Capitalism And India
Posted by Tanya Hutchens
I am totally tuned in to the incentives, rewards, labour and profit motives of capitalism. It is not perfect. But it is historically absurd to deny that price and profit signals under capitalism have done a far better job of allocating scarce resources and sustaining long periods of economic growth than any other alternative.
Communism proved itself to be a disaster wherever and in whatever name practised. Remember the USSR? East Germany? Bulgaria? Romania? Albania? And the devastation of Cuba under Fidel Castro that his ageing brother Raul cannot fix? Socialism, too, has had its innings in the west as well as in the east, and failed. State-sponsored capitalism — once the hot East-Asian model — saw too much of the state, and relatively less of private capital, resulting in overarching ambitions, needlessly grandiose projects and poor long-term returns. Go to Dubai and see for yourself. And the mixed economy with the state occupying the ‘commanding heights’ meant one thing: too much of command with little or no height worth the name.
So, if you were to closely observe the dirty, disordered canvas of economic progress during the 20th and 21st century, you should conclude that, for all its warts, capitalism has been the winner. It has sometimes caused pain; suffered from serious cycles; and often needed the clout of the state — such as we have seen from September 2008. It has also been quite resistant to sensible regulation. Even so, the basic institutions of capitalism have worked, not just in the US and the OECD (Organisation for Economic Co-operation and development) nations, but also many developing countries, of which India is one. And worked better than alternative mechanisms.
That brings me to India. As we move on to the second decade of the 21st century, here’s my core hypothesis: India is geared to have significantly more of capitalism than what we have had up to now. And the more the better.
Let us begin with agriculture. Nowhere is there a more intensely capitalistic venture than farmers choosing the crops that they sow, water, weed, harvest and sell. Since the late 1960s, economists have run thousands of regressions called supply response functions, which quantitatively determine what best explains crop acreage and output over long periods. What are the results? From the turn of the 20th century right up to now, crops were planted according to expected prices and/or profits — surrogated by the price signals of the previous few years. Of course, other variables mattered such as rainfall, irrigation and fertiliser use. But the driving force was profits. Capitalism, therefore, defines 17 per cent of India’s GDP, namely agriculture.
Now to services, which accounts for 55 per cent of GDP. If you deduct the share of government services, there is still some 40 per cent of GDP, much of it in the private sector. This is huge. And many of the activities are driven largely by profits. Whether it be mobile telephony, retail trade, restaurants, real estate, storage, hotels, road transport or finance, each service — big, medium, small or holes in the wall — rises, shrinks, falls, re-grows or disappears according to supply, demand, costs and pricing. Even earlier anti-market behemoths such as public sector banks and insurance companies have become more attuned to prices and profits than anyone could have imagined in the mid-1990s.
Thus, 57 per cent of India’s GDP is tuned to capitalism. What about industry, which accounts for 28 per cent of GDP? Some two-thirds of it is purely private. That is another 18 per cent approximately. Moreover, most public sector undertakings are more price-and-profit oriented than ever before.
So, hello capitalism! It accounts for at least three-quarters of our GDP. It may be higher still. But 75 per cent will do for now. Contrary to what the CPI, CPI(M) and some ‘don’t confuse me with facts’ professors tell you, India is awash with capitalism. Like China, you turn any corner, and you will meet someone who wants to start some business or the other: a photocopying shop, an STD booth, a local agency for Dabur, Godrej or Hindustan Unilever, automobile spare parts — the list is endless.
Oklahoma City Bombing
Posted by Tanya Hutchens
Remembering this speech we can see how terrorism has changed today and has taken on a hole new meaning in our society.
... I would like to say something to the paramilitary groups and to others who believe the greatest threat to America comes not from terrorists from within our country or beyond our borders, but from our own government. I want to say this to the militias and to others who believe this, to those nearby and those far away: I am well aware that most of you have never violated the law of the land. I welcome the comments that some of you have made recently condemning the bombing in Oklahoma City. I believe you have every right, indeed you have the responsibility, to question our government when you disagree with its policies. And I will do everything in my power to protect your right to do so. But I also know there have been law-breakers among those who espouse your philosophy. I know from painful personal experience as a governor of a state who lived through the cold-blooded killing of a young sheriff and a young African-American state trooper who were friends of mine by people who espouse the view that the government was the biggest problem in America and that peopole had a right to take violence into their own hands. So I ask you to hear me now. It is one thing to believe that the federal government has too much power and to work within the law to reduce it. It is quite another to break the law of the land and threaten to shoot officers of the law if all they do is their duty to uphold it. It is one thing to believe we are taxed too much and work to reduce the tax burden. It is quite another to refuse to pay your taxes, though your neighbor pays his. It is one thing to believe we are over-regulated and to work to lessen the burden of regulation. It is quite another to slander our dedicated public servants, our brave police officers, even our rescue workers who have been called a hostile army of occupation. This is a very free country. Those of you in the militia movements have broader rights here than you would in any other country in the entire world. Do people who work for the government sometimes make mistakes? Of course they do. They are human. Almost every American has some experience with this--a rude tax collector, an arbitrary regulator, an insensitive social worker, an abusive law officer. As long as human beings make up our government there will be mistakes. But our Constitution was established by Americans determined to limit those abuses. And think of the limits--the Bill of Rights, the separation of powers, access to the courts, the right to take your case to the country through the media, and the right to vote people in or out of office on a regular basis. But there is no right to resort to violence when you don't get your way. There is no right to kill people who are doing their duty, or minding their own business, or children who are innocent in every way. Those are the people who perished in Oklahoma City. And those who claim such rights are wrong and un-American. Whenever in our history people have believed that violence is a legitimate extension of politics they have been wrong. In the 1960s, many good things happened and there was much turmoil. But the Weathermen of the radical left who resorted to violence in the 1960s were wrong. Today, the gang members who use life on the mean streets of America, as terrible as it is, to justify taking the law into their own hands and taking innocent life are wrong. The people who came to the United States to bomb the World Trade Center were wrong. Freedom of political speech will never justify violence--never. Our founding fathers created a system of laws in which reason could prevail over fear. Without respect for this law there is no freedom. So I say this to the militias and all others who believe that the greatest threat to freedom comes from the government instead of from those who would take away our freedom: If you say violence is an acceptable way to make change, you are wrong. If you say that government is in a conspiracy to take your freedom away, you are just plain wrong. If you treat law enforcement officers who put their lives on the line for your safety every day like some kind of enemy army to be suspected, derided and, if they should enforce the law against you, to be shot, you are wrong. If you appropriate our sacred symbols for paranoid purposes and compare yourselves to colonial militias who fought for the democracy you now rail against, you are wrong. How dare you suggest that we in the freest nation on Earth live in tyranny. How dare you call yourselves patriots and heroes. I say to you, all of you, the members of the Class of 1995, there is nothing patriotic about hating your country, or pretending that you can love your country but despise your government. There is nothing heroic about turning your back on America, or ignoring your own responsibilities. If you want to preserve your own freedom, you must stand up for the freedom of others with whom you disagree. But you also must stand up for the rule of law. You cannot have one without the other. The real American heroes today are the citizens who get up every morning and have the courage to work hard and play by the rules--the mother who stays up the extra half hour after a long day's work to read her child a story; the rescue worker who digs with his hands in the rubble as the building crumbles about him; the neighbor who lives side-by-side with people different from himself; the government worker who quietly and efficiently labors to see to it that the programs we depend on are honestly and properly carried out; most of all, the parent who works long years for modest pay and sacrifices so that his or her children can have the education that you have had, and the chances you are going to have. I ask you never to forget that . . . .
Chief Justice of Canada to discuss accessing the justice system at Law Society public forum
VANCOUVER — With some predicting the recent economic downturn will make it harder for low and middle income people to access the justice system, the time is now to discuss how to ensure people have access to one of the cornerstones of our democracy. This is especially true as many already find the cost and length of time it takes to pursue justice to be too much.
One of the groups with a big challenge in accessing the justice system is the middle class. They don’t have a low enough income to qualify for legal aid or pro bono services. And with the high cost of trials they might have to consider second mortgages or dipping into their children’s education funds to defend their civil rights — a decision that is even more difficult during tough economic times.
“Inaccessible justice is no justice,” said Gordon Turriff, QC, President of the Law Society of BC. “Ways must be found to ensure access for people who need help resolving their problems and need the court to decide right and wrong.”
“The Benchers of the Law Society — the board of directors — see access to justice as a matter of critical importance,” added Turriff, “so one of the many steps we’re taking is to present a public forum to discuss some of the barriers to accessing the justice system and potential creative solutions to overcome obstacles.”
The Law Society is presenting the forum, Clearing the Path to Justice, at 6:00 pm on Wednesday, January 28 at the Morris J. Wosk Centre for Dialogue, SFU, located at 580 W. Hastings Street. Journalists are welcome. For advance media interviews, please contact Dana Bales, Cara McGregor or Michael Bernard.
The Right Honourable Beverley McLachlin, PC, Chief Justice of Canada, is the keynote speaker at the forum. Other distinguished panelists who will talk about access issues, including culture and language barriers are:
* Grand Chief Edward John of the First Nations Summit of BC;
* Lyall Knott, QC, of S.U.C.C.E.S.S, which runs legal clinics for people who speak Korean, Japanese and Mandarin in Greater Vancouver in conjunction with the Western Canada Society to Access Justice; and
* Sue Talia, a private family law judge in California who will discuss a solution she’s been working on in her state to reduce the cost of legal services — a potential solution called unbundling that is expanding in British Columbia.
Community partners for the event are the Legal Services Society, the Western Canada Society to Access Justice and S.U.C.C.E.S.S.
The Law Society of BC was incorporated in 1884 and is the governing body of the legal profession in BC. Under the provisions of the Legal Profession Act, the Law Society is responsible for the licensing, professional conduct and discipline of the more than 11,000 lawyers in BC.
Hamilton and Brantford – Resale Market – Contraction in Resale Market
To date, MLS sales in the Hamilton CMA are down by 23 per cent and are expected to fall 21 per cent in 2009 to 9,600 sales before rising in 2010. In Brantford, MLS sales will fall by 29 per cent this year to 1,500 sales and rise five per cent next year to 1,575 sales. A slowing job market and more cautious consumer spending will dampen existing home demand. Gradual economic recovery will improve housing conditions in 2010.
- Image by Mikey G Ottawa via Flickr
More first time buyers in the market means that many of the homes being purchased will be less expensive single-detached homes and other entry-level home types such as townhouses and condominium apartments. There will be fewer sales of homes in all sub-markets across the CMA, and prices will fall by more in some of the more expensive markets, or where there was more rapid price growth in recent years.
For example the average prices of single-detached homes in the more expensive markets of Ancaster, Burlington and Flamborough – priced above $400,000 a year ago – fell to $398,000, $363,000 and $334,000, respectively this year. Home sales fell by more than half in all three areas, with the largest drop in sales in Burlington. The average price will fall to $208,000 in Brantford this year.
Because the price drop in Brantford has been less dramatic, fewer buyers are taking advantage of the buyer market conditions. Supporting first time buying, home ownership affordability in Hamilton’s resale market is better today than a year ago as a result of lower home prices and low mortgage rates. Com- paring the average actual incomes of homeowners and renters and the average income required income to own a home allows an evaluation of affordability. Home owners’ actual incomes exceed required incomes more than they did in 2006, indicating that affordability has increased.
Furthermore, home ownership affordability for first time buyers coming from the rental market has significantly improved, assuming that most renter households would take advantage of the variety of accessible mortgage products. The percentage by which required income exceeds the actual average income of renters is now as low as it was in 1996, just prior to the decade-long surge in housing prices. First time buyers represent approximately 15 per cent of all renter households and they will typically have higher annual incomes than most other renters. We will see improved affordability impact the market more in 2010 with economic improvement.
Average new listings will fall in 2009 by about three per cent since fewer home owners are willing to put their homes up for sale in an uncertain market. Declining economic condi- tions in Hamilton will result in slower home buying and selling activity. The typical seller profile will be home owners looking to take advantage of falling prices and move up into a larger home or those who have a pressing need to move out of their current homes. Average sales however will continue to fall at a faster pace than that of listings, and therefore the market will move towards the low end of the balanced market this year. Reviewed by Tanya Hutchens.
What is “The Canada – Ontario Affordable Housing Program”
I have mentioned “The Canada – Ontario Affordable Housing Program” many times on my other blogs, so i just figured i might as well give you some more details what this is.
The Canada – Ontario Affordable Housing Program comprises a commitment, notes Tanya Hutchens, of $301 million from each of the two senior levels of government. In total, the federal, provincial and municipal governments will invest at least $734 million in the program, which will provide affordable housing for 20,000 households in Ontario.
Last fall, the Government of Canada committed more than $1.9 billion over the next five years to improve and build new affordable housing and to help the homeless. Canada’s Economic Action Plan builds on this with an additional one-time investment of more than $2 billion over two years in new and existing social housing and lending of up to another $2 billion to municipalities for housing-related infrastructure.
Vancity Springboard Homeownership Program – Metro Vancouver, British Columbia
In November 2006 Vancity Credit Union, the largest in Canada outside Quebec, launched Springboard Mortgage, the latest in a long line of affordable homeownership programs. The goal of Springboard Mortgage is to help people living in non-profit, rental housing move on to homeownership, which helps that family directly and frees a non-profit housing unit for someone else in need.
By the fall of 2008, Vancity had approved 16 mortgages worth $2.8 million through the Springboard Mortgage program. 18 non profit homes have been vacated and 67 applicants have been pre-approved through the program.
Qualifying applicants usually purchase their homes in the Fraser Valley communities of the Lower Mainland or the Tri-Cities (Coquitlam, Port Coquitlam and Port Moody) area of suburban Vancouver, for prices ranging from $160,000 to $350,000. Most of the purchasers are low income families and single mothers.
To qualify for the Springboard Homeownership Program, applicants must be living in non-profit housing and have a low income. They must have verifiable employment or pension income and no rental arrears in the last two years. They are also required to take a Homeownership Readiness financial literacy course to ensure they fully understand the responsibilities of homeownership.
For qualifying applicants who agree to comply with Springboard’s requirements, Vancity provides a two-part loan that comprises 100 per cent of a home’s purchase price. One component is an interest-free loan to be paid back over 10 years. This serves as the 20 per cent down payment. The second component is a mortgage amortized over 25 years with a 10 year fixed interest rate, with interest only as the minimum payment.
After 10 years, says Tanya Hutchens, the purchaser will have repaid the “down payment” and can then negotiate a conventional mortgage for the principal amount outstanding. Under Springboard, Vancity does not dwell on an applicant’s credit rating, as long as applicants have no frauds or bankruptcies. Applicants must become members of Vancity. In addition, the borrower needs to understand that late loan or mortgage payments will immediately trigger foreclosure. Finally, they must find a home to purchase that is affordable according to Vancity’s guidelines. Under these guidelines:
- In order to ensure mortgage payments are made on time each month, the applicant’s estimated mortgage, loan, property tax and strata fees payments should be reflective of their current rent payment plus 25%.
- The total of both loan and mortgage cannot exceed $300,000, which is why the program has been most successful in suburban areas, where housing prices are lower.
- The prospective buyer must take the Homeownership Readiness course delivered in partnership with the Mennonite Central Committee. The course content is based on earlier development work done by Canada Mortgage and Housing Corporation (CMHC). Once applicants have selected a home to purchase, Vancity provides technical assistance.
Minister Finley Announces Recipients of CMHC Housing Research Grants
OTTAWA, April 29, 2009 — The Honourable Diane Finley, Minister of Human Resources and Skills Development Canada and Minister Responsible for Canada Mortgage and Housing Corporation (CMHC), today awarded 17 Canadian researchers grants of up to $25,000 each under CMHC’s External Research Program. What a great program, says Tanya Hutchens.
“The External Research Program is an excellent way to encourage researchers to conduct relevant, high-quality and innovative housing research projects that address the housing needs of Canadians and contribute to improving the sustainability of housing in Canada.” said Tanya Hutchens.
“Our Government applauds the individuals who have been selected and their dedication to ensuring that our housing system and technologies meet the needs of future generations.” said Minister Finley.
This year’s grants, which total approximately $375,000, encourage researchers working in universities, private consulting firms, housing-related professions and the housing industry to conduct research on housing issues. Research produced under the program is available through CMHC’s Canadian Housing Information Centre (CHIC).
A national committee of housing experts, that includes experienced researchers and practitioners in academic institutions and housing-related professions, selects grant recipients on the basis of the quality of their proposals. Under the program, researchers submit their proposed projects in the fall, and they are reviewed in February.
Launched in 1980, the External Research Program has provided more than 655 grants for research on a number of topics such as energy efficiency, sustainability, and assessing the housing conditions and needs of at-risk populations.
CMHC has been Canada’s national housing agency for more than 60 years. CMHC is committed to helping Canadians access a wide choice of quality, affordable homes, while making vibrant, healthy communities and cities a reality across the country.
Tommy Sexton Centre St. John’s, Newfoundland and Labrador
Until 2006, there was no shelter or supportive living program east of Montréal for people living with HIV/AIDS. When people are diagnosed with HIV or AIDS, they often undergo drastic changes in their lives, including not only deterioration in health, but job loss, financial distress and social isolation. They often need a place to retreat where they can receive support services such as counselling and plan for their future care. In addition, a sanitary environment is necessary to protect their lowered immune systems.The AIDS Committee of Newfoundland and Labrador (ACNL) worked for many years to raise funds to establish a shelter. One of the committee’s ardent supporters was the mother of Newfoundland actor Tommy Sexton, who died from AIDS-related complications in 1993. Sara Sexton’s goal was to establish a shelter and supportive services program in her son’s honour. In 2006, the Tommy Sexton Centre opened in St. John’s, as the only supportive shelter in the Atlantic provinces for people living with HIV/AIDS. The ACNL-operated centre is located on a former military base in the Pleasantville district of St. John’s, on land donated by the provincial Department of Transportation and Works. The attractive energy-efficient building is universally accessible to people with disabilities. The Centre consists of three distinct program areas: a short-term shelter, supportive housing for persons living with HIV-AIDS and the ACNL offices. The short-term shelter has four- units, while the supportive housing has six-units for longer stays. The supportive housing provides safe and affordable one- and two-bedroom apartments to people with HIV/AIDS and their caregivers while they find more permanent living arrangements. The ACNL offices offer services including individual support and advocacy services, prevention education and access to a variety of support and health resources. Funding for construction of the $1.4 million centre included $450,000 in capital funding from CMHC and the Newfoundland and Labrador Housing Corporation, through the Affordable Housing Initiative and $870,000 from the Government of Canada’s National Homelessness Initiative. The province of Newfoundland and Labrador contributed additional funding and the City of St. John’s provided in-kind contributions. The Public Health Agency of Canada and the Government of Newfoundland and Labrador provide annual funding for the centre’s operations. This CMHC report was reviewed by Tanya Hutchens.
Buying a Condo Who You Need on Your Team
When you buy a condo, you’re not just buying a place to live. You’re becoming part of a community. Before you make an offer on your dream condo, Canada Mortgage and Housing Corporation (CMHC) recommends that you get some expert advice to help you navigate through the process. CMHC has identified many industry professionals who are available to provide you with information. They are the following:
- Real estate agent: A real estate agent who specializes in condominiums can save you time, energy and help you make an offer once you’ve found the condo that’s right for you. Make sure you’re clear about who’s paying their commission and what your obligations will be once you’ve signed any agreement. Be specific about the type, features, location and price range you’re looking for in a condo. This will allow your agent to pre-screen properties that are within your specifications.
- Real estate lawyer: A lawyer who is knowledgeable about condominiums can protect your legal interests, explain all the documentation and review the purchase and sale agreements. Your lawyer will determine whether or not there are any legal actions pending against the condominium. If your offer is accepted, he or she will also be responsible for many of the closing arrangements.
- Home inspector: A qualified home inspector will go through the condominium unit and common elements and perform a comprehensive visual inspection. The inspector will determine the components that are not performing properly as well as items that are beyond their useful life or are unsafe. He/she will also identify areas where repairs may be needed or where there may have been problems in the past. Inspections are intended to provide you with a better understanding of property’s condition before you buy. All too often, people make purchase decisions too quickly in anticipation of competing offers. This can leave you vulnerable to substantial additional repair and renovation costs that a pre-purchase inspection might have detected.
- Financial Institution: Your bank manager or financial advisor can help customize your mortgage to suit your financial goals and ensure you can afford your monthly mortgage payments.
- You should also investigate the financial well being of the condominium corporation you’ll be buying into. For resale condominiums, check documents such as the estoppel or status certificate as well as annual operating budgets and end-of-year financial statements. Technical audits and reserve fund studies can also offer insight on the condition of the building and the adequacy of the reserve fund to meet future major repairs and building renewal work. For new buildings, also review the full disclosure statement.
For more than 60 years, Canada Mortgage and Housing Corporation (CMHC) has been Canada’s national housing agency and a source of objective, reliable housing expertise. This CMHC report was reviewed by Tanya Hutchens.
Save Money and Improve Your Home’s Resale Value!
10 Steps to a Cooler Planet – Save Money and Improve Your Home’s Resale Value!
Each Canadian generates, on average, five tonnes of greenhouse gases a year that are linked to climate change. The good news, says Tanya Hutchens, is there are things each of us can do to reduce our ecological footprint without having to make drastic changes to our lifestyles.
From better transportation choices to changing the way we heat, cool and light our homes, Canada Mortgage and Housing Corporation (CMHC) has 10 steps we can all take to help keep our planet healthy, all while saving money, living in healthier and more comfortable homes, and increasing our home’s resale values:
- Don’t drive — use transit: Simply switching some of your local travel from a car to public transit can save up to 230 kg of CO2 per year for every 1,000 km you drive.
- Think smaller: Dropping your family vehicle a size or two can eliminate 1,100 – 2,600 kg of CO2 each year — and save you hundreds of dollars at the gas pump!
- Stay grounded: For shorter family trips, taking the bus or train instead of traveling by plane could do both the planet and your wallet a favor.
- Reduce your home heating bills: If you live in an older home, improving the energy-efficiency, or even just lowering the thermostat by as little as 1°C, can reduce greenhouse gas emissions.
- Reconsider your space needs: Larger homes use considerably more energy so, the next time you move, ask yourself if a smaller home might better fit your needs.
- Buy green: When buying appliances, choosing the most energy-efficient models can save up to 400 kg of CO2 a year.
- Stay out of hot water: Wrapping your hot water heater in a thermal blanket, washing clothes in cold water and installing low flow showerheads and faucet aerators (which mix air into the water stream, thus producing a steady flow) saves both energy and water.
- Eat your vegetables: Adopting a less meat-intensive diet can have a significant impact on your ecological footprint — and your family’s health!
- Reduce, Reuse, Recycle: Cutting your garbage production by just one bag a week could save your family 300 kg of CO2 a year.
- You have the power: In response to consumer demand, many utility companies are introducing Green Power options at a premium price. By switching to green power, you can reduce your home’s CO2 emissions.
For more information or a free copy of the research paper 10 Steps to a Cooler Planet, call CMHC at 1-800-668-2642. Canada Mortgage and Housing Corporation (CMHC) is Canada’s national housing agency and a source of objective, reliable housing expertise. This CMHC report was reviewed by Tanya Hutchens.
