| There are good reasons why the US creates jobs | | | | quantity of society's work is fixed and ergo by dividing |
| and the Canada-EU socialist axis does not | | | | this fixed amount of work by requiring less hours and |
| August 10 2005 | | | | more vacation or sick time from a population, the |
| There is barely a whimper in the Canadian media on | | | | greater will be the number of workers, and hence the |
| the July '05 jobs report - or more accurately, the no | | | | lower the unemployment rate. In fact the exact |
| job creation report. Incredibly no jobs were created in | | | | opposite occurs. |
| Canada during July. If the same happened in the US, | | | | One reason why Europeans and Canadians work less |
| the media would be full of tales of US economic | | | | than Americans is the punitive level of taxation. The |
| weakness and empire decline. The US is creating | | | | US is certainly not a free market nirvana of low tax |
| 190.000 jobs per month with its economy growing at | | | | rates and unfettered trade. Far from it. The US |
| 3.5-4.0 % per annum. Combined with productivity rates | | | | economy is over-taxed, over-regulated and |
| of 2.5 % per annum - double and in some years triple | | | | over-protected. In fact the U.S. has the highest per |
| the Canadian average - the US will experience higher | | | | capita taxes of any developed country. But importantly |
| incomes, higher standards of living and more tax | | | | the Americans also have lower marginal tax rates. |
| revenues as the economy expands, and these monies | | | | This difference occurs because Americans work and |
| can be reinvested in health, education and | | | | consume more, and so have higher tax bases and |
| infrastructure furthering US economic advantage. | | | | therefore pay in total higher per capita taxes. |
| This difference in job creationism is massive. In | | | | Why do Americans work more? Well living in the US is |
| Canada in 2004 225.000 jobs were created and in | | | | expensive with housing, education and health care |
| 2005 the estimates are that about 130.000 new jobs | | | | costing small fortunes. So Americans must work more. |
| will be generated. The trend to lower economic and | | | | The propensity to greater work and higher productivity |
| job growth in Canada is self-evident. Indeed in Canada | | | | in the US coincided however, with its marginal tax |
| thus far in 2005, less than 8.000 jobs per month have | | | | rates decreases. As the US lowered its marginal tax |
| been created. Such a job creation growth translated to | | | | rates, the economy grew, and hours of work and |
| the US would mean a US job creation rate of 80.000 | | | | wages per hour increased. The cycle of economic |
| per month or about 1 million per annum. In fact the US | | | | growth was stimulated by marginal tax and investment |
| job creation level is 2.2 million per annum. The | | | | reductions, further enhanced by the $1.3 Trillion Bush |
| difference in US job creationism and its impact on | | | | tax cuts. |
| society and employment levels cannot be downplayed. | | | | Similarly, Europe's change to shorter hours coincides |
| The lack of real job creation in Canada and in Europe | | | | with its marginal tax increases. Three completely |
| underscores the weakness of the big government | | | | independent recent studies reach the same |
| society model. In both locales, there are fewer jobs | | | | conclusions: The Federal Reserve of Minneapolis |
| produced on a per capita basis, than in the US and | | | | concludes that twenty years ago, Europeans worked |
| crucially both Canada and Europe have less full time | | | | just as long as hard as the rest of the developed |
| and non-governmental job creation than the US. In | | | | world. The Federal Reserve's report said that when |
| Europe in the past 15 years according to the OECD, | | | | European tax levels were comparable to those in the |
| fully 90 % of jobs have been government based. In | | | | U.S., work hours were similar. As Europe's taxes |
| Canada it is 50 % with about ½ of the remainder | | | | increased, workers responded by working less and |
| in part-time positions. The exact opposite has occurred | | | | those that do find jobs, find them in government. The |
| in the US where 90 % or more of jobs are full time | | | | only exception to Europe's poor job and tax |
| and non-government based and indeed until recent | | | | performance has of course been Ireland and the UK. |
| months one of the biggest job losers in the US was | | | | Ireland currently has the lowest European marginal tax |
| the government sector [along with manufacturing and | | | | rate, even lower than the U.S and UK. |
| transportation]. | | | | The recent Timbro study cited above concludes that |
| The US has a labor force participation rate of 66 % | | | | marginal tax rates have a material impact on explaining |
| trending to 70 %, which is higher than the European | | | | the difference in economic performance. In |
| average of 60% and the Canadian average of 62%, | | | | approximately the last 30 years, taxes in the U.S (as |
| both of which are trending lower. This large | | | | well as in Ireland) have increased by 1.5 percent. In |
| discrepancy in the % employed leads to burdensome | | | | contrast, European country tax rates (except in Ireland) |
| taxation in both Canada and Europe as less people | | | | have increased much more - closer to 4 %. The sum |
| work fewer hours. The lack of labor force participation | | | | of ruinous taxation is evinced in the low per capita |
| is exacerbated by declining birth rates in Canada and | | | | GDP rates in Canada and Europe. Canada GDP per |
| the EU which are lower than in the US and by less | | | | capita (at purchasing power parity) is $29,800 [2003 |
| dynamic labor, industry and services sectors which | | | | est. CIA Factbook] and the EU's is $25,326, versus the |
| militate against ease of labor and capital mobility. Big | | | | US GDP per capita (at purchasing power parity) of |
| government ensures lower rates of employment, | | | | $37,800. Even if Americans must buy health care and |
| higher unemployment with EU levels double that of the | | | | guns, they are far better off then they would be in |
| US [10 vs. 5 %] and Canadian rates 2 % above US | | | | Canada or the EU. |
| levels [7% vs. 5 %], and market rigidity leading to lower | | | | Importantly Americans produce private sector jobs, |
| wages and lower living standards. | | | | eschewing the big government-union alliance that |
| Not only are workforce rates lower in Canada and the | | | | impedes productivity growth in Canada and the EU. A |
| EU but both Europeans and Canadians work | | | | recent OECD study concludes that practically all (97 |
| significantly less hours than Americans at far lower | | | | percent) of all European civilian job creation has been |
| productivity rates. In Canada the average worker | | | | in the government sector. Europe's higher taxes fuel |
| productivity is at about 80 % of a US worker's rate | | | | public sector growth, while its social welfare programs |
| [see this article on the factors involved in lower | | | | eliminate some of the penalties for not working. The |
| Canadian productivity Productivity problems in Canada]. | | | | OECD blames European's unwillingness to work as the |
| Though Canadians work more hours than Europeans | | | | principal reason for lower output per worker and the |
| they work 10 % less hours than Americans. With lower | | | | resulting lower standard of living compared to |
| outputs and less hours Canadians are assured of | | | | Americans. According to OECD, "Research has clearly |
| being poorer than their US counterparts. | | | | established a remarkable fact: namely that the sizable |
| Similar gaps exist between Europe and the US. | | | | U.S. advantage in real GDP per capita ... is largely due |
| Alarmingly the number of hours worked in Europe is | | | | to differences in total hours worked per capita." This |
| now 25 % below US levels [about 2100 hours per | | | | unwillingness to work is compounded by the political |
| year in the US vs. 1600 in the EU], falling from parity in | | | | and economic leverage of big unions. Union rates in |
| the 1970s [OECD data]. Around six weeks of paid time | | | | Canada more than double US rates [32 % vs. 14 %], |
| off is now the annual norm across Europe. This is 2 to | | | | though lower than in Western Europe [34 %, ranging |
| 3 times as many paid days off per year than | | | | from 12% in France to 45 % in Sweden]. Unionism |
| Americans. Vacation time has nearly doubled since the | | | | increases costs, reduces flexibility and reduces |
| 1970s in Italy, Spain and the Netherlands. France | | | | productivity. The higher a society's union membership |
| recently extended its three-year law reducing the | | | | rate, the worse off its economy. |
| workweek to 35 hours from 39. The law now includes | | | | We see the media bias in not reporting the above |
| companies with fewer than 20 employees. The trend | | | | facts. Lower job creationism, higher tax rates and |
| in Europe is towards 30-hour work weeks which | | | | over-spending in Canada and the EU doom these |
| would mean 1400 hours per year of work, or fully 33 | | | | societies to be also-rans in the world economy. The |
| % below US levels. Indeed in Canada and Europe | | | | Canadians given their proximity and dependence on |
| workers not only work less but as well take off more | | | | the US market where 40 % of GDP is tied to US |
| 'sick' time further reducing the number of working | | | | trade are becoming uncompetitive. Yet such proximity |
| hours. | | | | also allows the Canadians to muddle through with bad |
| In 2002 Timbro Institute of Sweden conducted a study | | | | policy choice in their socialist obsession with being |
| found that the average European worker took more | | | | different than the USA since they can count more or |
| than 30 days of sick time per year. According to a | | | | less, on US market access. The EU is in of course |
| New York Times report, on an average day in | | | | worse shape than Canada and will experience even |
| Norway, 25 percent of Norway's workers call in sick. | | | | graver economic and political dislocation as big |
| Shorter work-weeks in both Europe and Canada and | | | | government and militant Islam change the EU |
| increased 'sick' time, have done nothing to reduce | | | | political-economy. |
| higher unemployment. Both Europe and Canada have | | | | In the race to the top in international economic |
| destroyed the fallacy of a fixed division of labor, which | | | | competition it is clear that both Canada and the EU |
| is a favorite of socialists and big government | | | | need job growth and far reaching economic reforms. |
| supporters. Supposedly under this inane idea, the | | | | But don't bet on the media covering that story. |