Chapter 6 Media Article

"Investors searching world for opportunities," The Province April 24, 2007.

Just as the article's heading suggests, investors all around the world are looking for commodities and resources to invest in, meaning that there is a large amount of capital available for businesses. The key to acquiring these investment dollars is being able to find "the right people doing the right job and the right asset" and taking advantage of these opportunities. The mining industry in particular is a popular industry which attracts investment from the all around the world. And since there is so much demand for the mining industry, the article suggests that businesses have to be careful in their dealings. When investment from foreign governments and businesses is involved, it is crucial that there is a clear understanding of the situation because countries often change their laws or policies.

When money is invested into the economy, more money is able to circulate through various industries, with more money going to the hands of individuals in the end. As individuals acquire more disposable income to spend, the consumption of goods further triggers the growth of the economy. Also, as businesses have increases in investment, they are able to expand, purchase new equipment, and increase the available job openings in the economy. All of these factors contribute to the increase in gross domestic product, GDP, and indicate that the economy is in good shape. Furthermore, the increase in disposable income and spending by consumers is one example of how aggregate demand is affected which in turn affects the equilibrium RGDP. This change in equilibrium RGDP is advantageous because it helps the economy move towards the state of full employment where resources are fully utilized and the economy is working at its maximum capacity and efficiency.

I think that increased investment in the economy is definitely beneficial for businesses and individuals. Businesses end up having more funds to expand and increase efficiency. As businesses see increases in profit, employment opportunities for individuals will also increase. Moreover, under good economic conditions, I think individuals will end up wanting to spend more instead of save more which will benefit the economy. And also, the increase in spending will have the effect of lowering interest rates in the economy.

Chapter 5 Media Article

"A student asks: Why don't schools do more to promote trade skills?”, The Province March 14, 2007.

"Our high schools tell us to keep our options open. How can we do this if, slowly, they are limiting our options?" This opinion was voiced by Erin Tattrie, a current grade 12 student who points out the fact that high schools provide a contradiction with regards to our education. Currently, our curriculum is academic intensive and places much priority on subjects such as English and mathematics. Yet, trades courses such as carpentry and joinery are neglected. The schools that actually provide trades courses provide ones with low quality resources and safety conditions. Furthermore, people with a skilled trade are in high demand right now since there is such a low supply of this labour resource in our economy. But our schools still do not encourage the trades, and especially not towards women. And so, this high school student urges for more focus towards the trades in school because "trades were in the past, they're in the present, and they are the future."

Relationship to Ch. 5 - employment and unemployment, price increases

Keynes' theory on economic growth suggests that if you stimulate demand, production will follow. In a way, this theory applies to the situation described by the article. Since schools do not encourage or attempt to stimulate interest from students for jobs in the trades, there is a very limited amount of labour available from people with a skilled trade, yet the demand for tradespeople is very high. And this poses another problem as the majority of students are so focused on academics. The situation may foreshadow a sort of long term frictional unemployment in the future for a large population. As a vast population of students graduate from the academic field, seeking and expecting employment for similar jobs, many will be unsuccessful as there will definitely not be enough openings to accommodate every unemployed individual. On the other hand, if more people entered the labour force and have jobs, more will spend money, and if more workers enter labour unions, costs will go up. Both of these are examples which end up leading to a rise in prices in Canada, continuing the economic cycle of inflation and unemployment.

Personal Reflection

I understand the view point where the writer of the article is coming from because there really is very much importance placed on academics. And often the courses that one is required or encouraged to take will likely end up being of no use in the workplace. Honestly, I think a skilled trade is much more valuable to have because many academic-based jobs will be worthless if the economy crashes and the current structure of our society is destroyed. But personally, I do not have an interest in pursuing a skilled trade which may be because I have been brainwashed by the school systems that teach you otherwise.

Chapter 4 Media Article

“Richmond council pushes for federal flood-protection aid”, The Province Feb. 13, 2007.

The article states the concerns of the low-lying city of Richmond of a potential impending flooding by the bordering Fraser River. The concern is that billions of dollars worth of damage may present itself come spring, as the river overflows due to factors such as high levels of snow. The Council has passed a motion and proposes for more federal funding and “commitment” to improve the amount of “flood protection” to prevent and/or minimize the damage predicted. According to the article, the city council of Richmond refuses to support the plans of Vancouver, the Fraser and North Fraser to merge together port operations if their condition of increased funding is not agreed to. The disaster of Hurricane Katrina is one of the arguments used to support their reasoning as it is an example of poor dike protection. But the bottom line is the there is and has long been a lack of funding.

Relationship to Ch. 4 – Wagner’s law of increasing state activity, Peacock-Wiseman theory, benefits-received approach, ability-to-pay approach

In order to increase funding for flood-protection aid, either funding from other areas will have to be transferred to it or taxes will have to be increased. But since people are not willing to give up the level of services they currently enjoy, that leaves the government with the decision to raise taxes. Since the city of Richmond has a large infrastructure with many services, the government has an obligation step in and get involved to protect the city from the predicted damage of a flood. But to increase funding, who should the government impose taxes on? If the government follows a benefits received approach, the level of taxes imposed on citizens of Richmond will be too much of a strain. Yet, there may be unwillingness from the rest of the population if they are to be taxed on something that does not involve them directly. On the other hand, I think the Peacock-Wiseman theory comes in to play as the people will not mind increases in taxation when it comes to problems of a sort of natural disaster such as this one. But, in the end, the general taxation level will be raised and tends to stay at that level because people become complacent with the taxes. And this leads to a question of equality as some people may not have the ability to pay additional taxes. Furthermore, the ability-to-pay approach of taxation would not work as it also questions equality if not everyone needs to contribute to something they will end up benefiting from. Wagner’s law of increasing state activity presents another problem, the fact that the government already spends more than the good and services that are produced. But, in my opinion, the government has a duty to support the infrastructure of Richmond because if the city does actually become flooded, it will negatively impact a vast group of people.

Personal Reflection

The potential flooding of the city of Richmond is a huge problem because it can have disastrous effects depending on the intensity of the flood. If the city were flooded, numerous jobs could be lost which would end up harming and slowing down economic activity. Homes would be ruined, schools would be closed, and so many other important aspects would be negatively impacted. Those are some of the reasons why I think that Richmond should receive more funding in order to limit the damage that a flood would bring. It’s better to be safe than to be sorry afterwards.

Chapter 3 Media Article

“Better rapid transit, but not rapidly”, The Province Jan. 17, 2007.

This article states that Translink is planning to expand its service and range according to the changes and growth of population. The changes that will be seen will either be bus rapid transit (BRT) or light-rail transit (LRT). The BRT includes on-board announcements and dedicated transit lanes while the LRT (variation of a SkyTrain) is less expensive and is on a grade instead of an elevated guide way. This plan is in place because the population and number of jobs are predicted to increase. For example, in Surrey, White rock, growth is expected to be about 58 percent or 948,045 in population and the number of jobs to have increased by 73 percent. Also, BRT bus routes may be upgraded into LRT bus routes as the planning process continues. So, in the next decade or so, we should be expecting to see many alterations to Translink and the places it can take us to.

Relationship to Ch. 3 – government involvement, natural monopoly, third-party effects, privatization

Transportation is an important factor in the Greater Vancouver area as it is booming economically and the need to travel around is high. Therefore we have Translink in place. According to my knowledge, Translink is partially composed of subsidiary companies and government involvement where government officials make up the board of directors. The government is involved in our transportation services and allow Translink to more or less have a monopoly on this aspect of the market due to the fact that it is not so efficient to have many competitors. As Translink expands, its service will reach more people more promptly and efficiently. Translink allows for fewer traffic jams as there are fewer vehicles on the road. But for those who choose it, there are alternate sources of transportation, namely automobiles which is the most popular by far. In terms of public transit though, Translink is likely to have the best combination of good efficiency and low cost, especially since it has much capital at its disposal. And of course, if there are fewer vehicles out there, it will, in the end, benefit the issue of global warming as there are less greenhouse gases emitted. Another possible third-party effect is on a much smaller scale. If a good transportation system is in place and places are easily accessible, the tourism industry in the area affected will benefit and prosper. Furthermore, in my opinion, privatization of this industry is not the best option because privatized companies are most concerned with profit and will lead to higher costs and will probably be more damaging to the environment as the materials used are unlikely to be environmentally-friendly, even if the end result is a more favourable service.

Personal Reflection

Although Translink has its flaws and may not offer the speediest way to travel, I think that the advantages outweigh the drawbacks. One thing that I think is really important is that travelling by public transportation is much safer than travelling by car. What I mean is, how often do you see, for example, buses crash? Now compare this to how often cars accidents occur. What I will never understand is the obsession of the current youth generation to drive. But it is because of this mindset, this obsession that results in the many car accidents around us. Besides, drivers hired by Translink are likely to be more careful because their jobs are on the line.

Chapter 1 & 2 Media Article

"Education Key to Thwart Looming Labor Shortage", The Province Nov. 1, 2006.

This article suggests that B.C. is highly likely to face a labor shortage as the aging population is heading towards retirement. The consequences of this will have serious effects as there are more people that are retiring than there are entering the work force. It suggests that education is the answer to solving this problem.

Relationship to Ch.1 – scarcity of labor resources, opportunity costs

An important factor to the economic success of B.C. is the fact that it has abundant resources, whether it is land, labor, or capital. But all of these resources are still considered scarce. Our labor resource is scarce in the way that the older generation is retiring, relying on the younger population to support them and our economy. But the problem is that there is a large population of the elderly and a relatively smaller younger population, creating difficulties. The decreasing workforce will place stress on the current workers as they will have to do more work in order to compensate for and attempt to replace the retired workers. There will be a decline in all areas of the economy if there is a lack of workers, such as in research and development, technology, manufacturing, and a vast amount of services that make up our economy. The scarcity of our labor resource will also diminish our capital resource in certain ways. For instance, the money that will need to be used to support services that the elderly need, such as health care. High taxes may need to be put in place to support this. The high standard of living that the residents of B.C. enjoy now will be put at risk due to the simple fact that we just do not have enough people who are able to contribute to our workforce and support the economy. And what about opportunity costs? If we were to pursue education to solve this scarcity problem, we would be giving up possible better alternatives in the process. Time, effort, and money will be given up in direct and opportunity costs to finance and support this decision when we cannot be absolutely sure that education is the answer. What if it only makes things worse? What then?

Personal Reflection

This scarcity of resources affects me in that I am approaching the age in which I am to enter the work force as I am a part of the younger population who will be expected to support the aging population. Pressure will be placed on my generation to do more work for less in return. High taxation rates will further place strain on us workers. Services provided for the younger generation may worsen in an effort to preserve the quality of services for the older. Yet, we do not really have a choice in the matter as the government makes most of the decisions for us, and if it were to come down to a vote, the aging population outnumbers the younger. So, do we just go with the flow then?

Relationship to Ch.2 – supply and demand for education

As previously mentioned, the article suggests that the way to solve a labor shortage will be to pursue education. Demand is becoming increasingly higher for a greater population of immigrants, international students, etc. There is an increase in demand for more students to complete and graduate from high school to ensure more workers to enter the workforce. The need for a post-secondary education is encouraged for both older and younger people in order to enter the workforce or stay in the workforce. Furthermore, there really does not seem to be good substitute for an education, causing competitive spirits to rise as post-secondary openings do have a limit. And, the expectation of a bright future with a successful job and high wages is pushing people to fight for what is seemingly right. With all these demands, what will happen with supply? More and more media and advertisements are attempting to promote more people to move to B.C., and it looks rather successful, as population growth rates seem more than favorable. According to the article, "By 2020, there will be 773,200 more people in B.C. than there were in 2005, representing an 18-percent increase in population." Various post-secondary institutions seem to be 'popping up' constantly, claiming to be having a majority of students successfully enter the workforce. Statistics show that there are increases in overall post-secondary enrolment. All these changes to supply and demand sound good up to a point. But what would happen to the 'value' of the people who actually pursue what is advertised. Currently there is a high demand for education preparing to fill the gaps that will be left by the aging population, thus high post-secondary enrolment already exists, with more and more students entering the same field simultaneously. The downside is that the supply of workers will eventually exceed the demand for workers, possibly resulting in mass unemployment, as the post-secondary degree so highly pursued, becomes a measly piece of paper left unused.

Personal Reflection

The mindset that a post-secondary education is the way to go for high school graduates is a strong belief that is uneasily swayed. After years of a certain degree of 'brainwashing' by the media, schools, and other organizations, I too believe that a post-secondary education is the correct decision. The question is: Would I have made the same decision to pursue a post-secondary education if the media were not involved? Or am I just following popular demands and supplying what the economy wants?