U.S. lumber industry questions Harper's $1B aid fund
Stephen Harper is making a decision on having a one billion dollar aid fund for the Canadian communities that aren’t flourishing as well. These are mainly the unemployed workers in forestry, fishing, and manufacturing. The American lumber industry is against Harper’s decision and claim that the act is be a violation of the 2006 Canada-U.S. Softwood Lumber Agreement. The U.S. Coalition for Fair Lumber Imports thinks that Stephen Harper is attempting to reduce the liabilities of Canadian companies, but the government claims they are investing the majority of the money on job retaining and community infrastructure instead. The Coalition does not have hard evidence yet, but they are continuing in having a watchful eye on the events.
The government’s rationale for deciding in investing one billion dollars to fund certain Canadian communities may be for unmet public goods and income distribution. People who are unemployed will receive more benefits and as a result, they may end up finding a job. Areas and infrastructure will be fixed and built benefiting the community. By paying workers to build and fix roads or other transport systems around Canada, third parties benefit as well. With more and better roads, people will have an easier way of getting around. Another reason might be because the government is trying to gain popularity, or they are seeing a downturn in Canada’s economy so in order to prevent that from occurring, they are spending a billion dollars.
I think it’s great that the government is spending one billion dollars in aiding communities around Canada, but if what the Coalition say is true then it might not be as beneficial in the long run. If money is spent on lowering the liabilities of Canadian companies, then Canadians will be able to mass sell their products at a lower price, diminishing all other competitors. As a result this may damage USA’s economy and in return damage Canada’s economy because both countries are so tightly connected with one another. Other than this problem, the one billion dollar investment will create jobs for the unemployed.
1 comment:
I agree with Stephen Harper’s plan to fund job employment in the trade industries. I don’t see any problems with investing money into this. Even though others might fear that this will harm their economy, the investment will support our economy by providing people with jobs, making our products cheaper, and lowering our liabilities. Though this might result in us gaining majority of the shares in the markets, the others just fear that they can’t compete with us. Like what we have learned in this chapter, the market is driven by competition so shouldn’t this follow the theory of the “invisible hand”.
Kevin Tran
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