So there's really no new model for how to run this economy, and nobody's even, I think, thinking about that question, much less an answer."
-Doug Henwood, of Left Business Observer, on The Real News Network
Tepid GDP numbers released Tuesday by Statistics Canada confirm that Canada's economic recovery, such as it was, is sliding completely into the ditch. We're clearly heading for stagnation at best, and quite possibly another "double dip" downturn.
The headline number was disappointing, to say the least. Real GDP grew only 2 per cent (annualized) in the spring quarter. That's just a hair faster than the U.S. economy (which everyone knows is still deeply in the soup). Two per cent doesn't keep up with population and productivity -- implying higher unemployment ahead, not lower. Typically, at this stage of recovery, the economy should be growing three times faster.
Tell Premier McGuinty to build Ontario, not tear it apart.
Premier McGuinty put banker Don Drummond in charge of recommending nearly 400 cuts to jobs and public services in Ontario. At a time when Ontarians are in desperate need of economic recovery, these cuts will jeopardize every aspect of society: from health care to full-day kindergarten to pensions. No public service is safe. However, in McGuinty's reckless plan to balance Ontario's books by putting more people out of work and destroying the social safety net, he refuses to roll-back corporate tax cuts that are starving the province of billions of dollars that could be better used to create new jobs and help tens of thousands of struggling Ontario families to get back on their feet.
Yesterday's GDP numbers (a sprightly gain of 0.3 per cent at basic prices in July) ensure that there will not be a so-called "technical recession" in Canada -- at least, not yet.
Economists have a perverted definition of "recession," whereby it's considered official only if real GDP declines 2 quarters in a row. That's hilariously arbitrary. And the flip side of the coin is even more galling: "recovery" is with us, they say, once real GDP stops contracting and starts growing again. That's why Mark Carney could declare the recession over in July 2009 (when real GDP started to grow again), even though for most Canadians it hasn't stopped feeling like a recession ever since.