Statistics Canada reported recently that the annual inflation rate remained 2.9 per cent and the Bank of Canada's core rate remained 2.1 per cent in November.

The monthly increase in consumer prices slowed to 0.1 per cent in November from 0.3 per cent in October. The monthly increase in core prices slowed to 0.1 per cent in November from 0.2 per cent in October.

Inflation remains modest and should not deter the Bank of Canada from keeping interest rates low, and perhaps reducing them, to support our fragile economy and labour market.

A comprehensive study released today by CUPE shows there's no evidence public sector workers are paid consistently more than those in similar jobs in the private sector.

Instead, overall average pay in the public sector is remarkably similar when compared against similar jobs in the private sector: only 0.5 per cent higher.

The just-released 2011 ILO World of Work Report is a must-read for progressive economists.

Released on the eve of the G20 meetings, the report underlines the gravity of the current global employment situation and warns of the need to put job creation first if we are to avoid a very extended period of high unemployment and rising incidence of precarious work. It emphatically calls for demand side measures to create jobs, along with job-friendly labour market policies.

We all know that the wages and compensation individuals receive in private competitive markets reflects their productivity, unless pesky unions and government regulations get in the way -- because Economics 101 (and Michael Hlinka) have told us so.

Corporate CEOs are worth every penny their "independent compensation committees" award in compensation and stock options them because they are "creating value" and hedge fund operators are worth the billions they made helping the world learn about the impact of financial crises. Meanwhile, minimum wage workers, union members and public sector workers must all be overpaid because regulations, unions with their monopsony power, accommodating politicians and labour laws have all interfered with the magic of the market.

In an earlier post, I noted that falling real wages as indicated by July and August data from the Labour Force Survey which showed increases of just 1.4 per cent in nominal hourly wages over the past year signalled trouble ahead: "If this trend continues, it is likely to further undermine a weak recovery, negatively impacting upon consumer spending and perhaps serving as the tipping point to deflation of the housing bubble."

This essay was commissioned by the National Post. It was published under the headline "A Problem for Everyone". In the print edition, the overline -- a large font summary of what you are about to read written by the editors -- reads: "Income inequality isn't just unfair -- it threatens the whole foundation on which our capitalist economy is based." Those are not my words. They are the words of the National Post.

Work hard and you'll get ahead. That's been the mantra of folks who prefer their governments small and their success big.