Exactly the reason more money shouldn't be put into medicare -- the money just goes to pay more to people who were happy enough to be working at a lower wage.

I'm just kidding, ha ha.

But to get back to your marketplace example, an increase in the amount of money and the number of people wanting a service usually means some combination of a better class of service becomes available or more people move into the market to meet the demand.

As to your first para, because the GST is not transparent to the consumer, each vendor will actually have to choose to visibly raise the price of items, meaning vendors who don't are more (and obviously) competitive. This is even more true (i.e. highly correlated to observed and expected behavior) in the low end of the market where the consumer is highly price sensitive.

But if the entire class of vendor has the same opportunity, there is no incentive to provide better service or a price break as they have already theoretically maximized. The popcorn money won't create new buyers if the price goes up by the amount added to available revenue and I think it is the case that GST is effectively hidden in professional billings which are the sort described - bankers, dentists, landlords. All that is created is inflation for the same goods and services.

But every vendor doesn't have the same opportunity, as one assume buyers are sensitive to the product they're acquiring. And the money will create new buyers, as there's always margin where "I'll stay home/I'll drop her off at my mom's/my friend's/etc" switches to "it'll be easier/better for me to put my child in daycare" or "I'll take that part time job now".

The three other classes you mention are interesting. Canadians are far to passive toward their bankers, maybe that's our nature. However, banks offer a wide range of products that are not only competitive in price but in the type of service offered -- also thinking of ING Direct and HSBC here. Landlords hide a lot of things in their rent prices which I think should be exposed; however, in Toronto the type and price of the product offered here is very sensitive to market demands.

Buyers aren't sensitive in a vendors market like day care. There isn't enough supply in the first place making shopping around a very problematic thing - hence the need for the program of some sort recognized by all parties. Plus any new demand potentially created is both lost through the inflationary opportunity that vendors will take advantage of and also will not create new buyers due to the total possible marginal increase in buying power being less than the cost of the product.

I'm not sure where you live, but there's a hell of a lot of supply around here. As for you latter argument, what I said earlier. There's demand at all price points and supply at some price points (i.e. there's a price below which it's not worth getting into the child care business -- let's call that "the margin"). More money in parents hands means more people that currently aren't being serviced by the market will now be above the margin. Your belief is essentially that the margin will be set higher; my belief -- which I think is quite well supported by economics in theory and in practice -- is that more services will become available at the margin as the demand that previously wasn't there will be.

As callous as it sounds, the childcare market experiences no different pressures than the beer or popcorn market. Do you expect the price of Labbat's or Steelhead or whatever it is the kids drink these days to go up now that parents have an extra $1200 burning a hole in their pocket?

That is interesting about supply because where I live it is not the case. People have a very hard time finding day care they trust and can afford. But your trust in theory is touching. The inflationary effect acts against the demand. If you note the cost of a 24 of Labatt Blue at the LCBO or a bottle in any bar in Ontario compared to northern New York where they are trying to make room in the marketplace you will see that, yes, where there is greater demand and greater funding, prices will go up for the same good or service.

Obviously too many Queen's students getting pregnant out of wedlock...

My faith is in the practice, not the theory. The bars have upped their price because they know that Al McLeods's and his ilk are looking for a product in bar (i.e. a certain feel, a certain class of clientele, a certain level of service), not a price point. I expect if you look around the corner you'll find a bar with a bucket of 6 splits and a dozen wings for $6.

Is the Internet wonderful, that two nerds can talk about stuff on Sunday mornings. To think that that wasn't possible in a practical fashion even 10 years.

I like to think of the wonder of the internet being both of us are essentially wrong, out of our depth and guided by belief rather than fact yet we are slightly convinced of our wisdom and Google will rank the conversation overly high giving others the impression we have half a clue.<p>Plus I am no part of the Blue economic cycle for reasons other than its massively inflated price.

When you get as old, wise and hungover as I am, you'll release that every who seems to have a clue is just making it up as they go along too :-)

So when you have that sleep early thing and have a hangover...do you drop at 7 pm and wake up at 1 am with a ringing head?

Nope -- if I can make it past 9 PM, I'm generally good till around 2 PM. I still wake up between 4-5 AM though. Amazingly, I was watching the Buds which should have put me to sleep except for maybe all the fights in the 3rd.

The Leafs are enough to give a fella a hangover in themselves.