Saturday, August 21, 2010

Canada needs way more Immigrants --- skilled immigrants

The average Canadian in 2004 was 39.7; that makes Canada one of the oldest nations on earth. However bad things are now things promise to get a lot worse. The percentage of Canadians over 65 is set to go from 14.7 now to 27.6 in 2050. If the situation was ever allowed to get this bad, the economy would at best be stagnate, the federal government would surely be in deficit, and virtually every public entitlement program would be under enormous pressure or would have already collapsed. Most notably our health care system would be in serious trouble. Indeed as it stands now "People age 65 and older accounted for 13.2% of the Canadian population but consumed an estimated 44% of provincial and territorial government health care spending in 2005."

The problem is this.

In 2005, per capita health care spending was found to be highest at the beginning and at the end of life but, in general, to increase exponentially with age. While 65- to 74-year- olds consumed $6000 per capita, 75- to 84-year-olds consumed $11 000 per capita, and 85-year-olds (and those older) consumed $21 000 per capita, on average. In comparison, per capita health care spending among those age 1 to 65 was approximately $1700.[While 65- to 74-year- olds consumed $6000 per capita, 75- to 84-year-olds consumed $11 000 per capita, and 85-year-olds (and those older) consumed $21 000 per capita, on average. In comparison, per capita health care spending among those age 1 to 65 was approximately $1700.

This problem is not going to go away. Even if today's 60 is tomorrow's 70, we all die and most deaths are preceded by some kind of serious illness. As a critical mass of people reach whatever is the average life expectancy, they will cost the system more -- a lot more.

The notion that this problem can be addressed by encouraging Canadians to have more kids is unrealistic. Currently Canada has the 144 highest fertility rate and our birth rate is 190th in the world.
What goes for Canada goes for the rest of the Western world. There is not one Western nation with a fertility rate above the replacement rate yet alone one with a fertility rate high enough to withstand the aforementioned increase in the number of seniors as percentage of the total population.

To think that Canada has chance of nearly doubling its current fertility rate of 1.6 -- and that is what it would take -- is pie in the sky nonsense. Moreover, far from making things better a massive baby boom would only increase an already mushrooming dependency rate for a good number of years. There is something perverse about wanting Canada to become a country of the very old and very young supported by taxes on a rapidly shrinking working population.

Canada has no option but to continue with a high rate of immigration.

Immigration is allowing us to make some headway. 2001 study found that based on 1996 census if Canada did not allow any immigrants, then the number of seniors as percentage of the population in 2050 would be 29. 8. If on the other hand Canada let in 225,000 annually, then that number would drop to 25.4. Finally, if Canada let in 450,000 annually that number would drop further still to 22.9. Of course, if 450,000 annually is good, somewhere between 500,000 and million is even better. Finally, the latter number and more of an emphasis on youth would be best of all.

That is the good news. The bad news is that Canada's immigration system badly needs to be reformed and for reforms to mean anything Ottawa needs also needs to reestablish that immigration is a federal issue. Indeed, what is the point of reworking the points system, for example, if Gordon Campbell and his ilk are working with big business to set up a rival system in which restaurant hostess is a skilled position?

Family reunification is a great place to start. There is no reason why an immigrant should be able to bring in anyone other than his spouse and dependents. After all, if the main point of a high rate of immigration is to lessen the effects of an aging population, what sense does it make to allow immigrants to sponsor their parents and grandparents?

Family reunification is part of a larger problem, viz., the ratio of skilled principle applicants as percentage of the over number of immigrants to Canada is way too small. Currently less than one in 5 immigrants is a skilled principle applicant. And however much I am loath to admit it, the Mark Steyn's of the world are right about one thing. Allowing someone to immigrant to Canada has a huge potential cost associated with it. This especially so with regard to any other category of immigrant other the skilled principle applicants. After all, it is only skilled principle applicants that earning anywhere close to what their Canadian peers are earning and skilled principle applicants are the only category of immigrants that are working in numbers that even approach the Canadian average.

"At 26 weeks after their arrival, 50% of all immigrants aged 25 to 44 were employed. This was 30 percentage points below the employment rate of about 80% among all individuals aged 25 to 44 in the Canadian population. ... At 52 weeks after arrival, the employment rate among prime working-age immigrants was 58%. This narrowed the gap to 23 percentage points. At 104 weeks, or two years after arrival, the employment rate among prime working-age immigrants was 63%, 18 percentage points below the national rate of 81%. ... Immigrants admitted as principal applicants in the skilled worker category had an even better record for employment. At 26 weeks after arrival, the gap in the employment rate between them and the Canadian population was 20 percentage points. By 52 weeks, this had narrowed to 12 points, and by two years, it was down to 8 points."

If you tease out the numbers, 55% of non principal skilled applicants in the 25 to 44 age group are working after 2 years! Canada needs to do a better job of ensuring that immigrants are able to succeed and while some bleeding hearts will no doubt claim that a complete turn around is possible, an approach that is far more likely to bare fruit is eliminating or greatly limiting those categories of immigrants that are not likely to succeed economically. To say that Canada needs immigrants is only half right. We need young well educated immigrants who are proficient in English. Indeed, we need a lot more than what we are allowing in now. We do not, however, need their parents and grandparents. We also do not need refugees. Most of all what Canada does not need is cheap unskilled guest workers.

Given Jason Kenney's stated desire to avoid “the kind of ethnic enclaves or parallel communities that exist in some European countries” and Mark Steyn's rantings about second generation Islamic exterminism in Europe you would think that Kenney and Steyn would reel back before the subject of guest workers like vampires before garlic. Instead, Steyn's musings reduce to an infantile and bigoted ethnic essentialism and Kenney seems hell bent on allowing more guest works than Germany did in the 1960s and 1970s.

Indeed, whereas the typical guest worker was once an American transferred to a branch office in Canada, the fastest growing category of guest worker is now the unskilled type with poor language skills. Under the Conservatives, Canada has allowed in some two hundred thousand plus unskilled workers a year. In other words, the average Canadian tax payer now pays through the noise to have cheap labour sent in from other countries for the sole purpose of cutting his wages. Forget Conservative talk about such provincial programs bringing in much needed skilled workers, this was the kind of positions Alberta was hoping to fill through its guest worker programs this summer: Front desk clerk, short order cook, baker, maid, assembly line worker, server, buser, bellhop, valet, and cafeteria worker, laundry attendant, pet groomer, general labourer, and hair dresser. All that is required of such would be immigrants is that they score 4 or 24 on the language assessment. In other words, they can still be functionally illiterate and still get it in.

Pace Mark Steyn, Integrating immigrants is really quite simple. If you bring in young well educated immigrants that are fluent in English, they will integrate. It will not matter a lick what their background or skin colour is. On the other hand, if you bring in non English speaking uneducated immigrants to clean toilets and serve donuts at Tim Hortons, you have recipe for what happened in Europe, viz, poor race relations, xenophobia and illegal immigration. It is really that clear cut and Kenney should know this. Every expert on immigration does.

It takes a great deal of chutzpah to Kenney to talk about wanting to avoid “the kind of ethnic enclaves or parallel communities that exist in some European countries” and then go about encouraging the very thing that led to the creation of these communities in Europe, viz., importing gobs of unskilled guest labour.

In addition to letting in more skilled immigrants and less of everyone else, Canada needs to refine what it means to be skilled applicant.

The point system is a mess. It is weighted, accidentally I am sure, in such a way as to favour older applicants over younger ones. A premium is placed on experience, being married is advantageous and age is not penalized much at all. For example, a 49 year old is given the same number of points for age as a 21 year old! Not only is all this is completely at odds with the stated aim of using immigration to mediate some of the stresses of having a low birth rate, a shrinking supply of labour and a graying population, the very kind of skilled worker most likely to fail, viz., older workers is the one most likely to qualify.

Indeed, while everyone agrees that Canada needs to be a better job of recognizing foreign credentials, what has gotten less attention is just how hard it is establish oneself in a particular field without any contacts in that field and work contacts are what many new immigrants lack. As various studies have shown, for immigrants outside of the Western world, work experience counts for virtually nothing as at all. For this reason alone, Canada needs to redo its point system such that it looks to attract younger skilled workers who are not at such a disadvantage contact wise as their peers.

Above all else though Canada need put more of an emphasis on language proficiency. After all, although Jason Kenney may let in hundreds of thousands of unskilled guest workers with little or no English, he is right to say that language proficiency is best predictor of economic success.

It should be noted that by language proficiency I mean ones ability to converse in either French or English. Currently, moderate proficiency across the board in both English and French is amounts to the same thing high proficiency in one! This is akin to thinking an average switch hitter is the equal to all star who bats only right handed.

All that being said, in order to get at appreciation for some of the short comings of the current points system consider this. Under the current formula, a single 26 year old who has just completed a PHD in Canada, and who speaks perfect English, but who lacks relevant work experience and is not proficient in French would likely not qualify. Indeed, assuming no family ties and no relevant work experience, they would score 56 out of 100. In other words, if they were not able to quickly secure a job in one of the relevant fields, they would be heading back to their country of origin in short order. Even, if that same applicant spoke perfect French and English they would still not qualify. They would score 64 out of 100.

By contrast a 49 year old who has never set foot in the country and speaks no French but has a BA, 3 years experience, moderate English skills a spouse with a 1 year diploma, and a cousin in distant Canadian city would score 67! This is absurd.

Wednesday, August 18, 2010

The Stupid People's party and how to respond to the Stupid things they say

Andrew Coyne is aghast that the Conservatives would seek to be the stupid people's party. He is right to be. As he says, "A society that holds education and expertise in contempt, no less than one that disdains commerce or entrepreneurship, is dying. To whip up popular hostility to intellectuals is to invite the public to jump on its own funeral pyre."

That said, Coyne overstates Harper's Machiavellian inclinations. The Conservatives are not without convictions and neither is Harper. Not everything they do is a ploy to stay in power. Far from it. It is evident what Harper wants to do. It is just that Harper's world view -- particularly when it comes to foreign affairs-- is not terribly sophisticated. Needless to say, this is also true of most Conservative MPs. As for all those stupid talking points the Conservatives have trotted out over the years it is a mistake to assume that they are merely instrumental. That is to say these talking points not merely designed to get the base going. On any number of issues these talking points seem hardly different from what various Conservative MPs (e.g., Stockwelll Day) have said previously on the subject and in private life. In sum, many Conservative talking points should be seen on some level as a reflection of what Conservatives MPs truly believe.

Whatever the case, the Liberals should welcome the opportunity to debunk these talking points and ridicule the Conservatives for having championed them. But that is not what the Liberals have done. Take the census issue. Whereas, most pundits have focused in on the idiocy of Tony Clement has had to say, the Liberals have focused on showing just how many groups use the census and to what ends. In other words, they have treated it as an issue Canadians care deeply about, but that is simply not the case. What has caught the public's attention and what will always grab the public's attention is the ham fisted manner in which Conservatives have proceeded and above all else the ridiculousness of what Conservatives have had to say. The Liberals should not be trying to educate the populace about how useful the census is, but rather be doing their utmost to make Tony Clement into a punch line to various jokes. They should be laughing it up with the pundits. Keep it light. For example: "The Conservatives believe that most Canadians have a secret desire to fail stats 101. I do not believe that to be the case."

Tuesday, August 17, 2010

The following should be headline news

"It all started with something that is by now horrifyingly routine: a YouTube video of the gory execution of a Mexican policeman by a gang of narcotraficantes. Posted on July 22, it begins with the interrogation of the policeman, who was from the northern state of Durango, by masked gangsters employed, in this case, by one of Mexico’s most powerful trafficking groups, the Zetas. Such interrogations have been circulated on the Internet before, and, as here, they often end in death. However, in the course of this particular video the policeman stated that the director of a federal prison in Durango was in the habit of releasing and arming certain prisoners at night, so that they could commit murders aimed, broadly speaking, at the Zetas. The recent massacre of seventeen people attending a birthday party in the neighboring state of Coahuila was the work of these temporarily sprung assassins, the policeman said, as were two other mass killings earlier this year.

The policeman’s account gained instant notoriety, and came to the attention of federal authorities in Mexico City. At a press conference on July 25—three days after the YouTube posting—the Attorney General’s spokesman confirmed the story, adding that the R-15 rifles used in the Coahuila massacres were indeed standard issue for federal prison guards—a fact that had apparently gone unremarked before. Pending further investigation, the government placed a number of people under temporary arrest, including the director of the Durango prison, a chunky, tough-looking blonde by the name of Margarita Rojas Rodríguez.

What happened next was astonishing. The inmates of the prison rioted, killed a prison guard, and demanded that Señora Rojas be restored to her post immediately, surely the first time in history that prisoners have risen up on behalf of their jailer. .... "

Wednesday, August 11, 2010

Bob Rae: I do not think he would make a great leader

A common lament is that if not for his record as premier of Ontario, Bob Rae would make a great leader. He is a good debator, charismatic, well spoken, and funny.

This is not an opinion I share. I do not like him for other reasons. Philosophically Bob Rae and I are worlds apart. I do not believe in collective rights. Rae does. I do not believe in affirmative action. Rae does. I do not believe in asymmetrical federalism. Rae does. I generally do not believe in means tested social policy. Rae does.

As the saying goes, policy aimed at the poor is poor policy. Tax rebates and the like if they are effective at all are vulnerable to changes in the political landscape, and more importantly are certainly not enough to hold back the tide of growing inequality in this country. The best -- check that -- the only way of achieving a "just society" is to introduce board based social policies that embody of the principle of universality. Not only do such policies stand a far better chance of effecting social change, in marked contrast to affirmative action for example, they are wildly popular.

Now in fairness to Rae, he is not alone. Under Martin and Chrétien the Liberals abandoned universality and favored instead means tested programs. The thing is means tested social programs do not win elections; the populace is not going to get excited about paying for a service that only a small percentage of the public can use. By turning every social program on offer into a form of welfare, the ability of the Liberals to offer anything other than tax cuts is very limited. The implosion of the Progressive Conservatives and NDP in 1993, obscured just how much this has hobbled the Liberals politically. The Liberals are now always having to play to a core Conservative strength. Indeed, as Tom Flanagan crowed after the 2006 election, there are certain issues that favour the Conservatives and the economy and taxation are two. The simple fact of the matter is that most of the public will not gain a working knowledge of each party's economic policies over the course of the campaign and when assessing each of the parties on the issue of taxation will rely on worn out stereotypes.

Now, the Liberals still benefit from being the party --- with help from the NDP -- that introduced the Canada Health Act and Canada Pension plan, but given that they have long ago abandoned the principle of universality it seems almost farcical for the Liberals to now point two these two shining examples of the that very principle as two of their greatest achievements.

Tuesday, August 10, 2010

Bob Rae comes to North Vancouver: some thoughts

Bob Rae came to North Vancouver yesterday. Unfortunately I came late and so missed his opening talk. I was there for some of the question period though.

First thing I took note of is just how patient Rae is. Not every question asked of him made sense. Others were not questions at all but short editorials. Finally, most questions were buried in lengthy preambles. Still, Rae was polite to a fault, responded to each in timely manner and at length and he was never short or cutting. In other words, Rae not only has the gift of the gab he also knows how to listen and how to make people feel listened too.

That said, even Rae can not turn lead into gold. When someone asked him just what the Liberal party stood for his response was less than satisfactory. He said that Liberals were committed to enshrining good parliamentary process into law and enacting legislation that would protect institutions such as Stats Canada and elections Canada from an overly aggressive PMO. I could not agree more and think level headed people of all political stripes would feel this same. However, this is a far cry from "just society".

The other pillars mentioned by Rae were sustainability and early childhood education. The problem with the former is that it is so nebulous that it is hard to see why anyone -- even the Conservatives -- could not claim to be committed to sustainability. As for the later, it is politically useless. For the vast majority of Canadians, the Liberal promise to work out a different deal with each province amounts to little more than a vague promise to provide more daycare sometime in the future. Canadians could not figure out what this would mean for their lives in 2006 and not surprisingly they preferred the Conservative baby bonus. Nothing has changed.

In order for the Liberals to capitalize on the issue they need make a clear offer to Canadian voters. They could, for example, offer all day preschool and kindergarten for every kid in Canada. That would garner them votes and provide them with the option of juxtaposing such a policy with the Conservative plan to build more prisons.

Speaking of prisons, someone asked Rae what the Liberals planed to do about the biggest mass murder in the world --- "drugs". As I mentioned before, some questions could have been worded better. Anyway, Rae said that diseases associated with poverty were a bigger killer and then went on to question the wisdom of Harper's war on drugs. He said that addiction is better thought of as a medical issue and not criminal one. This is fine as far as it goes, but other than Insite, he did not mention anything specific and he did not deal with Ignatieff's worries about "marijuana cigarettes" or how Liberals have supported every Conservative crime bill since Ignatieff came on as leader. Later that night, I remembered his hollow answer as I watched a CBC story about California's November referendum on whether to legalize marijuana and read that former Mexican President Vincent Fox said that all drugs should be legalized.