Please spend

by Aaron Wherry

Sounding like Mark Carney, Jim Flaherty urges the private sector to uphold its part of the bargain.

“We’ve done a lot through the tax system to encourage Canadian executives, business people, to start utilizing some of the capital they have on their balance sheets,” said Flaherty. ”At a certain point, it’s not up to the government to stimulate the economy, it’s up to the private sector, and they have lots of capital.”

In response to Mr. Carney’s comments, the Globe made a list of low-debt, cash-rich companies. Mike Moffatt blames Mr. Carney for the situation.




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Please spend

  1. On a recent Freakonomics podcast, Steven Levitt talked about the power of shame in inducing appropriate behaviour. Not perhaps the strongest incentivizer out there, but it does have one plus side – shame is free.
    Perhaps Carney and Flaherty are trying to shame corporations into spending. Almost certain it won’t work. But what the hey, at least it doesn’t cost anything.

  2. Mr. Moffatt stands alone.

    Good if you’re a talking head looking for exposure and followers. Not so great if you’re an alumnus of the institution he references in all of his undertakings.

    What Carney has stated (use the money or return to shareholders in the form of a dividend) is Finance 101.

    • Where does the institution in question stand on prolific, anonymous web trolls?

      • I believe they arrange to give them tenure, elsewhere.

  3. Flaherty unfortunately believes all that bilge about how this country would just be booming…..’if only we didn’t have all this tax’. Sucker.

  4. Turns out all the great stuff companies said they do with money is only stuff they do as a last resort.

  5. Once again, the Cons rely on their conviction that, aside from abolishing taxes, governments need not intervene because the invisible hand of free market is the best natural regulator.

    And once again, events will prove them wrong.

  6. Moffat is blaming Carney because he says Carney is maintaining an “excessively tight monetary policy”… that being holding rates at 1% instead of cutting them even further.

    He then points out that companies aren’t going to spend, because nobody’s buying, without asking the rather obvious question of, “Well, why aren’t people buying?”

    The answer is that they’re not buying because pretty much everybody on earth is screaming, “For god’s sake! Don’t take on any more debt or you’ll be screwed when the rates rise” and at the same time companies aren’t hiring because.. well.. nobody’s buying.

    Seems there’s no way out of this little dilemma, doesn’t it? If only there were some sort of organization or body that could decide that profit isn’t the end goal, but rather that the good of the people is more important, and so start spending money building things that might help people out, like high-speed rails or knowledge infrastructure, or hospitals, schools, low-income housing, places like Incite to help people combat addictions, or hell, even more prisons to help reduce the overcrowding within and the consequent rioting and stress issues for prison workers, what with our new laws and all. Damn, if only there were some sort of body that could do that….

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