stimulus – mackaycartoons

Friday May 15, 2020

May 22, 2020 by Graeme MacKay

May 15, 2020

Editorial Cartoon by Graeme MacKay, The Hamilton Spectator – Friday May 15, 2020

CFL could lose $100 million if season lost

The CFL commissioner says that a repayable loan would be among the possibilities within the league’s request to the federal government for up to $150 million in financial assistance.

November 21, 2012

“The one point that hasn’t come out so far is that we’ve said to the government we’re prepared to be creative, and consider all options to be on the table, ” Randy Ambrosie told The Spectator on Wednesday morning. “Ultimately, we just want to find a way to get through this crisis together and we’re prepared to talk to the government about anything.”

Tuesday night, Ambrosie told Dan Ralph of The Canadian Press that in the request the league’s accountability to taxpayers would include, “community programs, tourism promotion, the Grey Cup, our digital channels.” But a loan was not specificially mentioned.

August 23, 2014

Those are positive things the CFL already does and Ambrosie did not mention then the prospect of any kind of loan. But, on Wednesday, he said a loan would be among the things that the CFL would be willing to discuss with the federal government.

The CFL financial proposal to the government is three-tiered: $30 million to manage the impact the pandemic has already had on CFL business; further assistance if there’s a shortened regular season; and up to another $120 million should the league have to collapse its entire season.

Ambrosie reiterated Wednesday that if the CFL cannot play at all in 2020 it might imperil the league’s future because the cumulative loss “could be $100-plus million. Those are actual P &L (profit and loss statement) losses.”

There has been understandable negative reaction to the questionable optics of what appeared to be a straight bailout to a league in which six of the nine teams are privately-owned, including Bob Young’s Hamilton Tiger-Cats. Ambrosie said he understands that sentiment.

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“We are not tone-deaf to the realities of all this but we also know that this crisis will end and Canadians will need to get back to things which bring joy and passion to life,” Ambrosie said. “Sports is part of that and the CFL is a really big part. It’s not appropriate to just hope that this crisis passes: somebody famously said that hope is not a plan.

It has long been the opinion in this space that while the CFL must always operate as a sustainable business and league, it is, and has been first and foremost a cultural institution. The failure to grasp that — at various times in the past even some franchise owners themselves have done that — is to misunderstand its role in this country, and the unifying place of the 111-year-old Grey Cup game, which is much older than the formal league itself.

The CFL seems to welcome a broader discussion on whether it is indeed a necessary cultural institution, differentiated from the NHL, NBA and MLB, leagues with headquarters and most of their teams in the U.S. Ambrosie feels its history, consistent local-employment factor, and the historic durability and surging financial impact of the Grey Cup festival arguably separate it from other domestic leagues as well.

“We are so different than every other sports league on the planet,” Ambrosie told The Spectator. “And what we do in our communities really matters. The tone we’ve set for generations and generations has been so consistent with Canadian values. We are more than a sports league.” (Steve Milton – Hamilton Spectator)

Thursday May 7, 2020

May 14, 2020 by Graeme MacKay

Editorial Cartoon by Graeme MacKay, The Hamilton Spectator – Thursday May 7, 2020

Farmers expected a miracle. No wonder they’re disappointed by Ottawa’s aid package

July 29, 2014

When the Canadian Federation of Agriculture laid out a $2.6-billion ask last week to help farmers endure the COVID-19 pandemic, they were setting the bar very high. And so it is little wonder that Prime Minister Justin Trudeau’s Tuesday announcement of a program worth barely $252-million sent the farming community reeling.

Fair enough. The funding announcement was indeed underwhelming, and it will not be enough to get some of those on the precipice to stick around. Many will exit the industry, regrettably. Our preannouncement estimates were that as many as 15 per cent of our farms could be lost by year’s end due to COVID-19; Ottawa’s plans will not change that.

August 10, 2019

The $125-million program to support livestock raises a variety of questions. Executing the program will take time, something producers do not have. Few details were given about the role of provinces or how much farmers will receive. The measures presented will likely not prevent more animals from being euthanized in the days to come. Along with milk dumping, COVID-19 is serving up case studies on a silver platter for animal-rights activists. It’s a shame that our farmers have been put in this position.

May 22, 2019

Losing farms will not compromise our nation’s food security, however. Farmland doesn’t just disappear, as it can always be exploited by someone else. But the most significant concern is how we can create jobs and wealth in rural economies located far from urban centres. This should be a priority; occupying our vast nation’s topography should be top of mind, from coast to coast to coast. Ottawa doesn’t show that it cares for rural communities enough – or for agriculture, for that matter – but it should, before it’s too late.

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Its response to farmers pleading for help was unsurprisingly slow as well. In the United States and Europe, most governments have provided pandemic-related financial aid directly to farmers weeks ago. In the United States, every American is providing $86 in support for agriculture by way of government-sanctioned programs; in Europe, it is over $90 per capita. Here in Canada, each of us giving six measly dollars to support agriculture. Farmers have every right to be disappointed. (Globe & Mail)

Friday April 16, 2020

April 24, 2020 by Graeme MacKay

Editorial Cartoon by Graeme MacKay, The Hamilton Spectator – Friday April 16, 2020

The Bank of Canada rolls the dice

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If desperate pandemic times demand desperate government actions, the Bank of Canada just delivered big-time.

It’s printing money out of thin air to fund an estimated $200-billion-plus spending-spree intended to keep the nation’s economy alive.

The best name for this historic and, frankly, alarming intervention is quantitative easing, and every Canadian should pay close attention to what amounts to a roll of the dice by their central bank.

That’s because while quantitative easing is justified under the circumstances, it’s unconventional, controversial and highly risky. Our 85-year-old central bank has never tried it before, and no wonder. It may cure what’s ailing the Canadian economy today only to infect it with new illnesses a year from now.

It all began at the end of March when the Bank of Canada announced it would spend at least $5 billion a week in the coming months to buy Government of Canada bonds on the open market. In other words, it would buy up much of the federal government’s debt.

That action was meant to ease the pressure on the federal government’s growing debt burden while injecting badly-needed cash into an economy ravaged by the COVID-19 pandemic.

And that part of quantitative easing makes sense because it works. The mind-bending part of it comes with the realization that all these billions of dollars are being created digitally.

It’s as if Bank of Canada Governor Stephen Poloz had donned a magician’s cape, put his hand into a top hat and — poof — the Canadian economy had what it needed to buy its way out of this crisis.

What Poloz did was correct, according to experts such as former Bank of Canada governor David Dodge. At the time of Poloz’s intervention, the rapid spread of COVID-19 across Canada had already triggered government-imposed business shutdowns, huge job losses and what could become the nation’s sharpest economic downturn ever.

The federal government was mobilizing its fiscal forces to prop up revenue-starved businesses and extend a financial lifeline to the newly unemployed, whose numbers could reach 2.8 million this month.

Other governments around the world were doing the same. And other central banks, most notably in the United States, the United Kingdom and the European Union, were also playing their part by making new money to ease the debt loads of their governments.

The Bank of Canada doubled down on that strategy this week when it expanded its bond-buying program to include purchases on the open market of the debts of provincial governments and corporations. They need help, too, but it will mean pulling another $50 billion in new, digitally-created money out of Poloz’s magic hat.

The sheer magnitude of all this newly manufactured cash is worrisome. If countries can get everything they want by simply printing more money, why doesn’t everyone do it all the time?

The answer is the world’s financial markets wouldn’t let them get away with it. The U.S. Fed and the European Central Bank are considered to be big and powerful enough to do what they deem necessary.

Canada, with its much smaller economy, probably won’t be cut the same slack. The value of its currency may slide if quantitative easing lasts too long. Inflation could rise to unmanageable levels even as millions of Canadians remain unemployed and the nation’s economic engines are struggling to fire on all cylinders.

This spring, the Bank of Canada had no choice but to experiment with quantitative easing. In short order, it must provide Canadians with a plan and timetable for getting out of it.

Canada, with its much smaller economy, probably won’t be cut the same slack. The value of its currency may slide if quantitative easing lasts too long. Inflation could rise to unmanageable levels even as millions of Canadians remain unemployed and the nation’s economic engines are struggling to fire on all cylinders.

This spring, the Bank of Canada had no choice but to experiment with quantitative easing. In short order, it must provide Canadians with a plan and timetable for getting out of it. (Hamilton Spectator Editorial)

Saturday August 29, 2015

August 28, 2015 by Graeme MacKay

By Graeme MacKay, Editorial Cartoonist, The Hamilton Spectator – Saturday August 29, 2015

Justin Trudeau alters election equation with deficit-spending gamble

Justin Trudeau has just broken this election campaign wide open. His Liberals have chucked the balanced-budget pledge, at least in the short term, to promise economic growth instead. And now Mr. Trudeau gets to offer a different economic policy.

2009

It makes the Liberals the interventionist party, the only party willing to tell voters they’d spend substantially more in the short term in a bid to get a slow economy rolling.

2008

It’s in part an effort to outflank NDP Leader Thomas Mulcair, who won’t make those kinds of promises. Many Canadians want a more interventionist approach: A Nanos Research poll released Wednesday found 54 per cent say they support a new round of deficit spending to boost the economy.

But it is a big gamble with a charged political symbol, the deficit. Mr. Trudeau is walking right into Conservative Leader Stephen Harper’s accusation that he’d increase the national debt. Still, the economy is the issue, and the Liberal Leader has altered the election equation.

1997

Until now, all parties had accepted they were constrained by more or less the same shackles: balanced budgets, and roughly the same tax rates, give or take a small shift of the burden toward one group or another.

That meant big money wasn’t available. Parties could shift a few billion dollars around, and then claim their child benefits or child care or tax breaks were the best plan. But one major option – using the federal treasury in a bid to boost economic growth – was more or less off the table. It takes billions and billions to have any real hope of nudging growth in an economy the size of Canada’s.

Now, Mr. Trudeau has thrown off the restraints and said he’ll run deficits of up to $10-billion a year for three years in order to allow for a multibillion-dollar increase in spending on infrastructure, raising it from $5.1-billion to $10.2-billion next year. He’s gone where no other leader will go. (Source: Globe & Mail)

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Tuesday February 14, 2012

February 14, 2012 by Graeme MacKay

By Graeme MacKay, The Hamilton Spectator, Tuesday February 14, 2012

How Ontario’s ‘stimulus’ spending led to disaster

The fiscal mess in Ontario is now common knowledge across the country, thanks in part to a sensational report from the Conference Board of Canada demonstrating that unless the government slashes spending and/or raises taxes, health care and education will have to be decimated. The report was no surprise to people who tracked Premier Dalton McGuinty’s march into Keynesian fiscal stimulus spending.

If we can’t expect politicians to take the blame for following the Keynesian deficit-spending policies advocated by their economic advisors, shouldn’t we turn to the economic experts to get them to explain themselves? The same people who supported and advised the McGuinty Liberals — and the Obama Democrats, the Greek and Portuguese politicians, the French and Canadian governments — to run up spending to rescue the economy will spend the next decade telling governments how to get out of the mess they helped create.

Ontario’s current circumstances create a perfect opportunity to confront the economic establishment and lay blame for the fiscal disaster that is Ontario. Government spending has been soaring for years. It all looks good if growth rates stay strong. Where were the dire economic warnings through the last decade that the expansion in government activity cannot continue without hitting a wall?

A table on Ontario’s spending habits (above) captures the disconnect between the government and the people. While the personal income of the people dragged at 26% growth, government spending soared more than 60%.

On Wednesday, former TD Bank economist Don Drummond will deliver a set of tax and spending options to the McGuinty government, a road map on how the province can resolve its fiscal problems. (Source: Financial Post)