Economy
Canadians experiencing second-longest and third steepest decline in living standards in last 40 years
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From the Fraser Institute
From 2019 to 2023, Canadian living standards declined—and as of the end of 2023, the decline had not yet ended, finds a new study published today by the Fraser Institute, an independent, non-partisan Canadian public policy think-tank.
“Despite claims to the contrary, living standards are declining in Canada,” said Grady Munro, policy analyst at the Fraser Institute and co-author of Changes in Per-Person GDP (Income): 1985 to 2023.
Specifically, from April 2019 to the end of 2023, inflation-adjusted per-person GDP, a broad measure of living standards, declined from $59,905 to $58,111 or by 3.0 per cent. This decline is exceeded only by the decline in 1989 to 1992 (-5.3 per cent) and 2008 to 2009 (-5.2 per cent). In other words, it’s the third-steepest decline in 40 years.
Moreover, the latest decline (which comprises 18 fiscal quarters) is already the second-longest in the last 40 years, surpassed only by the decline from 1989 to 1994 (which lasted 21 quarters). And if not stabilized in 2024, this decline could be the steepest and longest in four decades.
“The severity of the decline in living standards should be a wake-up call for policymakers across Canada to immediately enact fundamental policy reforms to help spur economic growth and productivity,” said Jason Clemens, study co-author and executive vice-president at the Fraser Institute.
- Real GDP per person is a broad measure of incomes (and consequently living standards). This paper analyzes changes in quarterly per-person GDP, adjusted for inflation from 1985 through to the end of 2023, the most recent data available at the time of writing.
- The study assesses the length (number of quarters) as well the percentage decline and the length of time required to recover the income lost during the decline.
- Over the period covered (1985 to 2023), Canada experienced nine periods of decline and recovery in real GDP per person.
- Of those nine periods, three (Q2 1989 to Q3 1994, Q3 2008 to Q4 2011, and Q2 2019 to Q2 2022) were most severe when comparing the length and depth of the declines along with number of quarters required for real GDP per person to recover.
- The experience following Q2 2019 is unlike any decline and recovery since 1985 because, though per person GDP recovered for one quarter in Q2 2022, it immediately began declining again and by Q4 2023 remains below the level in Q2 2019.
- This lack of meaningful recovery suggests that since mid-2019, Canada has experienced one of the longest and deepest declines in real GDP per person since 1985, exceeded only by the decline and recovery from Q2 1989 to Q3 1994.
- If per-capita GDP does not recover in 2024, this period may be the longest and largest decline in per-person GDP over the last four decades.
Read the Full Report
Authors:
Business
ESG will impose considerable harm on Canadian workers, doesn’t reflect the reality of how markets actually work
![](https://www.todayville.com/wp-content/uploads/2024/08/tvrd-fi-esg-its-time-move-on-image-2024-08-27.jpg)
From the Fraser Institute
By Steven Globerman, Jack Mintz, and Bryce Tingle
The ESG movement—which calls for public companies and investors in public companies to identify and voluntarily implement environmental, social, and governance initiatives—will cause substantial harm to the economy and
workers, finds two new essays by the Fraser Institute, an independent, non-partisan Canadian public policy think-tank.
“Investor support for ESG is starting to wane, which isn’t surprising as the considerable harms ESG mandates pose come to light,” said Steven Globerman, resident scholar at the Fraser Institute and author of It’s Time to Move on from ESG.
The essay summarizes the arguments against imposing top-down ESG mandates. In particular, evidence shows that (1) ESG-branded investment funds do not perform better than conventional investment funds, (2) companies that proclaim to pursue ESG-related activities are not more profitable than companies that do not, and (3) mandating ESG-related corporate disclosures imposes additional costs on public companies and diverts resources away from productivity-enhancing investments, harming workers.
A separate new essay in the Institute’s series on ESG, Putting Economics Back into ESG written by Jack Mintz and Bryce Tingle of the University of Calgary, highlights how the current concept of ESG mandates being pursued in Canada are incompatible with basic economic theory and fail to understand how markets actually work. As a result, ESG mandates will (1) discourage new businesses from locating in Canada, (2) investors will be reluctant to invest in Canada, (3) Canadian companies will be less competitive than their international peers, (4) capital will leave Canada for jurisdictions without restrictive ESG mandates, and (5) economic growth will slow and workers will suffer as a result.
But these harms can be minimized if the definition of what constitutes ESG is expanded, securities commissions are not tasked with regulating ESG, but instead focus on ensuring market integrity, and if governments prosecute fraud in ESG branded funds, and likewise, governments impose liability for the use of ESG ratings, which have been found to be invalid and unreliable.
Crucially, both essays conclude that public policy objectives, such as those addressed by ESG initiatives, should be decided by and acted on by democratically elected governments, not private sector actors.
“There is no reason to believe that managers and business executives enjoy any comparative advantage in identifying and implementing broad environmental and social policies compared to politicians and regulators,” said Globerman.
“The evidence is clear—the private sector best serves the interests of society when it focuses on maximizing shareholder wealth within the confines of the established laws, not complying with top-down imposed ESG mandates that will harm the economy and ultimately Canadian workers.”
- The ESG movement calls for public companies and investors in public companies to identify and voluntarily implement environmental, social, and governance initiatives—ostensibly in the public interest.
- One school of thought supporting ESG is that doing so will make companies more profitable and thereby increase the wealth of their shareholders.
- However, academic research to date has failed to identify a consistent and statistically significant positive relationship between corporate ESG ratings and the stock market performance of companies.
- In fact, research instead suggests that adopting an ESG-intensive model might compromise the efficient production and distribution of goods and services and thereby slow the overall rate of real economic growth. Slower real economic growth means societies will be less able to afford investments to address environmental and other ESG-related priorities.
- The second school of thought is that companies, their senior managers, and their boards have an ethical obligation to implement ESG initiatives that go beyond simply complying with existing laws and regulations, even if it means reduced profitability. However, corporate managers and board members cannot and should not be expected to determine public policy priorities. The latter should be identified by democratic means and not by unelected private sector managers or investors.
- Given that there are indications that investor support for ESG is waning, it is apparent that the time has come for corporate leaders and politicians to acknowledge that it’s time to move on from ESG.
Authors:
Business
Canadian Conservatives look to gather support for bill banning a central bank digital currency
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From LifeSiteNews
Bill C-400, sponsored by Conservative MP Ted Falk, seeks to ensure that a central bank digital currency is never created and that Canadians will always be able to use physical cash in the settling of debts and other financial transactions.
Canada’s Conservative Party is looking to gather support for a bill that would outright ban the federal government from creating a central bank digital currency (CBDC) and make it so that cash is kept as the preferred means of settling debts.
The bill, dubbed the Framework on the Access to and Use of Cash Act, or Bill C-400, is sponsored by Conservative MP Ted Falk and already passed its first reading back in June of 2024. It is currently awaiting its second reading.
According to Falk, for “millions of Canadians,” notably “vulnerable folks in our population,” the use of “physical cash is essential to everyday life.”
“Likewise, charities, community organizations, and remote communities rely on cash to achieve their worthy goals,” he said while speaking of his bill.
“Finally, in a world where governments, banks, and corporations are increasingly infringing on the privacy rights of Canadians, cash remains the only truly anonymous form of payment.”
At its core, Bill C-400, if passed, would allow for a national framework to be made which would ensure that Canadians always have access to and can use cash. It would also amend Canada’s Currency Act to restrict the current finance minister’s ability to suddenly put out a call that all bank notes be recalled. Finally, the bill would amend the Bank of Canada Act to ban it from creating any form of digital dollar.
The bill also calls for ways to “incentivize businesses and creditors to accept payments made in cash,” as well as to “remove barriers and disincentives in relation to donations made in cash to non-profit organizations and community organizations without compromising efforts to curtail money laundering, fraud and other financial crimes.”
As previously reported by LifeSiteNews, an overwhelming majority of Canadians want the government and the Bank of Canada (BOC) to “leave cash alone” and not proceed with the creation of a so-called “digital dollar.” The feedback came after the BOC launched a public survey to gauge Canadians’ taste for a digital dollar.
Despite the bill before Parliament and the survey, as previously reported by LifeSiteNews, the BOC has already forged ahead by filing a trademark for a “digital” buck.
Conservative leader Pierre Poilievre has before promised that if he is elected prime minister come the next election, he would stop any implementation of a “digital currency” or a compulsory “digital ID” system.
As recently as a week ago he posted on X about protecting “cash.”
“Ban central bank digital currency, protect your freedom to use cash, and get the government out of your wallet. Proud to support @MPTedFalk‘s common sense Conservative Bill C-400 to protect the privacy & freedom of Canadians,” Poilievre wrote.
Ban central bank digital currency, protect your freedom to use cash, and get the government out of your wallet.
Proud to support @MPTedFalk's common sense Conservative Bill C-400 to protect the privacy & freedom of Canadians.https://t.co/NeqCsSS5fh pic.twitter.com/ft21ISLKdC
— Pierre Poilievre (@PierrePoilievre) August 12, 2024
Digital currencies have been touted as the future by some government officials, but, as LifeSiteNews has reported before, many experts warn that such technology would ultimately restrict freedom and be used as a “control tool” against citizens similar to China’s pervasive social credit system.
Prominent opponents of CBDCs have been strongly advocating that citizens use cash whenever possible and boycott businesses that do not accept cash payments as a means of slowing down the imposition of CBDCs.
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