Newsline Canada
 

Recession packs biggest wallop since 1930s: Study http://www.policyalternatives.ca/news/2009/04/pressrelease2206/?pa=A2286B2A April 28, 2009 | National Office | Topic(s): Economy & economic indicators, Employment & labour, Inequality & poverty | Publication Type: Press Release OTTAWA – This recession is hitting Canada harder and faster than any previous downturn and Canadians are more exposed to economic ruin than they’ve been since the 1930s, says a report released by the Canadian Centre for Policy Alternatives (CCPA). Exposed: Revealing Truths About Canada’s Recession examines the previous 13 economic downturns and discovers two troubling signs: no other recession since the Great Depression has come on this strong and Canadians face greater vulnerability than at any time since the 1940s because of low savings, high household debt and a weakened social safety net. “Canada may have come late to the global recession, but the economic downturn is hitting the country with a force that is unparalleled in post-war economic history,” says CCPA Senior Economist Armine Yalnizyan, who authored the report. The report notes Canada’s GDP drop and job loss figures have come on far more rapidly than any previous recession. It also raises a warning flag from the last two major recessions – the early 1980s and 1990s – which consisted of deep and prolonged job loss. “The loss of 387,000 full-time jobs to date could well be just the tip of the iceberg,” says Yalnizyan. “Judging from past recessions, more job losses may be on the way. Canada took four years to restore the full-time jobs lost in the 1980s recession and seven years to restore 1990s recession job losses. Recovery could take years.” Canadians are more vulnerable to financial ruin that any recession since the Great Depression. The report finds Canadians have the weakest unemployment insurance system since the 1940s; their personal savings rates low, comparable to those of the 1930s; and household debt levels were at a record high even before the recession began. The report recommends improving benefits for the unemployed, given six of out 10 unemployed Canadians don’t get jobless benefits today. In the last recession, only two out of ten unemployed had no income protection.

Deceptive economic glimmers http://www.thestar.com/printArticle/625937 Excerpt from: April 29, 2009 | Thomas Walkom Around the corner from where I live, two more houses were just sold. They serve as visible reminders that Toronto isn't Fort Myers, that the housing market here isn't as bad as it is in the United States and that global recessions don't affect all countries equally. That made me a little less depressed about the future – until I happened upon a study by Toronto economist Armine Yalnizyan that argues (convincingly, I'm afraid) that the worst is yet to come. Her paper, to be released today by the Canadian Centre for Policy Alternatives, looks at the current downturn in the context of previous economic recessions and concludes that, yes, this one really promises to be bad. Consider: Canada has experienced six recessions (defined as two consecutive three-month periods of economic shrinkage) since 1926, but until now only three have been serious – the Depression of the '30s, the slump of the early '80s and the contraction of the early '90s. This time, the economy is shrinking faster than it did in either the '80s or the '90s. As a result, Canada has lost more jobs, both in absolute and relative terms, than it did during the first few months of those two earlier recessions. Unlike other postwar recessions, we can't count on the U.S. pulling us out. In many ways, it's in more trouble than we are. We're more vulnerable to recession than at any time since the 1930s. Households are struggling with debt (on average, Canadians now owe $1.40 for every $1 of disposable income). We're saving only a tiny fraction of the income we earn and much of what we have saved has been wiped out by the financial crisis. The unemployment insurance system is in worse shape than it has ever been since it was set up after World War II. When the recession of the '90s hit, about 80 per cent of the jobless were eligible for what is now called Employment Insurance. Today the figure is half that. Conventional wisdom holds that, as an exporting country, Canada has little choice but to wait for the rest of the world to recover. Yalnizyan's paper shows that this wasn't always the case. Thanks to free trade and the elimination of tariffs, Canada's economy today is more dependent on exports than at any point since the Depression. For instance, we didn't rely on the vagaries of export markets alone to pull us through the slumps of the '80s and '90s. In those recoveries, domestic spending was more important. Yet in spite of this export dependence, we can no longer count on free-spending Americans to rescue us. Hobbled by debt, they are retrenching from the heady days when they bought everything Canadians could offer. How long will this one last? Here, too, the past fails to provide cheering examples. Technically, recessions are over when the economy starts growing again. By that measure, the Great Depression of the '30s lasted only four years, and the recession of the '80s just 18 months. But in terms of human cost, the effects linger on. In the Great Depression, it took more than 12 years for the unemployment rate to return to 1929 levels. By a similar measure, the recession of the '80s lasted seven years. Yalnizyan's remedy for this slump is to have government do more, more and more again – for the simple reason that there is nowhere else to turn. She makes a convincing case that Canada, in spite of entering this downturn from a relatively strong position, is more exposed than it has been at any time since the 1930s. Thomas Walkom's column appears Wednesday and Saturday.

Kenyan Catholic bishops say country's political leaders must step up http://www.catholicregister.org/content/view/16/87/ NAIROBI, Kenya (CNS) -- Kenya's Catholic bishops said the country's political leaders have ignored the needs of Kenyans and pursued their own selfish interests. 'Goods and wealth which rightfully belong to the people are being arrogantly misappropriated,' members of the Kenya Episcopal Conference said in a statement released April 27 following their general meeting in Nairobi. Manipulation along tribal lines is dividing rather than bringing people together, said the bishops. Human rights are being violated and religion is being used to justify the lust for power, they said. 'There is a feeling that one can get away with anything if money is available,' the bishops said. 'The saying that 'no stone will be left unturned' is the slogan for the culture of lies.' People have lost their respect for the basic institutions of the state, the provincial administration, police, the elders and the family, they said. The bishops said they believe elected officials are capable 'of showing the necessary leadership to bring about a renaissance in our country' but they must act together now.