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Originally Posted by Baraka_Guru
How am I focusing on trivial matters? I'm trying to see if you understand a fundamental fact about economics, which is where wealth comes from. This goes back to proto-capitalist Adam Smith.
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I don't understand your point. I believe wealth comes from the application of labor, intellect and resources. Those are broad categories that can be defined further.
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If you look at overall figures on poverty, inequality, and the efficiency of Canada's social programs, we rank higher than most countries in the OCED. Although we have problems with growing poverty and inequality, these are recent problems and are likely reversible.
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As long as the oil/minerals boom does not go bust.
When it comes to natural resources like oil and minerals, it is easy to and I support government's role in a distribution of a fair share of that wealth to all citizens. A private company should pay "the people" for the right to drill oil or extract minerals from the earth. Those private companies should have to compete for those rights in a free, open and competitive market as to give the biggest benefit to "the people". Is that the way it is done in Canada, consistent with free market principles? In the US I argue that our system is corrupt and is prone to favoritism from powerful politicians or based on political influence.
You might argue for a "mixed" approach in this regard, I don't. The BP oil spill proved that there are weaknesses in a "mixed" approach. BP had to meet all the government "rules and regs" and there was still failure. Using free market principles, I say let those that fail, pay the real price for failure. BP was able to negotiate with the government to limit its liability (and I am betting BP got the best end of the deal), I would suggest we let the free market determine the true liability.
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Finally, the oil and mineral boom is confined for the most part to two provinces. Canada is comprised of 10 provinces and 3 territories; our economy is more than about us being "hewers of wood and drawers of water," though that is our legacy. We're not all lumberjacks and curlers either. Have a look. The city I live in is considered the "economic engine" of Canada. Ontario is the most populous province. Toronto is over 1,600 miles away from Calgary, Alberta, the epicenter of the oil boom.
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My wife spent time in Toronto and said it was the nicest large city she had ever been to, I have absolutely nothing against Canada. I am sure it is a great place to live.
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Energy exports account for less than 3% of our GDP. Overall, a small minority of Canadians are employed in the primary industries (including oil and minerals), and these industries in total only account for about 6% of GDP. The service sector? It accounts for over two thirds. (And I haven't even touched manufacturing.)
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O.k., but let's not underestimate the importance of that comparing US oil imports are "only" about 2% of GDP. Having what you need, plus a surplus that can be exported. Very few industrialized nations are in the position Canada is in.
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So your argument that if it weren't for oil and minerals that Canada wouldn't be in a good position at all is tenuous at best. You're going to have to explain it much better than that.
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Canadian debt is about $500 billion (ed.). GDP about $1.3 Trillion. Canada sits on over 1 trillion barrels in oil sand reserves. If we multiply that by $100 per barrel, using round numbers you have $100 trillion in resources. If the prices stay high, Canada can do all the social activities it wants. If the price drops to the point where it is not economically feasible to exploit the resource. Debt will eventually consume GDP.
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People can exercise free choice in anarchy as well.
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I don't support anarchy. I think there is a role for government in free markets.
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It's difficult to consider your free choice when you're being exploited by holders of capital when you have little to hold of your own.
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Labor will always have the value labor. Labor in a free market can be more valuable than natural resources or intellect. It is possible for labor to exploit holders of capital.
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But you're right, I suppose this is where our opinions differ. I find it difficult to address your position, since it's so radical.
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It appears that you place little value to labor in the market and you think my view is radical? It appears that you assume labor has no power in the market and you think my view is radical? Rhetorical questions. I understand our differences and nothing I can present will change your point of view as there is nothing that you can present will change mine.
---------- Post added at 09:59 PM ---------- Previous post was at 09:45 PM ----------
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Originally Posted by filtherton
But your response essentially acknowledges my point, which is that there isn't anything inherently noble in the "freeness" of the free market.
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I don't look for "nobility" in free markets. I assume market participants will do what they perceive is in their best interest. And there certainly no "nobility" in bureaucracy or powerful politicians wanting to control others. I fear people who want to control and restrict the freedoms of others.
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However, you seem to be under the impression that the bad actors are thieves or criminals. The fact of the matter is that under the free-est of free markets, certain types of thievery are the natural consequence of the market working how it ought to.
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A guy like Maddoff is a theif. A guy like Zuckerberg may have defrauded others, we will never know. A guy like Buffett made billions off of the work of others from buying and selling financial instraments. A guy like Ray Kroc (Mcdonalds) used his drive and initiative and made billions that benefited millions of people and will continue benefiting millions and millions more into the future. There are subtle and not so subtle differences. To understand my point of view, one would need to explore those differences in greater detail.