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Great chart Stephen. In addition to the exchange rate, 9-11 and crackdown on border security have probably had a large effect too on cross border travel.

It would be interesting to see another chart showing the opposite - day trips made by Canadians to the US. If the exchange rate dominates, one would expect to see a big jump in day trips over the same time period. But if growing security concerns/lineups/bureacratic hassles are significant, the number of Canadians crossing would be flat or even falling, despite the loonie's increased purchasing power down south.

I had the opposite reaction to that graph, day trips dropped before the exchange rate. Which one is driving the other? Perhaps the recession is the true cause, and the exchange rate is just coming along for the ride.

It's not the exchange rate, it's border security. Too simple for you to grasp I guess. I talk to several cross-border business types, and they all cite the requirement on both sides to have a passport is the biggest driver of the decline.

I just spent a little while skimming through the posts here, as a first time visitor, and I can say with certainty I won't be back. You are simply out to lunch on all levels, to put it politely. I could put it in more accurate terms, but that would not be printable.

Honestly, I think you aptly demonstrate what is wrong with "economics" as taught in modern business schools. All ivory-tower wishful thinking, and zero reality. Have you ever run a business, made a payroll, worked in the private sector? I would seriously doubt it. Let's face it, the NDP is electorally irrelevant in this country, and deservedly so. The "public sector" in this nation is due for a massive reduction in size, and never more deservedly so. Taxpayers are fed up with CUPE and their trough-sucking bloated ilk. A healthy economy can not include idiotic greedy public servant unions, their cost has long since soared past the point of any value to non-union members.

A more truthful title for this Blog would be "The Clueless Leftist". Pathetic.

I would have said "border security" too. Then I saw Stephen's graph.

I wonder if it works as well the other way (voyages from Canada to the US, on the reciprocal of the exchange rate)?

Got A Watch: Wow. That's a lot of vitriol and not a lot of substance.

Thought he's not often overtly political on this blog, I don't think Nick is much of NDP supporter. So this is not a 'leftist' blog.

Instead of wages in the public sector being bloated by unions, could it be that private sector wages are supressed by their absence and the resulting power imbalance?

Corporations form 'unions' in the form of industry associations. They band together and use their money and influence to shape the world in ways the benefit them. Why is OK in your book for corporations to do this and not workers?

In any case, I think you might be surprised at the reception from business to a policy proposal to significantly lower income taxes and raise consumption taxes and Pigovian taxes. In fact, there are some very prominent right wing economists who support both those policies.

Now, you might not find much agreement on the right that a guaranteed national income is a good idea, but I think the right might at least concede that if one is going to have a significant welfare state, GNI is the way to do it.

Ugh. Sorry about all the typos in my previous post.

Explaining US trips to Canada over the past decade would make one interesting econometric challenge.

According to my out-of-the-window observations, the exchange rate, tightening border security and prices of fossil fuels seem to be all positively correlated since 2001. Higher fuel costs should reduce tourist travel. As indicated in an earlier blog post here, when the price of oil goes up and the value of the Canadian dollar relative to the US dollar follows.

Pointbite's point is worth persuing - when was the last turning point?

Patrick, Stephen Gordon is explicitly left of center (at least in US terms), but the actually policy he supports seperate him a bit from the mainstream left (particular US commentators).

Um, is it me or is the explanation for pointbite's observation a bit more obvious? Looks like the initial drop was in late 2001. Now, what happened in late 2001 that would cause a sudden drop in Americans travelling outside their borders ... anyone...Beuller?

And did security coming INTO Canada change the way security going into the US changed? Probably not at all in the same league. So a comparison with Canadian trips would have to adjust for that.

Personally, I've been planning to go the the states for a while, then remember that the kids don't have passports, start the passport application process, but have gotten stalled on the paperwork, so we've foregone, what, 2 or 3 trips to the US in the last year, including probably one trip of a couple of weeks vacation. Though before the passport requirement, we went down several times a year, and during that parity blip last year we even bought a car in the US and drove it home.

Got A Watch: won't be back, eh? Shame, because that bile contributes so much to the discussion.

There might be other factors. Border crossings are usually located near major Canadian cities (for example, Vancouver) but not necessarily U.S. ones (for example, Bellingham). The difference in basic things such as food, accommodation or gas is HUGE. Also, American visitors would be coming for events and sightseeing, since they're not coming to shop (our goods and services are very expensive).

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