[peck420]

BartSimpson wrote:

Because Obama hates Canada. I don't know why, but he does. At least Bush appreciate Canada as an ally - Obama would just as soon kick you out of NATO and NORAD if he could.

What Obama or Bush or whomever thinks is really not relevant.

US Presidents are temporary (as are Canadian politicians), it is the longterm feeling of goodwill between the people that is what's important.

As long as Canadian and American citizens are content with the relationship we are good.

I do understand that politicians can, to some extent, mould public opinion, but it is much harder to do between neighbouring nations, that are equal in a social sense, than say with a 3rd world country on the other side of the planet.

In my opinion, Obama not liking Canada is very similar to some Canadian politicians dislike for America. Nothing but irritating little side comments by people that should know better.

[DrCaleb]

BartSimpson wrote:

peck420 wrote:

DrCaleb wrote:

"Don't kid yourself honey, it's going up your poop chute" - Frank Zappa

Although I understand the sentiment...why?

Because Obama hates Canada. I don't know why, but he does. At least Bush appreciate Canada as an ally - Obama would just as soon kick you out of NATO and NORAD if he could.

Irony being the last softwood rape deal was done under Bush, not Obama.

[Curtman]

BartSimpson wrote:

peck420 wrote:

DrCaleb wrote:

"Don't kid yourself honey, it's going up your poop chute" - Frank Zappa

Although I understand the sentiment...why?

Because Obama hates Canada. I don't know why, but he does. At least Bush appreciate Canada as an ally - Obama would just as soon kick you out of NATO and NORAD if he could.

Was this a joke of some kind? Dubya was at the wheel during the softwood lumber issue. Also for the Devil's Lake issue (probably more of a local issue to Winnipeg).

Devils Lake dilemma

Quote:

U.S. officials have resisted Canada's request to let the commission deal with North Dakota's plan. Of course, this has more immediate implications, especially for Manitoba.

North Dakota says it will now unilaterally go ahead with its plan for dealing with flooding that over the last decade has swallowed more than 28,000 hectares of farmland and forced 300 households to move.

The state has already spent an estimated $400 million US to deal with the problem by building a levee, raising roadways, and moving buildings and people. Now it wants to pump water out of Devils Lake into the Sheyenne River, which connects to the Red River and Lake Winnipeg in Manitoba.

The problem is that Devils Lake, about 160 kilometres south of the border, has no natural outlet. It loses water only through evaporation.

No outlet means Devils Lake has accumulated high levels of pollutants, such as sulphates, arsenic and phosphorus, and Canadian officials fear it also contains invasive species, including parasites that will flow along with the released water into Lake Winnipeg.

The dispute has caused political turmoil at the highest levels – Prime Minister Paul Martin has repeatedly raised Canada's concerns with U.S. President George W. Bush.

Despite this, North Dakota appears poised to go ahead with its diversion plan, foregoing a full environmental review and building only a rudimentary filter to screen potentially harmful foreign fish from the outflow.

When Harper was elected, he immediately caved on both issues and let the U.S. do whatever they wish. Dubya was no friend to Canada.

[BartSimpson]

On Devil's Lake there's nothing stopping you folks from building a dam at the border.

[Curtman]

On the Red River? The hell there isn't.

[Khar]

peck420 wrote:

Mini recap:
Our corporate tax rate should be marginally lower than our competitors, no more, no less. If they are at 36%, we are at 35%, etc. Why we are (in Alberta) 11% lower than our competitors in the US boggles my mind.

It would make zero difference to the corporation as they have to pay the difference anyways.

I just responded to this exact point above, man. Here is the section that is relevant:

Khar wrote:

Labour mobility, means of production or transport, privatization levels and so forth strongly impact the decision of a firm to move or expand to a different country. We must adjust our tax rate to account for variations in those variables as well. Low income regions like Mexico, South America or Asia are competitors with some levels of the Canadian economy, not just those listed in the G7+Russia.

However, a reduction in corporate tax rates is shown to have a dramatic impact on foreign investment, start-up and diversity and size of firms, which improves competition and reduces pricing problems within our borders. Likewise, there are suggested elements which improve equality, tax evasion and so forth, although an expanded study on those topics could not be readily found.

We are competing with an international labour market. While we have the ability to invest large amounts of capital and technology into our business sector to offset our comparatively high paid labour force (an area of economic study with tons of potential variables), it does not mean that that alone is going to do it. It also does not mean that it offsets the transportation issues, business climate, tenuous political conditions and so forth which may all come together to cause problems. It's not just corporate tax rates alone which matter.

Moving a business or starting up a business, or even expanding a business into another country it a massive undertaking potentially costing billions of dollars for some firms to do so. Even now, I know of a few firms which are running south of the border or over to Britain because of issues which how Canada stands. Sometimes it’s subsidies, sometimes it’s restrictions on output, or sometimes it’s simply regulations that drive companies away. A reduction in corporate tax rates is meant to incentivize Canada’s business sector to remain here and keep growth here, instead of giving money to companies and hoping they stay after they get it.

Companies have a duty to their shareholders and so forth. The fiscal risks of moving to Canada must be worth it to make a successful business case, and that means that Canada needs a strong, consistent record that it comes to how we handle the business sector. As all parties are approaching it from this direction in various ways (the most left of the parties appears willing to just leave it be) then I’d assume it’s because they are looking at the potential benefits of reducing corporate tax rates.

Also, keep in mind that federal/provincial/state tax levels change from region to region and even industry to industry. In Canada, these rates are additive but I do not know what they are for the States. As I mentioned in that other thread mentioned, I believe, there are suggestions that the States may also be having problems being competitive on an international scale, although I am not sure how I feel on that.

Just my opinion!

[peck420]

Khar wrote:

Labour mobility, means of production or transport, privatization levels and so forth strongly impact the decision of a firm to move or expand to a different country. We must adjust our tax rate to account for variations in those variables as well. Low income regions like Mexico, South America or Asia are competitors with some levels of the Canadian economy, not just those listed in the G7+Russia.
However, a reduction in corporate tax rates is shown to have a dramatic impact on foreign investment, start-up and diversity and size of firms, which improves competition and reduces pricing problems within our borders. Likewise, there are suggested elements which improve equality, tax evasion and so forth, although an expanded study on those topics could not be readily found.

I just wanted to bold that particular section. Are we in a race to the bottom? We will never be able to compete with 2nd or 3rd world countries, corporate tax or not, unless we are willing to take drastic reductions in our standard of living. These are sacrifices I am not prepared to make.

Quote:

We are competing with an international labour market. While we have the ability to invest large amounts of capital and technology into our business sector to offset our comparatively high paid labour force (an area of economic study with tons of potential variables), it does not mean that that alone is going to do it. It also does not mean that it offsets the transportation issues, business climate, tenuous political conditions and so forth which may all come together to cause problems. It's not just corporate tax rates alone which matter.

Moving a business or starting up a business, or even expanding a business into another country it a massive undertaking potentially costing billions of dollars for some firms to do so. Even now, I know of a few firms which are running south of the border or over to Britain because of issues which how Canada stands. Sometimes it’s subsidies, sometimes it’s restrictions on output, or sometimes it’s simply regulations that drive companies away. A reduction in corporate tax rates is meant to incentivize Canada’s business sector to remain here and keep growth here, instead of giving money to companies and hoping they stay after they get it.

Companies have a duty to their shareholders and so forth. The fiscal risks of moving to Canada must be worth it to make a successful business case, and that means that Canada needs a strong, consistent record that it comes to how we handle the business sector. As all parties are approaching it from this direction in various ways (the most left of the parties appears willing to just leave it be) then I’d assume it’s because they are looking at the potential benefits of reducing corporate tax rates.

Also, keep in mind that federal/provincial/state tax levels change from region to region and even industry to industry. In Canada, these rates are additive but I do not know what they are for the States. As I mentioned in that other thread mentioned, I believe, there are suggestions that the States may also be having problems being competitive on an international scale, although I am not sure how I feel on that.

Just my opinion!

Well said, and well thought out.

May I pose a counter thought?

Why race to the bottom when we just need to change our perspective? There are certain limitations that business' face regardless of country the choose to reside in. We know that we can not compete on the human capital. But, we can compete on the energy and cost of business level. I think it would be far more prudent, especially over the long term, to make Canada a choice business location for variables that are fairly consistent from country to country.

1) Transportaion: It effects us all around the globe and is a major cost for most producing business'. We could focus on better and more efficient (all together cheaper) transportaion within Canada to help draw in business development.

2) Clean(er) and cheap energy: Every business requires it. Make ours comparatively cheaper for the business, thereby reducing the cost of business.

3)Rebrand Canadian Industry: Steal a page from Germany. They managed to rebrand themselves as the choice spot for highend manufacturing. This was done on multiple levels, but most importantly through close co-operation between their Federal and business regulators (streamlining, integrated and uniform standards, etc). This will help shield us, to some extent, from the 'race to the bottom' that seems to be the fashion of the week in many industries.

All in all Khar, great post. You have given me some things to think about. I may respond further on it.

[BartSimpson]

Curtman wrote:

On the Red River? The hell there isn't.

Just build a big enough dam to back it up into North Dakota. Then the US will honor the water treaty and open the issue to discussion.

[Curtman]

The damage is already done. They've drained their "dead sea" into our lake already.

[Khar]

Quote:

I just wanted to bold that particular section. Are we in a race to the bottom? We will never be able to compete with 2nd or 3rd world countries, corporate tax or not, unless we are willing to take drastic reductions in our standard of living. These are sacrifices I am not prepared to make.

Quote:

But, we can compete on the energy and cost of business level. I think it would be far more prudent, especially over the long term, to make Canada a choice business location for variables that are fairly consistent from country to country.

You might be assuming that everything is equal outside of our work force (I think), so we will never be able to compete, but that is somewhat flawed in my point of view. The dynamics of output come from not just labour, but capital and technology invested into the process. For example, someone might make a buck an hour make soccer balls in one country, while another person, thanks to technology and investment in capital, makes the same amount of soccer balls in a few seconds and is paid much more due to his skill set. They are able to compete, even though their wages are quite different.

As countries begin to catch up with us, more and more of their workforce is being replaced by capital implements. It has been a demonstrated trend in China and India. However, this is partially due to people moving into other industries, like local services or education, which do not really compete with us. It's not a race to the bottom, and only is if you intentionally simplify us down.

If these things were going to take us to the bottom, we would already be there. The fact that we are not effectively demonstrates that there are means which give us a comparative advantage on the international market, not to mention that a lot of what gives the Canadian industry it's power, resource and energy, cannot be effectively moved out of country. However, improving corporate taxes can improve investment in this field, as the literature in my last post demonstrates. It is one of the many advantages demonstrated by removing corporate taxes from a positive point of view, as is also previously mentioned in that post.

The States has had a massive share in manufacturing for decades, and it's share recently grew, as is shown in some of the sources. If we really were in a race for the bottom, we'd have already lost, but the States is a perfect example of how first world countries can effectively compete on a world-scale. Germany is another one, who even though it is first world, has managed to compete with nations with massive labour reserves because of it's ability to effectively use capital and labour to stretch what labour it has.

Ironically, on the other bits, that's all been parts of platforms the parties generally share -- putting on a good face for the costs faced to do business in Canada, compared to elsewhere. It's not something I disagree with either. While we can disagree on the costs of the G20 summit in this forum all we want, there wasn't much disagreement on the point of making Canada a better place to do business in, and reducing corporate taxes is just one of those aspects which this has manifested itself in. I view what we are doing as fairly aggressive, but it may also give us a very strong edge over the next decade or two as we come out of a recession. Giving us the best possible face for the next couple of years means making us a better place to do business now.

I don't think it is a counter-thought, because generally (cheap and clean, good luck with that! ), I agree with the idea behind it. I think it would be even better if it could happen alongside what we are doing as long-term goals, so in the future we could potentially raise corporate taxes if necessary but still have a good business environment. Just my quick opinion, though. Thanks for the great response, I appreciate it!