Raising Minimum wage to Living Wage:
Many studies have shown that Canada needs to raise their minimum wage rate to living wage rate. For example, take Ontario, which the highest provincial minimum wage rate in Canada for 2012 at $10.25. The average living wage rate in Toronto back in 2008 was calculated around $16. Since then inflation has had a steady increase in Toronto – one could guess that the actual living wage rate is now around $18.
The government can’t just produce currency and introduce it into the market by increasing minimum wage as that would result in the Canadian currency being overvalued. One possible way to help increase minimum wage is by changing the tax bracket (shown below).
CURRENT PERSONAL INCOME TAX BRACKETS:
[Income / Tax rate]
Less than $41,544 / %15
$41,544 – $83,088 / %22
$83,088 – $128,800 / %26
Over $128,800 / %29
PROPOSED INCOME TAX BRACKETS:
[Income / Tax rate]
Less than $21,000 / %7
$21,000 – $35,000 / %15
$35,000 – $50,000 / %22
$50,000 – $75,000 / %26
$75,000 – $100,000 / %30
$100,000 – $150,000 / %34
Over $150,000 / %38
This will not only allow the lower – middle class to save but also allow the government to collect from the upper classes to spend on minimum wage; among other things.
Now there are many economic reports that condemn raising minimum wage rate. The argument being that raising minimum wage would increase unemployment since employers would not want to pay and potentially hire illegal workers at a lower rate.
However, David Madland, Director of the American Worker Project at the Center for American Progress Action Fund states, “Raising the minimum wage does not kill jobs— even during periods of high unemployment,” he said, but instead encourages spending, investment, and economic growth. There are economic models that argue and support this claim as well.
In conclusion, economic models and predictions should not deter Canada from providing citizens the right to live, shelter, clean water, food, and other human rights.
The Bank of Canada may not be able to keep interest rate hold (1%) for much longer. Given Canada’s strong growth over the year, despite a weak final quarter of 2011, has changed predictions that the output gap will close as early as 2013, three quarters earlier than previous expectations.
What effect would this have on Canada for the coming years?
Domestically, the overall effect of a higher interest rate decreases the demand for goods at any level of output; higher the interest rate implies a lower level of output. In addition the increase would also reduce real money supply (money stock in terms of goods, not dollars).
In other words; higher interest rates would make it harder for companies/consumers to invest in products. For example, higher mortgages on houses or higher costs on investment. You can expect the housing market to decrease if not become more expensive.
Globally, the increase in domestic interest rate leads to an appreciation of domestic currency. Save a linear increase in the foreign interest rate, the exchange rate would decrease making Canada more prominent for trading.
Currently Canada stands at almost a 1:1 exchange rate with America, the ideal exchange rate would be 0.80c for every American dollar. This would increase exports from Canada, who has naturally been a export country, and decrease imports increasing overall GDP. This in addition to future improved trading plans with China will benefit Canada in the long run.
Overall, my view as of this moment is that Canada should let interest rates increase naturally without any monetary or fiscal policy save drastic inflation results. Canada within the next year should start seeing itself being back to exporting goods to other nations and focus on fixing its national debt.
"Stocks are trading sharply lower at midday after a dismal report on the job market stifled hopes for a quick economic rebound.
The Labor Department says only 18,000 jobs were created in the U.S. last month, the fewest in nine months”
Not that surprising. Unemployment is still very high in America. Too bad journalist don’t know the calculation for unemployment rate.
”..Harold Camping and his devoted followers claim a massive earthquake will mark the second coming of Jesus, or so-called Judgment Day on Saturday, May 21, ushering in a five month period of catastrophes before the world comes to a complete end in October.
At the center of it all, Camping’s organization, Family Radio, is perfectly happy to take your money — and in fact, received $80 million in contributions between 2005 and 2009 …” My friend once told me something I’ll never forget. If there is a reason to something its almost always for money.
At the center of it all, Camping’s organization, Family Radio, is perfectly happy to take your money — and in fact, received $80 million in contributions between 2005 and 2009
My friend once told me something I’ll never forget. If there is a reason to something its almost always for money.
Shares went up from 45 to 94.25 in a matter of 24 hours.
Interesting read. If nothing else look up, analyze, and see how good his stocks will hold.
Interesting article. Nothing to quote or snip, just something that’s soaking in my mind.