

#132 Stan Brooks on 07.06.19 at 12:30 pm

And hey, the news is that with the sinking currency you get all sort of capital ‘gains’ that are taxable.

Absolutely fantastic news for the manufacturers of lubricants.

#133 Sail Away on 07.06.19 at 12:43 pm

Maybe I live in a privileged area, but I don’t know any starving people in my community. Actually, I’m not aware of any in all of Canada or the US. Some detentions on the border and MSM yowling about 4th of July celebrations, but no starving.

We better take care of this capitalistic western world starvation. Sunhowers, can you point us in the right direction? Or was that just theoretical starvation?

#134 Gravy Train on 07.06.19 at 12:46 pm

#120 dharma bum on 07.06.19 at 9:50 am
“[…] Natural selection. The strong survive. That’s just the way it is.” No, the concept is not that the strong survive, but that those best adapted to their environments are more likely to survive and reproduce. :P

#135 akashic record on 07.06.19 at 12:51 pm

Rent a bunkbed for $1200 per month in Los Angeles with a new startup.

https://edition.cnn.com/2019/07/05/success/podshare-co-living/index.html

#136 april on 07.06.19 at 12:55 pm

#121 – According to a Vancovuer realtor, Steve Saretsky, there is no truth is this… it’s not happening. Of course the usual culprits are at it again trying to pump real estate.

#137 Antarctic Empire on 07.06.19 at 1:02 pm

Today I’m happier than ever!

“Luxury cars have a shorter lifespan, and a regular turnover with income levels often not deemed an issue for their buyers. Mercedes-Benz saw a 17.7 per cent drop year-to-date, with contracting Audi just over 20 per cent and BMW falling 6.6 per cent during the period.”

Let the house prices fall baby!

#138 50 YEARS OF MAPLE LEAF INCOMPETENCE! on 07.06.19 at 1:25 pm

*117

DELETED

>>>>>>>>>>>>>>

Sorry Garth. Too soon?

I will therefore pledge to try to find some positive things to say about Toronto, in this time of grieving.

:) :) :)

#139 Pfft on 07.06.19 at 1:31 pm

hilarious how few folks on here know the difference between communism and socialism.

#140 Pfft on 07.06.19 at 1:33 pm

@#114 TurnerNation on 07.06.19 at 8:03 am
Once again crossbordershopper nails it.
Kanadians’ idea of making the money is by asking their government for more taxation.
The latest crop of SJW will redouble these efforts.
_______________________________

LOL, no.

#141 oh bouy on 07.06.19 at 1:41 pm

@#82 MeryEn on 07.05.19 at 10:02 pm
It’s difficult to explain briefly, especially with my English, but let me tray…

1. I did my Master based on Elinor Ostrom’s work and didn’t find her as a socialist. Her focus was on common-pool resource (CPR) that is not applicable on whole economy. However, even in these specific matters, her research shows that government mostly did the worst job managing CPRs comparing with local communities or private ownership. Also, game theory with zero result is the simplest game and isn’t at all applicable on whole entire economy. As you can see, never in the human history was a population on the planet Earth larger but in the same time people have never lived better then now-days thanks to innovations and productivity. So, Capitalism did a great job comparing with alternatives.

2. Laffer curve illustrates very nice how more taxes at some point result in less Government revenue. E.g. due to newest taxes, my family physician decreased his working time from 5 to 3.5 days per week. If he moved to USA instead, who would you tax?
________________________

1. so true, life is damn good for most people. especially for those of lesser means – wouldn’t know it though if you read this comments section daily.

2. possibly but your eg is anecdotal at best
like most of the comments on here.

#142 SWL on 07.06.19 at 1:43 pm

Multiple levels of bloated mostly useless government employees and regulations are destroying this country and these people want more of the same

Idiocracy

Go start up a small business and tell us all how easy it is, how much money you make, how you should pay more in taxes and how you need more government regulation

Guaranteed you will change your tune, and if not there’s always sunny Cuba for you

#143 oh bouy on 07.06.19 at 1:47 pm

@#87 IHCTD9 on 07.05.19 at 10:39 pm
#29 Sail away on 07.05.19 at 5:57 pm
Well, I tried to stay away from commenting… but as predicted, am addicted and can’t do it. Especially after today’s two guest posters
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Glad to have you back!
________________________

ya, welcome back to the echo chamber lol.

#144 NEVER GIVE UP on 07.06.19 at 2:19 pm

Much of the worlds taxation rules are there to compete with the USA. If a nation does not follow their lead they will lose corporate investment.

The good ole USA… Best Government money can buy!

Having said that it most of the advantages Corporate lobbying receives is in regulation and setting up barriers to competition. Lowering costly regulation and increasing the bar to enter a business space.

Its all about keeping the small guys out and the big guys bigger.

For just one example in Canada.
The trucking industry up until a few years ago could register and receive a permit to enter and pick up loads from ports. Small individual operators or small companies with say 5 trucks would compete with the big guys. They paid $2000.00 per year for the permit.

Then all of a sudden there was a minimum 15 truck requirement on the permits or $30k for a permit. Voila! all the small pesky operators are gone!

Some quite port work altogether and some of them joined forces with bigger companies.

There you have it another tranche of small businesses killed by regulation.

There is a multitude of these small business killing regulations out there. Its a wonder any of us survive!

#145 Leo Trollstoy on 07.06.19 at 2:37 pm

Don’t see the crybabies leaving their capitalistic society

Hypocrites lol

#146 Blessed_Canadian_Millenial on 07.06.19 at 2:47 pm

#90 SunShowers on 07.05.19 at 10:49 pm

——————————-

Hahah… your post is just awesome. You’ve very little practical understanding of how things actually work. It’s a bit sad, to be honest.

Capitalism has lifted MILLIONS of people out of poverty. This is an undisputed fact.

Communism has killed MILLIONS of people (Stalin, Mao, Ho Chi Minh, Castro). Again, this is an undisputed fact.

If you create value, you will get paid handsomely for it. Most billionaires who are billionaires don’t set out as one. You think Elon Musk, Buffett, Bill Gates, Mark Zuckerberg, Larry Page, Sergy Brin, et. al all were billionaires and received their inheritance?

The fact that you actually believe this shows me that you have no real knowledge and understanding of history. I’m sorry to say this, please read more.

I’m not here to change your mind, but at least read the “The Next Millionaire Next Door” book by Sarah Stanley Fallaw. It greatly and painstakingly breaks down the notion that wealth only goes to those who are currently rich.

Good luck, my friend!

#147 Blessed_Canadian_Millenial on 07.06.19 at 2:50 pm

#107 Jon B on 07.06.19 at 12:42 am
Just imagine the sorry state of the world if people like these two socialists ran the place.

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I hate to say this, but the thinking displayed by these two gentlemen is rampant and is way more mainstream that you realize.

Case in point: the election of Trudeau, Horgan, Notley (in ’15 in Alberta) etc.

#148 Blessed_Canadian_Millenial on 07.06.19 at 2:59 pm

People keep talking about income and wealth inequality.

Don’t they realize that it is not the same people who are at the top each year? People’s income changes drastically: those who were earning at the top 1% in the ’80s are not the same who are still earning at the top 1% level today.

Again, a simple yet undisputable fact.

So why do people (especially politicians) still talk about this inequality? To divide, and to win votes. To win votes so that they can get in power.

#149 please go on 07.06.19 at 4:00 pm

@#138 50 YEARS OF MAPLE LEAF INCOMPETENCE! on 07.06.19 at 1:25 pm
*117

DELETED

>>>>>>>>>>>>>>

Sorry Garth. Too soon?

I will therefore pledge to try to find some positive things to say about Toronto, in this time of grieving.

:) :) :)
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do us all a favour and just go away.

#150 Nathan on 07.06.19 at 4:13 pm

Capitalism has been around since the US was founded just because pay hasn’t risen since the 80’s does not mean capitalism is broken. The problem with advocating for a bigger tax on business is they will just move their office and pay a lesser amount somewhere else, why do you think apple is out of Ireland do you think they sell all their phones over their. The true problem is needing to refine the tax structure for the new age we are in. The only way that will happen is if the government could work together to fix a problem, they would rather fight with each other over weather the problem even exists. Business/corporate tax rates need to be set based on the revenues they earn in each country not based on where they hold their patents or head office. That way every country would get a tax on business that operate in their country, want to sell IPhones in Canada – you need to pay Canadian taxes on your revenues here. The individual has all the options, don’t like minimum wage get your self some skills so you can earn more. Starbucks pay is shitty, don’t work at starbuck’s, its your CHOICE. The idea that government should be able to fix everyone’s own problems hasn’t worked well historically. Our government cant even run a payroll system effectively yet you want to give them more control over your choices, as if that could fix things. The socialists among us need to go back to school, it seems they have been misguided. Just because your earnings are less than someone else does not mean you are any less of a person and confined to life of poverty. You can start making the right choices when you start to save 10% of your next paycheck, that way you can become the owner and not the slave. Although i make a much smaller income than most of my friends, i own my own home and have funds saved for my future. All my peers still have mortgages and no money saved yet earn 4 times what i do. CHOICE, Make yours.

#151 Leanne on 07.06.19 at 4:15 pm

Thanks to today’s posters for some thought provoking content! Jeff, I am genuinely interested to hear your thoughts on alternatives to capitalism. I also feel that the incentives of capirltalism bring out the selfishness and greed of humans, damaging the planet and failing to reward the human qualities that make life and human relations pleasant. I think the best approach, and one that leads to greatest happiness for a majority are the left leaning social democracies where capitalism is in check (think Sweden, Norway, Denmark, Finland, etc.)

#152 oh bouy on 07.06.19 at 5:54 pm

@#147 Blessed_Canadian_Millenial on 07.06.19 at 2:50 pm
#107 Jon B on 07.06.19 at 12:42 am
Just imagine the sorry state of the world if people like these two socialists ran the place.

———————

I hate to say this, but the thinking displayed by these two gentlemen is rampant and is way more mainstream that you realize.

Case in point: the election of Trudeau, Horgan, Notley (in ’15 in Alberta) etc.
__________________________________

LMAO, do you even read what you write?

#153 Jim on 07.06.19 at 7:57 pm

What is this? I came to this blog expecting wisdom and insight, only to receive simplistic viewpoints from people who have probably only been alive for half of my lifetime. How much longer do we have to endure such torture?!?

#154 Gotta Get Out of Calgary on 07.07.19 at 1:21 am

#146 Blessed_Canadian_Millenial on 07.06.19 at 2:47 pm

I’m not here to change your mind, but at least read the “The Next Millionaire Next Door” book by Sarah Stanley Fallaw.

————————————————————-

I recommend reading the original THE MILLIONAIRE NEXT DOOR by Thomas Stanley and William Danko. An updated version was published in 2010.

Yes, some of the stats are old now but the concepts are presented much better in the original version than in the daughter’s version.

#155 Alex on 07.07.19 at 8:31 am

#78 One of my friends lived in communist Poland and one of his favourite sayings from that experience is: “They pretend to pay us and we pretend to work.”

Does criticizing capitalism by default mean that the socialism is the only comparable option to it? Why not consider improving the current system, since the current one (read personal and governmental debt stats that Garth pulled out) obviously does not work for an average person, unless you presume that all the immigrants were barefoot and had nothing to eat, so whatever they get here is better than what they had back home”. I am stunned with the fact how big, beautiful and how much potential this country has and yet we collectively sink in debt vs making the progress and having better lives (yes, there are external factors that affect us but let’s clean our own backyard first and see if we get any improvement here).
#78 what about pretending to own real estate/car here while basically owning the mortgage/loan, not the actual property/car? Unless we define ownership as only the title on the paper that makes you feel good having your name on it. Try not paying what you owe and see what happens with the state or fact of exclusive rights and control over “your” property

#156 SCD on 07.07.19 at 9:00 am

I don’t really see the point of this exercise. The guest posts by Jeff and Jake are so outrageous and inflammatory that they don’t even belong in a legitimate financial forum. Neither Jeff nor Jake has responded to the
main point that these proposed measures have failed horribly in socialist/communist countries with heartbreaking consequences for the people. As the daughter of an immigrant I feel very grateful to live in Canada and have the freedoms and opportunities available here. Jeff and Jake I agree with the other posters who suggest you move to Venezuela-and please take John Horgan and crew with you.

#157 Shawn Allen on 07.07.19 at 11:18 am

How to Get Rich

Millmech at 83 said:

It is not that hard to become wealthy, just do what they [the 1%] do.

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Charlie Munger, Buffett’s almost life-long business partner agrees with you. At this year’s annual meeting he advised: “Figure out what works and do it.”

I think the doing it is often the barrier. It takes sacrifice and/or work to invest regularly in equities. Perhaps also the seeing what works get lost in the huge noise of the information age.