hard times: we are ruled by banks, corporations, and the governments that enable them. it doesn't have to be this way.

In Canada this year, food bank usage hit an all-time high. In March 2022, there were almost 1.5 million visits to food banks -- 15% more than there were one year ago, and a whopping 35% more visits than in March 2019, pre-pandemic.

Food prices have ballooned at the highest rate in four decadesThe Consumer Price Index, which approximates a cost of living barometer, has risen 6.9% since this time last year, which was already 5.9% higher than the previous year. At times over this past year, food prices had gone up more than 10%.

The price of gasoline is 13.2% higher than it was the previous year -- down from an eye-popping 22% increase a few months earlier. Most Canadians must drive in order to work; in most areas of the country, public transit is minimal. In urban areas, 17% of Canadians take public transit to work. In non-urban areas, a scant 2% do so. 

This is usually attributed to Russia's war on Ukraine, and supply chain interruption. Why would a faraway war impact the price of food in North America? Because everything, including basic survival, is subject to the irrational, mysterious ways of the market. The good old invisible hand of capitalism, causing good times and bad. And supposedly there's nothing we can do about it. Too bad, so sad. 

But there is something we can do. We can build a better system -- a rational system that privileges the needs of many over profits for a few.

It doesn't have to be this way

But in response to this crippling inflation, the Bank of Canada has raised interest rates, which harms people, and benefits banks. Raising interest rates to combat inflation has been shown to fail 100% of the time

That's worth repeating. The Bank of Canada is following a policy with a zero percent success rate. Unless your goal is helping banks, in which case it's spectacularly successful.

As Economist David MacDonald puts it:
History tells us that the Bank of Canada has a 0% success rate in fighting inflation by quickly raising interest rates. If a pilot told me that they'd only ever attempted a particular landing three times in the past 60 years with a 0% success rate, that's not a plane I'd want to be on. Unfortunately, that looks like the plane all Canadians are on now.

Free-market rationale says that rising interest rates will discourage borrowing and encourage savings. This seems little more than fantasy.

(1), mortgages are already borrowed, we can't un-borrow them, so increasing interest just increases the housing costs of real people. (2), the price of food and fuel continues to climb, so therefore, (3), ordinary people have even less money to save, if indeed they ever had any.

These rising interest rates and higher mortgage payments occur are occuring in a country where housing has become increasingly unaffordable. Rising interest rates are bad news for everyone -- except banks.


Exxon Mobil and Chevron raked in a mountain of profit this year. The net income for the world's oil and natural gas producers is set to double in 2022 from 2021, to a new high of $4 trillion. World Energy Outlook calls it "an unprecedented windfall for producers".

Loblaw, the corporate food giant, tried to package a routine holiday practice -- freezing prices on their store brand for a few months -- as noblesse oblige. Who do they think they're fooling? In the first quarter of this year, Loblaw enjoyed a 40% increase in profits compared with the previous year. 


Nearly a quarter of Canadians have been forced to cut back on purchasing food.

Whose government is this?

The Liberal Government defends interest rate hikes, even though this has squeezed many Canadians in a fight for survival, and pushes many into food insecurity or outright hunger. 

The Conservative Party criticizes the rate hikes, but that's just partisanship. History is quite clear on this point: if the Conservatives were in power, they would also support the Bank's moves, too.

Only Jagmeet Singh and the New Democrat Party speak out against this insanity.

But there's little enough that any party can do, as our laws are written to support big business and minimize government input. The NDP can call for investigations and strategies, but the fact is, a remedy would require an entire re-thinking of government's role in business. 

It would require a government that protects people from predatory businesses, rather than enabling their voracious greed.

All this could change. Laws are not found in nature. They are written by people. 

If the government governed for us, there would be laws against price gouging, there would be a "Robin Hood" tax, there would be caps on profits for essential goods. There would be a human right to food and shelter, and laws that supported those rights. 

Instead, the laws of the land are designed to maximize the profits of the few, not the needs of the many.

We must ask, who does the Government represent? If Trudeau's Liberals support policies that are killing Canadians, how can they credibly say they are representing the people who elected them?  

I am fed up

I am fed up -- I am way beyond fed up -- with governments that represent Loblaw, Suncor, and RBC. For the millions of Canadians who will only vote Liberal or Conservative, I ask, How's that been working out for you? 

In the US, there is no viable third option. That has enabled the march to the extreme right. In Canada, where there is a developed third party, the majority are afraid to vote for it -- even those who claim to support its platforms. Supposedly progressive people routinely advise and pressure others to not vote NDP. 

Obviously voting NDP will not magically fix these problems. But it would be a start. With Liberals and Conservatives, things will continue along the current path, which will only lead to greater wealth concentrated in the hands of fewer people. Then Canada will be well positioned for the desperation that allows fearmongers to incite scapegoating, violence, and all manner of repression. 

I have no illusions about the NDP. They are a political party, and therefore subject to the same pitfalls as any other. But if all the partisan politics are equal, only the NDP speaks for ordinary Canadians. 

Isn't it time to try something different? 

Further reading

David Macdonald, quoted above, is the senior economist for the Canadian Centre for Policy Alternatives, a progressive think tank that I am proud to support. You can read Macdonald's analysis here

Paul Krugman is also a good read on this topic. See his "wonking out" columns.

Here are three good stories on food insecurity in Canada -- all published pre-pandemic. Since that, it has gotten so much worse.

Wealth is health: The Reality of Food Insecurity in Canada

People Across Canada Are Struggling with Food Insecurity

More Canadians are food insecure than ever before – and the problem is only getting worse

Imagine something different.

What Would a Socialist Food Industry Look Like?

Capitalism and food: Hunger amidst plenty

Socialism for the bankers, capitalism for the rest of us -- so it goes


Amy said...

Great post, and although I am not familiar with Canadian politics, I sure know how the two party system here has led to polarization and stagnation and control of politics by those with money.

I did not know, however, that the policy of raising interest rates to curb inflation has never worked. Is that true in the US or were you speaking only about Canada? The logic of what you said applies everywhere, but why would US (and I guess Canadian and other) policymakers continue to use a policy that has always failed? Because there is no other choice? Because they are evil? Stupid?

The theory I've always heard (and I have only a really, really superficial understanding of economics since I never even took a class in it) is that it will "cool" the economy---that it will stop the spiral of raising prices by reducing demand. Of course, those with the least will be hurt the most by that policy, and that makes it grossly unjust. But does it work to accomplish the goal of cooling off the economy so prices stop increasing for everyone, including those most at risk? I don't know.

I am asking in total good faith---not to defend the policymakers and certainly not to defend the corporate greed that lies behind most of what causes the high prices to begin with.

laura k said...

Amy, I would always assume your comments or questions are in good faith! But thanks for that.

I know very little about economics, but what I know, I learned from Paul Krugman (who I've linked to in this post). He coined the expression zombie economics for this -- dead ideas that are still walking. So the context is not Canadian-specific in any way.

Why do they do it? In my view, because it's good for banks and Wall Street. "The economy" means Wall Street, stockholders. So the banking institutions say do it, it will work, and no one questions it. If Wall Street improves, then "the economy" has improved -- in this view.

What I meant about the two-party system is how it has moved the politic spectrum steadily to the right. One reason that happens less in Canada is the existence of a party on the left.

Amy said...

I will go look at the Krugman article. He is always my best teacher on anything dealing with economics.

And yes, the two party system has always been about moderation---but it does keep shifting right. I think that unfortunately it's also true that the population in the US is heavily weighted to the right, more and more so. It's depressing as hell---especially since "right" these days seems to be way beyond what "right" meant even forty years ago. Was there ever a true party of the left in the US that had more than minimal support?

laura k said...

What do you mean by "the two party system has always been about moderation"? (Also asking in good faith.) Many countries have more than two parties, and all are moderate, none extremist.

The NDP in Canada is similar to liberal Democrats of the past (pre-Clinton), perhaps like Elizabeth Warren or Bernie Sanders now. Nothing one could rightly consider extreme or immoderate.

Socialism and a third party have been strong in the US in the past, especially on the state level, but also federally -- from around 1900-1920 (with opposition to US involvement in WWI), then again during the Depression. The New Deal was largely in response to fear of socialism.

Governments made it impossible for those movements to flourish. Leaders were targetted, arrested, deported. Red Scares, blacklisting, etc.

I would also ask a chicken-and-egg question about Americans and the right. It's always easier to move people to the right rather than the left. Is the US's rightward shift a genuine expression of what people want, or did parties (aided by media) move rightward, and opinions followed them?

There's no single answer to this, but I think more the latter than the former. Remember the election where "liberal" became a dirty word, and how the Democrats bought into it, falling all over themselves to declare that they were not liberal? (1988, I believe.)

Amy said...

What I meant was that when you have only two parties, it's not surprising that they are both going to move to the middle of the spectrum (wherever that spectrum begins and ends) to try and get as many votes as possible. So moderate in that sense---of moving to the middle, not in the sense of being non-radical in their underlying views. Id say that right now the Republicans who are really in control are pretty radical in their views---from my perspective. But the system of two parties makes them try to appeal to some of those in the middle of the spectrum who, for example, are pro-choice and anti-guns but who find a truly "liberal" party too far left for them.

The spectrum from right to left, however, has shifted, as you said. We used to think that someone like Eisenhower or Rockefeller or even Bush was on the right, but today they would likely be to the left of center. Today a "moderate" Republican is someone who is pro-life, pro-business, pro-guns, anti-affirmative action, anti-government regulation for environmental or other purposes, etc. Even Nixon and Reagan seem pretty centrist by today's standards.

It is hard to know which is the dog and which is the tail---are Americans really that racist and isolationist and "libertarian" and ignorant, and Trump and his surrogates (DeSantis, Cruz, etc.) have just tapped into all that hate and anger? Or have those people been sold on those ideas by the Trumps and the Fox News, etc? I think it's both. All those MAGA people firmly believe that America was ruined by the Democrats and Obama and Biden and all the laws protecting human rights.

Yes, there were more left wing movements and parties in the past, but none on a federal level that ever got much power. And whether it was the media, the government, the corporations or any other source that convinced Americans that chaos comes from too much government doesn't change the fact that that's where we are now. I am not sure why it is harder to move people to the left than the right except to say that there's a cultural bias here against government telling anyone what to do---whether it's who they hire or go to school with, how they run their business, whether or not they can carry a gun. Except for abortion, of course. That the government can regulate.

And that's where we've been in the US for as long as I can remember---at least on a federal level. State by state, there are good people doing good things in government in some places. But the federal government is broken, useless, and hopeless.

laura k said...

Absolutely, moderate Republicans of the past are Democrats now. That's why I can't agree that the two-party system pushes both parties to the centre. How can that be true, when the centre has shifted so far to the right? If everything moves to the right, then saying it moves to the centre is contradictory.

Americans are certainly racist and isolationist and love fascism. And they have also been manipulated by demagogues, media, and dark money. I agree that it's both. And yet there are millions whose liberal (in the US context) views are simply not represented.

While it's true that no third party has broken through federally, it's also worth considering that leaders of movements were jailed, deported, slandered, and blacklisted in order to prevent that from happening. My point is only that it isn't necessarily a lack of appetite for left-leaning ideas that accounts for the absence of a leftist party in the US.

Now that it takes so many millions of dollars to run for office -- plus the spectre of Trump, DeSantis, etc. -- any hope of a third party movement has been killed.

Amy said...

Yeah, it's hopeless. But then I look at the system in Israel where you do have a broad array of parties with very different viewpoints, and they also are paralyzed and captive to the most right wing racist elements of that society.

I guess what I was trying to say (not very well) is that whenever you have only two parties, those parties are going to fight for the votes in the middle because they take for granted they have the left (dems) and right (repugs) already. The middle just is more repugnant than it once was as the stupid country has moved right.