The Crazy Socialist Communism of Canada (Not.)

So, Canada is a bunch of money hungry liberal socialists, eh? Not so fast. Recent reports have shown how Canada, the "Tax and Spend" capital of the world (or so say the neighbors to the south), has avoided the recession due to its active regulation. (Image: CBC) Crazy, eh? Well, I can't say I'm surprised. If there's one thing that U.S. style deregulation causes, it's chaos. There's no two-ways about it, regulation works -- deregulation doesn't.

So, how did Canada remain so prosperous despite it's lack of fiscal conservatism? Truth be told this success has little to do with the government. All the government had to do was pass laws requiring that financial institutions do things within certain constraints. No bailout or handouts, simple legislation.

Why those interested in the success of the financial system (read. right-wing politicians) don't believe in regulation confuses me greatly. The crash of a financial system benefits no one, especially not the private sector. It also doesn't prevent government growth. Regulation, it would seem, is fiscally conservative in its roots.

Being proactive costs nothing. Now, Canada's banks are some of the healthiest on the stock market, which means that Canadians who use these banks are safe from their money and savings disappearing. It also means these banks can continue to loan money without fear.

The article cited at the beginning of this post quotes an economist, Craig Alexander, who points out how regulation forces banks to think long-term. While it may have limited their short-term gains, it benefitted them in the long-term by forcing them to evaluate who they are loaning money to. This is a great success for the country and benefits everyone who has their money in Canadian banks.