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Time to roar To become the Northern Tiger, Canada needs to emulate winners
Calgary Herald | Saturday, December 28, 2002 | Editorial

Posted on 01/03/2003 8:36:22 PM PST by Sparta

Canadians feel like they're working harder, but they don't seem to be getting ahead. It's not just an illusion; our standard of living, compared to other industrialized nations, has been in freefall since the end of the Second World War.

Two years ago, Industry Canada reported that Canada's standard of living was equal to that of Mississippi, the poorest state in the U.S. In early December, a study on innovation by the Conference Board of Canada ranked Canada last out of 10 countries. Last week, the Centre for the Study of Living Standards reported that Canada had slipped -- again -- in its annual ranking of 23 nations. We're now in sixth place, ousted by the Celtic Tiger of Ireland which leapfrogged to third.

The irony is not lost that it is a nation whose people once flocked to Canada for a better life, which is now providing a far better one for its citizens.

Ottawa's response to such gloomy numbers has been to first deny them, then defend them, and then, thankfully, to declare improving productivity a high priority. Industry Minister Allan Rock held a summit this fall, and unveiled his innovation agenda in November.

Unhappily, many of his ideas were met with snorts of skepticism from business leaders.

Rock wants to create, through federal intervention, 10 internationally recognized industry clusters spread across the country by 2010.

A worthy enough goal, but as other nations have learned, micro-managing innovation isn't possible. Instead, governments must create the right macroeconomic conditions for entrepreneurship to thrive.

Ireland, for example, was mired in economic torpor in the 1980s. In 1987, it elected new, fiscally responsible leaders who launched aggressive reforms.

The size and cost of government was severely reduced, corporate and income taxes were slashed, and a deal brokered with the unions to keep wage increases low. Labour leaders were smart enough to see the benefits to them of a healthy economy. Besides, when accompanied with deep income-tax cuts, even modest wage increases still resulted in more money in their members' pockets.

These changes made Ireland an attractive place to invest, not just for the Irish themselves, but for more than 1,000 foreign firms, who were warmly welcomed. About 600 U.S. firms landed on the tiny island in the late 1980s and helped fuel its recovery.

As the economy roared forward, government revenues quickly rose again. Tax levels were kept low, but, with growth so high, the net effect was that government regained the means to provide a high level of core services, such as a massive expansion of post-secondary training programs and free university tuition.

Ireland now leads the world in GDP and job growth and provides a standard of living below only that of the U.S. and Norway.

Rock's New Year's resolution should be to listen to Canadian business leaders, who are begging for similar types of reforms.

First, Ottawa needs to eliminate the capital tax, which provides a huge disincentive for corporations to invest their profits. Second, it must slash corporate taxes. Ireland's rate is 12.5 per cent; in Canada, it can run as high as 43 per cent.

Marginal income taxes have to come down, too, as they are also a disincentive to work longer or to try for a better job. Canada's top rate kicks in at around $103,000 federally, and $65,000 provincially, compared to $300,000 Cdn in the U.S.

Follow those moves by cutting red tape for entrepreneurs, eliminating domestic trade barriers and removing limits to foreign investment, and Canada would soon be able to earn the title it so covets -- Northern Tiger.

The key is to learn from others' successes and to listen to those who know.


TOPICS: Business/Economy; Canada; Editorial
KEYWORDS:
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The clouds darken over the worker's paradise of Canada.
1 posted on 01/03/2003 8:36:22 PM PST by Sparta
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To: Clive
ping!!!
2 posted on 01/03/2003 8:36:43 PM PST by Sparta
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To: Sparta
Our neighbors to the North have to learn that they can't tax their way to prosperity.
3 posted on 01/03/2003 8:39:59 PM PST by Ciexyz
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To: Ciexyz
Don't forget their lovely habit of importing hordes of third-world castoffs.

Looks like Canada's leaders are doing their utmost to create a nation that combines the worst aspects of the Balkans and Cuba.
4 posted on 01/03/2003 8:48:32 PM PST by second_half_recovery
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To: Ciexyz
Our neighbors to the North have to learn that they can't tax their way to prosperity.

So do we... That highest marginal tax rate in the US takes effect at a very low level.

5 posted on 01/03/2003 8:49:58 PM PST by The Electrician
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To: Sparta
Reply to post #1: To achieve freedom and economic success Canadians must follow the example of the people of Poland and overthrow their marxist government.
6 posted on 01/03/2003 8:59:10 PM PST by A6M3
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To: A6M3
To achieve freedom and economic success Canadians must follow the example of the people of Poland and overthrow their marxist government.

These days, Poland has an unemployment rate of about 18%, no growth, per capita GDP of $8000 USD and is quickly reverting back to Marxism. Poland is only a marginal success when comparing it to the other disasters in Eastern Europe.

7 posted on 01/03/2003 9:11:55 PM PST by Black Powder
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To: Black Powder
For canada that would be an improvement.
8 posted on 01/03/2003 9:23:19 PM PST by A6M3
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To: A6M3
I've spent a lot of time in Canada and it is a very pleasant place to live. I fear they are doing what we did in the 60's and 70's and running their economy into the ground. We woke up, may be they will too. Better for everyone if they did.
9 posted on 01/03/2003 9:32:55 PM PST by Lonesome in Massachussets
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Comment #10 Removed by Moderator

To: Lonesome in Massachussets
I am under the impression that it was Trudeau who sent Canada on its current "tour" of socialism - their dollar was better than ours until he started his social commandeering....and seems things are still stuck there today. Too bad...there are a lot of intelligent and God fearing Canadians who work hard.....to support those who think they don't have to (work hard.)
11 posted on 01/03/2003 9:46:12 PM PST by goodnesswins
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To: scisyhp
Reply to post #10: The problem is, is the communist government you elected is a threat to the United States. Your marxist government has been providing cover for arab terrorists in fear of losing arab votes from your large arab population. The members of parliment you elected are standing up in that parliment and making speeches lobbying for hamas so they can set up bases in canada. Most of the terrorists that sneak into the United States come from canada.
12 posted on 01/03/2003 10:03:10 PM PST by A6M3
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To: A6M3
http://www.freerepublic.com/focus/site/user-posts?id=90539

Sciscyp's previous posts. You're arguing with a brickwall.
13 posted on 01/03/2003 10:08:02 PM PST by Sparta
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To: A6M3
Most of the terrorists that sneak into the United States come from canada.

Even the ones you taught how to fly commercial airliners and gave visas to after they're dead? Are all americans irresponsible dumbasses like you, who like to blame others for your own problems?

14 posted on 01/03/2003 10:15:00 PM PST by Black Powder
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To: Black Powder
Defensive of our little igloo are we?
15 posted on 01/04/2003 12:33:17 AM PST by Clemenza
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To: Black Powder
Reply to post #14: We might have taught them how to fly, but we didn't teach them how to land. I think you misunderstood, I am not blaming canada for our problems, I am stating that canada, is our problem. In future dicussions please try and remember, that the party who calls the first name, loses the debate.
16 posted on 01/04/2003 1:07:52 AM PST by A6M3
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To: A6M3
I think you misunderstood, I am not blaming canada for our problems, I am stating that canada, is our problem.

Why is that? None of the 9/11 terrorists came to the USA from Canada. They were practically invited there by the americans and given room and board, and a few flying lessons. US immigration is so utterly lame, even after 9/11, that a terrorist wouldn't have to bother going through Canada. You let in millions of illegals each year from your southern border, cozy up to countries like Saudi Arabia, Egypt, and Yemen (where the terrorists usually come from) and yet you have the nerve to point fingers at another country like Canada because of your own inept policies and security. It's Canada that should be worried about all of the freaks that end up in the US and whether they'll someday spill across the border. Actually, that's already occuring since 75% of immigration to Canada comes from the US.

17 posted on 01/04/2003 1:44:00 AM PST by Black Powder
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To: goodnesswins
I don't know when the rot started, I only what know what I see today. They have other problems besides Socialism, just like we do. Their elites hate the ethic and peoples that made Canada such a pleasant place and they're doing everything they can to destroy traditional Canada.

Of course being harnessed to a few million bitter francophones doesn't make the place easier to govern. French is moribund in North America and Canada spends an enormous amount of political capital trying to avert the inevitable.
18 posted on 01/04/2003 5:32:16 AM PST by Lonesome in Massachussets
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To: Lonesome in Massachussets
>>French is moribund in North America<<

It's moribund in Europe, too.

C'est la vie.

19 posted on 01/04/2003 5:43:19 AM PST by Jim Noble
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To: Black Powder
Reply to post #17: Why is that? What about the 5 terrorists the canadian government let in last week? What about cover given to arab terrorists because the canadian politicians are afraid of losing votes from the ever increasing arab population in canada? What about your MPs who stand up in parliment and lobby for hamas to be allowed to set up shop in canada to garner arab votes as reported earlier this week on Fox News by a canadian commentator? As far as illegals go, I would rather have none, but if I had to choose, I would rather have millions from Mexico than millions from canada. Most American's who make the decision to immigrate to canada are communists and canada is the closest thing to their imagined marxist utopia this side of North Korea.
20 posted on 01/04/2003 9:03:27 AM PST by A6M3
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