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Why Stephen Poloz isn’t ready just yet to pivot on interest rates

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Normally, we’d preview the Bank of Canada’s next policy decision closer to the actual date. But all the relevant data has been published, so why wait? Unless the central bank scraps its story, it will leave the benchmark rate at 1.25 per cent on May 30.

Canada’s dollar dropped half a cent against its U.S. counterpart on Friday, probably because new readings on inflation and retail sales suggest the economy is chugging along, not racing ahead at a pace that would alarm policy makers. The prices of financial assets linked to short-term interest rates put odds of an interest-rate increase next week at about 25 per cent.

Bank of Canada Governor Stephen Poloz and his lieutenants on the Governing Council will take note of those prices. When Poloz abandoned explicit forward guidance, he said he hoped investors would think harder about the economy and spend less time trying to guess what he might be thinking. The market’s current message: There’s no need to change policy.

The sudden wobble in the renegotiation of the North American Free Trade Agreement might also have influenced traders. Policy makers have characterized uncertainty about trade policy as the biggest headwind facing the economy because it’s a chill on investment. So the shift to a protracted negotiation, after politicians spent several weeks suggesting a deal was close, is a negative.

But trade never was going to play a major role in the May decision. The vibe around NAFTA was turning positive a month ago, and the Bank of Canada opted to leave the benchmark rate unchanged. Officials said they would stop worrying about trade only when they saw evidence that business investment was holding up. RBC Capital Markets said last week that its monitoring of company announcements suggests a modest increase in spending. Still, definitive data won’t be available until after May 30: Statistics Canada will release its tally of second-quarter gross domestic product the following day, and the central bank’s quarterly Business Outlook Survey is due on June 29.

That’s why the policy announcement scheduled for July 11 is the earliest the Bank of Canada could raise interest rates and remain consistent with what it’s said about how it would react to trade news, positive or otherwise. To move in May would require a noticeable change in other economic variables and that hasn’t happened.

To be sure, oil prices are about $15 a barrel higher than central bank’s current forecast, which is based on prices a month ago.

That will prompt some debate over the next 10 days as policy makers deliberate over where the economy is headed. Normally, a shift of that magnitude would represent a material change in Canada’s prospects. Yet there has been no discernible change in the value of the currency, the TSX or the outlook for economic growth, according to economists at Bank of Montreal. Higher crude prices mean the value of exports is rising, but those gains are being offset by doubts about whether the increase will last and the future competitiveness of Canada’s high-cost oil industry.

One indicator that would outweigh concerns about business investment is inflation. The Bank of Canada’s primary mission is to keep the consumer price index advancing at an annual rate of about 2 per cent. Statistics Canada reported the CPI increased 2.2 per cent in April from a year earlier, the third-consecutive month that inflation exceeded the central bank’s target. That’s noteworthy because annual price increases had brushed the target only three times in the previous three years.

The upward pressure on inflation could make the May decision a closer call than currency traders seem to think. The Bank of Canada cares more about three specially crafted inflation gauges than it does the headline number, which is often distorted by surges and plunges in energy and prices. Two of those three measures now are above 2 per cent, and the third is at 1.9 per cent, so for the first time since early 2012 all four of the key price indicators have been at target or higher. Sebastien Lavoie, a former staffer at the BoC who now is chief economist at Laurentian Bank Securities in Montreal, calculated that prices for 24 of the items in StatCan’s CPI basket were increasing at a rate faster than 3 per cent in the first quarter, compared with 22 that did so in 2017. The number of items that were cheaper declined to 30 from 34. The change suggests inflation is heating up, if only gradually.

“We still think it is preferable for [Bank of Canada] officials to remain on the sidelines at the May 30 monetary policy decision meeting,” Lavoie said in a note to his clients. “This being said, this decision is likely to be a close call given that two of the three core inflation measures are now above the 2% target.”

The two other factors that dominate the Bank of Canada’s narrative about the economy are household debt and Poloz’s contention that lower interest rates might actually help policymakers stay ahead of inflation.

Household debt is about 100 per cent of GDP, compared to about 70 per cent in 2005, according to the International Monetary Fund’s new Global Debt Database. All that debt probably means consumers are more sensitive to changes in interest rates than they were in the past. So the BoC is looking for evidence that credit growth is slowing, but not so fast that it crushes domestic demand. And as you might expect, higher interest rates appear to be restraining consumer demand. StatsCan said last week that retail sales jumped 0.6 per cent in March from the previous month, but only because of a surge in automobile purchases. Most other retail segments are essentially unchanged from January 2017.

Sluggish retail sales support Poloz’s argument that Canada’s economy isn’t as strong as its 5.8-per-cent jobless rate suggests. He sees elevated rates of long-term and youth unemployment as marks of the financial crisis and the oil-price collapse. Higher interest rates risk killing growth that could pull more of those people into the labour market and Poloz has been crystal clear that he intends to do what he can to encourage that to happen.

“In some models of the economy, that would become a permanent thing, a hysteresis thing,” Poloz said of the elevated number of marginalized workers, while talking to me and a couple of other journalists in Washington last month. “Well, if it can happen in one direction, there is no reason with enough time that it can’t be reversed because it’s just people combined with new investment, just building more economic building blocks.”

He added: “You’ve got to believe we’re going to get a fair bit of that. But again I can’t guess how much, but I think it’s a really important phase.”

It will take some strong evidence to push Poloz off that course and there hasn’t been enough since then to force a pivot. Bottom line: low for a bit longer.

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Toronto-area rapper blames systemic racism for months of misdiagnosis

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TORONTO — When Matthew John Derrick-Huie went to the doctor with chest pain and shortness of breath in 2017, he didn’t know he was about to embark on a two-year medical nightmare.

The 24-year-old Canadian rapper who goes by the stage name “John River,” told CTV News that he went to the emergency room five times before doctors took him seriously and on that fifth visit, they gave him a spinal tap to test for meningitis.

“I felt I had been trying and pushing so hard with every fibre in my body,” he said. “I’m not a quitter. I don’t think I’m weak. I don’t believe in giving up in any capacity in my life and even for me, I was unbelievably outmatched.

For the next 60 days, River visited family doctors, specialized clinics and emergency rooms as often as 30 times in search for an answer, but failed to find one. Some doctors told him he was suffering from anxiety and depression and prescribed him antidepressants, but he knew that wasn’t the issue.

“One physician told me that I was in a depressive state and I just didn’t realize,” he said.

“I said: ‘Respectfully, I lost my house twice when I was 17, my cousin who used to live with us was murdered…with all due respect, if I was going to have an anxious breakdown, I feel like it would’ve happened already.’”

It wasn’t until River’s family took to social media that they were able to find a doctor who would take a look at River’s case. The doctor soon discovered River’s brain was sagging in his skull due to low cerebrospinal fluid levels. The doctor believed River’s spinal canal had been leaking since that meningitis test two months prior. Cerebrospinal fluid leaks are a known complication of spinal tap procedures. 

”I understand (cerebrospinal fluid) leaks are what some people would call a rarity and a difficult diagnosis, but I don’t think that’s applicable here,” he said.

Rivers questions why doctors didn’t follow up with him after the original operation and given him an immediate treatment to fix the leaking.

“They knew they had given the patient a procedure in which you told him: ‘For the next two days, you may feel like you want to die.’ If you don’t proceed with a follow-up procedure, one would have to assume that that patient is still out there.”

River required eight months of recovery and also wonders why no one would listen to his pleas for help.

“I absolutely, unequivocally, no doubt, feel that it absolutely had to do with the fact I was a young black man,” he said.

River adds that he felt multiple instances of racism as he dealt with health-care providers, including one visit when a nurse accused him of visiting the hospital solely for drugs.

“She said to me: ‘I know you are here for drugs, why don’t you just tell us which drugs they are and we’ll expedite this process,’” he said. “How is it within a two-minute time period (that) you were able to come to the distinction that I either came to your hospital to abuse narcotics or to sell narcotics?”

River said it was only after he spoke publicly about his medical situation on Twitter that other members of the black community reached out to him with similar stories dating as far back as the 1970s.

Dr. Onye Nnorom, a family doctor who works with the University of Toronto to advance the health of black people in Canada, said River’s experience in the health-care system is one of many similar stories she’s come across.

“I do hear about experiences of racism and I’ve heard about it not only from my patients, but also from family members (and) from colleagues, so it is certainly a problem,” she said. “I think one of the biggest problems is that we’re not able to collect data to demonstrate it.”

Nnorom adds she’s also heard from black patients who’ve been accused of seeking drugs instead of medical care.

“The (health-care provider) is making assumptions about their appearance and thinking that they’re a drug dealer,” she said. “That’s going to affect the way the health-care provider is able to diagnose and treat the patient.

“From the patient’s end, that really makes a person feel like they’re not being respected.”

Racism within the Canadian health-care system is not only an issue among black Canadians. In 2017, an external review found several Indigenous women had felt pressured into sterilizing themselves immediately after childbirth at a hospital is Saskatchewan.

Additionally, a report concerning the case of Brian Sinclair, who died of a treatable bladder infection in 2008, found emergency staff at a hospital in Winnipeg ignored him for 34 hours because they assumed he was homeless or intoxicated.

In 2018, the Canadian Public Health Association acknowledged that “we are all either overtly or inadvertently racist and that the influence of this racism affects the health of individuals and populations” and offered several recommendations for all levels of government and health-care providers, including a complete review of their policies and to provide “system-wide anti-racism and anti-oppression training for all staff and volunteers.”

Kathleen Finlay, the CEO and founder of The Center for Patient Protection, called River’s treatment “appalling.” 

“Anytime a person presents multiple times to a hospital or a health-care provider for the same symptoms or worsening of their symptoms, that should send up big red flags, that should not be happening,” she said. “Fortunately, the outcome here worked out well, but patients can actually die in these situations.”

The Ontario Ministry of Health declined to comment directly about River’s case, but said in a statement Thursday that the government “is committed to providing all people in Ontario with a health-care system that is focused on them.”

“(The People’s Health Care Act, 2019) states that the health-care system should be centered around people, patients, their families, and should be guided by a commitment to equity and to the promotion of equitable health outcomes,” a spokesperson for the department wrote in the statement.

The ministry adds it does not collect data on a patient’s race that could be used to measure access to treatment.

River, who was nominated for a MuchMusic Video Award in 2015, took two years away from music to deal with his health situation. He has since returned to his promising career and plans to advocate for equality within the health-care system.

“The only thing that’s on my mind every day is how much pain I went through,” he said. “I could never consciously allow somebody else to go through what I went through.”

“If we save one life because of the pressure that we apply today, then I can say to myself: ‘OK, I did my job.’”

River’s first song since the ordeal, titled “Burn the Boats,” discusses his misdiagnosis and how he is now “back from the dead” following the complications.

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ROTHENBURGER: What we need in this country is a special racism court

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ANOTHER PERSONALITY LOST his job Friday over racist remarks.

The latest offender is Calgary Flames head coach Bill Peters, who resigned after revelations he used racist slurs against a player a decade ago.

The case is pretty typical when it comes to process. An indiscretion is revealed, social media lights up, an employer assesses the damage and acts accordingly. Loss of employment is often the resulting punishment.

There’s got to be a better way, a practical approach based on common criteria and effective assessment.

Aside from legislation against hate speech, the court of public opinion has mostly been in charge of defining racism and the appropriate punishment for those found guilty of it.

Social media are the vehicle of choice both for committing acts of racism and for meting out retribution, but racism means different things to different people.

Quoting the dictionary definition of racism is of little use, since we have a habit of either expanding it or contracting it to fit our own opinions for each situation. As an exercise, consider the following, and rank them according to your own view of the seriousness of the offence.

1. A hockey commentator chastises “you people” who immigrate to Canada but don’t wear poppies on Remembrance Day.

2. A prime minister is found to have worn “brownface” at costume parties.

3. An NHL coach makes racist remarks to a hockey player.

4. A woman taunts people sitting near her in a restaurant, saying they aren’t true Canadians.

Are any of these situations more egregious than the others? What factors do you consider in defining them as racist, or not, and in making your own judgment as to what should happen?

In each of those cases, apologies weren’t enough. Don Cherry tried to apologize but was fired anyway. Justin Trudeau apologized and almost, but not quite, lost his job. The woman in the restaurant apologized but was fired. Bill Peters apologized but was suspended, then resigned.

Immediacy isn’t always an extenuating factor, either. Cherry was immediately fired from his TV job, and so was the Lethbridge woman in the restaurant, but Trudeau’s and Peters’ indiscretions happened years ago. There seems no statute of limitations when the public’s indignation is aroused.

What about intentions? Does it matter if someone offends inadvertently, or is ignorance no excuse? It’s pretty clear, for example, that Trudeau wasn’t trying to be racist — he just likes to dress up on occasion, and has a habit of making bad choices.

Was Don Cherry intentionally being intolerant, or did he just get carried away with his fervor about the need to honour veterans? Many have said the latter. Did Cherry understand that “you people” is widely viewed as being racist, or is it just the way he speaks?

Clearly, there’s a difference between using racial slurs to intentionally belittle someone, but is the end result the same?

Premier John Horgan last week announced the creation of the Resilience BC Anti-Racism Network. By the sounds of it, it’s mostly an information, training and prevention program, not one that hands out punishment, but it might prove to be an important step.

The move came after Ravi Kahlon, the NDP MLA for Delta North, spent his summer travelling the province gathering ideas on how to deal with racism. He’s flying the idea of fining people for lesser offences relating to racism, the kind that currently don’t make it to court.

None of the examples I gave above was prosecuted other than by public opinion which, as I said, carries a lot of weight. The offences weren’t committed by organized hate groups, weren’t part of any campaign against minorities, didn’t involve violence.

But they have consequences, both to the perpetrator and the target. Society has decided it’s no longer the sort of thing we just put up with. The question is, how can their seriousness be defined, and how can appropriate repercussions be decided? There are no guidelines, and it would help if there were.

So, following up on Kahlon’s idea, what if a sort of bylaws court for hate offences was developed that could take care of things like the Burnaby convenience store case in which a customer berated clerks for not speaking English, or the examples above?

After all, we could take the position that racism is racism is racism, and one example is as ugly as the next, but is that really fair?

Suppose this special court operated under a set of criteria such as the ones I’ve mentioned. How much time has passed since the incident? Was an apology offered? Was the offence intentional? What language was used and to what degree are the terms offensive? Did it involve an overt slur? Did it occur in a public setting? Was it a first or second offence?

With those things in mind, our brief list might rank the restaurant rant and Peters’ insults ahead of the others, followed by Cherry and Trudeau. You might view it differently but the point is that one offence isn’t always the same as another, and that penalties should be somewhat different from one another.

Should those penalties involve community service? A public apology? Fines based on a system similar to traffic offences?

Such a system would have to be complaints based, and it would be a challenge to enforce. But each time it was, it would make a statement that if you engage in racist talk or actions, even though it falls short of violence or an all-out hate campaign, you’ll pay a price.

And, employers could make decisions based on these independent evaluations by the court system, instead of on the highly fallible court of public opinion.

Mel Rothenburger is a former mayor of Kamloops and newspaper editor. He writes five commentaries a week for CFJC Today, publishes the ArmchairMayor.ca opinion website, and is a director on the Thompson-Nicola Regional District board. He can be reached at mrothenburger@armchairmayor.ca.

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Remembering everyday violence against women and girls on Dec. 6

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It’s the National Day of Remembrance for the 14 women who were killed at the L’école Polytechnique in Montréal for being women and for being students in a discipline that, at the time, was wholly male-defined.

Across the nation and on different social media platforms, the remembrance is being marked by symbols and personal testimonies.

It’s a reminder that the violence has not ended despite the overworked sector of civil society — women on the front lines in shelters, rape crisis centres and counselling centres.

While the collective outpouring of grief that marks this day is anchored in a remembrance of the murders of women at the polytechnique, it is also imperative that high-profile acts of violence don’t overshadow the everyday, routine forms of violence that women suffer.

Six deaths every hour

The report of the Canadian Femicide Observatory for Justice and Accountability notes that around the world, every hour, six women are killed by men they know.

Femicide, or the killing of women because they are women, is underpinned by patriarchal ideologies that define how women should comport themselves. This ideology, grounded in the belief that men own women and that women need to be controlled, is also at the heart of gender inequities.

A woman places flowers on the monument dedicated to Maryse Leclair during a ceremony at Place du 6 décembre in Montréal on Dec. 6, 2003, to commemorate the 14 women slain by a gunman at l’École Polytechnique engineering school in 1989. THE CANADIAN PRESS/Paul Chiasson

Although the tragic events at the polytechnique occurred 30 years ago, women and girls in Canada today continue to suffer from the effects of patriarchal ideologies. They experience that patriarchy differently, depending on where they are located in the matrix of domination — the axes of race, class, gender, religion, age, ableism and sexuality that criss-cross society and heighten the vulnerabilities of some women more than others.

The Missing and Murdered Indigenous Women and Girls Inquiry reveals the extent to which Indigenous women, girls and LGBTQ+ are dehumanized and subjected to violence. Canadian statistics reveal that a woman is killed every five days by an intimate partner or a family member. Murder is the finality in the continuum of violence that women and girls experience.

Privilege does not shield

We can’t forget these deaths — the murders that are reported in short, terse paragraphs in the news, or that are accounted for only by organizations situated in particular communities, or remembered by close family and kin.

These deaths testify to the presence and power of patriarchal values and traditions. Similarly, while groups like the incels have attracted power and attention, they remain the tip of the iceberg. There are countless everyday expressions of male power and violence that work to constrain women.

Much like how the focus on racism that tends to be restricted to the actions of extreme hate groups and their acts of violence, the systemic, everyday racism that permeates society also needs to be named and dealt with.

The takeaway of the murders at the polytechnique is this — violence that is endemic and coursing through society is violence that crosses the boundaries of race, class, age, sexuality, gender and religion. It’s violence that is anchored in the view that women are inferior, less than men, and to be controlled by men.

The 14 women killed at the polytechnique were white, middle class and educated, and this did not shield them from patriarchal violence. What then about the women who have no such privileges? How best can we remember them?

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