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PeakTrader said...
With so many natural resources, and few people, why is Canada's standard of living so low?:

Canada's living standard 9th among 17 top nations: conference board
October 27, 2008

Canada's standard of living slid five spots to ninth among the world's 17 top industrialized nations in the past two decades, according to a report from the Conference Board of Canada.

Canada's per-person income is approximately $6,400 less than the U.S. average income, a gap that has doubled between 1984 and 2006.

"Lower labour productivity accounts for the largest component of the income gap between Canada and the United States," the conference board said.

"Canada needs to boost investment in resource sectors by eliminating the capital tax on businesses and removing remaining internal trade barriers, such as restrictions on interprovincial log trade in the forest sector," said board president and chief executive officer Anne Golden.

Canada received its worst marks in "innovation," where the country scored a "D."

My comment: A lack of financial innovation may explain why houses in Canada are so small compared to the U.S.

Typically, there can't be a bust without a boom. However, there can be a more stable and stagnant economy while other economies go through booms and busts.

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Canadian said...
Oh, where to start...LOL

It is a widely held view in Canada that Americans don't know nuttin' about Canada and some of the posts here certainly support that view.

There are many similarities between the two countries. Just as deficits soared during the Reagan and Bush Jr years, deficits have grown in this country during Conservative Party goverments (Mulroney, Harper). In both countries it was the other side that lowered/eliminated deficits (Clinton/Chretien).

In Canada, Harper's decision to lower the GST (value added tax) by two percent before the financial crisis solely to satisfy his conservative base has made the present deficit situation worse.

To Peak Trader I would say:GDP per capita is indeed lower in Canada....so we drive Ford Escapes instead of Hummers. We still get to where we're going. You might watch the news on a 52 inch TV while we watch on a 26 inch...but the news is still the same. Bigger houses??? good for you, me? I hate cleaning...LOL...Hey, Peak, google "HDI index"...there's more to life than the size of your car or house.

Home ownership is higher in Canada than it is in the US and owners have much more equity in their houses...and we did this whitout subsidizing home ownership through tax deductions. And Canada is the "socialist" country????? We don't even have food stamps for pete's sake....what are those for anyway??? You use 'em to mail food down there????LOL

KPMG reported that the US has some of the highest corporate taxes in the world (attention Obama bashers, the report is from 2008).
To become more competitive the US will have to lower corporate tax rates. On the other hand, some people are still demanding that the Bush tax cuts be extended. Clearly both can't happen.

The idea that cutting taxes for the "rich" would lift all people has been proven to be a hoax. Reaganomics don't work in the long term. Get over it and move on.

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PeakTrader said...
Canadian:

It seems Canadian household debt is higher than U.S. household debt, although Canadians live in smaller houses, drive smaller autos, and generally consume less. Perhaps, Canadians can learn something from Reaganomics:

The Bankwatch
Asset value increases hide a rise in Canadian debt levels

"In 2009 Canadians also increased debt through mortgages and loans, with the average ratio of household debt to income at 146.2%."

Federal Reserve Bank of San Francisco
FRBSF Economic Letter
May 15, 2009

"U.S. ratio of debt to personal disposable income...reaching an all-time high of 133% in 2007...it currently stands at about 130% of disposable income."

http://thebankwatch.com/2010/03/15/asset-value-increases-hide-a-rise-in-canadian-debt-levels/

http://www.frbsf.org/publications/economics/letter/2009/el2009-16.html