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Most Canadians Are Now Better Off Than Most Americans

bloomberg.com

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Re: Most Canadians Are Now Better Off Than Most Americans

#31

Post by [deleted] »

lostgame wrote: post #21
ska wrote: post #9

Earlier quoted context omitted.

It's not that simple, really. Although for some comparisons you are probably correct, in other ways they are a very natural pairing. For all their differences, in many other ways Canada and the USA are much more like each other than either are like any other country.

Completely agree with this, having lived for time in both countries. While we might be a percentage of the overall US population, we are fortunate to have access to most of the same things as the USA, just with a few extra nice things like health care.

[deleted]

Re: Most Canadians Are Now Better Off Than Most Americans

#32

Post by dragonwriter »

refurb wrote: post #24
hackbinary wrote: post #8

Earlier quoted context omitted.

Well spotted. And that is mostly due to Harper and the Conservatives giving huge tax breaks to the very wealthy, and the super ridiculously wealthy.

What do tax breaks have to do with private debt, namely mortgage and HELOC debt?

Tax breaks can (to use US examples, not sure how many have Canadian analogies: the mortgage interest deduction, California's property tax assesemt increase limitations, the capital gains tax exclusion on home sales) serve as incentives to take on debt for real estate purchases.

Re: Most Canadians Are Now Better Off Than Most Americans

#33

Post by zht »

anaphor wrote: post #7
refurb wrote: post #4

Canadians have been gorging themselves on debt for the past decade. Far higher than other OCED countries. That's left them in a very precarious situation.[1] [1] https://www.cnbc.com/2017/11/24/canadas-household-debt-level...

A huge chunk of our economy is real-estate and finance[1], so that's not too surprising. Everyone thinks the path to getting rich is to buy houses / condos. They're in for a nasty surprise I think. It's never a good idea to go crazy leveraging debt. When you combine that with all of the insane student loan debt people go into (I know someone on their 4th university degree!), then it's a recipe for disaster. https://w…

4 university degrees is probably cheaper than 1 private school degree from the US

Re: Most Canadians Are Now Better Off Than Most Americans

#34

Post by bazooka_penguin »

vgoh1 wrote: post #22
product50 wrote: post #3

And then you realize that the population of Canada is 10% of US. Canada should be compared to the Nordic countries vs. US in terms of quality of life etc.

I don't understand this argument. What does the population of the country have to do with anything? Shouldn't a country with a larger population have more power to make competitive advantages, and larger economies of scale, and therefore have an easier time?

More people to manage, more local governments with more layers of hierarchies and more bureaucracy overall and I've never heard of bureaucracies scaling well

Re: Most Canadians Are Now Better Off Than Most Americans

#35

Post by vkou »

refurb wrote: post #4

Canadians have been gorging themselves on debt for the past decade. Far higher than other OCED countries. That's left them in a very precarious situation.[1] [1] https://www.cnbc.com/2017/11/24/canadas-household-debt-level...

They've been going into debt in order to buy housing, not on other forms of consumer spending or 'living beyond their means'.

Who sells them housing? Other Canadians.

Why do they go into so much debt? Because the nature of housing is that rising prices will squeeze out every last cent of saved money from the pockets of people trying to buy their first house.

It boggles my mind that the average house in Vancouver or Toronto costs ~20 years of average wages (Assuming you don't eat, sleep under a bridge, and don't pay any taxes.)

20 years worth of labour sure as hell did not go into building it. It's all land speculation.

Re: Most Canadians Are Now Better Off Than Most Americans

#36

Post by krn »

ska wrote: post #9
product50 wrote: post #3

And then you realize that the population of Canada is 10% of US. Canada should be compared to the Nordic countries vs. US in terms of quality of life etc.

It's not that simple, really. Although for some comparisons you are probably correct, in other ways they are a very natural pairing. For all their differences, in many other ways Canada and the USA are much more like each other than either are like any other country.

Canada and Australia are the only two countries with the population of over 20 million that are ranked higher than the USA in the OECD Better Life Index[1]. Therefore, it's safe to assume that the size of the country makes a huge difference in such rankings.

[1] https://en.wikipedia.org/wiki/OECD_Better_Life_Index

Re: Most Canadians Are Now Better Off Than Most Americans

#38

Post by dx87 »

vgoh1 wrote: post #22
product50 wrote: post #3

And then you realize that the population of Canada is 10% of US. Canada should be compared to the Nordic countries vs. US in terms of quality of life etc.

I don't understand this argument. What does the population of the country have to do with anything? Shouldn't a country with a larger population have more power to make competitive advantages, and larger economies of scale, and therefore have an easier time?

If everyone agrees with each other, then yeah, a large population is better. But when you've got a ton of people it's harder to find a solution that everyone likes. It's like the difference between two people trying to decide where to get lunch, and 30 people trying to decide. It also doesn't help that the West and East coast are culturally different, even among people of the same political party.

Re: Most Canadians Are Now Better Off Than Most Americans

#39

Post by ashlebede »

zht wrote: post #33
anaphor wrote: post #7

Earlier quoted context omitted.

A huge chunk of our economy is real-estate and finance[1], so that's not too surprising. Everyone thinks the path to getting rich is to buy houses / condos. They're in for a nasty surprise I think. It's never a good idea to go crazy leveraging debt. When you combine that with all of the insane student loan debt people go into (I know someone on their 4th university degree!), then it's a recipe for disaster. https://w…

4 university degrees is probably cheaper than 1 private school degree from the US

Well, you have to pay your other life expenses during that period.

If you don't work and spend 30k on rent, food, utilities, etc., then you get 30k deeper into debt every year. Even if there's no tuition.

Re: Most Canadians Are Now Better Off Than Most Americans

#40

Post by rayiner »

There's a really significant caveat on page 5, regarding the factors used to adjust for purchasing power:

> Using the PPPs from the OECD instead, between 25 and 32 per cent of Canadian households would be better off than their American counterparts. The Appendix provides the full estimates using PPPs from the OECD.

Leaving that aside, Canada is broadly comparable to the US in terms of policy so we would expect it to have similar outcomes. Over the past few decades, Canada has been pushing a massive policy of economic liberalization: https://www.cato.org/publications/commentary/great-right-nor.... Their government spending as a percentage of GDP dropped from almost 50% in 1990 to under 40% (comparable to the US) in 2008. They've done a better job controlling the deficit than we have, so they have lower debt as a percentage of GDP. They've cut individual taxes to around U.S. levels, and have cut corporate taxes to below U.S. levels. Canada's social spending as a percentage of GDP is slightly less than the US's as of 2014: https://ftalphaville.ft.com/2014/11/27/2053392/welfare-spend.... Canada has also aggressively deregulated: Canada ranks #8 in the Heritage Foundation's economic freedom index, versus #12 for the US.

Canada, Australia, and the United States are more similar than they are different, both culturally and economically. Unsurprisingly, outcomes in those countries are also very similar.

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