Saturday, 16 June 2012
Why Diane Francis is clearly a national embarrassment
|Country club conservative elitist Diane Francis. |
Image Source: Ideacityonline.com
Country club conservative elite
It is reasonable to suspect that Diane Francis is one of the most odious types of people out there. A high society member of Canada's chattering class who lacks compassion for the poorer members of society. But not just that, she goes one step further and radically denounces socioeconomically comfortable Canadians who do give a damn about the less fortunate. This breed of pretentious, hypocrisy-obsessed hypocrites, is quite common in the United States. In the US they're the type of people known for smoking fine cigars and driving their Hummers 30 kilometres to the golf course while decrying "liberals" as elitists for drinking a cheap latte or driving a Prius. Yes, folks, this nonsense meme has come to Canada.
Now, what makes me say this? Because Francis, in her infinite wisdom, attacks Mulcair for - get this - residing where Leaders of the Official Opposition reside. This is apparently hypocritical because he agrees with Pat Martin's obvious claim that Royal visits are useless and cost too much. Apparently, the cost of upkeeping the residence of the Leader of the Official Opposition - someone who actually does important public duties (like keeping the government to account) - is as obscene as the cost of hosting a royal visit for a few days. That is despite the fact that the royal visit costed almost sixteen times as much as up-keeping Stornoway in a year does1. These "hypocrisy allegations" ironically all comes from a person who circles through high society via the lecture circuit and crisscrosses the elite financial centres of New York and Toronto.
Okay, I've nailed down the "need to project her own elitist hypocrisy onto others" part, but what about the lack of compassion for the less fortunate? Well, we can always speak of her callous support for China's brutal "one-child" policy during the infancy of voluntary, education-based family planning initiatives in high birth countries. But others have gone about tearing into her arguments there - so it'd be best to examine some of her more recent instances of cruel, out of touch opining. Such as what she has to say about the problems facing the Greek people and the student protests in Quebec.
They [striking Quebec students] are spoiled brats, fronted by kids who actually believe their "tuition crisis" is noble. Premier Charest is correct in shutting them down.("Greece Must Go -- and Quebec's Students Too." Huffington Post Canada, May 22, 2012)
The Greeks are also spoiled brats.
In that article, by the way, Francis admits that Greek living standards are "going to fall behind the Romanians". If she had done her due diligence (rather than coasting on by while tarnishing who groups of people) she would've discovered that over half of full-time students in Quebec WORK WHILE ATTENDING SCHOOL. "Screw you" is basically what this privileged member of the chattering class has to say to people who are going through real misery and dramatic shifts. Which brings me to my next point.
Out of depth and macroeconomically illiterate?
Diane Francis styles herself a "business person who delivers insights through journalism" rather than "a journalist who covers business". This may be so, but like more than a few businesspeople Diane Francis appear to have no clue about macroeconomic issues and challenges, in addition to flip flopping like hell from year to year (the next section touches on this). Once again, she projects these flaws onto Thomas Mulcair when she calls him"in way over his head".
In the same column where she pontificates that Thomas Mulcair's supposed lack of knowledge makes him a "national problem", she offers a diagnosis of what ails Eastern Canada's economies.
The loss of jobs is due to the economic slowdown since 2008, competition from low labor jurisdictions and lousy productivity levels in Canada where they are 25% lower than the U.S.
("Why Thomas Mulcair is clearly a national problem". Diane Francis (June 1, 2012. Financial Post.)
Except CANADIAN MANUFACTURING - which includes MANUFACTURING IN WESTERN CANADA - has been on the decline before the 2008 financial meltdown.
|Job changes in Manufacturing & the rest of|
Canada's economy - 1998 - 2008. Note the
beginning of this trend before the financial meltdown
Image Source: CBC
|Sharp Decline since 2008 in Western Canadian|
Image Source: Western Economic
Before 2008, as well, there was some substantial decline in Western manufacturing. Look at British Columbia, for instance, which has had some ups and downs but has witnessed some stark slumps in manufacturing prior to the meltdown.
|Changes in British Columbian Manufacturing|
Alberta, the province which houses the Athabasca Oil Sands, hasn't been immune to Dutch Disease.
|Manufacturing Employment Changes in Alberta,|
1998 - 2007.
Data from Statistics Canada.
|Changes is Saskatchewan Manufacturing Employment,|
Data from Statistics Canada.
|Changes in Manitoba Manufacturing Employment,|
1998 - 2007.
Data from Statistics Canada.
While the Francis is right that the global meltdown was a blow to manufacturing, the beginnings of manufacturing decline nationally started much earlier. The Manufacturing Job market was very volatile and unstable in the Western Provinces during that period, with stark job losses taking a toll during certain years. Contrary to what Diane Francis thinks, manufacturing decline very much is a NATIONAL issue rather than an Eastern Canadian issue.
This isn't the only issue Diane Francis earns her status as an apparent economic illiterate on, though. There is also her misdiagnosis of what ails Greece and the economic pressures facing Quebec (and other Canadian) students.
Quebec's unruly students are no different than the Greeks. Both have enjoyed free rides for years, both are being asked to pay their share of the tab and both are refusing to do so.
The backdrop to both situations and many more to come is the Great Markdown, or the irreversible decline in living standards in developed countries due to mismanagement by democracies, debts, demographics and the success of emerging economies.
The second and third mortgages on the world's "rich" nations means tax hikes and spending cuts, in varying degrees. The students and the Greeks are deadbeats, willing to go to any lengths to get out from under their share of the burden. Obviously, the degree of discomfort is wildly variant. The Greeks are going to fall behind the Romanians in living standards in short order while the students are making a fuss over a pittance.
The Greeks are also spoiled brats. They have elected for years leaders like those leading Quebec students who are all show and no substance, who believe in the Free Lunch from Germany or whoever else pays for their benefits and who are prepared to go to the wall for their "noble" cause.
("Greece Must Go -- and Quebec's Students Too." Huffington Post Canada, May 22, 2012)
In this post she mindlessly parrots various righting falsehoods and half-truths used to explain the economic hardships facing Greece and Quebec's students. It looks like she's spend just a little too much time inside the Canadian-American chattering class bubble.
"Deadbeat" student after long night of
Diane Francis facing the hardships of
the lecture circuit (bottom).
Top image from Maclean's (ironically).
Bottom image from The Financial Markets Association of Canada.
The "pittance" of an issue the evil and entitled™ students of Quebec are upset about is the death of the vision of Quebec's educational system. Those who set up Quebec's post-secondary schooling system envisioned education as a right and intended that tuition be used merely to cover the cost of building campuses, it would be phased out. The fact that it's being jacked up (albeit not as much as in other provinces) is a complete change in direction, the beginning of the end of the dream of education as a right. In addition to having little macroeconomic literacy, Diane Francis is also a history of Quebec education ignoramus - failing to do her due diligence prior to insulting the hard-working students of Quebec.
Her ascription of demographics being one of the "grand challenges" facing Western social safety nets is largely fashionable nonsense. Economist Dean Baker has soundly argued that worker productivity gains more than outstrip the growth in the retired. The Greeks, far from being solely in a crisis of their own doing, are also victims of an incompetent central bank and a major trade (rather than budget) deficit problem. Germany - more specifically, German banks - have, far from being the responsible parties in the room, taken part in a deluge of reckless loans.
Take, for instance, what the much more intellectually responsible and diligent writers at Bloomberg have said:
In the millions of words written about Europe’s debt crisis, Germany is typically cast as the responsible adult and Greece as the profligate child. Prudent Germany, the narrative goes, is loath to bail out freeloading Greece, which borrowed more than it could afford and now must suffer the consequences.
Would it surprise you to know that Europe’s taxpayers have provided as much financial support to Germany as they have to Greece? An examination of European money flows and central-bank balance sheets suggests this is so.
Let’s begin with the observation that irresponsible borrowers can’t exist without irresponsible lenders. Germany’s banks were Greece’s enablers. Thanks partly to lax regulation, German banks built up precarious exposures to Europe’s peripheral countries in the years before the crisis. By December 2009, according to the Bank for International Settlements, German banks had amassed claims of $704 billion on Greece, Ireland, Italy, Portugal and Spain, much more than the German banks’ aggregate capital. In other words, they lent more than they could afford.
When the European Union and the European Central Bank stepped in to bail out the struggling countries, they made it possible for German banks to bring their money home. As a result, they bailed out Germany’s banks as well as the taxpayers who might otherwise have had to support those banks if the loans weren’t repaid. Unlike much of the aid provided to Greece, the support to Germany’s banks happened automatically, as a function of the currency union’s structure.("Hey, Germany: You Got a Bailout, Too". Editors. Bloomberg News. May 23, 2012.)
It looks like Diane Francis is totally out of her depth when commenting on the eurozone crisis, instead preferring simplistic stories of "spoiled brat Greeks" and "straight-laced Germans" to doing actual research. She's thinking more like a ten year old rather than a learned adult, much less one who's paid for their thinking.
Yet it seems that she was right on one macroeconomic issue - one year ago.
Why the flip-flop?
Diane Francis very well knew that Dutch Disease was real and that it had long-term effects in terms of the stability of the Canadian economy. This is so because a resource boom coupled with manufacturing decline leads us to a situation in which volatile resource markets can cause us great damage. For, while Diane Francis seems to be a standard economically illiterate country club conservative in her recent columns, perhaps this is not the full story. Over a year before joining the media assault on Tom Mulcair, she was sounding the Dutch Disease alarm bell.
It’s assumed that when the United States catches cold, Canada gets pneumonia. But the reality now is that if China ever catches cold, Canada will get double pneumonia.
And the reason is, sticking with medical metaphors, that Canada is weak and vulnerable because it has an advanced case of the “Dutch Disease.” This is an affliction caused by a booming resource sector which drives up the currency’s value, which in turn drives out exporters, manufacturing and tourism.
Canada’s looming predicament is well described in a report by MacroResearchBoard (MRB), an independent investment consulting firm. Located in London and Montreal, the report is headlined O Canada (Part I) and Uh-Oh Canada (Part II). This study, and its conclusions, should be required reading for every politician and executive in Canada.
“A severe case of Dutch Disease has dramatically reduced the breadth of the Canadian business sector over the past decade, hollowing out manufactured goods exporters and making the nation increasingly reliant on commodity demand. Canada has often been referred to in jest as the 51st state, due to its historical reliance on the U.S. as a key export market. However, it is becoming more accurate to regard Canada as another Province of China,” writes MRB partner Phillip Colmar.
Canada is not directly co-dependent with China, as it has been with the United States, but it is dependent on high commodity prices, which are largely driven by China’s economic boom.
In fact, Eastern Canada’s economies resemble Michigan’s, Detroit’s or Spain’s, but are hidden by the boom in the West, led by Alberta. But once commodity prices head downward, China slows or both, it will have a huge impact on Canada. This is the report’s important takeaway.That's right, folks. In the same publication (Financial Post) where she rails against Tom Mulcair's "nation-busting" dutch disease analysis, she offers a pretty damn similar one a year earlier. Either she is unaware of the contents of her own columns for some weird reason or is willing to become a propagandist for Canada's right at the sound of the whistle of faux national unity outrage.
("Canada's case of 'Dutch Disease'. Diane Francis. Financial Post. April 16, 2011.)
This clearly makes her a national embarrassment.