The end-game.

It's underway, right now. This evening, right under our noses; and it's all related.

A massive fraud was perpetrated on the people of Alberta, today. The Redwater Energy ruling gives the oil and gas companies the ability to just walk away from their well clean-up obligations. The people are now on the hook for untold billions of dollars of clean-up, once the oil's gone and the companies have declared bankruptcy (after siphoning every drop of profit out of Alberta). Banks will win out here.

At the same time, Alberta gets hit with a downgrade in its credit rating to AA, from AA+. This has a big influence on the bonds that the Alberta government, essentially the public will pay more. Banks win again.

Add to that, the National Energy Board gave the green light to a massive, capital-intensive, pipeline to ship diluted bitumen from Alberta to Coastal British Columbia, further destroying the Alberta economy. Alberta is collecting, in aggregate, somewhere around a 1.5% royalty rate on its oil and gas operations, given first quarter reported earning from oil and gas companies. Banks and oil companies win here.

We're all going to have to pay for this, every small-time Canadian is going to foot some of the bill for the construction or the clean-up. The banks are running things now, and they want their money, and they'll go through every single cent each and every one of us has. It's already underway. This is "austerity", the rich appropriate profit from the masses. See Greece, for example. See Brazil, see France, see Spain, see Portugal, see Ireland. Each European nation in deep to the European Central Bank.

Our political leaders need to start talking about how to take on the banks and the largest corporations on the planet, now, as in yesterday. The time for half-measures is over. Let's take the beast head-on.  Start with the banks, they sit at the top. Austerity's end-game is not at all pretty, for all of us.

Clueless Little Willy Watson's Weak Critique of Postal Banking. 

It is not often I find myself reading the National, or Financial Post for any reason. Little do I need of puff pieces for oil and gas operations. However I did stumble, accidentally, on an article written by William Watson trashing Naomi Klein's (and the committee which gathered to write the Leap Manifesto) idea of Postal Banking hubs through existing Canada Post locations. 

Watson's first paragraph immediately goes on the offensive trashing not only the CBC, but Paul Kennedy, Naomi Klein herself and the Canadian Centre for Policy Alternatives. Watson laments that perhaps Ideas should invite the bastion of free thinking, the Fraser Institute, on for a visit. Watson even states that the Fraser Institute has some "internationally known conservative thinkers". Who might that be, I wonder? Jason Clemens? The same guy that can't multiply consumer price indices to adjust time value of money? The same guy that wrote two different reports in less than a month with the same referenced tables and couldn't write the numbers from the datasheet onto the screen without making a mistake?

Well, I googled "internationally renowned conservative thinkers" and this is what I got: 

Pretty measly selection (160,000 hits). 

I clicked on the first link and the list is even more hilarious. 

1. Confucious (551-479 BC)
2. Cato the Elder (234 - 149 BC)
3. John Locke (1632-1702)
4. Edmund Burke (1729-1797)
5. Goethe (1749-1832) ...

Not sure if any of these (collection of dead) guys would be available for an episode of Ideas, and I must admit, I've read very little of Confucious or Cato the Elder; I'm aware of John Locke, but I will read their stuff.

But then I got to the real source of Watson's inspiration, the grandaddy of them all, Milton Friedman. 

Fresh out of the Chicago School of Economics (founded by John D. Rockefeller), the godfather of neoliberalism. Milton Friedman and Supreme Court Justice Lewis Powell are two names that might not ring bells for most people, but it is difficult to imagine two more influential people in charting the course to our current state of economic, social, and business affairs. 

I have gone heavily off the rails in my critique of William Watson's paper. However, it's clear that nobody on that list (none on the list of 16 great conservative thinkers is alive today) is up for an episode of Ideas or an episode of whatever crap Ezra Levant spews out. 

Watson then spends two more paragraphs outlining all of the far-fetched things that Postal Workers might do (after the obligatory swipe at the Postal Union), like, deliver food from local farms. Or perhaps administer Postal Banking outlets which might not charge exorbitant lending fees (a la the effectively criminal payday loan establishments, or even the proven criminal regular banks). (It's not entirely clear if Watson misunderstands how banks actually work, or if he thinks the average person is too dumb to understand that banking is about the simplest activity on the planet: You take money in and pay a low interest rate, you lend money out and collect a higher interest rate than the deposited funds, and it is essentially impossible to lose money, unless you get really greedy and siphon all the money to yourself, see 2008 for example). Or perhaps some recently "disemployed" (curious term) oil-sands workers might actually get jobs installing (or even manufacturing) solar panels on public buildings, such as post-offices, government labs, new housing developments, municipal buildings... the list goes on. 

All extremely far-fetched and "progressive" activities, eh Willy? People doing work and getting paid to do it, absolute craziness. 

Though it is funny how Watson spends two paragraphs shitting on public service (in this case Postal Workers), while the media has been thanking the very public and private service first-responders who were first on the scene in Fort McMurray. I guess when public servants help oil-sands workers they get a pass, but if they help anybody who isn't extracting non-renewable resources at fire-sale prices for oil and gas companies, they're scum. But this is classic Milton Friedman ideology; you take a swipe at the public service any chance you get, and Watson takes ample swipes. 

He even has the curious line: 

Haven't we just seen the fire crews in and around Fort Mac work themselves into exhaustion "helping" the Canadians caught in the fire's deadly swath? Are they not "government" workers, by extension? It is also fairly obvious to anybody with a working cerebellum that no firefighter is going to usher the words "I'm from the gov't...blabla". 

Maybe Willy's been watching too many super-hero movies where characters in some fantasy land offer short soliloquies of platitudes with extended hands? Either way, this paragraph is a shit attempt at humor and an even greater offense to the tireless men and women who have been offering their time and energy to the humanitarian effort in Fort Mac. 

Then Watson spends a paragraph, swiping the union again, with a suggestion that door to door mail delivery should be abolished as there are electronic means of delivery. He suggests that most letter carriers actually drive to their place of employment, and then even suggests they just look for other work, as that would lower their carbon footprint. Right. 

It is kind of funny that Watson essentially outlines some very realistic alternative working arrangements for Postal Workers, but then immediately dismisses his own suggestions. Different work, as he suggests they find, he's already listed: urban and rural Postal Banking, food delivery associated with local farmer co-operatives, or other community oriented (or not) projects, or something of that nature. It is clear that, perhaps, the traditional Postal work business model might need a reboot, or an upgrade, Klein offers helpful suggestions, Watson suggests they all just stop working... or something (that's a win-win for the economy, eh Willy?).

Watson then hearkens back to another "internationally known conservative thinker", Friedrich Hayek; Friedman's mentor. He quotes Hayek to admonish Klein: the real world is far too complicated for any normal mortal to understand. (While this may be the case with the real, physical, world, but understanding the state of economics is not difficult at all, after all, it is a human creation and we can all just re-write the rules at any time, if we all so wished). He even doubles down on the widely discredited "complex general equilibrium system" of economic theory. The economy is neither inherently complex, nor is it ever in "equilibrium" in real terms. The global economy is in trouble because the distribution of wealth is so far off the charts that every conceivable method of lending money is exhausted and fully leveraged. The economy has navigated itself precisely to this state by following the Milton Friedman, and the Chicago School of Business's, doctrine. 

Watson then throws in the obligatory red herring that the climate system is really too complicated for any of us to really do anything about. He advocates for "small, incremental things", ie. do nothing, or maybe lower emissions intensity, or some other nonsense which does little to actually reduce the total global amount of greenhouse gasses. 

It is abundantly clear that Watson is against the Leap and instead advocates for baby, sloth-like, steps. Let the oil and gas keep flowing, we wouldn't want to "rapidly eliminate the (completely non-renewable) energy source on which we are the moment 85% dependent", would we (actually I would). It is also abundantly clear that the neoliberal ideology is alive and well in the mindset of the right, voiced through Watson. We should be using our non-renewable resources now to transition our cities and rural infrastructures away from fossil fuel dependence. There is little time to waste in this regard. There is an economic and social imperative to prepare ourselves for now for the coming end of non-renewable resources; Watson offers no suggestions for what these are. 

Clueless. 

Capitalist Island!

I had an idea as I was cooking dinner tonight. I would assume most people would have seen an episode or two of Survivor during the past two decades. My idea kind of spawned from that show. In the show, about 24 or 25 people (I have no idea) are "stranded" on a desert island, some tropical beach, or in the jungle and they have to co-exist for a small period of time while consecutively conniving and backstabbing their way to the final vote, or something. There is only one winner, though occasionally there are runners-up. I always thought it would be more interesting if the contestants actually had to survive on their own, though I guess humanity has not slipped to that level where televised real life and death encounters are filmed. 

In any case, this isn't about game shows or television, it's a thought-experiment. Imagine 100 people, 100 capitalists to be more accurate, which are stranded on a real desert island. On the island contains all of the necessary tools, equipment and resources for survival for all 100 capitalists for the foreseeable future, let's say the next 50 years. 

The rules of the game: 

Let's pretend the capitalists are sterile (wouldn't that be nice...) and androgynous in order to remove the element of sexual dominance (or lack thereof) from complicating the game. The resources, tools, and equipment include: shelter, means of subsistence (cattle, chickens, grains, water, sheep, etc) and recreational activities; a veritable mini-version of the world, though with no escape boats. 

However, the resources, equipment, and tools are not equally distributed among the players. At the start of Capitalist Island, one lucky capitalist gets ownership of 99% of the resources. The rest of the resources are distributed to the other 99 players in a manner that is roughly equivalent to the distribution of wealth today. Essentially there would be about 50 or so players with very, very little to start with, no shelter, no food, no water. 

There's a catch though, the one lucky capitalist will require aid from his fellow contestants in order to maintain his dominant resource allocation, the windows don't wash themselves, you know. 

Let's say that at the start of the game that there are weapons on the island as well, just to spice things up. 

The game starts immediately after the 100 contestants are situated in whatever shelters they are allocated (let's assume that they are representative of the actual conditions of the distribution of wealth in the world today, from cardboard boxes to a palace).

The game ends when there exists are general "equilibrium" among the players; which could mean that there are no players left, 100 players left, 56, 2, or any number in between.

The thought experiment:

What kind of distribution of wealth would ensue after a few days? What type of "economy" would emerge? Would it be the economy where the 1 owner of the 99% of resources exerts his dominance over the rest of his fellow islanders, through a select group of courtiers and tough-guys, until the end of all their days?

One can only guess that given 3 or 4 days of desperation, the lowest 25 capitalists on the "totem" pole would have either starved to death, or begged for food from one of the other 74 contestants, or the 1 "initial ruler". 

What kind of distribution of wealth would emerge after a few months? The richest capitalist will soon realize that tending his massive amounts of resources requires labor. What type of arrangements will he make with his 99 compadres? 

Will the 99 other capitalists unite and overthrow the 1? 

Will factions emerge, mini-wars ensue and one victor rise from the ashes?

Will they divide the resources in 1% shares, work together and co-exist in harmony? 

Will the 1 kill off the other 99, or vice-versa? 

Will there just emerge a constant re-organization of the wealth on the island with various capitalists vying for the top spot? 

Would some other completely new arrangement come up that nobody foresaw? 

I think it would be fascinating to watch and evaluate. 

I also think it's highly doubtful that the economic system which emerged would resemble anything like what is in place today.

What do I really mean?

Obviously throwing 100 people on a desert island in a struggle for survival is not a realistic experiment. Though, in the context of our planet, what is the difference? We are all on this one planet together, there is nowhere else for us to go. The distribution of wealth and resources is completely askew today and seems to be getting worse.

Will we find it in ourselves to create a more egalitarian society in which resources are allocated more equally?

If not, what is the end-game?

These are serious questions and there isn't anybody talking about them. 

Time for a Carbon Tax? Or is this just more "austerity"?

If you follow politics in Alberta then you'll have heard of Rachel Notley's NDP government's plans on implementing a carbon tax in that province.

The past few weeks, the broadscale media, from left to the right, has manufactured consent for the carbon tax in Alberta to address its financial woes. Trevor Tombe has written a piece in MacLeans on how "Alberta needs to get off the resource rollercoaster", the carbon tax being just the ticket off the rollercoaster. Tombe displays a number of charts, graphs and figures about how and why the province is slipping further and further behind.

Tombe's counterpart, Andrew Leach from the University of Alberta, jumps into the conversation with his own sets of charts, figures and graphs about how resource revenue is falling over time (he doesn't actually mention why though). He links a number of studies that show how the carbon tax is a pretty good way of reducing greenhouse gas emissions. It's all very interesting, so many charts and data, and none of it relevant.

(I personally like the IDEA of a carbon tax; if implemented PROPERLY, can provide an incentive to change habits, though is easily co-opted by corrupt governments, see BC for an example of how to fuck up a carbon tax)

At the "grand-scale", Alberta seems to have difficulty raising revenue to pay for its provincial financial obligations, such as education, public service, childcare, you name it. The general media seems to agree on this fact; Alberta's short on cash. How to solve the issue is another matter. It seems to be broken down into two camps. On the "conservative" (aka free marketeers) it's time to cut public service wages 10%, cut spending and dive into austerity, full speed ahead. On the left, the CCPA's determined that the design of the carbon tax in Alberta was well thought, though that the implementation of the tax might be less than optimal (to put it nicely)

But none of this matters. Both sides miss the obvious solution to Alberta's revenue issues.

Surprisingly, or not, neither Leach, Mintz, nor Tombe showed this figure. They've shown plenty of figures, but not this one. This figure shows the total amount of oil and gas sold in Alberta over the past 30 years, the total amount of royalties and land sales collected, and the amount of pre-tax profit industry pocketed. A few things jump out to me in this figure. What shouts at me from that figure is the staggering amount of money that was made by private industry. From 2000 to 2014, industry made over 35B$ per year of pre-tax profits; in a decade and a half they made over 400B$. This is offset by the meager pittance the owners of the resource received in royalties and rents. Another tidbit in that figure which jumps out is that the ratio of private profits to public royalties and rents was fairly equal through the 1985-1998 period. Then 1999 happens and the whole thing goes to shit.

This post isn't about the "optimal" distribution of private profits derived from a public resource, but one could argue that a ratio of 1, where private industry makes as much as the public, off of the sale of the public's resource is a pretty good deal for industry. At any rate industry has been making an ever increasing share of the profits off the sale of resources while Alberta has been collecting less and less; regardless of price. Last time I checked Wal-Mart didn't sell Rolex's.

There's a good reason why the province's share of profits are dwindling, beyond the fact that industry has some magic hold of government. Conventional oil sales are more or less flat, natural gas prices have gone in the toilet and the majority of the oil Alberta sells is from oil sands. Herein lies the problem.

The amount of resource sold from sands projects in the "pre-payout" phase of development has increased dramatically since 1997 to now account for 34% of total sales. Any sands project in the "pre-payout" phase currently (and probably for the foreseeable future, if WTI stays <  50$/ bbl) pays 1% royalty rates. This represents corporate welfare at the highest level. Alberta is handing its resources over, for nothing, to an industry that has pocketed nearly half a trillion dollars in the past 15 years.

If you follow the news you'll have no doubt heard also about the beleaguered oil and gas industry in Alberta. You might think that they've shuttered the doors and pulled up stakes. Not so, production is soaring as the figure below shows. A reader might also be inclined to ask as to the destination of Alberta's resources. Most of the resources are piped cross-border where it is refined with all the value-additives going United States. A relatively stable amount, and decreasing proportion of the total production from Alberta, of all oil and gas, make it to Canadian refineries.

Surprising that none of these charts made it into any of the "regular media's" articles. One look at these figures and it's clear that implementing a carbon tax is austerity wrapped in a green blanket. Changing the profit ratio back from the abyss to a more equitable stake for the owners would provide billions of dollars to Albertans, for the foreseeable future (next 20 years).

Notley's government had a chance to get rid of the ridiculous pre-payout royalty rate scheme a few months ago. She balked. There's no justifiable reason to keep royalty rates at pre-payout levels, none. The government caved to industry and each and every citizen of Alberta gets to pay for it; I'm sure that will go over well whenever the next election rolls around.

One has to wonder the thought patterns of the governing NDP, who were elected on a mandate of increased royalties and a "fairer share" of resource revenues. Were they really "afraid" of the oil companies... as if they'll just ... leave? Getting rid of the pre-payout royalty would easily cover any revenue downfall, and then some. Flat-rate the royaties at 25% this year and crank them up to 40% in 4 years, why not? The goal of the carbon tax is to cut greenhouse gases, isn't it? If Notley was serious about cutting emissions, then raising the royalty rates is one of the few mechanisms she has to address it.

If you've ever played poker, generally the hardest calls to make are the ones where you're holding a winning hand yet your opponent has pushed a mountain of chips into the pot.

Sometimes you just have to call their bluff and know you have the winning hand. 

Liberal media? How about neo-liberal media

It's been quite a week for the corporate media in Canada. They've tangled themselves in knots trying to outdo each other over what happened in the NDP convention in Edmonton over the weekend. The "Leap Manifesto" has been at the crux of most of the articles written, from the right, to the left. It's abundantly clear, however, that heart of their arguments are rooted in what can only be defined as the idolatry of the "free market"; the essence of neo-liberalism.

I think Paul Wells, from MacLeans (a magazine that may have been worth reading at one time, though I can't remember) magazine, characterizes the Red Tory perspective of what the Leap Manifesto meant to the NDP over the weekend. Wells goes out of his way to suggest that any significant reductions in greenhouse gas emissions in Canada mean that the workers on the rigs in Alberta will be left out in the cold. Never mind that the Leap Manifesto calls for workers of all stripes to join together to build the renewable economy of the future. Wells conveniently leaves out the fact that industry in Alberta has pocketed untold billions of dollars of non-renewable resource-derived revenue, a resource owned by each and every citizen of Alberta. Now that the "oil sector has collapsed", or whatever convenient excuse is used to justify the lay-offs in Alberta, for some reason the public is supposed to pick up the pieces. This is classic neo-liberalism; given a choice over the health of the market (business) or the health of the people; you choose the market; profits are privatized, debt and real costs are socialized.

Then there's the release of the Newfoundland budget, a budget the CD Howe institute gives an F. If the CD Howe institute is anything like its cousin the Fraser Institute, I wouldn't put much stock into their analytical prowess. The amount of errors I found in just one of the Fraser's papers, and given that their review of public schools is at the analytical level of snail, both these "Institutes" deserve about as much press as the men's room toilets. Having not read the budget of Newfoundland but for the very highest level highlights, it appears they are at least partially shunning austerity.

Trevor Tombe, the young voice of neo-liberal economics at the University of Calgary (sponsored by The Patch), is concerned over the level of spending versus the level of debt Newfoundland will wrack up in the next few years, and MacLeans published a scathing account of the budget in Newfoundland. Valid concerns, by all means, but the public debt is not a critical issue. Austerity is a fraud, as the Panama Papers have laid bare at the feet of the prophets of liberal economics. It's a wonder as to who actually owns the public debt in Canada? Does it have ties to offshore accounts? Are the financiers of our public debt avoiding tax payments themselves? Why should the public service the debt of private financiers that are actually massive criminal enterprises? Evidence suggests that ownership of public debt in the US is falling into fewer and fewer hands; similar control of the public debt is likely similar in Canada. This begs the question; where did that money come from in the first place? How much of it was sequestered through illegal means?  Do we even need to service the debt?

Back to Paul Wells for the denouement. Wells' thesis in his article is that you cannot govern in Canada unless you kiss the ring of the corporate masters; AKA you sell pipelines and you sell weapons to terrorist states. I guess it's not a surprise someone embedded within the corporate media would defend the status-quo; it has done him well. One has only to look South to see the rising tide of citizens in that country that have completely had it with the status-quo of cronyism and "free-market" ideologues. Wells is a good writer, but his views are outdated. The NDP youth and the youth of the world have had it with neo-liberal economics; the economics of the free market, private profits, mass inequality and debt-based social organization. The youth has had it with fact that their planet may turn into a toaster in the next generation, thanks, in large part, to unrestricted flow of capital and an assumption that you can apply the natural rate of growth indefinitely on a very finite planet supported by the Prophets of the Church of economics.

The very real question we all might think of asking is why do we even need to pay our debts if the majority of the money we're lent was sequestered through mechanism of deceit, crime and suppression?

Clemens et al. skewer their numbers in their "Enrollments" paper.

Let's dissect the Fraser Institutes "Study" on "Enrolments and Education Spending in Public Schools in Canada". This fine piece of work was written by some guy named "Jason Clemens", who, it turns out, seems to write quite a few pieces on the costs, numbers of students and other various factors surrounding public education in Canada. Pressprogress has a clip of his philosophy of manufacturing consent in the public to steer Canada towards private schools. Pretty sure he's an advocate for charter schools in Canada; see Washington State's issues with charter schools.

I have to say that Jason Clemens looks like the type of guy that would go to a strip-club, grab a plate from the buffet, and pull up a seat in perv-row to chow down.

But I digress.

Let's get into their 'document': This thing is supposed to be about "Enrolments (turns out they didn't even spell 'Enrollments' correctly) and Education Spending in Public Schools in Canada". I know that because that's what the title says. When you find a typo in the title generally the chances are slim that you're dealing with a winning document.

It doesn't take long to find some more errors.

Ok lets have a look at that. On the surface this looks correct, (12,070 - 9,231) / 9,231 = 0.3076. However, the actual numbers themselves are wrong. The data in the image is a result of calculations they made from data from the Statistics Canada cansim tables, specifically table 478-0014. Clemens et al. never actually say which row that they get their data from. There's something that resembles an explanation in the first few pages, but it's not clear what they mean. The closest row that I could find for spending, in Canada, on public education, was found in the row labelled "Public school board and direct government expenditures". Clemens et al. quote the total amount of spending on public education in 2003 to be $41.6B, which does not match the cansim data of $41.4B. Their 2013 number does not match the cansim tables either, it's off from the $60.5B value by the same 0.2 amount (60.7 is their number); somewhere 2 billions dollars disappeared. 

In any case, this isn't really the error. The error is in the consumer price index calculations (CPI) they used. Clemens et al. link another cansim table with Canada's CPI values from 2003-2013. Again, it's impossible to tell exactly how they applied this table in their paper. It's clear that they did it incorrectly, however. To be sure of my calculations, I used two different sources of CPI conversions; the same table as linked in the FI piece and the Bank of Canada converter. If you convert 41.6B in 2003 dollars to 2012 you get $49.1B using the BoC converter, if you use the cansim tables for "All of Canada" you get a CPI difference of 19.5%, which converts to $49.5B in 2013 dollars. Clemens et al. list the 2003 values of total spending in Canada as 46.9B in 2013 dollars, a 2.5B difference, or a 5.5% difference right off the bat.

Now the actual value they are quoting in the image is cost PER student in 2003/2004 vs the cost per student in 2012-2013. So this means that they've used the 60.7B divided by the number of students enrolled in 2013, as well as the 46.9B divided by the number of students enrolled in 2003. Their table 2 in the document, which is referenced by the cansim table with a hyperlink in the references section, claims that there are 5,286,949 in the public education system in Canada, the cansim tables claims there are 5,081,703 students. 

So which is it? 

Well, let's look at the quote above again: 

It's really easy to back calculate their numbers, all we have to do is multiply the cost / student, $9,231, by the number of students, 5,286,949 and we get: $48.8B dollars spent in 2003/2004. A quick search of their document produces no such number, "48" is nowhere to be found. How is this possible? 

There is simply no possible way you can get the $9,231 quoted in the document. Even if I fiddle with my CPI calculations, I can't realistically reproduce that figure. That's unreal.

Let's tally up the errors so far. 

1. Typo in the Title
2. Incorrect amount of students enrolled in 2003/04 and in 2012/13
3. Unclear use of CPI tables to convert values into 2013$. 
4. Unclear where they got their 2003/04 totals for $ spent

And this is after the 1st bullet that contains data. I really tried to reproduce their number of  $9,231 of "adjusted" spending in Canada. I tried weighting the amount of money spent in Canada per province; that didn't help. I fiddled with the CPI calculations, but there was no justifiable way that I could reproduce that figure. Not to mention, their total of numbers of students in each year do not match any of the cansim tables; they're overestimating the number of students by about 200,000, with the bulk of those in Quebec, which may or may not be adults. Have a look:

As you can see, their total in Quebec in 2003/2004 of 1,241,143 is a good 250,000 students higher than the highest enrollment year ever in Quebec, according to their referenced cansim table, of 983,709 students in 2003/2004. Fraser Institute even has another document that disagrees with the numbers of students used in this study. Explainable, perhaps, except they were published almost a month apart, written by the same people. These facts are neither here nor there when you consider the  clusterfuck application of the CPI tables.

It's pretty clear that dissecting this document in any real sense is going to be a quagmire, so I'll zoom out from the details and focus on the broader message. 

Their first main section of the document blathers on about how spending on public education has increased nominally by about 45% over the 10 years from 2003-2013. While this is well and good, not considering for inflation and talking about money is pretty much useless. Money is representation of value; a social interaction that changes over time due to various factors. Not accounting for the change in monetary value during any analytical period is going to introduce a number of biases and distortions. Obviously the cost of education has risen, but not by 45% as they claim. Depending on which values you use for CPI, you get a range from of 22-23.5% which is about 5% above an inflationary value of about 17-18% (22-17 = 5, 23.5 - 18 = 5.5) from 2003-2012. All told, the real cost of spending on public education has increased by about 5% above inflation.

Not to get stuck in the weeds of the errors of Clemens' calculations, this document offers absolutely no reason as for the increases. Are there extra downloaded costs onto the school boards? What extraneous contract obligations do the school boards have to deal with? What administrative red tape are staff dealing with when asked to do more work than they can handle? It completely forgets to mention that spending of public funds on private schools has increased a similar rate in the decade considered in the 'paper'. Why would the public fund private schools; makes no sense. The public is on the hook for over 4$B in spending on PRIVATE schools in Canada in 2012/2013 year; unless I'm reading the table wrong and that is the extent of private school spending, by private entities themselves, in Canada.

What the Fraser document misses: 

The Fraser Institute's paper misses the obvious point. We're ONLY spending about $12,000 PER child in Canada? That's it? Let's unpack that; we get schools, teachers, desks, books, gymnasiums, playgrounds, areas in cities or towns for kids to play, learn and interact together. We get all of that, and more, and it only costs about 12 thousand dollars per year?

I spent about $12,000 last year on my 3 year old's daycare service. I got... a babysitter. In a house. With 6 or 7 other snotty nosed kids. They went to the mall for their activities. I can't afford to pay $1500 / month for adequate, stimulating, child care, so I get the discount version. 

$12,000 a year for our children to go to school, for good quality public education, is the deal of a lifetime. $12,000 per year gets you mid-grade daycare services in several cities in Canada. Educating the future members of our society is not a "cost", rather it's an investment. An investment that's guaranteed to pay off if only given enough time, attention, stimulation and challenge.