Saturday, May 15, 2010

The 2010 Toronto Blue Jays

We've seen it before; only a mere year ago Jays fans were rejoicing in an unfamiliar feeling: legitimate contention. The Jays had gotten off to an unexpected 27-14 record by May 19 which was good for first-place in the best division in baseball. We had the best pitcher in baseball - Roy Halladay - and a seemingly endless supply of young arms to back him up. May 19 however, would be a turning point for the season and begin a nine game losing streak with sweeps by Boston, Atlanta (at Atlanta), and Baltimore. Injuries depleted those young arms and losing beget losing as the Jays stumbled to a 75-87 finish. Now as the Jays have overachieved once again to start the season but this time the atmosphere seems to be different. The bubble from last year has been popped and support for the Jays are now a soapy mess as fans say "not again". The cavernous 50,000+ seat Rogers Centre looked terrible with 20,000 fans in it in past seasons and this year it looks downright embarrassing with 10,000 people. Neither the Raptors nor the Maple Leafs are in the playoffs yet no one seems to be willing to talk Jays. It was as if the team were relegated to second-class status along with Toronto FC and the Toronto Marlies. Meanwhile, the Jays are becoming a feel good story in the MLB whether anyone in America and many in Canada notice or not.

Fred Lewis has been an incredible find and brings Toronto its first genuine lead-off hitter since Shannon Stewart circa 1999. Lewis doesn't steal a lot of bases (3 SB out of 5 attempts) but has good speed on the basepaths and certainly has the attention of opposing pitchers and managers. Vernon Wells is having a comeback year after years of being mired with nagging injuries. Fans may boo him for not living up to his $20 million contract but he is all too aware of the expectations that he has missed. This season Wells is confident that he is 100%  and in the power vacuum that was left with Roy Halladay's departure Vernon stepped up into a more vocal and veteran role. He is finally silencing critics with a .306 AVG, .980 OPS and 10 HR in 37 games. Travis Snider seems to have turned a corner in recent games and despite his struggles has still managed to hit 6 HR and .806 OPS. Jose Bautista does many things well as he can hit for power (7 HR) and patience (21 walks) and can steal a few bases when needed. I have not mentioned Aaron Hill and Adam Lind yet partly because they have had poor starts after their breakthrough seasons last year, a "sophomore jinx" for success, and are batting .184 and .223 respectively. They maintain in their regular 2 and 3 spots in the lineup and despite their struggles the Jays have still found a way to win. When the two offensive stars for the Jays come around and come even close to the levels they reached in 2009 the Jays offense should look downright dangerous. They Jays already lead the MLB with 57 HR (9 more than second-place Boston) and score just as many runs as the Red Sox and a few behind Tampa Bay and New York at the top. The Jays have done this with a balanced team effort with 10 HR from Alex Gonzalez and Vernon Wells and 8 HR from John Buck. Lyle Overbay has been a disappointment and hasn't had a good season since 2006 but is in the last year of his contract and Brett Wallace (traded from Oakland for Michael Taylor) seems ready to take over afterwards.

The biggest question mark for the 2010 Jays was how they could survive an entire season with inexperienced and, in many cases, rehabilitating arms. One of those rehabilitating arms was Shaun Marcum who was chosen as the opening day starter and defacto ace. Marcum despite missing all of 2009 has the most MLB experience on his belt - including a spectacular first-half of 2008 - among the Jays' starting rotation. The ace in waiting is obviously Ricky Romero, who notched a 12 K one-hitter earlier this season and struck out 12 again against the Texas Rangers in a complete game shutout. Brandon Morrow and Dana Eveland, two Alex Anthopoulos imports, have been volatile but have shown signs of brilliance. Morrow in fact leads the AL with 11.83 K/9 IP while Eveland's only poor starts were against Boston (twice) and Oakland. In the bullpen, Kevin Gregg has truly been a lights-out closer. This should be no surprise considering that Gregg averaged 28 saves over the past three seasons in the NL for the Florida Marlins and Chicago Cubs. Scott Downs is consistently tough - against right and left handed hitters - while Shawn Camp and Rommie Lewis deserve honourable mention as well.

The Future
Make no mistake,  I am no homer that is claiming that the Blue Jays will win the World Series this year or even the next for that matter. However the true beauty of sports is its unpredictability and although the Jays were given 100:1 odds to win the World Series this year, there is always that one instance where they shock the world and win it all. There is no reason why the Jays cannot keep up their current pace and finish third - a mere afterthought only a few years ago - ahead of one of the Boston Red Sox, New York Yankees, or Tampa Bay Rays. For a team that has proclaimed that they are in year one of a long-term rebuilding project that would be a tremendous accomplishment and catalyst for future success along the rebuild. For realists out there, the Jays are not contenders but you can take solace in the fact that you are watching some of the pieces of the future contending Jays teams. Based on the make-up of the younger players on the team and in the farm system the team should be comprised with big sluggers - Adam Lind, Travis Snider, J.P. Arencibia, etc.. - and strong starters - Ricky Romero, Kyle Drabek, Zach Stewart, etc... Anthopoulos has handled his responsibilities capably including snagging two top prospects for Roy Halladay in a deflated market and increasing scouting expenditures. He appears sincere when he says that this will be a legitimate rebuild and that he will not sell-out the team by making an expensive signing or trade to improve the team in the short-term. He also appears sincere when he says that in the meantime, the Jays will be more competitive than most fans think. The fans in Toronto do not seem to be convinced and have stayed away in droves. It is true that winning is highly correlated with attendance however I believe that the experience trumps all other factors. The Rogers Centre and the Blue Jays have never been considered hot tickets in town and it is very common to see waves of disinterested fans clearly there because of a work outing. The rebuild must transcend the team itself and focus equally on rejuvenating a detached fan base. The city can draw on its glory days of the early 1990s when the Blue Jays were the best organization in baseball and regularly led the league in attendance and it is only fitting that the same man who oversaw that period is at the helm now. Can Paul Beeston strike lighting twice?

Top 30 Blue Jays Organization Prospects

Thursday, May 13, 2010

Book Review: Wal-Mart: The Face of Twenty-First Century Capitalism

A group of intellectuals tackle America’s giant

Nelson Lichtenstein, Wal-Mart: The Face of Twenty-First-Century Capitalism (New Press, 2006)

On average, every minute almost 10 000 consumers visit an American Wal-Mart store. It is the largest private employer in the United States and Mexico and operates stores in eight different countries. There is no denying the ubiquity of the corporation in our everyday lives and the significant role that it plays in determining the future of our world economy. Nelson Lichtenstein attempts to explore the profound influence as well as the humble beginnings of this multinational giant in his collection of essays, Wal-Mart: The Face of Twenty-First-Century Capitalism. Lichtenstein, a professor of history at the University of California Santa Barbara, assembled the diverse group of scholars to compare their perspectives on Wal-Mart and the “global manufacturing-transport-distribution chain in which that corporation is the largest and most significant link” (x). The common theme that is expressed throughout the book is that Wal-Mart has become the template for twenty-first-century capitalism. While all of the contributors may agree on that aspect, their opinions deviate on whether this template is the source of a capitalist revolution or demise. Although each essay is written independent of each other, they are broadly organized into three sub-themes: History, Culture, Capitalism; A Global Corporation; and Working at Wal-Mart. These three themes aim to explain Wal-Mart’s phenomenal rise to the top, and their strategies to remain there.

Wal-Mart’s ruthless ascent to the top is as much attributable to favourable timing and location as its charismatic founder, Sam Walton. The first Wal-Mart discount store opened in Bentonville, Arkansas in 1962 with a simple concept; generate high inventory turnovers using low markups. In order to maintain low markups, Walton realized that it was absolutely necessary to keep labour costs at a minimum. Fortunately, the New Deal and civil rights revolution had not been firmly established in Arkansas which meant that Walton could play around with minimum wage laws. Moreover, thousands of men and women were desperate for jobs after the agricultural revolution, which made farming more capital intensive. As the years went on, Wal-Mart capitalized on events such as the failure of unionization in Arkansas, Reaganomics, and NAFTA to keep costs low. While other discount retailers and the dominant corporation of the time GM suffered from rising wages, Wal-Mart actually saw their real wages decrease in the years after 1970. This is nothing out of the ordinary as Wal-Mart has built an empire based on being different and trying new techniques to increase efficiency. As Wal-Mart grew, it tirelessly searched for innovative technologies to implement in order to improve their economies of scale. For example, the use of communications technology reduced management costs and allowed Wal-Mart to expand while still being able to micromanage each individual store. It was evident that Wal-Mart was changing the way retailers conducted business. It was only a matter of time before Wal-Mart took over the rest of the world.

For years, retailers were forced to accept the manufacturer’s prices if they wanted to do business. The emergence of Wal-Mart shifted the power towards retailers because manufacturers were fighting to get their products on Wal-Mart’s shelves. Also, the rapid growth of global manufacturers gave retailers more choice, and often a cheaper option than its American counterparts. This power shift ushered in an era of post-Fordism, a period characterized by globalization of production, extreme capital mobility, and high levels of employment insecurity and stratification. A prominent feature of the post-Fordist economy was the logistics revolution of the global distribution chain. As the proportion of merchandise being imported was dramatically increasing, a more efficient method of trade was necessary. Of course, Wal-Mart set the template with inter-modal freight transport and Radio Frequency Identification (RFID) tags. Inter-modal transport used more than one mode of transportation to move freight which Wal-Mart used in conjunction with their famous distribution centers. This method resulted in a faster and cheaper way to get inventory. Accordingly, the system of production and distribution shifted from push to pull, where the retailer tracked consumer behaviour and demanded an exact amount. Wal-Mart used this pull system to keep wastage to a minimum and constantly improved it by sharing consumer data with its suppliers. The result is greater sales and lower costs for both Wal-Mart and its suppliers. Wal-Mart’s globalization of the distribution chain continued past the supplier as they began to open retail stores worldwide. As Chris Tilly points out in his essay, one of their most successful ventures was in Mexico. In fact, it’s 2004 sales in Mexico were greater than the next three leading competitors combined (189). The point is reiterated that Wal-Mart has built an empire based on taking advantage of favourable conditions. Firstly, thanks to the North American Free Trade Agreement (NAFTA), goods could move freely between America and Mexico. Also, at the time there were few large, modern retail stores and on top of that, Wal-Mart bought the leading retailer in Mexico, Cifra. The low income population welcomed Wal-Mart because of the cheap goods and the abundance of jobs, which paid relatively well for them. There are however, limits to this success. Since Wal-Mart has established itself as a template business, other Mexican retailers have begun to modernize and adapt some of their efficient practices. As Wal-Mart’s piece of the pie is decreasing, the pie itself is also shrinking. The polarization between the rich and the poor is expanding and with the ever-present risk of economic recessions, less people can actually afford to shop at Wal-Mart. Nevertheless, Wal-Mart was a trailblazer in international expansion for retail companies, who previously preferred to stay in North America. As the section suggests, Wal-Mart has truly become a global corporation and their ideas involving globalization – intermodal transport and international establishment – have become the model for large-scale growth for companies in America.

Wal-Mart’s non-conformist ideology has historically changed the American economy and is currently revolutionizing the global economy. However, there is one issue where Wal-Mart’s refusal to let up has drawn a storm of criticism. The final theme that the essays explore is ‘Working at Wal-Mart.’. This is the aspect of the Wal-Mart template that people fear most. For years Wal-Mart has been accused of “vociferous antiunionism, embedded gender discrimination, compulsive cost cutting and near comprehensive control over workers and the workplace” (213). In Wal-Mart’s defense, these practices have been rampant in discount retailing for years. It is just that Wal-Mart has become the epitome of bad labour relations because they have so ruthlessly used them to their advantage. The author depicts working at Wal-Mart as a demanding and unjust occupation. Every single employee from top to bottom of a Wal-Mart store each faces his or her own difficulties from the authoritarian executives. The lowest paid employees, in addition to being poorly compensated, are under constant surveillance. The threat of unionization was so great to Wal-Mart that private investigators and lie detector tests were often utilized in stores. When exceptional workers seem interested in forming a union, managers find fault with their work and fire them. To ensure maximum productivity, workers are shamed in front of their peers for bad jobs and constantly taken down a notch to prevent them from aspiring towards greater pay or position. These stressing conditions are only the beginning for female workers. The culture of Wal-Mart has always been patriarchal with a vast majority of men in managerial positions. It stems back to the early days when it was thought that promotions should be reserved for men because they were responsible for supporting their families. Women have consistently been paid far less than men at Wal-Mart and are rarely given the opportunity for advancement. This discrimination has become so endemic that a class action lawsuit has been filed by 1.6 million women who claim that they have been denied promotions and raises. As the template of American business, the result of this case may set a precedent that will echo throughout every workplace in the country. The blame for all of this discrimination cannot be placed squarely on the managers. Near impossible demands are given to store managers who have a limited wage budget to spend. Managers are expected to continually cut costs and increase sales which the executives constantly monitor. A common message from executives is “if you don’t beat yesterday, management could have your job at any moment” (254). It is easy to understand why some managers might be tempted to resort to unethical practices such as the discriminatory acts towards workers. Fortunately, progress has been made in the fight for greater labour rights at Wal-Mart. Aside from North America, all Wal-Marts around the world are unionized. The difficulty in getting unions in North America is Wal-Mart’s use of leverage in denying unions to form. Unless the entire American Wal-Mart workforce (1.3 million people) does the impossible and unites together to fight for a union, Wal-Mart can always fire the employees in favour of unions. Union expert Wade Rathke advocates a ‘Wal-Mart Workers Association’ that stands up for labour rights and provides a voice for workers. The prevailing belief among unionists like Rathke is that if nothing is done to prevent to conditions that are in place in Wal-Mart today, the future is not only grim for the state of workers in Wal-Mart, but for companies everywhere.

By the end of the book, there is a clear notion that Wal-Mart has and will play a big factor in our world economically, socially, culturally, and politically. It is the model of efficiency and innovation. It is spreading its mid-west values throughout the world. It is the heartless giant that treats its employees unfairly. It is Wal-Mart. This is the message of Wal-Mart: The Face of Twenty-First-Century Capitalism. Unlike its topic of focus, the book itself is inefficient in delivering that message. That is not to say that it is not an excellent read for one who wishes to get a comprehensive look into the history, culture, and ideology of the much revered company. However, while you are being served a full plate of information and statistics, you are also being stuffed with author bias and conflicting opinions. Ironically, the appealing strength of the book doubles as its inherent weakness. The diverse group of contributors provides an in-depth examination of the retailing giant from different perspectives but this interdisciplinary approach is hardly effective. Although Lichtenstein wants to present both sides of the argument, his collection is like listening to a debate where the opposing sides are arguing different topics. While James Hoopes seems to toe the company line by declaring “there is no denying the high morale of many Wal-Mart employees” (98), David Karjanen argues that Wal-Mart “simply cannibalize[s] sales from existing firms putting them out of business” (157). Amidst all this, some essays managed to stay neutral and provide an impartial view on Wal-Mart. In Lichtenstein’s own essay, he provides and excellent example that illustrates the varying impacts of Wal-Mart. He introduces four women: a single mom who depends on Wal-Mart’s low prices; a woman who lost her job as a result of Wal-Mart forcing other companies out of business; a Chinese labourer that makes goods for Wal-Mart for low wages; and the loyal wife of a Wal-Mart assistant manager. Four women. Four lives affected. Two for the better and two for the worse. Chris Tilly also provides an interesting look into Wal-Mart’s expansion into Mexico by observing the favourable conditions for Wal-Mart’s entry but also mentioning the limiting factors that could affect its growth.

Another deficiency of the collection of essays is since the contributors explore different issues and topics, there is little to no continuity between the chapters. They are autonomous of each other and show that little planning was made beforehand to link them together. While the essays are sorted into three loosely based sub-themes, some essays are expository and do not aid in the exploration of any themes. The essays in each section can be read in any order and still have the same effect. A more effective manner would be to present them cumulatively so that each essay builds upon the next. Once you reach the conclusion, you will be able to reflect upon the themes and concepts more adeptly than before. The fact that there is no true concluding essay to this collection leaves us searching for closure on the themes that were explored.

The essays themselves were quite well-written as is expected from a group of professionals and academics. The level of language and use of business terminology was suitable for university level students but some business concepts may be unknown to the average reader. The clean organization of each essay into sub-headings made the information easier to read and comprehend. Each author provided ample amounts of evidence to support their statements and the information was presented in a variety of ways. Many real-life examples were given to show the practical implications of Wal-Mart’s influence and occasional graphics were displayed for the reader to visualize the information.

Overall, Wal-Mart: The Face of Twenty-First-Century Capitalism is definitely required reading for anyone interested in Wal-Mart. It poses a simple question: To what degree will Wal-Mart create the template for twenty-first-century capitalism and what does that mean for us. Although the answer is not presented clearly by the authors, it provides enough information for the reader to formulate his or her own opinion. Therefore in a way, the book acts like a Wal-Mart manager. Stressed to accomplish an ambitious task – investigate Wal-Mart as a template of capitalism -, the book makes the reader go overtime to do all of the work. At the end up the shift, the reader is left with a feeling that they did not get what they deserved.

Book Review: The Sum of Satisfactions: Canada in the Age of National Accounting by Duncan McDowall

Making Sense Out Of Numbers
The Story of Canada’s National Accounts

McDowall, Duncan. The Sum of the Satisfactions: Canada in the Age of National Accounting. Montreal: McGill-Queen's University Press, 2008.

                 We live in a world of limitless information. On command, Google can retrieve virtually any piece of information in less than a second. Every month, economists spew out new numbers such as unemployment, inflation, and national production. It is hard to believe that merely one hundred years ago Canadians were leading the worldwide charge towards sophisticated fiscal calculations. The Sum of the Satisfactions: Canada in the Age of National Accounting tells the story of the Canadian academics charged with the task of creating Canada’s first national accounts. The tale and its characters are brought to life by the vivid storytelling of Canadian historian Duncan McDowall. McDowall is a professor of history at the University of Carleton with interests in business and political history particularly the Canadian banking system. However, McDowall is also concerned with Canada’s role in the developing world and the nation of Bermuda’s modern tourism (Department of History 2009)[i]. McDowall has been named “Most Popular Professor” by Maclean’s Magazine four times including a three-year streak from 2002-2004. The Sum of the Satisfactions is McDowall’s lecture to the public. He proves why he’s among the best professors in Canada with an informative read but don’t expect him to win any Pulitzer prizes.
Early in the book, McDowall flexes his historian’s muscles and reminds the reader that national accounts were hardly a new idea. Medieval monarchs in Europe sought to calculate their national wealth and trade leading to the works of William Petty and Fran├žois Quesnay. Leading up to the 20th century, fiscal calculations in Canada were still very naive but important nonetheless such as Robert Gourlay’s agricultural survey of Upper Canada and the early censuses. The latter were carried out by the Dominion Bureau of Statistics (DBS) which was the forerunner to Statistics Canada. Coinciding with the 1915 census, Robert Hamilton Coats, the Dominion statistician, made early estimates of Canada’s national wealth to be over $16.3 billion. The year 1918 would mark a turning point as the next couple of years would see the inclusion of product classification, a base year, gross and net production, and foreign trade into the national accounts (31). Despite all these advances, the data still failed to adequately capture what was actually happening in the economy.
The Great Depression would be the catalyst for demonstrating the need for better national accounts. Harry Stevens, then the minister of commerce and trade stated that the self-correcting model of the economy had failed (37). The depression had exposed glaring inequalities between the provinces (38). In response, Prime Minister R.B. Bennett created the Economic Council of Canada in 1935 because as Coats believed, the key to the economic system lay in intelligent intervention. Later that year, William Lyon Mackenzie King would regain the Prime Minister’s office and establish the Royal Commission on Dominion-Provincial Relations also known as the Rowell-Sirois Commission (39). Four economists were commissioned to study national income and government’s contribution to generating income. As McDowall puts it, the four economists asked to “completely reconceptualise how Canadian policymakers understood the economy” (46). Despite only twenty years of data from DBS, the Rowell-Sirois Commission produced the province-to-province breakdown of salaries paid and investment income. The final report, released in 1940, recommended the establishment of a permanent staff to collect national data.
Canada followed a strong worldwide Keynesian trend during World War Two as the need for government intervention increased. Committees such as the Wartime Prices and Trade Board and Economic Advisory Committee were created (57-58). The Rowell-Sirois Commission called for provincial tax income to be redistributed based on socio-economic conditions. Social welfare was gaining supporters with the implementation of unemployment insurance in 1941. All of these programs required proper numbers before they could be advanced (76).
In England, economist Colin Clark made tremendous progress when he realized that everything that is produced by an economy must be equivalently consumed (63-64). By 1944, British economists Richard Stone and James Meade, based on Clark’s breakthrough, had published a national income and expenditure model for calculating national income (66-67). Meanwhile, American Milton Gilbert was developing similar income and expenditure models (67). In 1944, Stone, Gilbert and George Luxton would represent Britain, U.S. and Canada respectively in a meeting to set up standardized national accounting principles (85).
Two prominent Canadian statisticians around this time were Luxton and Agatha Chapman. McDowall notes their similarities as both were academics from affluent British families. The two likely met as members of McGill’s Student Christian Movement which was rooted in Marxist and socialist ideologies. Afterwards, Luxton and Chapman’s careers would intertwine at Sun Life Financial and then at the DBS. Luxton would go on to become chief of DBS’s Research and Development Staff (83)before succumbing to tuberculosis in 1945 (93).
There were many other rising Canadian statisticians that McDowall spends some time describing. The Research and Development Staff at DBS included young intellectuals like David Slater, Thomas Rymes, Hans Adler, and Simon Goldberg (114). Goldberg would eventually become director of research and development. Two other Canadians, Larry Read and Jenny Podoluk made major advancements by showing Canada’s income distribution by class and province. Canada also began to calculate GNP in constant dollars to negate inflation and Canada’s seasonal economy (116).
By the 1950s, Canada’s national accounts were among the best in the world (119). With constant improvement, Canadian national accounts were seen as on the forefront of the field (128). In 1957, Toronto accountant Walter Gordon managed to predict Canada’s economic prospects up to 1980. Using research from DBS, Gordon’s report predicted a shrinking agricultural sector, increased foreign investment, and the growth of the service industry (124).
Computers were first introduced to the DBS in 1960 for data processing and storage (140-141). Among other things, computers made it possible to use econometrics. Throughout the 50s and 60s, econometrics gained fame as both a broad economic predicator and focused tool of performance measurement (144). However, national accountants were less than enthused about econometrics as their goal lay in dissecting the past, not envisioning the future.
Calculating production proved to be harder than originally thought. The concept of production, gross domestic product per unit of labour, seemed simple but its application was more complex (146). The DBS created two productivity indices: one for farm business and one for individual industries (147). Their calculations showed that from 1949-1962, growth in employment contributed to 45 percent of GNP growth in Canada versus 55% from increased output per worker (147). Critics however doubt the validity of these statistics because many factors were excluded from the calculations.
McDowall then introduces the reader to Wassily Leontief, the founder of input-output analysis. In 1936, Leontief developed a market matrix that segregated economic transactions. This matrix showed the inter-industry relations of an economy and helped statisticians create better benchmarks for GDP. Leontief further posited that inverting the matrix can demonstrate the impact of a decision in one industry on all other industries (150). In Canada, the first input-output table was made by Jack Sawyer in 1956. Input-output tables suited Canada’s regional industry because statisticians could focus on how one region can affect others (154).  Two Canadian academics were responsible for pushing Canada’s input-output reputation to worldwide acclaim: Kar Levitt, a professor at McGill University who studied the maritime region’s economy with input-output tables and Tadek Matuszewski who used input-output tables to show which commodities each industry consumed (158). By the late 1960s, computers and econometrics were helping Canada release more detailed and swift income information.
While Canadians were getting better at calculating GNP, its practical uses were limited. The GNP worked as an economic summary but could not understand issues such as quality of life, environmental deterioration, and resource depletion. In 1972, Prime Minister Pierre Trudeau appointed Sylvia Ostry as the new chief statistician at DBS. Ostry brought a demand for better qualitative measures to the DBS which was centred on the idea of “new welfare economics” (173). National accountant Hans Adler counter-argued that issues of morality and growth were up to policy makers, not statisticians at the DBS. Ultimately, Adler conceded to the demand for including social welfare factors into national accounts. The national income now included social factors such as household work and environmental impacts 175). In order to add these factors, the DBS used social indicators that imposed weights on existing national accounts.
McDowall juxtaposes opposing sides of a debate to give the reader an objective insight. On the issue of including household work in to GDP calculations, McDowall presents the arguments of two prominent economists: Adler and Richard Lipsey. Adler had calculated in 1978 that household work would account for 40% of Canada’s GNP if included with the national accounts. Lipsey questioned this number with the counterargument that calculating household work would require speculative evaluation, thus tarnishing the statistical integrity of GNP. Other attempts to include “social indicators” such as pollution were also met with resistance from traditional economists.
The economic collapse of the 1970s shook paradigms of economists everywhere. Chronic stagflation brought soaring unemployment and high inflation at a time when growth seemed inevitable (187). The DBS was pressured to provide quicker, more responsive data to cope with these problems. Ironically, at a time when they needed accurate data the most, the rushing of statistics meant only shallow revisions were made rather than extensive analysis (189-190). The reputation of Statistics Canada continually took a beating as statistical experts were constantly missing the mark on key economic indicators. Government officials were starting to lose faith in the entire system of national accounts (191-192). McDowall notes that the problems at Statistics Canada stemmed from intense infighting and a diminishing reputation. Statistics Canada was even accused of deliberately trying to influence the 1979 general election (198-199). These mounting problems eventually led to massive changes at the organization. Sir Claude Moser, the president of the British Royal Statistics Society examine the workings of Statistics Canada and reported that the producers of the national accounts needed to be in closer contact with the users of those national accounts in public and private sectors. Furthermore, the organization was lacking financial and administrative resources. In 1980, Martin Wilk was appointed to the chief statistician post with the promise of effective and responsive leadership in the face of changing times.
 The final chapter begins in the year 1993. The System of National Accounts, the first manual of national accounting since 1968, was released as a collaboration between 65 experts from 40 countries to create a universal system (208). Four years later, Canada would revise the System of National Accounts to better suit Canada’s needs. Canada’s ability to adapt to international standards proved that actions taken since the tumultuous 1970s had worked. Wilks raised morale with more of a bottom-line management style and improved accuracy with efficient computer system (215). Statistics Canada had created a statistical council in charge of strategic guidance and to minimize the gap between makers and users of statistics (213). Ivan Fellegi replaced Wilk in 1985 and continued in his predecessor’s goal of renovating old statistical methods. Fellegi became more attentive to the environment and non-market activities. One of Fellegi’s top projects was creating constant dollar input-output tables for provinces. Kishori Lal led the project overcoming obstacles such as cross-provincial trade flows. These input-output tables were extremely useful when measuring the impact that the Goods and Services Tax would have on provinces (222).
The 1990s resurfaced pesky problems of national accounting while introducing newer more complex complications. Debates still raged over whether to include resource depletion and the Keynesian model but newer issues involving how to measure technological advances and tourism were just as important. In the end, Statistics Canada was very conservative in changing their methods due to the difficulty in their calculation (233).
To respond to the growing demands for environmental accountability, Statistics Canada renamed their Income and Expenditure Accounts Division to the National Accounts and Environment Division (241).
McDowall parting words convey the need for better national accounts that can measure one’s quality of life. One example is the Genuine Progress Indicator (GPI) which measured progress after defensive expenditures such as resource depletion.
McDowall's extensive historical research relies on numerous interviews of key participants. This helps put a face on the otherwise anonymous public workers who revolutionized Canada’s world-class system of national accounts. He clearly is very knowledgeable on the historical facts and stories of Canadian national accounting.
The book can be confusing at times jumping back and forth between years. While structure is generally chronological, McDowall veers off course from the main storyline many times. Consequently, the reader is left trying to piece together a timeline. McDowall’s digressions also disrupt any flow for the reader as they are bogged down with irrelevant facts. At times, the book feels long and drawn out as McDowall includes the back stories of too many people. In some cases, knowing the context of these people hardly added to the overall point.
The story of national accounting was far more interesting that I would have ever thought. It was a good read about Canada and also the world throughout the twentieth century. I would recommend this book to anyone with a serious interest in business or history. McDowall uses accessible language for a university level reader in six well written chapters. His writing tends to drag at times which can lose anyone with less than a passing interest in national accounting. The book could have fared better if it were shorter and saved some trees.
The real power of The Sum of the Satisfactions: Canada in the Age of National Accounting is its potential as a teaching utility. This book is an export of Canada’s best professor that should be shared in economics, management, and history classes worldwide. As for the other faculties, The Sum of the Satisfactions may not add up for them.

[i] Department of History. 2009.

Tuesday, May 11, 2010

A Super League: The Premier League of Hockey

Most people in North America watched the men's hockey gold medal game at the Vancouver 2010 Olympics - by most I mean Canadians and anyone who drinks beer in America - and saw a glimpse of elite world-class athletes performing in an immensely important game. After Canada's "national moment" ended, the hockey players returned to their various professional teams and in the case of Switzerland their white flag factories. The NHL resumed with its thrilling Atlanta Thrashers-Tampa Bay Lightning type match-ups day after day. The overall level of play declined and not even Stanley Cup finals could match the intensity and skill of any Olympic hockey game. The All-Star game is a farce; the skills competition is alright. A team full of goal scorers is surprisingly not fun to watch despite the defense's hilarious pylon impressions. At least in the skills competition the All-Stars can actually show off their skills with real pylons. Which reminds me, there are too many players at the All-Star game. In fact, give me Alex Ovechkin, Sid Crosby, and Roberto Luongo in a game of hog until 21, win by two, and I would definitely watch that for the five to ten hours that it may take.

Perhaps the only way to muster high-level intense play is by igniting the nationalism within each player. Of course professional players make a great living playing in the NHL but who can represent their nation without giving everything they had. I know there are many international hockey competitions but they are all basically the same format and many top players opt out to rest during the NHL off-season.


A Super League. The ASL would begin with 6 (possibly five) teams with traditional hockey powers Canada, USA, Sweden, Finland, Russia, and the Czech Republic and Slovakia only if they joined together Belarus if they don't.These teams would play a season of 16 games weekly - a la NFL - with a heavy emphasis on long home stands and regional games. By the looks of it, there can be three quasi-divisions that will play each other eight times and then play the other teams twice each. In North America, the games in both countries are practically shared home game as they are for Sweden and Russia and Russia and mini-USSR. At the end of the 16 game season, every team makes the playoffs and the teams are ordered 1-6 by season record. Top two teams get a bye in a single elimination tournament to win the greatest trophy in the world - naming rights to be determined - and the right to hockey's international throne. Which player won't fight hard to win that for his country? You become to hockey what America is to the world: the shit (in a good way). You are the decision-maker for influential changes, get preferential treatment in competitions, and hold the chair of the International Ice Hockey Federation. Heck, I like their logo so much that the league should just be named to IIHF. I may not roll off the tongue in English but it is contagiously catchy in Finnish.

There would be a lower league of any country that wants to fund and enter a team (including "Team Bs" from current nations in the ASL) to compete for entry into the league. Every team in the inferior league would have a chance to play three of the ASL teams. There is a little excitement over the draw aspect of which three teams each nation must face. If a TIL team can beat one of those teams then they are allowed entry into the ASL for the year. Any team currently in the ASL that has a losing record against every team is booted down to the TIL.

Meanwhile, all of the other top hockey players are still playing in the NHL. The teams are a little thinner on talent and as a result teams will certainly contract, which should be happening anyways. Give me eight Canadian teams and eight American Teams. The talent level wouldn't be that bad if you look at all the competitive teams you could make with the Canadians who were left off the Olympic roster. NHL games would be a nice filler for hockey on weekdays and complement to the premier ASL on weekends.

It's a bold move that may be logistically impossible but who would say no to marquee Canada-USA; Russia-Sweden double headers every Sunday afternoon?

Are Hung Parliaments a Good Thing? 99% of Men Say Yes; Women are Split.

The frenzy of the U.K. general election has flowed untapped even days after the May 6 election where David Cameron's Conservative Party won a plurality of seats with 306 Tory seats out of 605 in the British House of Commons. This of course means that the Conservatives were denied a majority government - assumed a sure thing merely months ago - despite a 187 seat swing between the Tory and Labour parties. This represents the first hung parliament in the U.K. since 1974 - when the Labour Party claimed four more seats than the Conservatives - and only the second time since World War Two. As expected, David Cameron has assumed the head of government in a coalition with the Liberal-Democrats despite Gordon Brown's resignation just hours before Cameron's announcement. Brown's uninspired tenure as Prime Minister and Wile E. Coyote impression in the 2010 general election may have triggered the end for New Labour leaving the party fertile for generational and ideological change. It was no coincidence that Britons preferred the younger leaders Nick Clegg and Cameron.

In Canada, we have had minority governments since 2004 and one of our greatest Prime Ministers Lester Bowles Pearson introduced universal health care, student loans, the Canada Pension Plan, Order of Canada, and the current Canadian flag in only two minority governments over five years. Given the nature of the Canadian political landscape, Canadians should expect to see many more minority governments in the future. Canada, as a left-leaning country - despite the best efforts of conservative think-tanks to persuade us otherwise - generally votes more for left-leaning parties than right-leaning parties. However, those leftist votes just happen to be divided between the Liberals, NDP and Green parties and arguably even the Bloc Quebecois. There are also the extremist votes to go to the odd Marxist-Leninist or Marijuana candidate in the suburbs. Canada seems to have a lot of these fringe parties although they are largely unknown to Canadians except on election day. Meanwhile, the roughly 1/3 of Canadians who regularly vote Conservative have overcome the divided majority of Canadians left of centre to prop up two Conservative minority governments since 2006. In fact, Harper has had his chances for the elusive majority however his cold gaze surprisingly frequent mishaps have left Canadians reluctant to ever give him the reins. The last Liberal majority came in 2000 during the last vestiges of a divided right while the last conservative majority needed an utter collapse by John Turner and the Liberal Party. A divided left and unlikeable right abates any significant and enduring majority governments which will not change until there is significant and enduring change in the Canadian political landscape. The primary catalyst for minority governments are third-parties which in Canada are particularly thorny and complicated. The Bloc Quebecois have been an influential force in Canadian politics over the past two decades and although many outside of Quebec feel that the separatist movement has died down from the heydays of the 1995 referendum, Bloc support has remained steadily near the 54 seats they won when they formed the Official Opposition in 1993. The NDP has a rich history dating back to the days of Tommy Douglas - the greatest Canadian and father of Canadian health care - and before that when they were named the Co-operative Commonwealth Federation (Farmer-Labour-Socialist). Although the NDP have never exceed the Bloc Quebecois in terms of seats, they are essentially Canada's third national party leading to many instances of vote-splitting with Liberal candidates. As the Green party establishes itself in the minds of voters with each successive election, their votes will turn into seats that will inevitably come at the expense of the Liberals and/or NDP.

This is obviously a problem for democracy when a majority of voters can be against the current government. Of course this is unavoidable in minority governments however those are typically characterized by coalitions between groups representing voters. Since 2006, the Conservatives have stayed afloat by sheer intimidation and political hustle with a dash of Liberal ineptness and vacancy. While this can serve as a model for effective political leadership it is by no means a model for effective governance. One potential solution is electoral reform to a system that better represents Canadians.

In 2005, 57% of British Columbians voted in favour of switching to a single transferable vote where voters rank their preference of the candidates. If a candidate reaches a certain quota of 1st place votes then he or she is the winner and excess seats trickle down the the next preference. If no candidate reaches the quota then the last place candidate releases his votes and the next preference of those ballots are counted and so on until a winner is declared. Thus, in many ridings where votes are split between three parties the third party's voters would essentially decide the riding. This system maintains proportional representation while reducing wasted votes on sure winners or losers. Despite winning a majority of the vote, the reform in B.C. did not reach the 60% that it needed.

Ontario and Prince Edward Island have each had separated referendums while Quebec is debating to switch to a mixed member proportional representation system where two votes - one for a candidate and one for a party - are cast so that winning candidates may not necessarily be affiliated with the party that wins their riding. While this does not directly deal with the issue of reoccurring minority governments, it is an interesting separation of the member of parliament from political affairs and may lead to more personalized governance.

Regardless of whether electoral reform is likely or not, the barriers of entry for political parties need to be taken down. While there needs to be certain regulations in place to prevent the influx of Rhinoceros Party clones I would rather err on the side of silly satire than oppressed opposition. With more groups involved in the political process one of two things may happen. 1) Smaller parties may consolidate together as we have seen in the past and we will be back to square one or even worse and American-style two party system or 2) The broad spectrum of political groups makes decision-making less centralized requiring clear consensus and capable coalitions.

At least for now Canada has something in common with horses, Thomas Jane and Greg Oden: we are all publicly well-hung.

Elena Kagan: Another Supreme Letdown for Liberals

 On May 10, 2010, U.S. President Barack Obama chose Solicitor General Elena Kagan to fill the vacant Supreme Court seat left by John Paul Stevens. Kagan would be the fourth female justice ever and the third (out of nine) on the current bench. She brings impeccable academic and professional credentials - formerly acting as the first woman dean of Harvard Law School and then White House Counsel to Bill Clinton- however has never actually served as a sitting judge. It is not unprecedented for a Supreme Court Justice to have had no prior experience as a judge although the last instance was almost forty years ago with William Rehnquist's appointment in 1972.

While many view this move as "safe" by President Obama and believe that he chose Kagan because she would have the least Republican opposition, Obama is upholding the proud Democratic tradition of disappointing his activist base. Obama must be a sadist because he always finds himself in unnecessarily tough situations. Since the Republicans would have caused a furor over anyone Obama nominated - unless she had a sweet, folksy disposition - the President should have done his party a favour and picked a judge that could galvanize the leftist base such as Harold Hongju Koh of the State Department or Pamela Karlan of Stanford University. Instead, Obama is being accused of padding the Supreme Court with guaranteed liberal votes while not actually reaping those benefits. Kagan is pragmatic and logical not too different from the man she is picked to replace. In fact, Kagan found herself in opposition of the Obama administration as Solicitor General over the expansion of executive powers particularly concerning national security. Nevertheless, liberal groups are expected to support the nomination if not for the simple fact of adding numbers to the Supreme Court bench in time to push through much of the Democrat's policies.

As such, conservatives are not too concerned because the political balance of the Supreme Court would still tilt right. Many pundits have pointed out that this political imbalance in the judiciary is not just due to the lack of liberal justices but the weakness of their contention to the court's conservative leader Antonin Scalia - a Reagan nominee. In fact, one would have to look way back to 1967 with the nomination of Thurgood Marshall to find the last real liberal judge. In the end, the political makeup of the Supreme Court is partly a reflection of the American landscape and culture. The dearth of truly liberal Supreme Court judges partly coincides with the slow disappearance of liberal judicial activism while the hoard of conservative justices exist in a time when Republicans are passionately fighting half a century of social progress. However the fact cannot be ignored that when Democratic Presidents get the opportunity, they never live up to expectations as opposed to Republican Presidents who seemingly always "get their man". While the conservative selections of Scalia, Anthony Kennedy, Clarence Thomas, John G. Roberts and Samuel Alito were all celebrated by the right the left-wing reception to Clinton's choices of Ruth Bader Ginsburg and Stephen Breyer and Obama's choice of Sonia Sotomayor have been lukewarm. In fact for many years the two justices who were most aligned with the left were Republican selections - David Souter and Stevens. The Democratic nominations since Clinton have all been met with chagrin as the Democratic base felt there were greater champions of their cause out there. Are Republicans simply more talented and ruthless in the confirmation hearings to get their way or are Democrats severely lacking in as Sotomayor might call "cajones".

One feels as if having just conquered health care, facing a volatile immigration issue in Arizona, and fast-approaching midterm elections later this year that he wanted a "gimme" decision that was low maintenance. Nevertheless, had this been George W. Bush's decision, getting his brother Jeb Bush confirmed as a Supreme Court Justice would have been considered a "gimme decision" and low maintenance. What a difference a majority makes.