Wednesday, January 30, 2013



The Good, the Bad & the Economists

Is Canada's economic bubble about to burst?

Submitted by Betty Krawczyk, Cumberland BC


he bad economists? They’re either packing their expensive duds to vacate Davos, Switzerland where The World Economic Forum is ending, along with our Bank of Canada Governor Mark Carney, or in their own private spheres being advised of how the world’s most lustrous gathering of millionaires and billionaires went.


Last year Stephen Harper was invited. Our Prime Minister did attend last year and he proceed to lecture the world on how brilliant he was in the way he kept Canada afloat while other countries were dealing with all kinds of economic “bubbles”.
Well, Mr. Harper is not crowing in the barnyard this year. At least not so loudly. It seems that he’s been warned that his most skillful and incredible handling of Canada’s economy was a fluke.

A bubble, if you will. A bubble held gingerly aloft oh, so momentarily, by the world price of Canada’s real and projected resources, primarily oil. It seems it’s the projected price of Canada’s resources that are giving the trouble. It’s beginning to appear they aren’t what Harper had imagined while in his euphoria when thinking himself an economic genius out loud in Devos last year, and embarrassing Canadians to death in the process.

Now both Harper and Mark Carney are warning of serious economic detours ahead. And I must give him credit; Mark Carney has a fine sense of timing. Skip off to England now, before Canada’s banks get crippled in the world’s coming economic crush, and as a newbie bank manager in England, he won’t be blamed for their future bank dives to the bottom.

It seems there are muddy economic roads all over the place. But the Financial Post headline that grabbed my attention on Friday (Jan.25, 2013) was the announcement by Alberta Premier Allison Redford who warned that there is a widening gap between the North American price for oil and what Alberta gets for its oil sands bitumen as being the “new reality”.


More oil production in the United States is the stated big reason for this “gap”, and even if the proposed pipe lines to the west coast become a reality it would be years before shipping to Asia starts. The province estimates that the 13 billion they had forecast for Alberta’s bitumen will be cut in half. Austerity time. Enter economist Jeff Rubin.

Jeff Rubin is my kind of an economist. On the book flap of “WHY YOUR WORLD IS ABOUT TO GET A WHOLE LOT SMALLER” it states that Rubin was the Chief Economist at CIBC World Markets for almost twenty years. That bit didn’t exactly draw me to the book but the title did. And as of today the inside pages of this book are creased, underlined, refolded and showing signs of too many peanut butter and jelly sandwiches (after raising eight kids I still like kids and peanut butter and jelly sandwiches). And after rereading the book just recently I believe that Jeff Rubin has it right. His theory?

Rubin says that the world is running on oil and all the low hanging oil fruit has now been picked. Because it will simply coast more and more to extract oil and gas from depleting reserves the costs of extraction starts getting in the face of producers big time.


Fewer jobs, fewer workers to pay taxes until the world realizes that there is no getting around this and that the world has to change. The world’s bankers and billionaires clubs will cry and try to start more wars in the last functioning oil fields before they are overturned. The regular people of the world will more readily understand what is happening and seriously turn to investigating green energies. But in the meantime, won’t there be a global depression?

Yes. Of course. Many people will be without work or funds. But you know what? Canadians are good at sharing. And according to Rubin, there will be a lot more civic concentration on food production, transportation, etc. closer to home. Communities will become the backbone of the future economies, hence Rubin’s title “Your World is About to Become a whole Lot Smaller.”

And that will be a good thing. Getting there reasonably without undue civil unrest and mayhem is the challenge. But I think this is eminently doable as I see that many people are already thinking in that direction. We will relearn how to grow vegetables in small spaces, how to conserve energy, how to barter, how to simply do with less. I remember all of the Victory Gardens in Baton Rouge, Louisiana during World War Two.


People dug up their lawns and planted turnip greens and cabbage. There was rationing of meat and gas along with cigarettes and nylon stockings. While our soldiers were dying, our health at home improved with less meat and cigarettes and gas (not to mention the first troubles that nylon stockings brought). A lot of us now already forgo two or three or maybe even all four of these items.

The men (and a few women) leaving the Davos Billionaires club must be exhausted. After all they have spent several very hectic days trying to figure out how to suck up the last of the earth’s resources along with the rest of global worker’s salaries and savings. These men (and a few women) are patriots of no country. They are internationalists. They don’t think or act in the best interests of their own country (or countries), they think and act in the best interests of their exclusive global class and contacts.


They are of no use to the evolution of humanity. These people lack a sense of social responsibility and they will be weeded out by the process of evolution. We can’t really ignore them because they are in the midst of plundering the environment and the banking system, but we can refrain from becoming emotionally involved with them. Then with clear heads we can think seriously about how we might organize our lives in the coming new oil-depleted world.

Women are good at this kind of thing. Women know that within the family, resources must be shared as equally as possible. We have striven to do this all of our lives. We already know how to cut back, to make do, and how to call up skills long submerged such as sewing, canning, baking, what to look for in thrift stores, how to give homemade gifts the prestige they deserve, how to impress children that the newest electronic gadget they desire will not be forth coming, that they must made do with last year’s model, whatever that was, and how to be proud of the perceived deprivation, instead of ashamed.

Remaking the world will be a challenge, but in a good way, as First Nations’ people say of issues that challenge us. Let’s make it in a good way. Prime Minister Harper and Mark Carney and all the banks and Millionaires and Billionaires clubs do not own the world. We do.


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