Insecurity and the Economy

Our community is experiencing severe housing and food insecurity. The increasing numbers of people living in tents and depending on food banks indicates that action by the government is essential and urgent.

Homeless in the Ball Park

 

The 2023 CBC Massey Lectures, The Age of Insecurity, feature filmmaker and writer Astra Taylor who explains how society runs on insecurity and how we can change it. The lectures are also available as a book, The Age of Insecurity: Coming Together as Things Fall Apart, from House of Anansi Press.

Taylor takes a deep dive into the history of capitalism and explores how, paradoxically, the ways that we’ve been encouraged to achieve security — purchasing health and wellness products, buying life insurance, acquiring property — actually work against us.

She also looks forward at the ways we might be able to achieve true security, using collective action. 

But today, we also live in an era of manufactured insecurity, imposed on us from above. Consumer society, Taylor argues, capitalizes on the very insecurities it produces, making us all insecure by design.

How we understand and respond to insecurity is one of the most urgent questions of our moment — nothing less than the future security of our species hangs in the balance. (Taylor, 2023)

Agnieszka K. Wielgosz serves as a vocal sustainability/ regenerative wellness advocate. She is the woman behind CEI Collective, serving the creative needs of wellness professionals, regenerative & green living brands to grow and make a dynamic impact.

When we consider the phenomenal speed at which the USA ramped up industrial production during the Second World War, or the efficiency with which developed nations are able to respond to natural disasters, we see that notions of “money” and “the economy” quickly fall by the wayside.

If only we allocated the same amount of resources and effort into the health of our global community!

It’s a well established fact that modern societies with advanced levels of technology could easily provide all the resources required for their citizens to live in ample comfort and safety, without having to resort to money, credit, bartering or worst of all, debt.

With shared responsibility and co-owned resources, humanity would quickly overcome the artificial boundaries that currently separate us, leaving us free to pursue a better way of living whilst caring for our shared environment. (Wielgosz, 2020)

A report by Lars Osberg tracks Canadian income inequality through 75 years of growth and recessions and speculates about the post-COVID-19 future. 

Although the Keynesian consensus on the importance of full employment to balanced growth and social stability enabled growing real wages and stable inequality, it was replaced, after a surge in inflation in the 1970s, by Neo-Liberal policies that emphasized budget balance and low inflation. But slowing growth and the concentration of income gains at the top produced widening income gaps, increasing discontent and political instability—even before COVID-19 hit. In the post-COVID-19 era, the Green New Deal emphasizes social and environmental sustainability, and is reflective of the economic policy changes that likely lie ahead. This report has contrasted the balanced growth and stable inequality of the Keynesian consensus era, 1946–1980, with the unbalanced growth and increasing top-end income shares of the Neo-Liberal years that followed. It has also contrasted the policy choice facing both past regimes—how to share the gains from growth—with the possibility that a post-COVID-19 world will be dominated by a more depressing choice: how to allocate the costs of contraction. As always, future policy choices will be conditioned on prior experiences. The era of Keynesian consensus decision-making saw full employment and the sharing of the gains from economic growth as central issues because that generation had experienced the costs of social instability. And although they could not solve the problem of inflation, they left a social insurance system and a history of stable inequality to their Neo-Liberal successors, which muffled initial discontent with the high unemployment, stagnant middle-class wages and increasing inequality of Neo-Liberalism. Neo-Liberalism solved the inflation problem but could not produce a fair distribution of the gains from economic growth—and that matters. When social insurance protections are dismantled and top-end incomes grow faster than middle-class incomes, inequality and insecurity increase over time. So the legacy of Neo-Liberalism includes the populist political reaction of those who were left behind in the Neo-Liberal decades and those who were, and will be the casualties of the COVID-19 years. The legacy of Neo-Liberalism also includes a global climate crisis. Those failures of Neo-Liberalism will condition Canada’s responses to the challenges of the post-COVID-19 world. (Osberg, 2021)

Prior to the Keynesian consensus era, 1946–1980, Crown Corporations, including Wartime Housing Limited built thousands of homes in Canada.

Klein, Seth. (2020) A Good War: Mobilizing Canada for the Climate Emergency. Toronto, ON:ECW Press.

Wartime Housing in Halifax

 

The abstract from the Masters Dissertation of Jill Wade (1984) entitled Wartime Housing Limited, 1941-1947 : an overview and evaluation of Canada’s first national housing corporation asks the question of why did the federal government not reconstitute WHL as a permanent, low-rental housing agency.

Between 1941 and 1947, a federal crown corporation called Wartime Housing Limited (WHL) successfully built and managed thousands of rental units for war workers and veterans. At the same time, an Advisory Committee on Reconstruction study (the Curtis report) described the enormous need for low and moderate income shelter throughout Canada and recommended a national, comprehensive, and planned housing program emphasizing low-rental housing. Instead, in 1944 - 1945, the federal government initiated a post-war program promoting home ownership and private enterprise; it neglected long-range planning and low income housing. Thus, an interesting question arises. Why did the federal government not reconstitute WHL as a permanent, low-rental housing agency (Wade, n.d.)

The evidence of stagnant middle-class wages and increasing inequality is seen in the growing numbers of homeless people and the increasing importance of food banks and soup kitchens in our community.

Feed Nova Scotia essential for food security

The role of the government to protect the health of Canadians was essential during the Covid 19 emergency. Government Action, similar to wartime programs, to guarantee the right of Canadians to adequate housing and access to healthy food is urgently required now.

References

Klein, Seth. (2020) A Good War: Mobilizing Canada for the Climate Emergency. Toronto, ON:ECW Press.

 

Osberg, L. (2021, March 2). From Keynesian Consensus to Neo-Liberalism to the Green New Deal. | Canadian Centre for Policy Alternatives. Retrieved November 21, 2023, from https://policyalternatives.ca/publications/reports/75-years-of-income-inequality-canada 

Taylor, A. (2023, June 16). The Age of Insecurity. 2023 CBC Massey Lectures. Retrieved November 21, 2023, from https://www.cbc.ca/radiointeractives/ideas/2023-cbc-massey-lectures-astra-taylor/lecture-1-curas-gift 

Wade, J. (n.d.). Wartime Housing Limited, 1941-1947 : an overview and evaluation of Canada's first national housing corporation. Open Collections. Retrieved November 21, 2023, from https://open.library.ubc.ca/soa/cIRcle/collections/ubctheses/831/items/1.0096317 

Wielgosz, A. K. (2020, October 20). A New World is Possible: An Introduction to Resource-Based Economies. Agnieszka K. Wielgosz. Retrieved November 21, 2023, from https://agnes-wielgosz.medium.com/a-new-world-is-possible-an-introduction-to-resource-based-economies-5def63e87e2a 

Three Strikes and?

The policies of Prime Minister Binyamin Netanyahu have come under scrutiny since the horrible attack of Hamas terrorists on Israeli citizens on October 7 2023. At least “three strikes” against Netanyahu have been the subject of news commentary. Is it now time to call him out of this conflict?

Calling Netanyahu Out

Hussein Ibish, a senior resident scholar at the Arab Gulf States Institute in Washington, a weekly columnist for The National (UAE) and Now Media, and a monthly contributing writer for The International New York Times in an interview with Matt Galloway on CBC The Current defines Hamas in this way.

this is a religiously millenarian group, that it is apocalyptic and that it believes that it's doing the will of God. And so all of this is divinely mandated and there's a kind of religious imperative here. So I think there is also an irrational belief on the part of Hamas that in the end, if they are sufficiently fervent that there will be some kind of divine aid as well. (Monday October 16, 2023 Full Transcript, 2023)

Ravi Nessman, Associated Press, and  Amy Teibel, Associated Press, reporting for PBS comment that many Israelis are furious at their government’s chaotic recovery efforts after the Hamas attack. STRIKE ONE!

“It has to be clear. The government is completely incompetent,” said Ruvi Dar, a clinical psychologist and Tel Aviv University professor who has been counseling survivors evacuated from their homes.

Critics have accused Netanyahu of recklessly ignoring a raft of issues. The police force is understaffed, and the military was caught off guard on Israel’s southern flank as forces were more heavily stationed in the occupied West Bank, home to half a million settlers. The government did little to address the spiraling cost of living and rampant killings in Israel’s own Arab communities, while ultra-Orthodox Jewish and pro-settlement coalition partners have received billions of dollars for pet projects. (Chehayeb & Teibel, 2023)

Evan Dyer of CBC News reports notes Netanyahu's Hamas policy came back to haunt him — and Israel. STRIKE TWO!

A symbiotic relationship between Netanyahu and Hamas has been remarked on for years, by both friends and enemies, hawks and doves.

Yuval Diskin, former head of Israel's Shin Bet security service, told the daily newspaper Yedioth Ahronoth in 2013 that "if we look at it over the years, one of the main people contributing to Hamas's strengthening has been Bibi Netanyahu, since his first term as prime minister."

In August 2019, former prime minister Ehud Barak told Israeli Army Radio that Netanyahu's "strategy is to keep Hamas alive and kicking … even at the price of abandoning the citizens [of the south] … in order to weaken the Palestinian Authority in Ramallah."

The logic underlying this strategy, Barak said, is that "it's easier with Hamas to explain to Israelis that there is no one to sit with and no one to talk to." (Dyer, 2023)

Matt Galloway on the CBC program, the Current, discussed the Israel-Hamas conflict and its deadly impact on civilians inside Gaza on Nov. 2, 2023  with Rami Khouri, a distinguished fellow at the American University of Beirut.

Rami Khouri observes that the situation has been disastrous. He focuses on the Palestinian territories, Middle East geopolitics and American foreign policy in the region.

But, you know, part of it is the Palestinian leadership's fault, and part of it is by design of Israel to divide and conquer the Palestinians. And they've worked that very well, including by helping entrench Hamas in the Gaza Strip. I mean, this is the plan from Netanyahu as well. I mean, it's been leaked and reported in the Israeli press that he found Hamas's governance of Gaza Strip useful to him and useful to the Israelis. (The Current With Matt Galloway | Live Radio, n.d.)

The lessons from past wars on terror indicate that Netanyahu’s policy to obliterate Hamas is unrealistic. STRIKE THREE!

policy to obliterate Hamas is unrealistic

The Economist International article on Fighting Hamas comments that Hamas is at the same time a religious idea, a social movement, a political party, a government and a hybrid militia wedded to terrorism. Whatever happens in Gaza, Hamas remains a powerful political force in the West Bank.

“We will obliterate Hamas. We will triumph. It might take time, but we will end this war stronger than ever.” The words of Binyamin Netanyahu, Israel’s prime minister, are intended not only to convey resolve, but also to signal that his war in Gaza is different. No longer is Israel aiming to punish and deter Hamas. Now it wants to destroy it altogether.

In private conversations, Israeli military officials are defining the objective more narrowly: to seize the main urban centre, Gaza City; wipe out Hamas’s top political and military leadership in the territory; and destroy as much of its military capacity as possible. (Israel Needs to Resist Irrational Retaliation, 2023)

Yossi Melman, in Tel Aviv, is a defense and security analyst for Haaretz. Dan Raviv, in Washington, is a former CBS News correspondent. They write that Israel’s vow to ‘eliminate Hamas’ is unrealistic. 

Among the clearest voices saying the hostages’ welfare must come first is that of Tamir Pardo, a former head of the Mossad who was himself an IDF commando soldier. Known for thinking outside the box, he expressed to us that military rescues—even with the well-practiced expertise of Israel’s most elite fighters—would be impossible, with hostages divided into many groups in perhaps unreachable underground lairs. Pardo, and now many others in the security establishment, have reached the conclusion that negotiations are the best route to save hostages’ lives. Using Egypt and especially Qatar as mediators, four women were set free in the first releases.

While Netanyahu and the army promise to “eliminate Hamas,” that is not realistic. Hamas is an extreme Islamic ideology, a set of ideas—including total refusal to accept a Jewish state right alongside—that cannot be wiped out. But their quasi-government in Gaza can be shut down. Of course, there will then be the challenge of finding someone to govern that poverty-stricken areas needing reconstruction and a new, hopefully more positive, beginning. (Melman & Raviv, 2023)

Three strikes and you are out. The track record of Prime Minister Binyamin Netanyahu should make the insistence on policies of Gaza occupation and continuous conflict instead of negotiations toward cessation of war very likely to fail and should not be supported by the community of nations, including the United States, NATO, and the EU.

References

Chehayeb, K., & Teibel, A. (2023, October 26). Many Israelis are furious at their government's chaotic recovery efforts after Hamas attack. PBS. Retrieved November 13, 2023, from https://www.pbs.org/newshour/world/many-israelis-are-furious-at-their-governments-chaotic-recovery-efforts-after-hamas-attack 

The Current with Matt Galloway | Live Radio. (n.d.). CBC. Retrieved November 4, 2023, from https://www.cbc.ca/listen/live-radio/1-63-the-current 

Dyer, E. (2023, October 28). How Netanyahu's Hamas policy came back to haunt him — and Israel. CBC. Retrieved November 1, 2023, from https://www.cbc.ca/news/politics/netanyahu-israel-gaza-hamas-1.7010035 

Israel needs to resist irrational retaliation. (2023, October 16). The Economist. Retrieved November 10, 2023, from https://www.economist.com/international/2023/10/16/israel-needs-to-resist-irrational-retaliation 

Melman, Y., & Raviv, D. (2023, October 28). Column: Israel's Vow to 'Eliminate Hamas' Is Unrealistic. Time. Retrieved November 13, 2023, from https://time.com/6329637/israel-hamas-war-netanyahu-strategy/ 

Experts in Economics and Climate Policy

Some comments in the Chris Hatch, Zero Carbon newsletter for November 5 2023, highlight the struggle to have political pronouncements refer to expert analysis of policy like the carbon tax in Canada.

Economist's take on the Tax

“The carbon tax is dead,” laments Trevor Tombe, a professor of economics and a carbon tax supporter. “It all unravels from here” is the widespread view among economists who have been championing carbon pricing as the most “efficient” way to cut greenhouse gas emissions. (Zero Carbon Newsletter | Canada's National Observer: News & Analysis, n.d.)

Angela Köppl and Margit Schratzenstaller have published  Carbon taxation: A review of the empirical literature in the Journal of Economic Surveys. The conclusion of their study includes attention to the big picture of climate change. Public acceptance of carbon taxes can be increased by providing public information, avoiding negative distributional effects, and channeling part of the revenues into "environmental projects."

Environmental taxes in general and carbon taxes in particular need to be considered in a broader perspective in the context of climate change, and it is important to keep in mind that the transition to climate neutrality requires a profound structural change that cannot be achieved through incremental (political) steps. The focus therefore needs to be on a broader policy mix that integrates a wide range of policy interventions such as price-based instruments, subsidies, standards, and public infrastructure investments, and not to forget the greening of finance. (Köppl & Schratzenstaller, 2019)

The researchers have made several recommendations that can be derived based on the results presented in their report.

✔️		Eight Characteristics of Effective Carbon Tax Policy
	1	Carbon tax at a sufficiently high level to trigger emissions reduction and innovation.
	2	Two contradicting objectives need to be balanced carefully. Exemptions will undermine environmental effectiveness of carbon taxes and will improve acceptance and public support.
	3	Revenue recycling is important to increase public support and acceptance and to mitigate undesirable distributional effects. Recycling schemes should be created in a way to support innovation and employment.
	4	Revenue recycling schemes cutting the labor tax burden seem to be more favorable regarding macroeconomic effects compared to lump-sum revenue recycling, whereas the latter is more supportive regarding public acceptance. Policymakers therefore should consider both mechanisms when designing carbon taxes and recycling schemes.
	5	Compensation measures to cushion off regressive effects should also account for socio-demographic household characteristics.
	6	Information and communication are important to secure public support for carbon taxes. On the positive impact of the carbon tax on emissions reduction and on the future costs of inaction in a business-as-usual scenario.
	7	Present the broad theoretical and empirical consensus on the usefulness of environmental taxes in general and carbon taxes in particular. Take into account both the system boundaries and the specific political context as well as general socioeconomic conditions and policy styles in the country concerned.
	8	More evidence is needed to enable the diffusion of experience and knowledge gained on the effectiveness of climate policy instruments across countries.

First of all, carbon tax rates should be implemented at a sufficiently high level in order to trigger emissions reduction and innovation.

Second, exemptions which on the one hand very likely will undermine environmental effectiveness of carbon taxes, will on the other hand improve acceptance and public support; therefore, these two contradicting objectives need to be balanced carefully.

 

Third, revenue recycling is important: to increase public support and acceptance, but also to mitigate undesirable distributional effects. If possible, recycling schemes should be created in a way to support innovation and employment. 

Fourth, revenue recycling schemes cutting the labor tax burden seem to be more favorable regarding macroeconomic effects compared to lump-sum revenue recycling, whereas the latter is more supportive regarding public acceptance. Policymakers therefore should consider both mechanisms when designing carbon taxes and recycling schemes.

 

Fifth, compensation measures to cushion off regressive effects should not only consider vertical distributional effects, but should also account for horizontal aspects, that is, socio-demographic household characteristics. 

Sixth, information and communication are important to secure public support for carbon taxes: not only with regard to the positive impact of the carbon tax on emissions reduction and further co-benefits, but also the future costs of inaction in a business-as-usual scenario.

Finally, apart from the broad theoretical and empirical consensus on the usefulness of environmental taxes in general and carbon taxes in particular, any specific policy reform must take into account both the system boundaries and the specific political context as well as general socioeconomic conditions and policy styles in the country concerned.

Last but not least, more ex-post evidence is urgently needed to enable the diffusion of experience and knowledge gained on the effectiveness of climate policy instruments across countries (Carraro et al., 2015), as informed policymaking requires sufficient empirical evidence (Green, 2021). (Köppl & Schratzenstaller, 2019)

Chris Hatch, in the Zero Carbon newsletter, regrets that the debate has become fixated on carbon taxes instead of carbon emissions. 

You’ll often hear that carbon pricing is the cheapest way to drive cuts in climate pollution. And that there’s evidence it works. That evidence exists but, frankly, it’s not overwhelming. Pricing does seem to work but the effects are modest and usually accompanied by bigger carbon cuts from regulations.

There seems to be no way forward that won’t be a messy combination where regulation does the heavy lifting supplemented by pricing and incentives. Industry always fights regulations but there’s a long history of successful ones that industries claimed they could never survive.

How did Ontario phase out coal? Regulations.

How is Alberta phasing out coal? A combination of regulations and pricing.

How did we get lead out of gasoline? Regulations. 

Acid rain? Regulations that allowed pricing and trading. 

The ozone hole? A regulated phaseout of the chemicals causing the problem. (Zero Carbon Newsletter | Canada's National Observer: News & Analysis, n.d.)

The rejuvenation of carbon pricing in Canada should be based on the research and expertise of economists who have a track record of research in the subject. The “feeling” of disgruntled provincial premiers and the populist dog whistle of “Axe the Tax” are political slogans that do nothing to advance our need for programs that are based in the research of experts and our experience with past regulatory regimes to effect the changes necessary to reduce the extremely expensive damage from future wildfires, floods, and hurricanes.

References

Köppl, A., & Schratzenstaller, M. (2019, March 9). Carbon taxation: A review of the empirical literature. Wiley OnLine Library. Retrieved November 8, 2023, from https://onlinelibrary.wiley.com/doi/full/10.1111/ 

Zero Carbon newsletter | Canada's National Observer: News & Analysis. (n.d.). National Observer. Retrieved November 8, 2023, from https://www.nationalobserver.com/newsletters/zero-carbon