Tag Archives: prices

MayDay 2011: Price & Purchasing Program

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Canadians are getting ripped off.

We are paying more at the gas pump, despite being one of the world’s largest (albeit dirtiest) sources of oil.

We consistently pay anywhere from 20-50% more on basic items like cars, books, food products and other goods.  The continuous – and lame – excuse from suppliers is that the cost of doing business in Canada is rising.  Labour, regulations and other ‘impediments’ are positioned as the point of blame for these rising prices.

However, think of these excuses in context of current events:

  • Unions are being broken.  They are not increasing in strength.
  • Although minimum wages are increasing, they are not increasing 20-30% every year.
  • When was the last time you saw an overzealous government implement a broad change in tighter regulations anywhere in Canada?

Despite the fact that our dollar continues to rise in value, we are paying more for the goods and services we rely on each day.

As a reminder, for those of you who aren’t familiar with economic terms, when your currency rises in value, imported goods should be cheaper in an inverse manner.  That is, if your currency rises 20% compared to all other currencies, the cost of goods imported into your country should drop by roughly 20% to represent this increase in buying power.

As it stands, Canadians are getting screwed over twice because they only

The progressive party (as opposed to the regressive Conservatives) that proposes an investigation into the skyrocketing prices that Canadians are paying will win this election.

MayDay 2011: Prices

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The leader that proposes to address prices in Canada during the election campaign will win the election.

That’s prices of everything.

Here’s why:  Canadians are getting screwed.

As the value of our dollar rises compared to other currencies, particularly that of the US dollar, the cost of imports should be decreasing.  It’s a simple inverse relationship:  the more valuable our dollar, the more you can buy with the dollar.

It’s called ‘buying power’.

As a refresh, here’s a chart showing the value of the Canadian dollar compared to the US dollar:

Cdn-US-Dollar

Since 2002, the Canadian dollar has appreciated roughly 63%, from a low of about 63 cents to a high of roughly 104 cents (compared to the US dollar).

Despite this massive increase in value, prices have not dropped in a similar and inverse manner.  Of course, not all of our import/export relationship is related to US goods, but the fact is this:  the US accounts for roughly 50% of all imports into Canada.

In fact, the price for basic commodities – gas, food, etc – have increased 50% or more over the last few years.  According to the latest CPI figures, the price of gas has increased 18.3% since last March.

Again, Canadians are getting screwed.

Students, seniors, lower income groups and even the elite that Stephen Harper is courting – those few people that will enjoy tax breaks way off in the future – are paying higher prices RIGHT NOW.  An 18% increase in gas represents an 18% increase in taxes and yet no one is crying for the head of the Prime Minister like they do if the price of their Timbits rises $0.02 when the HST is implemented.

It’s slowly sinking in and Canadians are catching on to the idea that we’re getting hosed, but a wise leader would make this an issue sooner rather than later and attack these price increases.

The first step would be to promise an investigation into gas prices, followed by questions like why Canadians have to pay anywhere from $10,000 to $15,000 more for a Honda in Canada compared to the US when it’s made in Alliston and is exactly the same.


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