Article: http://www.digitaljournal.com/article/266703
Summary
The article I have chosen briefly shed some light to the rate of unemployment in Canada from this past January. About 129,000 mainly full time jobs were lost, which brought the unemployment rate from 6.6% in December to 7.2%. The manufacturing sector in Canada had suffered the greatest loss in employment, losing approximately 101,000 jobs. However, industries in health care and social assistance had seen their employment increase by 31,000 despite of the downfall in jobs experienced by other industries. In the three largest provinces in Canada, the effects of unemployment were seen. Ontario had lost 71,000 of the 129,000 jobs, British Columbia had lost 35,000, and Quebec had lost 26,000. Those that were mainly affected were youth from ages 15-24 and men from ages 25-54.
Connections
The connection from chapter 5 to this article would be unemployment and its variants. While Canada’s economy is heading into recession, many residents are discouraged to spend money and would rather save the money in banks and in investments. This lack of demand for product results in demand-deficient unemployment for workers in different industries. Looking at the job loss in the manufacturing sector, the demand for the goods and services provided must be decreasing. The current unemployment rate in Canada is also in the estimated range of the natural rate of unemployment of 6 and 9.
Reflection
Looking at the economic status of our major trading partner, the United States, it seems that the problem of unemployment in Canada will continue to rise unless the US economy starts picking up. Although newly-sworn president Barack Obama and his advisors have came up with an economic plan to put a halt to the current recession, from the last article I have made it seems that certain parts of it may not be as effective as it seems. Unless the Canadian government does something to help with the situation, the rate of unemployment will continue to increase for the next few months. As a student coming out of high school in the next few months, these job losses will hinder my ability to find a part time job as many of those unemployed will have to temporarily take part in any jobs available to keep up their income.
Sunday, February 22, 2009
Thursday, January 22, 2009
Chapter 4 - Government in Canada
Article: http://http://online.wsj.com/article/SB122714465532443171.html?mod=relevancy
Summary
This article I chose from The Wall Street Journal is about the opinions of two individuals, Newt Gingrich, and Peter Ferrara on the flaw in President Obama’s tax plan, which consists of creating or expanding federal income tax credits to low-middle income families. These credits provide little help to economic growth because it does not reduce marginal tax rates, which gives an incentive for people to save their money, invest, and work. Gingrich and Ferrara propose to have the 25% income tax rate paid by workers earning $32,550 to $78,850 reduced to 15% for everyone earning below that level. If one includes all the taxes along with the marginal tax for middle-income earners, it would add up close to 50%. By having these tax cuts instead of tax credits, middle-income earners would earn more money, and at the same time reducing the marginal tax rates for higher-income workers.
Connections
The concept tying into this article would be the marginal tax rates discussed in chapter 4. As suggested by the writers of the article, by reducing the tax rates, people would gain an incentive to save, invest, and work more than before due to benefits of gaining that extra income from the tax cut. The 15% flat tax rate would help further eliminate disincentive effects of the high marginal tax rates. However, the tax credits from President Obama’s tax plan currently acts as a disincentive to the workers, further discouraging risk taking and hard work rather than promoting it.
Reflection
The points brought up in this article are all very valid and of which I totally agree with. I personally would rather have a marginal tax cut than receiving tax credits. A 10% reduction in marginal taxes can be a considerable amount for me if I ever plan to live on my own. More so, a tax cut would really help the economy going, more people would work and there would be more money circulating in the system. I believe that Canada should have one of these reductions in their marginal tax rates, seeing the cut would benefit our economy just as it would if it was implemented in the US.
Summary
This article I chose from The Wall Street Journal is about the opinions of two individuals, Newt Gingrich, and Peter Ferrara on the flaw in President Obama’s tax plan, which consists of creating or expanding federal income tax credits to low-middle income families. These credits provide little help to economic growth because it does not reduce marginal tax rates, which gives an incentive for people to save their money, invest, and work. Gingrich and Ferrara propose to have the 25% income tax rate paid by workers earning $32,550 to $78,850 reduced to 15% for everyone earning below that level. If one includes all the taxes along with the marginal tax for middle-income earners, it would add up close to 50%. By having these tax cuts instead of tax credits, middle-income earners would earn more money, and at the same time reducing the marginal tax rates for higher-income workers.
Connections
The concept tying into this article would be the marginal tax rates discussed in chapter 4. As suggested by the writers of the article, by reducing the tax rates, people would gain an incentive to save, invest, and work more than before due to benefits of gaining that extra income from the tax cut. The 15% flat tax rate would help further eliminate disincentive effects of the high marginal tax rates. However, the tax credits from President Obama’s tax plan currently acts as a disincentive to the workers, further discouraging risk taking and hard work rather than promoting it.
Reflection
The points brought up in this article are all very valid and of which I totally agree with. I personally would rather have a marginal tax cut than receiving tax credits. A 10% reduction in marginal taxes can be a considerable amount for me if I ever plan to live on my own. More so, a tax cut would really help the economy going, more people would work and there would be more money circulating in the system. I believe that Canada should have one of these reductions in their marginal tax rates, seeing the cut would benefit our economy just as it would if it was implemented in the US.
Sunday, November 23, 2008
Chapter 3 - The Role of Government in a Market Economy
Article - http://www.economist.com/world/asia/displaystory.cfm?story_id=11793340
Summary
This article that I chose from the Economist website briefly explains the steps the Labor government in Australia is taking to reduce carbon emissions. Mr. Kevin Rudd, leader of the party and supporter of the Kyoto Protocol, aimed to cut 60% of emissions of year 2000’s levels by 2050. To achieve this, companies that emit the most pollution will have to buy these permits from a market auction each year starting from 2010. Even by implementing this, the Australian government will provide initial benefits to ease these companies to integrating the plan. These benefits include free permits for companies that will suffer in export; coal-fired power stations will receive cash compensation; and for three years, excise taxes will be cut if petrol prices rise from carbon costs.
Connections
The connection between chapter 3 and this article would be about third party effects. This would be a negative third party effect. Being a country capable of supporting New Zealand, Indonesia, and Singapore’s electricity with their supply of coal, the amount of pollution these industries emit has a significant impact on Australia and the world. Coal processing contributes a large amount of pollution to the air, which can cause many harmful effects to both humans and the environment. The carbon emissions build up the amount of greenhouse gases in the atmosphere, thus increasing global temperatures. This increase in temperature disrupts the balance in nature, causing many disasters to occur throughout the world.
Reflection
Global warming is an issue that many are concerned about now more so than before. What the Labor government is doing to lower carbon emissions is not only helping its own country, but is also helping to shape the future for people around the world such as myself. Countries that have not done anything to lower their carbon emissions should follow Australia as an example. But with the effects of global warming already being felt by many, hopefully this may be sufficient enough in helping the world slowly recover from the damage done by years of pollution.
Summary
This article that I chose from the Economist website briefly explains the steps the Labor government in Australia is taking to reduce carbon emissions. Mr. Kevin Rudd, leader of the party and supporter of the Kyoto Protocol, aimed to cut 60% of emissions of year 2000’s levels by 2050. To achieve this, companies that emit the most pollution will have to buy these permits from a market auction each year starting from 2010. Even by implementing this, the Australian government will provide initial benefits to ease these companies to integrating the plan. These benefits include free permits for companies that will suffer in export; coal-fired power stations will receive cash compensation; and for three years, excise taxes will be cut if petrol prices rise from carbon costs.
Connections
The connection between chapter 3 and this article would be about third party effects. This would be a negative third party effect. Being a country capable of supporting New Zealand, Indonesia, and Singapore’s electricity with their supply of coal, the amount of pollution these industries emit has a significant impact on Australia and the world. Coal processing contributes a large amount of pollution to the air, which can cause many harmful effects to both humans and the environment. The carbon emissions build up the amount of greenhouse gases in the atmosphere, thus increasing global temperatures. This increase in temperature disrupts the balance in nature, causing many disasters to occur throughout the world.
Reflection
Global warming is an issue that many are concerned about now more so than before. What the Labor government is doing to lower carbon emissions is not only helping its own country, but is also helping to shape the future for people around the world such as myself. Countries that have not done anything to lower their carbon emissions should follow Australia as an example. But with the effects of global warming already being felt by many, hopefully this may be sufficient enough in helping the world slowly recover from the damage done by years of pollution.
Monday, October 27, 2008
Chapter 2: The Operation of a Market
Article - http://www.economist.com/business/displaystory.cfm?story_id=12481020
Summary
The selected article talks about the effects on retailers as American consumers are lacking the urge to shop. The drop in demand by the consumers is shown in the significant decreases in share prices of major retailers. Some situations are not as serious as the other, such as Wal-Mart’s one-fifth drop in share prices compared to the 80% drop of Whole Foods Market. In the case of smaller retailers, this fall in demand is causing some of them almost bankruptcy. To counteract this problem, some ideas were thought of to minimize this downturn. Cuts in labour costs are one of them, but the retailer would have to ensure that it does not affect customer service in any negative way. Price cuts are also thought of, but the psychology of the consumer might be troublesome, as they might believe the price will continue to drop as the economy gets worse.
Connections
The connection between the chapter topic and this article is the concept of supply and demand. While the demand for products decreases, retailers must come up with ways to respond to this change. In the case of current American retailers, certain measures such as cutting down the price of products and production costs are being made to keep up with the sudden drop. The change in demand could be affected by the consumers’ views on their expectation of future prices of the products, as stocks on the stock market are decreasing in value.
Reflection
In the position of a consumer, these price cuts were indeed expected and were actually looked forward to. With the current status of the stock market, one would only think that prices would continue to decrease. However, the ever-worsening state of the economy would push the world into a global recession, which it already seems like is in. As much as one would try to avoid, this recession could and would lead into a depression, if nothing is done to prevent it. From what I learned about the Great Depression in the 1920’s, it is something that no one will look forward to.
Summary
The selected article talks about the effects on retailers as American consumers are lacking the urge to shop. The drop in demand by the consumers is shown in the significant decreases in share prices of major retailers. Some situations are not as serious as the other, such as Wal-Mart’s one-fifth drop in share prices compared to the 80% drop of Whole Foods Market. In the case of smaller retailers, this fall in demand is causing some of them almost bankruptcy. To counteract this problem, some ideas were thought of to minimize this downturn. Cuts in labour costs are one of them, but the retailer would have to ensure that it does not affect customer service in any negative way. Price cuts are also thought of, but the psychology of the consumer might be troublesome, as they might believe the price will continue to drop as the economy gets worse.
Connections
The connection between the chapter topic and this article is the concept of supply and demand. While the demand for products decreases, retailers must come up with ways to respond to this change. In the case of current American retailers, certain measures such as cutting down the price of products and production costs are being made to keep up with the sudden drop. The change in demand could be affected by the consumers’ views on their expectation of future prices of the products, as stocks on the stock market are decreasing in value.
Reflection
In the position of a consumer, these price cuts were indeed expected and were actually looked forward to. With the current status of the stock market, one would only think that prices would continue to decrease. However, the ever-worsening state of the economy would push the world into a global recession, which it already seems like is in. As much as one would try to avoid, this recession could and would lead into a depression, if nothing is done to prevent it. From what I learned about the Great Depression in the 1920’s, it is something that no one will look forward to.
Wednesday, September 24, 2008
Chapter 1 - Scarce Resources and Opportunity Costs
Article - http://www.economist.com/world/international/displaystory.cfm?story_id=12260907
Summary
The article I read about was found on The Economist website. It mainly talked about a water shortage in many farming regions, such as Africa and the Middle East, and how there are many ways to prevent this. As Colin Chartres, International Water Management Institute’s director-general, put it, to prevent further water shortage, farmers need to increase efficient use of water. Mr. Frérot, the head of the water division of Veolia Environnement, a French firm, stated that up to 70% of the water used for farming never reaches the fields. Many ideas were proposed to save water, such as investments in drip irrigation, cut water consumption for flooding rice paddy fields, and growing fewer crops that require water.
Connections
The main concept that can be connected to the article would be scarcity. Water was believed in the past as a renewable resource, and because of that, people have been taking it for granted. With the increase in greenhouse gases over the past few decades, the glaciers up in the North and South Poles are slowly melting, thus reducing the fresh water supply. The inefficient use of water by farmers also contributes to this factor, as farming accounts for roughly 70% of human consumption of water. Unless advance technology or better techniques are implemented, water scarcity would not only affect developing countries, but the rest of the world as well.
Reflection
The shortage of water is and should be a major concern for all of us, even though it might not seem to affect our current lives. Water is essential to humans, as almost everything we consume contains water. Preserving our water supply will help us currently and in the future. Many of the ideas to save water are very effective, and they should be implemented, even if the costs might be a bit high. Unless changes to prevent global warming from occurring are made, water is going to get scarcer through the years. While the problem is still manageable, precautions should be made for the good of future generations.
Summary
The article I read about was found on The Economist website. It mainly talked about a water shortage in many farming regions, such as Africa and the Middle East, and how there are many ways to prevent this. As Colin Chartres, International Water Management Institute’s director-general, put it, to prevent further water shortage, farmers need to increase efficient use of water. Mr. Frérot, the head of the water division of Veolia Environnement, a French firm, stated that up to 70% of the water used for farming never reaches the fields. Many ideas were proposed to save water, such as investments in drip irrigation, cut water consumption for flooding rice paddy fields, and growing fewer crops that require water.
Connections
The main concept that can be connected to the article would be scarcity. Water was believed in the past as a renewable resource, and because of that, people have been taking it for granted. With the increase in greenhouse gases over the past few decades, the glaciers up in the North and South Poles are slowly melting, thus reducing the fresh water supply. The inefficient use of water by farmers also contributes to this factor, as farming accounts for roughly 70% of human consumption of water. Unless advance technology or better techniques are implemented, water scarcity would not only affect developing countries, but the rest of the world as well.
Reflection
The shortage of water is and should be a major concern for all of us, even though it might not seem to affect our current lives. Water is essential to humans, as almost everything we consume contains water. Preserving our water supply will help us currently and in the future. Many of the ideas to save water are very effective, and they should be implemented, even if the costs might be a bit high. Unless changes to prevent global warming from occurring are made, water is going to get scarcer through the years. While the problem is still manageable, precautions should be made for the good of future generations.
