Is this an economic truth?
From Michael Hinka - CBC Commentator:
Hlinka draws parallels between the Bank of Canada and its Swiss equivalent, which announced last week it was cutting its benchmark interest rate from one-quarter of a per cent to as close to zero as possible.
With unemployment at 3.2 per cent and an economy that is growing at two per cent in the midst of all the turmoil in Europe, the Swiss are the envy of the world.
"They're terrified that the appreciation of the Swiss franc is going to upset that apple cart," says Hlinka.
"So their public policy makers and central bank is saying, 'We'd much rather run the risk of creating an asset bubble, instead of sitting and watching the Swiss franc appreciate day after day and make the products we export to the rest of the world utterly uncompetitive,'" says Hlinka.
Switzerland's major trading partners are in the EU, while Canada's major trading partner is the U.S. Switzerland's economy is much healthier than its peers in the EU, just as Canada's economy is much healthier than the U.S.'s.
But Hlinka warns there is a risk in cutting interest rates.
"I feel like the wild-eyed Cassandra inside the gates of Troy who said 'Don't bring in that statue. It can lead to no good.'"
Rather than addressing fundamental economic problems, public policy makers are playing on the margins with factors that have nothing to do with what the real issues are, such as structural imbalances in the economy, says Hlinka.
"The public sector is too big relative to the private sector in the developed countries of the world. The public sector has a much better deal in terms of wages, benefits, job security, and working conditions, and it's creating a two-tier society of haves and have-nots."
The private sector creates wealth while the public sector distributes it, and the result of the imbalance is there are too many people who are working to distribute the wealth and too few people who are working to create it, according to Hlinka.
"By the way, these are very unpopular things to say and I'm the first to admit it."
It's an easier fix to fiddle with interest rates, rather than tackle politically sensitive issues, says Hlinka.
Not wearing pants.
Why do you think Harper is in Brazil courting Latin American business interests?
I'll agree with you on that one. WAY too many people in the public sector.
But, you should still comment on your own topics K-Rod.
It seems as though when I do, because I often tend to summarize enormous amounts of information into nuclear conclusions/pithy statements, somebody on here seems to always take offense (the truth often rubs against people's sensibilities and chosen illusions), so by posting the above, I was able to pass the original statement onto another's shoulders ... AND post it as a question at the same time.
Originally Posted by J_Scott
The article's message reminds me of a joke I once heard:
How many public employees does it take to change a lightbulb?
At least two: - one engineer to screw in the fixture
- and one public relations expert, to assur the public everything possible
is being done
I like seeing someone on the public broadcaster complaining the public sector needs it's fat trimmed.
He can demonstrate he's not a hypocrite by leaving.