Tuesday, August 28, 2012

Mises-à-jour: Gel des tarifs d'Hydro proposé par le PQ

Le cadre financier du PQ, que j'ai comparé avec ceux de la CAQ et du PLQ ici et ici, n'incluait pas sa promesse de geler les tarifs d'électricité. Les deux billets ci-dessus ont maintenant été mis à jour avec les effets de cette promesse.

On constate que les plateformes du PQ et de la CAQ deviennent alors très similaires aux niveaux du coût total des engagements (environ 3,6 milliards par année à terme) ainsi que d'une grande partie des mesures de financement prévues (dans les deux cas, coupures de 2 milliards, hausse de l'impôt sur les dividendes et des gains en capital). Le PLQ se distingue par le faible coût de ses engagements (1,1 milliards), la modestie des coupes prévues (0,6 milliards) et l'absence de hausses d'impôts.

Les trois partis tentent de paraître plus responsables qu'ils ne le sont:
PQ: non-inclusion du coût du gel des tarifs d'électricité (1,6 milliards par année à terme);
CAQ: lunettes roses quant à la croissance des recettes du gouvernement (1,5 milliards par année à terme);
PLQ: prétendre que les réserves pour éventualités s'accumulent en confondant le montant par année et le montant cumulatif, surtout que ces réserves n'existent pas à partir de 2014-2015.

Il est donc presque certain que les Québécois auront de mauvaises surprises (comme la hausse de la TVQ et la taxe santé), mais cette fois, même sans une récession mondiale...

Monday, August 27, 2012

PQ on the Cusp of a Majority, but CAQ Could Win

Two province-wide polls have been conducted in Québec since last week's four debates. Both give 33% to the PQ and 28% to the CAQ. The Liberals trail at 26-27%.

If the popular vote reflects these results, we could be in for a long election night: the PQ would likely be close to the majority threshold - but on which side, we don't know. It might appear surprising that the PQ can achieve a majority with just 33%, but remember that leading the francophone vote is what counts in Québec because there are many similar ridings that "swing" together. The federal NDP, of course, was a big beneficiary of this in 2011.

For the same reason, the CAQ would lose many tight races, and would be at risk of finishing in third place in terms of seats despite beating the Liberals in the popular vote. With current poll numbers, I'd say that the PQ would win 60-65 seats, the Liberals and the CAQ around 30 each, and 1 or 2 for QS.

However, even though these poll numbers give the PQ about twice as many seats as the CAQ, the CAQ still has a real shot at winning government: it trails by only 5%. The CAQ's predecessor tended to be underestimated in the polls. Indeed, in the 2007 election, which bears some resemblance to this one, the ADQ got 30.8% on election night despite being pegged at 25-26% in the last surveys of the campaign. Moreover, although the PQ has actually not been overestimated recently, its support this year relies disproportionately on young voters, who are notoriously unreliable. On the other hand, the CAQ has virtually no get-out-the-vote operation due to its limited means.

To further complicate the situation, many believe that the Liberals will do better than forecast on election night, since many voters may be ashamed to admit voting Liberal due to the anti-Charest hysteria. However, the Liberals are completely out of the picture among francophones, and it will be very difficult for them to get first place. Their only chance is if there's a virtual three-way tie on election night, with all three main parties getting around 40 seats, but that'd require a perfect storm.

In summary, many scenarios are plausible. I'd say that the most likely ones are as follows:
1. PQ minority, CAQ OO
2. PQ majority, Liberal OO
3. PQ minority, Liberal OO
4. CAQ minority, PQ OO

To win a majority, the PQ needs to win lots of tight races against the CAQ, so unless the PQ wins a wafer-thin majority (which, to be sure, could well happen), we will not have a PQ majority with a CAQ OO. Unless Marois commits a huge gaffe, I do not see the CAQ getting a majority, and I also do not see the PQ falling below the Liberals.

Sunday, August 26, 2012

Crédibilité des cadres financiers

Mise-à-jour: J'ajoute le coût du gel des tarifs d'électricité, proposé par le PQ, mais ne figurant pas dans son cadre financier.

Dans un billet précédent, j'ai comparé les cadres financiers des trois principaux partis en acceptant leurs chiffres. Mais ces chiffres sont-ils crédibles?

En général, les partis politiques chiffrent bien le coût de leurs engagements spécifiques: il n'y a pas vraiment possibilité de jouer avec le coût d'une place en garderie ou d'un crédit d'impôt, par exemples. On peut donc être assez confiant qu'effectivement, le PLQ a fait environ 1 milliards de promesses, le PQ 2 millards (mais 3-4 milliards avec le gel des tarifs d'Hydro), et la CAQ 3-4 milliards.

Ça se gâte un peu lorsqu'on examine les revenus générés par les augmentations d'impôts. En général, on assume que bien qu'un taux d'imposition augmente, la base taxable ne change pas. Cela peut être problématique: par exemple, si on taxe trop une minière, elle peut décider de cesser ses opérations; les gens et les entreprises peuvent déménager ou décider de travailler ou d'investir moins. Les 194 millions nets que le PQ veut percevoir des minières sont donc douteux. Il en va de même pour les 416 millions que la CAQ compte récupérer par la réduction de moitié de l'inclusion partielles des gains en capital puisque le PQ, qui propose la même mesure, ne compte récupérer que 255 millions. Match nul, donc, entre la CAQ et le PQ. Le PLQ n'est pas sujet à ce problème, puisqu'il ne propose pas d'augmentation d'impôt.

Mais la portion des cadres financiers qui suscite le plus de doutes, c'est la réduction de la croissance des dépenses sur les programmes existants. En effet, le dernier budget ne prévoit qu'une augmentation moyenne de 3% au cours des cinq prochines années, ce qui est à peu près égal à la somme de l'inflation et de la croissance de la population. Cela est déjà très optimiste, puisque le vieillissement de la population entraînera une croissance encore plus rapide des dépenses en santé.

De ce côté, la CAQ prévoit des économies de 2,1 milliards de dollars. De la pensée magique, dit le PQ, qui propose pourtant, à terme (en 2017-18), de couper 2 milliards lui-même en limitant le taux de croissance à 2,4%! On peut voir que la CAQ et le PQ prévoient des coupes similaires, mais la CAQ a au moins un plan, aussi imparfait soit-il. Cependant, la CAQ propose additionnellement de couper 0,6 milliards dans les dépenses des organismes non-budgétaires. Encore une fois, je dirais match nul entre la CAQ et le PQ. Le PLQ est plus réaliste, ne proposant de couper que 0,7 milliards.

Finalement, la CAQ a fait une chose que les autres partis n'ont pas fait: déclarer que les prévisions du budget en matière de revenus sont trop pessimistes. (En fait, il semblerait que la croissance économique cette année soit moins forte que prévue dans le budget.) En 2017-18, cela donne 1,5 milliards de plus à la CAQ, sans aucun effort! Soit la CAQ a tort, dans lequel cas il y a un manque à gagner, soit elle a raison, dans lequel cas le PQ et le PLQ ferait un beau surplus!

Au final, on constate que le PLQ a les chiffres les plus crédibles et prudents, suivis du PQ, et finalement de la CAQ. Cependant, si Pauline Marois a raison que les coupes de 2,1 milliards de la CAQ sont de la "pensée magique", ses propres coupes de 2 milliards le seraient aussi. Est-ce pour cela que le PQ n'a pas dévoilé son cadre financier avant les débats?

En enlevant tous les chiffres douteux que j'ai répertoriés ci-dessus, les coûts nets réels des engagements sont les suivants:
PQ: 1,0 milliard (mais 2,6 milliards avec le gel des tarifs d'Hydro)
CAQ: 3,1 milliards
PLQ: 1,1 milliards
On peut cependant croire que la CAQ va probablement réussir à couper plus que le PQ ou le PLQ, même s'il n'atteint pas son objectif de 2,1 milliards. L'écart entre la CAQ et les deux autres partis devrait donc être moins élevé qui ces chiffres n'indiquent, et la CAQ pourrait même faire mieux que le PQ.

À noter que pour faire les contributions prévues au Fonds des générations, il fallait plutôt créer un excédent de 0,9 milliard...

Il faut préciser que malgré des chiffres relativement crédibles, le cadre financier du PLQ n'est pas pour autant fiable. Comme je l'ai mentionné précédemment, même si toutes les projections des libéraux se réalisent, le PLQ ne parviendra pas à contribuer les montants prévus au Fonds des générations sans faire de déficit, comme il le prétend. La CAQ, qui a le même objectif, n'y parviendra que si ses coupes se matérialisent ET si les revenus du gouvernement croissent plus rapidement que dans le budget. Le PQ a tout simplement abandonné le Fonds des générations, anticipant qu'il n'y aura pas assez d'argent pour faire les contributions prévues à ce Fonds; avec le gel des tarifs d'Hydro, c'est le cas même s'il implémente les coupes promises.

Friday, August 24, 2012

Comparaison des cadres financiers

Le PQ a dévoilé son cadre financier aujourd'hui. Pour se faire une idée globale des plateformes des partis en matière fiscale, il faut les comparer. Or, les cadres financiers sont présentés de différentes manières; on a donc besoin de les mettre dans un format commun. C'est un travail important qui, malheureusement, est difficile à trouver dans les médias. Je me suis donc penché sur la question.

Le point de départ de tous les cadres, ce sont les prévisions du budget 2012-2013 du gouvernement du Québec. En voici les grandes lignes (en millions de dollars):

Surplus réels (avant contribution au Fonds des générations et réserves pour éventualités)
2012-13: -289
2013-14: 1 241
2014-15: 700
2015-16: 1 155
2016-17: 1 629

Contributions prévues au Fonds des générations:
2012-13: 911
2013-14: 1 041
2014-15: 1 575
2015-16: 2 030
2016-17: 2 504

Marge de manoeuvre (si positif) ou manque à gagner (si négatif)
2012-13: -1 200*
2013-14: 200**
2014-15: -875
2015-16: -875
2016-17: -875
*Solde budgétaire de -1 500 en raison d'une réserve de 300.
**Solde budgétaire de 0 en raison d'une réserve de 200.

Et voici les cadres financiers des trois grands partis, présentés selon un format commun. Tous les chiffres représentent l'impact financier, à terme, sur un an, en millions de dollars
Mise-à-jour: J'ai ajouté une estimation des réductions de dépenses non-spécifiées pour le PQ et le PLQ, donc l'impact n'est pas chiffré dans les tableaux de leur cadre financier.
Mise-à-jour #2: La promesse du PQ d'annuler la hausse des tarifs d'électricité n'est pas incluse dans son cadre fiscal. Cette promesse coûterait 1,6 milliards par an. Je donne maintenant l'analyse avec ce coût.


PQ

Nouvelles dépenses: 748
Annulations d'augmentations de tarifs: 197 (environ 1 797 avec le gel des tarifs d'électricité)
Réductions d'impôt: 1 005
Crédits d'impôt: 47
COÛT DES ENGAGEMENTS: 1 997 (environ 3 597 avec le gel des tarifs d'électricité)

Augmentations d'impôt (riches, gains en capital, dividendes): 1 005
Augmentations des redevances minières: 388
Perte en péréquation: -194
COÛT NET DES ENGAGEMENTS: 798 (environ 2 397 avec le gel des tarifs d'électricité)

Réductions de dépenses non-spécifiées*: 1 240 (en 2016-2017)
COÛT NET DE LA PLATEFORME: -442 (environ 1 158 avec le gel des tarifs d'électricité)

*Limitation de l'augmentation des dépenses des programmes existants à 2,4% par année, au lieu de 1,8% pour 2013-14, 3,0% pour 2014-15 et 3,4% par la suite


CAQ

Nouvelles dépenses: 1 836
Réductions d'impôt: 1 804
Crédits d'impôt: 23
COÛT DES ENGAGEMENTS: 3 663

Augmentations d'impôt (gains en capital, dividendes): 543
Réductions des crédits d'impôt des entreprises: 200
Réductions de dépenses spécifiées: 2 100
COÛT NET DES ENGAGEMENTS: 820

Réductions de dépenses non-spécifiées*: 551 (en 2016-2017)
COÛT NET DE LA PLATEFORME: 269

*Limitation de l'augmentation des dépenses des organismes autres que budgétaires à la croissance du PIB nominal


PLQ

Nouvelles dépenses: 713
Réductions d'impôt: 60
Crédits d'impôt: 301
COÛT DES ENGAGEMENTS: 1 074

COÛT NET DES ENGAGEMENTS: 1 074 

Réductions de dépenses non-spécifiées*: 654 (en 2016-2017)
COÛT NET DE LA PLATEFORME: 420

*Limitation de l'augmentation des dépenses des programmes existants à 2% en 2014-15, au lieu de 3%


On peut tirer plusieurs enseignements de cet exercice:

1. La CAQ est la championne des nouvelles dépenses. Cependant, elle propose des réductions de dépenses encore plus élevées, contrairement au PQ et au PLQ, qui n'ont spécifié aucune économie. Donc, au total, les dépenses seraient les plus basses sous la CAQ.

2. La CAQ est le seul parti qui propose des réductions nettes significatives d'impôt: 1,26 milliards de dollars par année à terme. Le PQ finance entièrement l'abolition de la taxe santé avec l'augmentation de l'impôt sur les revenus élevés, les dividendes et les gains en capital. Le PLQ ne donne qu'une baisse d'impôt sur les ventes d'entreprises familiales. À noter que toutes les réductions proposées portent sur l'impôt des particuliers plutôt que sur l'impôt des sociétés.

3. Le PLQ propose, de loin, le plus de nouveaux crédits d'impôt et transferts aux particuliers (prime au travail, aide à la rentrée, travailleurs expérimentés, rénovation verte, etc.). Le PQ propose plutôt de geler les frais de scolarité et de garde.

4. Le coût total des engagements est le plus élevé chez la CAQ, suivie par le PQ et le PLQ. (Mais le PQ s'approche de la CAQ si on inclut le gel des tarifs d'Hydro.) Pour ce qui est du coût net, il est d'entre 0,8 et 1,1 milliards par année pour les trois partis - c'est donc très semblable SI on exclut le gel péquiste des tarifs d'Hydro. Si ce gel est inclus, cependant, le PQ a des engagements qui vont coûter beaucoup plus cher.

5. Tous les partis sont en voie d'atteindre l'équilibre budgétaire global (avant de contribuer au Fonds des générations) malgré leurs promesses. Le PLQ et la CAQ le feraient même sans les coupes cachées. Cependant, aucun des partis ne sera en mesure de réduire la dette autant que les contributions prévues au Fonds des générations, même avec les coupes cachées.

Le PQ promet d'abolir le Fonds des générations, qui force le gouvernement à rembourser la dette (si le budget est équilibré après avoir contribué au Fonds, c'est qu'il est en fait en surplus). Son cadre financier promet de continuer à rembourser la dette, mais cela se fait en grande partie avec les coupes non-spécifiées, qui sont le double de ce que proposent le PLQ et la CAQ. Sans le Fonds des générations, il serait facile politiquement pour le PQ de ralentir ou d'arrêter le remboursement de la dette, puisqu'il aurait quand même des budgets dits équilibrés. La tentation sera très grande, parce que, si on inclut le gel des tarifs d'électricité, le PQ a promis plus que les surplus prévus avant les contributions au Fonds. Pourtant, si on veut pouvoir faire des déficits dans 10-20 ans (et on en aura besoin si on veut préserver le système de santé), il faut réduire la dette maintenant parce que le Québec a peu de marge de manoeuvre!

Par contre, le PLQ et la CAQ promettent de contribuer plus que prévu au Fonds des générations. Comment est-ce possible, considérant que seulement pour atteindre les contributions prévues, il faut un resserrement budgétaire annuel de 875 millions à partir de 2014-2015, alors que leurs cadres financiers proposent l'inverse? Le PLQ prétend pouvoir le faire en confondant l'augmentation annuelle de ses dépenses avec l'augmentation de ses dépenses annuelles - c'est soit de l'incompétence, soit de la malhonnêteté. La CAQ, pour sa part, estime que les prévisions du budget 2012-2013 sont trop pessimistes, et qu'il y aura donc plus d'argent que prévu - autrement dit, de la "pensée magique".

Alors voilà. J'espère que cette analyse vous aidera à faire un choix éclairé. À noter que j'ai accepté tels quels les chiffres des partis politiques. Si j'ai le temps, j'écrirai un autre billet (plus subjectif) sur la crédibilité de ces chiffres.

Wednesday, August 22, 2012

PQ Retraction

The PQ just issued a statement: all "Québec citizens" will have the right to run, including non-francophones automatically granted Québec citizenship, i.e. Canadian citizens living in Québec when the law comes into force and their descendants. I still disagree with the project, but at least anyone that currently has the right to run would keep it.

Of course, this begs the question: Was Marois hopelessly confused? Or was the PQ actually floating a trial balloon to see how people would react to denying fundamental democratic rights to a minority? Either way, not reassuring...

Tuesday, August 21, 2012

Too Far

Well, this is going too far. The PQ is tightening the criteria for its proposed Québec citizenship. The highlights:

There would be three types of Canadian citizens in Québec:
1. Non-Québec citizens
2. Québec citizens that don't speak French
3. Québec citizens that speak French

Only Québec citizens can:
- Contribute to a provincial, municipal or school board campaign
- Present a petition to the National Assembly

Only Québec citizens that speak French can:
- Be a candidate at a provincial, municipal or school board election

There are three ways of acquiring Québec citizenship:
1. Be a Canadian citizen living in Québec when the law comes into effect
2. Be born to a Québec citizen
3. Apply and satisfy all three of the following:
a) Have lived in Québec as a Canadian citizen for the three months preceding the application
b) Have lived in Québec for a total of six months
c) Have an appropriate knowledge of French and the rights and duties of Québec citizens

So, in particular:
- First Nations Quebecers that do not speak French would be barred from running in a municipal election. (Talk about newcomers respecting natives' heritage!)
- The same goes for Anglophones in the West Island.
- Canadians from elsewhere moving to Québec would be barred from donating to a provincial political party if they do not speak French.

This is almost certainly unconstitutional, and would likely violate clauses in the Constitution that the Notwithstanding Clause cannot override. Still, this shows the PQ's willingness to go much farther than it has ever gone in terms of the French language.

Update: The PQ is going back to its original, less controversial proposal. See this post.

Québec's Parties: A Primer and My Thoughts

As you know, an election campaign is ongoing in my former province of Québec. I am just following this campaign as a "normal" citizen, and not making seat projections. Here are some thoughts on the parties and their positions. I will likely do another post later on this campaign's electoral dynamics, which are fascinating.

- Liberal Party of Québec: A very tired government that has been plagued with ethics issues. The Liberals' strategy is threefold:
1. present themselves as the party of the economy;
2. show that the other main parties are as dirty as they are;
3. convince voters that they are the only reliably federalist option.

On point 1, I have to agree that the Liberals' platform is probably the best (or rather, the least bad) for Québec's economy. However, their fiscal plan is dishonest: they say that they are going to pay for their promises, which, once they're enacted, will cost over $1.2 billion/year, with the budget's $300 million/year contingency reserves. By their "logic," the contingency reserves total $1.5 billion, which covers the new spending... On point 2, it was somewhat surprising that during the debates, the other leaders were not able to score points on the corruption issues, which does suggest that the other leaders have skeletons in their closets. However, as the party that has been in power for the past 9 years, the Liberals will be held mainly responsible for the situation. Finally, Jean Charest is mocking CAQ leader François Legault's recent conversion to being a federalist, and says that he might switch back. This makes sense: as things stand, both the Liberals and the CAQ are federalist and centre-right, so Charest needs to create separation between the parties, or many dissatisfied Liberals will decide to go for the new thing.

- Parti Québécois: A team with many star candidates that fully expects to be Québec's next government. The main pillars of the PQ's strategy:
1. be THE party of the French language and Québec identity;
2. stay vague on whether a referendum will be held;
3. have a vague economic platform.

Just about the only major clear thing in the PQ's platform is that it will extend "Bill" 101 to colleges (grades 12 and 13) and to firms employing 11 to 50 employees. This project would have a destructive impact on Montreal's non-francophone communities, from English-speaking colleges who would lose much of their enrollment to Chinese restaurants that will have to shrink or close unless their staff learns French. Also, the PQ wants to adopt a secular charter that would more or less prohibit displays of religious symbols in public institutions and by their staffs - but it would make an exception for the cross in the National Assembly because it's part of Québec's heritage. At the same time, the PQ wants to remove from the National Assembly symbols of the monarchy, which, of course, are also part of Québec's heritage... Having grown up in Québec, I can say that most PQ supporters are not racist: they genuinely bear no ill will towards minorities, and just want to protect their language and their culture. However, the PQ has taken this very (too?) far this time around, and it is more probably more ethno-centric that it has been in a generation, or maybe ever. "All of us are Quebecers, but some more than others" seems to be the message.

The PQ is staying vague on everything else because it is ahead in the polls. It needs both the vote of the hardcore separatists (who now have other options like Québec Solidaire and Option Nationale) and of the separatists who don't want a referendum now (who might be tempted to vote for the CAQ). It is also a big tent party economically, and is being squeezed on the left by QS and ON and on the right by the CAQ. In keeping with its centre-left orientation, the PQ has a few lefty goodies in store, but they are relatively minor.

- Coalition Avenir Québec: This is a new party that can have a broad appeal. It is neither the Liberals nor the PQ, at a time many Quebecers want change. It is federalist (for now), but more nationalist than the Liberals. It has right-wing roots from swallowing the ADQ, but its actual platform is rather centrist, if with a populist/reformist bent (e.g. save on administrative costs by getting rid of school boards and regional health authorities).

The CAQ's main weakness is the quality of its team. Its leader François Legault is well-known and relatively well-respected (at least by today's standards for a politician). His lieutenant Jacques Duchesnau is an outspoken critic of corruption, but prone to making exaggerated statements, and hasn't always worked well with others. Gaétan Barrette, the prospective Health minister, is a controversial figure. Apart from these three and former ADQ leader Gérard Deltell (who is rather well-liked, but not that well-known), Quebecers don't know much about CAQ candidates. This is especially a problem due to the CAQ's proposals for systemic reforms: such measures tend to have unintended consequences, and Quebecers are worried that the CAQ team might end up making one big mess.

- Québec Solidaire: A left-wing and idealistic party - a separatist version of what the federal NDP used to be before becoming a major contender. One of QS's two spokespersons (the party does not have a "leader") was elected in 2008. To achieve sovereignty in the right way, it wants to create a citizen's assembly to write a prospective constitution and launch a vast consultation and social debate leading up to a referendum (as opposed to the PQ's quick 30-day referendum campaign). It is likely the biggest "clean" party, and the most likeable party in Québec. However, when you look at their economic platform, you wonder if they live in an alternative universe where all jobs are either in the public sector or created with public subsidies. QS has a shot in a few eastern Montreal ridings, and may be a spoiler for the PQ elsewhere.

- Option Nationale: A one-man show in the crowded left-wing separatist space (more hardcore separatist than both PQ and QS, between the two economically). The man in question, Jean-Martin Aussant, was elected under the PQ banner in 2008, but became disgruntled with Pauline Marois' leadership. ON will only be a factor in Aussant's own riding.

No other party, including the Greens, is likely to win a seat.

Monday, August 13, 2012

Why So Few Gold Medals?

Canada's low gold medal count in London - one - is raising eyebrows: it is lower than our "usual" total of three (achieved in every summer Games after 1984, except in London and in Barcelona, where seven were won). However, even three is low compared to how much silver and bronze our athletes bring home. Indeed, gold accounted no more than a third of Canada's medals in every postwar summer games except Barcelona! This Vancouver Sun blog post has more stats.

As it turns out, this can be explained by simple math and the following two facts:
- Canada does not have a very large population; and
- Canada is competitive in many sports.

To see this, consider the following situation: a sport has 5 elite athletes, two from China, two from the US, and one from Canada. For simplicity, we will assume there there's no luck involved at the Olympics - the final results perfectly reflect the quality of athletes.

What happens if every athlete receives the same quality of support and training, so that everyone has an equal opportunity? Our Canadian then has an equal chance of being in each position from 1st through 5th - 20% chance of gold, 20% chance of silver and 20% chance of bronze.

But now suppose that the sporting federation imposes a rule: each country can only enter one athlete. To win gold, our Canadian athlete would still need to be the best. But she can win silver either by being second, or by being third if the top two athletes are from the same country. And of course, she is now guaranteed at least a bronze. Simply by virtue of being a smaller country, Canada now has a 20% chance of gold, ~27% chance of silver and ~53% chance of bronze!

In other words, having limited entries hurts large countries chances of winning bronze much more than it hurts their chances of winning gold: they still get to send their best athlete(s), but might not get to send all of their medal contenders. Thus, small countries will tend to win disproportionately many bronze medals.

Of course, even though Canada isn't the US or China, we're still larger than most countries. But the same effect applies: suppose a sport has 100 elite athletes, with 50 from the US, two from Canada, and one each from 48 other countries, so that Canada is actually the second largest country out of 50. Again, assume that each country has one entry. Canada's chances of winning gold are 2%. We don't necessarily win silver if one of our athletes is second: we won't send her to the games if the other one is first. But it is very unlikely that the two Canadian athletes happen to be the top two in the world (~0.02% chance). It is much more likely that the top Canadian, even if she is third, still ends up with a silver because the top two are American (~0.50%). She could even rank worse and still get silver if all of the superior athletes are American. The probability of winning silver turns out to be about 2.97%, and the probability of winning bronze, roughly 3.92%. So if there were 100 such events, you would expect Canada to win roughly two gold, three silver and four bronze. Thus, limited entries help even relatively large countries like Canada, as long as some other country/countries are much larger. Canada is a significant player in diving, but think about what would happen to Canadian medal hopes in diving if all countries including China were allowed to send all medal contenders.

By the way, this also explains why, even excluding Vancouver, Canada has no gold medal problems in the winter: we are a relatively large winter sports nation. (We don't actually dominate any winter sport except for hockey and curling, which yield few medals - this is why you also wouldn't expect a disproportionate amount of gold. But we are a significant presence in all the ice sports, freestyle skiing and snowboarding, where we win most of our medals.)

What about small countries like New Zealand that rack up the gold medals? As it turns out, these countries focus on a small number of sports. New Zealand might have a smaller population than BC, but it has lots of rowers focusing on small boats (i.e. not Eights) and sailors. At these Olympics, we also saw North Korea and Kazakhstan focus on weightlifting, which brought results. On the other hand, Spain, whose talent is also spread out (outside male soccer and basketball, which don't give many medals), has the same problems as Canada: apart from Barcelona and two pre-WWII games where it only won one medal, Spain's gold medal count has never even reached one third of its total haul. In summary, what matters is a country's "effective size" within each sport. So small countries can earn a disproportionate amount of gold if they focus on certain sports. Canada, by contrast, is spread quite thin.

Does this mean that Canada should start focusing on few sports? No: spreading out makes our gold count low relative to our total medal count because it enhances our total medal count by allowing us to be a "small" country benefiting from the limited entries effect. (To be sure, there are other arguments, such as economies of scale, for focusing on a small number of disciplines - especially cheap ones like weightlifting.) Also, being competitive at a large number of sports may be more effective in encouraging athletic activity, which is the larger goal of participating in the Olympics.

By the same token, this analysis only explains why we have few summer gold medals relative to silver and bronze. It does not explain why our total count is high or low, though as I hypothesized in my previous post, our total count is probably right around where it should be.

That said, the single gold performance at these Olympics is very poor: just 0.3% of total gold medals, while we account for 0.5% of the global population and are comparatively very well off. Even accounting for the mathematical effect described here, you'd expect more than one gold out of 18 medals. Of course, throw in luck, and such a thing will happen once in a while - so let's hope that this is just a one-off.

Sunday, August 12, 2012

Canadian Medal Count: Not Bad

Every summer Olympics, some Canadians despair at our low medal count: not only do all more populous developed countries (except for Spain, who can console itself with its soccer team) beat us hands down, but Australia, with just 2/3 of our population, does so too. Certainly, the COC's objective of a Top 12 finish at summer games has once again been missed - Canada was 13th by total medals, two shy of the Netherlands and Ukraine. However, the obvious explanation for this is that much of our athletic talent is involved with winter sports, so one should take the winter Olympics into account before despairing.

(We should also note that with 18 medals, Canada ties its best performance at summer games conducted outside the US, albeit with less gold than in Barcelona or Beijing.)

Are summer and winter medals comparable? I think so. While fewer countries contest winter sports, there are also many fewer medals available at the winter Olympics: just 86 events in Vancouver versus 302 in London. The ratio is probably roughly right.

Here's a list of countries with at least 10 medals total from Vancouver and London (ties are broken by the number of gold, then silver) [updated to account for the doping incident in women's shot put]:
1. USA 141
2. CHN 99
3. RUS 97
4. GER 74
5. GBR 66
6. FRA 45
7. CAN 44
8. JPN 43
9. KOR 42
10. AUS 38
11. ITA 33
12. NED 28
13. NOR 27
14. UKR 20 (all summer)
15. SWE 19
16. HUN 17 (all summer)
17. ESP 17 (all summer)
18. BRA 17 (all summer)
19. CZE 16
20. AUT 16 (all winter!)
21. POL 16
22. BLR 15
23. KAZ 14
24. CUB 14 (all summer)
25. SUI 13
26. NZL 13 (all summer)
27. IRI 12 (all summer)
28. JAM 12 (all summer)
29. KEN 11 (all summer)
30. AZE 10 (all summer)

As you can see, Canada, in fact, does quite well, drawing level with much more populous countries like Japan and France, and handily beating Italy and Spain. And this is not a host country effect: Canada won only two more medals in Vancouver than in Turin. (Britain, however, increased its medal count by 18 between Beijing and London.) The only countries that are well ahead of Canada are the US, China, Russia, Germany and Britain. The first four all have more than twice Canada's population, while Britain is over 80% more populous and would likely have a much smaller lead had it not been the host country this year.

We also notice that there's a clear Top 13: the G8 countries, China, Korea, Australia, the Netherlands and Norway, who is 118th by population... (If only it produced as high quality soccer referees as athletes!)

One might be tempted to look at population per medal in order to establish a "fair" comparison. However, this ignores the fact that the number of entries into the competition is far from proportional to population: in most team sports, only one entry per country is allowed, and even in most individual sports, the limit is one, two or three. As a result, you just can't expect the US to win 9 times as many medals as Canada.

Then of course, there's the issue of each country's resources. Obviously, given similar populations, rich countries will have a much easier time than poor ones. Witness hapless India, with just 6 medals despite having more than 1/6 of the world's population. Pakistan, Nigeria and Bangladesh, the world's 6th, 7th and 8th most populous countries with over 150 million people each, have no medals at all!

A better way of looking at this data might be to plot the number of medals against total GDP. You wouldn't be looking for a straight line, but rather a concave curve, due to the lack of proportionality of competitive entries to population. And what to put on the GDP axis is not clear. First, it should likely be some mix of GDP at market prices and GDP at purchasing power parity (PPP, which adjusts for differing price levels between countries): a top-level athlete's consumption basket has a significant international component, so going by PPP alone would be misleading. Second, it should exclude "subsistence" GDP - something between the $1.25/day = $457/year/person poverty line used by the UN and $1,000/year/person, which is roughly the number for Afghanistan, the poorest country to win a medal in London (both figures PPP). Somebody should do this - looking at the various news outlets, many people have been paid for doing much less...

If we look only at rich countries, though, plotting medals against population works pretty well, since almost everyone's GDP PPP per capita is between $25,000 and $50,000. (It's still true that you'd want to fit a concave curve rather than a line.) Now, I'm feeling lazy, but just looking at the numbers, Norway and Australia would, unsurprisingly, be the big overachievers, while Japan, Italy and Spain would be the worst underachievers. Canada would likely lie above the fitted curve.

In terms of gold, however, the story might be different for Canada. Of course, in this cycle, thanks to the gold explosion in Vancouver, Canada has 15 gold medals out of 44. But usually, gold accounts for much less than one third of Canadian medals (3 in the summer and 7 in the winter is normal).

So, given the concentration of Canadian athletic resources in winter sports, our athletes' performance at the London games is right about what you'd expect - a bit better in terms of total medals, though a bit worse in terms of gold.