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SCHOOL DAZE (ECONOMIC DEPRESSION) FEB/2019

BY: Roger Callow  employeescasecanada.ca

QUOTE:

Malthus came to prominence for his 1798 essay on population growth. In it, he argued that population multiplies geometrically and food arithmetically; therefore, whenever the food supply increases, population will rapidly grow to eliminate the abundance.

RESPONSE: Malthus will be correct over the long run but not to date as he did not prognosticate the changes wrought by the industrial revolution of applying machinery to land, insecticides, disease, crop evolution, and wars. To date, we have witnessed exponential growth in population since WWII forcing us to recalibrate how we eat. For example dairy products can be expected to disappear in terms of the cow which requires too much water and pollutes the atmosphere with methane gas. Overfishing creates shortages in that area. Eating insects in pureed fashion harbingers the future.

MESSAGE:

1) PLACARD: BEHIND EVERY ECONOMIC COLLAPSE IS A MORAL COLLAPSE  And some would say the moral collapse is more significant as evidenced by countries with resources such as Venezuela, the Congo, Indonesia, but are unable to exploit their resources to the advantage of the people at large. Canada collapsed in that moral regard with the 34 year unresolved Employee's Case where no Compensation has been paid pointing to the dangers of imposed Legislation (BILL 35 B.C. 1985) which permits government by fiat.

2) The School 'Deficit' in Ontario can be mirrored right across Canada whereby we can see in the microcosm what exists in the macrocosm of many other institutions as well.

3) The figures bandied about are frightening in the above regard: Education costs have doubled in a time period where enrolment figures remain static. The situation is untenable. Actuaries know this explaining why they wish to convert ongoing expenses to capped outlays.

4) The effect of capping can be devastating such as for autistic children to be cut off from funding at age 20. Veterans are also being capped. The money may stop but the health costs continue beyond the capping allowance in many individual cases.

5) However, the capping runs unevenly as some may benefit in applying programs. For example, Haitii was devastated by an earthquake and received much financial aid from Canada with the RCMP sent to revise their policing. The RCMP came home with their tales tucked between their legs and then P.M. Harper finally called a halt to administering aid and pulled out. What happened? The Super Pacs enter the scene; select the new leader; pay him off, and then skim the money to themselves. In another example, Hollinger Corporation, under V.P. Cheney made a fortune out of the Iraq War. That's how the 1% of the wealthy become wealthier.

6) In the Ontario school picture, while costs have skyrocketed, teachers are worse off today than before the student decline; largely because their 2% salary increase each year, common to most employees, does not match the general increase of costs in the 4% plus range in the economy. In brief stagnant wages are the culprit.

7) Low interest rates, which were used to bail out the financial interests in 2008, succeeded only to become the source of the current Recession/Depression (We are all one job away from being on welfare; One persons employment in a Recession is another unemployed person's Depression.)

8) Consumers and governments find it easy to borrow money at low rates with any increase creating a Recession.For example,  governments create public road building with consumers buying new cars. A small increase can produce a Recession; particularly as half of Canadians cannot go without a paycheck. Further, money would flee a shaky stock market should higher interest rates with government bonds be provided. It's the perfect storm.

9) One illustration shows how inflation works which gov't. loves as long as salaries do not chase after them. In 1968,  the B.C. government reneged on paying the Peace River Dam contractors in a case which lasted 10 years; the longest one in B.C.'s history. In that time inflation took off so that when the Gov't. ultimately had to pay, they paid with 50 cent dollars after selling power to California for 10 years. As a teacher, I can remember getting a 16% salary increase one year (think Alberta today) with mortgage interest at 19% in 1979. People lost their homes while others had to rewrite their mortgages and get 'silent partners' (their parents).

10) Being liquid is all important in Recessions. There was plenty of money in the banks in the 1930's as there is today. It is just that no-one will loan it out...unless it is to Chinese interests driving our economy down the tube with high house prices.

11) Such as the Fraser Institute make much of the fact that parents (customers) are not 'getting their moneys' worth with public schools. Their bid for private schools which is not being detailed here is a major loser. The point is that the failure of our schools is due to the fact that we have displaced the work ethic with which I was raised (I'm now 77) and our own children (early 40's) is being displaced by young people whom do not want to work. Employers are turning increasingly to immigrants. For example, due to generous unemployment benefits in Nova Scotia for fishermen, there is no available local labour for the fish canneries in the off season.

12) The biggest factor in our population growth is our aging population. Pensions introduced after WWII were given to retirees on their 65th birthday with, on average, three more years to live. Today, we old buggers are clogging up the advanced nations as we live to 80-85 with  projected life-span increases. It is unsustainable, but here's the point, whom controls the resources of the world? Not the poor countries. Not the working joe in the rich countries.

13) Many countries are basket cases. Take Egypt. When I was there in 1965, much was made of the Aswan Dam enabling the extension of the farmland either side of the Nile to 6 miles. Today, that extension is 42 miles with the population expanding to meet these resources. But it is in the nature of dams (Three Gorges in China as well) to silt up. In 2010 while being in Egypt, concern was voiced about the delta being inundated with salt water. Foreign money from the U.S. and Israel is all that keeps Egypt from going the way of Rwanda in the 1990's. Soon that will not be enough for the expanding population.

14) To conclude with the Ontario School pension program: In 1990, there were 5 employed teachers for every retiree. Today the pattern is reversing and for some time now, it is Pension investment keeping the pension scheme alive as well as being a major investor in the economy. What will happen as the Pension Program has to pull more money out for retirees thus negatively affecting the investment market? It creates the domino effect which is beginning to steam-roller now as I write. No positive message there.

15) When Premier Ford canceled the carbon tax, he eliminated over $2 billion in revenue to pay his civil service. All his nickels and dimeing of various programs cannot raise that much money. A 10% increase in gas taxes aka the French experience is about the only way that he can go.

16) And then there is the hidden tax such as property values increasing as basis for taxation and yet the homeowner cannot realize that increase in income until he sells his home.