Armine Yalnizyan

Armine Yalnizyan (MIR 1985) is an economist who has focused on serving the community since her graduation from the Centre in 1985. After 10 years as program director with the Social Planning Council of Metropolitan Toronto, in 1998 she authored a ground-breaking report, The Growing Gap, about income inequality in Canada. Through this, and her many other publications (reports, articles and chapters in books) she has contributed to Canada's public discussion of social and economic equality. In 2002, Armine became the first recipient of the Atkinson Foundation Award for Economic Justice. She is a founding member of the Progressive Economics Forum; and a board member of the Public Interest Advocacy Centre.

May 062013

Meet Stephen Poloz, and some hints about how he will respond to key issues.

by Armine Yalnizyan

1. He’s Number Two:
Stephen Poloz was widely acknowledged in economic and political circles as the second-best choice for the top job at the Bank of Canada. So the surprise was not that he was chosen. The surprise was, Why Not Tiff Macklem? Will someone please find out and tell the rest of us?

2. Doctrinaire [or not?] on inflation targeting:
He thinks controlling inflation is “sacrosanct.” Having studied with monetary policy guru David Laidler at the University of Western Ontario, and been part of the Bank of Canada team that brought inflation targeting to a neighbourhood near you, he got the religion all right. Believers are more inclined to see a “rising inflation” problem that isn’t there. The hazard: Pulling the rising-interest-rate trigger too soon and choking off recovery.

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Mar 212013

Investing in infrastructure, healthcare, education, creates more and better jobs than austerity does.

by Armine Yalnizyan

These are the remarks David MacDonald and Armine Yalnizyan prepared for the press conference marking the release of the Aleternative Federal Budget 2013 in Ottawa, March 12, 2013.

Time flies and our Alternative Federal Budget is now in its 19th year.  Year after year it has shown that we can have a Canada where we all do better together.

This year the AFB is more inclusive than ever, with 27 chapters written by over 90 contributors, each laying out progressive policy ideas ready for implementation.  All policy proposals are fully costed and put within a realistic macro-economic framework to determine their impact on the deficit, debt and employment.

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Mar 022013

Workers with higher wages have more money to spend buying products.

by Armine Yalnizyan

President Barack Obama put the idea of raising the minimum wage on the radar in the US It deserves to be on the radar in Canada too. That's because low-wage work is on the rise.

Obama says raising the federal minimum wage from $7.25 to $9 an hour is good for families dependent on low-wage jobs, and for businesses dependent on more consumer power to fuel their growth. A growing economy helps balance the books too.

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Jan 142013
Armine Yalnizyan

Canada's growing income gap should worry us all, even the rich.

by Armine Yalnizyan

You couldn’t have made it through 2012 without running into a story about income inequality.  Chances are, it made you think about how you fit into the story.  That’s “entirely constructive”, as Bank of Canada Governor Mark Carney called the awakening triggered by the global Occupy movement.

A year later, some people think it’s time you go back to sleep.  A new debate is emerging in Canada: is inequality worth discussing at all?  On the “no” side are four main arguments, all deeply flawed:

  • Canada is not like the US;
  • The growing gap is not growing in Canada anymore;
  • Income inequality is not an issue because people experience income mobility;
  • Income inequality is not the problem; poverty is.

Canada is indeed not like the US.  In countless ways, nobody does extreme like the US.  America may be more equal than Turkey, Mexico and Chile in the OECD block of the world’s richest nations.  But since the 1990s, Turkey, Mexico and Chile all reduced income inequality.  In the US, the gap between the rich and the rest grew, unabated.

After the mid 1990s, the gap grew in Canada because the rich did so much better than everyone else. So much for trickle down.

Andrew Coyne argues the gap is not growing in Canada, a position fuelled by a recent TD Bank report. That study said income inequality grew until the early 2000s then stopped increasing.  

But Miles Corak, an economist and international authority on the links between income inequality and social mobility, demolished both Coyne’s conclusion and the TD study. Corak’s blogs show income inequality has not stopped increasing in Canada, and offer better ways to measure it. He points out Canada is not immune to the many ways in which inequality threatens opportunity.

This skips over a more important question: why hasn’t Canada seen a reduction in income inequality?

In the decade before the global crisis, our economy was firing on all cylinders and employment rates reached record highs. From the mid 1990s to the mid 2000s, 15 of 32 OECD nations reduced income inequality. Not us.

Instead of harnessing our extraordinary track record of job creation and economic growth, Canada tumbled further down the inequality rankings than any other nation, slumping from above-average equality to below-average.  If such a buoyant market didn’t help close the gap, what will?

The Conference Board of Canada cautions that Canada’s levels of inequality mean squandered potential.

A year ago economist Stephen Gordon offered some insights on how to assess income inequality in Canada, noting it has grown constantly over the last 30 years, but in different ways.  From the 1970s to the 1990s inequality grew because more people lost ground at the bottom of the income distribution in the wake of two big recessions; after the mid 1990s, the gap grew because the rich did so much better than everyone else, seeing the lion’s share of income gains from economic growth.  So much for trickle down.

The Fraser Institute mounted the income mobility defence of the economy’s track record over the past generation.  Their recent study dismissed the rich-got-richer concerns by countering that the poor got richer too.  They emphasized that the poor have seen faster rates of growth in their incomes than the rich since the mid-1990s.

The Fraser Institute's idiosyncratic marshalling of the facts and interpretation of the evidence was enough to pull Statistics Canada’s former Assistant Chief Statistician, Michael Wolfson, out of retirement.  He publicly laid bare the deep methodological flaws in their study, and finished by reinforcing  that growing income inequality remains a serious issue in Canada.

That takes us to the last argument, and a critically important reminder: poverty should be of far greater concern than income inequality.

There’s an internal incoherence with this approach.  Unless you’re the type who is willing to go on  record saying  “let them eat cat food”  improving the lives of the poor means providing either more opportunity or more cold, hard cash.  That involves money, which is where follow-through usually falls off, because it means some form of redistribution. And that brings us back to the beginning.

The IMF has warned that higher inequality is correlated to shorter spells of growth, more market volatility. The Conference Board of Canada cautions that Canada’s levels of inequality mean squandered potential.  Just this week TD Bank CEO Ed Clarke acknowledged inequality in Canada has been growing for the last 30 years, raising a challenge  for society that demands discussion.

Whether you want less poverty or a more robust economy, greater innovation or improved productivity,  better life chances or a healthier democracy, the way forward in Canada involves reducing income inequality.   But markets, alone, don’t reduce income inequality, not even when the economy is chugging away at full speed.  So what can we do?

First, don’t dismiss the issue. Start a conversation about how we can reduce income inequality. The ideas will flow from across the political spectrum, because this isn’t a partisan issue. It’s a problem for everyone.

Income inequality has become as inconvenient a truth as climate change, and every bit as challenging to our future. It, too, has its share of deniers.  But the evidence that is accumulating around the world makes clear — burying the issue under a false sense of progress won’t protect us from the massively disruptive consequences of a growing gap. Stay awake. Start talking.

Nov 052012

Wages lag inflation and new hires earn 40 percent less.

by Armine Yalnizyan

The Harper government likes to remind Canadians that we’ve done better than most developed nations in bouncing back from the global economic crisis. But digging into the data shows why many people might be having trouble cheering this news: wages have not kept pace with inflation, and new hires are making 40 percent less than the average worker.

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Sep 242012
Four years after Lehman Brothers collapsed, are you better off now than you were four years ago?

Are you better off now than you were four years ago?

Four years after Lehman Brothers collapsed, it’s time to take stock of things by asking a stock political question: Are you better off now than you were four years ago?

Where you stand on the answer depends on where you sit. Many people, businesses and communities are still struggling to regain the ground they lost after September 15, 2008, the day the giant investment banker filed for bankruptcy and triggered the biggest global financial and economic crisis since the 1930s. But for others, things have never been better.

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Jul 242012

Outsourcing production leads to Walmartization of ice cream.

by Armine Yalnizyan

It's been an unusually hot summer, and soaring temperatures have boosted sales of that quintessential summer food, ice cream. But Baskin-Robbins has decided to shut its production facility in Peterborough, Ont, and lay off 80 workers because of… wait for it… increased demand! From the department of "Wait, what?", here's the scoop behind this brain-freeze-inducing decision.

Baskin-Robbins, home of 31 flavours (one for each day of the month), brought in $1.8-billion in sales from its 6,777 outlets around the world last year. Same-store sales rose by an impressive 9.4 percent in the first quarter 2012, and that's before the heat wave.

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May 222012

Federal policies make it easier to hire a cheaper you.

by Armine Yalnizyan

Have you noticed how common it has become to talk about replacing workers with even cheaper workers? If you're looking over your shoulder, you're not paranoid; you're paying attention. There's probably a cheaper you out there. And in Canada, the feds are helping your boss find them. This week, the International Labour Organization noted there are 50 million fewer jobs in the global economy than before the financial crisis began in 2008. Some 200 million people are now looking for work, and many of them are on the move. Some have landed here.

But with 1.4 million unemployed, many Canadians, too, are desperately seeking opportunity, and trying to avoid losing economic ground. As manufacturers continue to decamp to low-wage climes, and the public sector sheds jobs, the job options are sliding down the income scale. There, the growing competition is pushing the pay floor lower and lower.


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May 082012

Changes to immigration policy could transform society.

by Armine Yalnizyan

Have you noticed how common it has become to talk about replacing workers with even cheaper workers? If you're looking over your shoulder, you're not paranoid; you're paying attention. There's probably a cheaper you out there. And in Canada, the feds are helping your boss find them.

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