Link About "Housing on the Knife's Edge"

Jim Flaherty (likely acting on the advice of people less stupid than he is) has decided to tighten-up the rules for buying a house in Canada. Heck, I'll let David Macdonald of Progressive Economics Forum tell it:

On the heels of multiple warnings from the Bank of Canada that Canadians have taken on too much household debt for comfort (we hold the dubious distinction of having the worst consumer debt to financial assets ratio among 20 OECD nations), the federal government announced three moves. It will reduce the maximum insurable amortization period from 35 years to 30 years as it scales back both home equity loans and the amount homeowners can refinance. With these changes, we are about half way back to where the CMHC lending standards stood in 2006 when the Harper government significantly loosened them.

I recommend reading the whole thing. Canada's continued housing boomlet is one of the main reasons why we didn't have the brutal plummeting of the economy that the USA suffered from. It isn't the only reason, but it's a big one.

What I'd like to contribute is how all of this reveals the sheer, utter failure of neoliberal economics. Canadian households are indebted ("the worst consumer debt to financial assets ration among the 20 OECD nations"), our provinces are in debt, our federal government debt is worse than the USA's (which is not to say that the USA's federal government debt, or Canada's federal government debt is catastrophic). Yes, yes. Debt, debt. Bad, bad,bad. Shame, shame, shame.

Except for the obvious: Without this increased debt there would have been little or no economic growth over the past decade or so. Zero. Nada. Zilch. Zip. Nothing. While Paul ("screw the 'Red Book'") Martin was imposing austerity and cutting taxes for the wealthy, the economy continued to grow because ordinary income earning households took on debt. While stephen ("screw democracy") harper doubled-down on that crapola (along with mike harris, dalton mcguinty, and all the other neoliberal premiers), the economy continued to lurch forward because Canadian households took on debt.

While corporations took advantage of the neoliberal policies of "free trade" and globalization, and shipped jobs overseas, the economy continued to stumble along because we took on debt.

While business down-sized and automated and shed workers, the economy chugged along because we took on debt. We took on debt as households and as taxpayers. The wealthy and the corporations now pay far less than in the 1960s (when the Carter Commission discovered how unequal the Canadian tax system was), and even the 1980s. Working Canadians paid into an Employment Insurance program that Paul (SCREW THE RED BOOK) Martin ...

[You know, I've really got to say something to you "progressive" Liberal supporters. We might be sliding into an election and you people, even after the pathetic failure of Obama (which is really not a failure but a successful con-job) and the plundering neoliberalism and the hugely hypocritical rhetoric of Chretien and Martin and Manley, you people still get all fired up about your stupid, contemptible party. The NDP would likely sell Canadians out too, but they start from a farther left position, which means that when they sell-out, it will end up selling out ordinary Canadian households LESS than what the neoliberal Liberals will. How can you continue to delude yourselves that voting in an anti-union, pro-war, pro-imperialist whose economic views are probably to the right of Barack Obama's to lead Canada's government will not produce a "betrayal" of everything you say you believe in?]

... used to subsidize his tax-cuts to the wealthiest. We pay more user fees. We pay higher tuitions. We get less government services. We pay and pay and pay, and we pay for it with debt. Shit. We even get fleeced by our publicly regulated financial and telecommunications industries. We get fleeced by our oil companies. And we pay for these excess charges with debt.

And it's running out neoliberal fuck-faces. You can't get blood from a stone. They're finding that out in the USA. Obama and the Federal Reserve keep shovelling money to Wall Street and they continue to let homeowners get repossessed and states to slash services and business to down-size. Obama (like all the other neoliberal scum-bags down there) believes that ordinary US-Americans will pay for it by losing Social Security, so, like, whatever. But all of this just contributes to the whole suicidal dynamic.

Let's ask ourselves, while the federal harpercons and the Ontario Liberals propose even further tax-cuts to corporations, ... why do it? What do WE get? WE are the people who buy the goods and services that produce these corporate profits. It's OUR MONEY the same way that government tax revenues are OUR MONEY. When Canadians pay excessive fees on their RRSPs and their cell-phones and their internet service and their credit cards and their bank accounts and at the gas-pump, this all becomes corporate profits. And why should we let our governments let them keep it? What is the rationale for that? So that they'll "create jobs"? Tell me another one! So that they'll "invest in the economy"? Please! Stop it! You're killing me!

What they'll do is "invest" their excessive profits in the whole Bay Street, Wall Street, City of London Casino of Corruption again!

Here's an idea. KEEP that revenue. And raise taxes and get MORE of it. And give it BACK to the over-burdened Canadian households who have been treated like a milch cow by yourselves and your puppet-masters. And do it for your own survival, as well as ours!