They’ve had an easy ride for too long
Opinion by Dave Glover
When I was growing up, there was a healthy social support system in place.
A system that ensured few people fell through the cracks, one that taxpayers funded providing a vital social security safety net.
At that time, governments invested significant resources to ensure Canadians had adequate housing, access to medical care and opportunities to succeed.
Investing in Canadians led to our standard of living increasing at a steady even pace.
This is the Canada I grew up in. Believing in.
However, toward the end of the 70s, the system changed. Not overnight, but slowly and deliberately.
Watching the gutting of our social security net over the last 40 years has been like watching a bomb explode in slow motion.
Organized labour has lost its footing as companies have moved away from hiring full-time workers and paying the benefits that go with a good job. The corporate rush to move jobs offshore because of global trade deals has exacerbated this trend.
During this time, Canadians have seen the rise of food banks and growing child poverty.
And the dramatic increase in those who have no place to live.
Throughout the 60s and 70s, corporations were taxed at 60 to 70 percent of net profits.
But there were tax breaks to incentivize their bottom line.
If they invested in research and development, worker compensation and providing benefits, they earned tax cuts. As a result, the average tax burden for Canadian corporations was around 35% of net profits.
Most corporations preferred the tax cut carrot to the high tax stick and played along.
It was the cost of doing business, and workers benefited.
During this time, workers’ productivity increased tremendously.
We saw Canada’s middle class explode.
Homeownership rose, and as they say, a rising tide lifted all boats.
Then, in the mid-70s, a massive recession hit Canada.
Canadians saw double-digit inflation, soaring energy prices and the cost of everything increase.
This is when corporations, particularly the multinationals, made their play to reduce their tax burden.
They accused the government of stealing corporate profits to fund a welfare state.
Terms like “welfare mama” and “lazy unions” entered the lexicon.
Margaret Thatcher, Prime Minister of England, declared society a lie.
Ronald Reagan decried government support as overreach.
In Canada, Prime Minister Mulroney zeroed in on what he called “hidden taxes.”
Their objective was to be best buddies with anything calling itself corporate and eliminate the boogeyman welfare state.
Government services were deemed handout, not a hand-up. The poor and most vulnerable were vilified for being a burden. Told to pull their boot straps up. And just go get a job.
But with massive tax cuts, the number of vulnerable Canadians grew.
In 1980, Parliament voted unanimously — and ludicrously — to end child poverty and food banks by 2000.
That never happened, and, of course, the problem has gone from bad to worse.
Cuts to social housing social services along with the closure of support facilities that provide care for those with mental health and developmental challenges has only exacerbated the problem.
As CEOs and corporations earned record profits, perennially on the road to endless growth, they claimed all their efforts were done in the name of common sense.
All the while the workers that drove their healthy corporation saw very little improvement in their lives.
Canadians were sold a bill of goods, and bought into the deal because of easy credit while ignoring the creeping problem of wage stagnation. Not enough money at the end of the month? Hey, just use your credit card.
The race to the bottom to lower corporate taxes has resulted in cut after cut to public services as governments struggle to support their citizens.
Today, people are finally seeing the effects of these cuts in tangible form.
People are living on the streets of communities all across Canada. Living rough because they can’t earn enough money to afford even the most basic of comforts.
People are working full-time hours but getting part-time incomes with no benefits.
People are forgoing medication to feed and clothe their children.
The list of social costs goes on.
The result of which has fed the rise in mental health and addiction issues.
Politicians ignore the poor and marginalized, but love to tout corporate tax cuts because, as they like to say, corporations create jobs.
But that is not the case.
Now we have the gig economy with its just-in-time justifications. Full-time jobs with benefits have been replaced by part-time work with no benefits.
Some choose to lay the blame for our nation’s woes at the feet of one man- Justin Trudeau.
But that’s simplistic thinking and, frankly, ridiculous.
Previous federal and provincial governments abandoned investments in social housing and cut back on support programs long before Justin Trudeau came along.
Recently, a friend told to me the story of his daughter who works for a major retailer.
Where she is employed, there are 27 employees but only four full-time workers who have benefits.
Her employer, in fact, doesn’t hire full-time workers because he doesn’t have to.
As a result, the employer’s bottom line is good but that of his part-time workers isn’t.
This hollowing out of the middle- and lower-rung wage earning power has been going on for 40 years.
Persons born after 1980 don’t know a time when Canada expected corporations to seriously help support our social safety net. They’ve never known a time when the government was there to fully support workers.
We can afford social housing, better healthcare and mental health care, but the rules of the game have to be changed.
We can’t afford to continue subsidizing private profits while socializing corporate debt.
A wise person once said “follow the money” and that’s exactly what we must do now.
When corporations receive a tax cut, it is you and I who bear the burden. Tax cuts never translate into reduced costs for goods and services.
Essentially, we are taxed twice.
Tax cuts = increased profits for corporations = increased tax burden for you and me as we pick up the costs.
Canada needs provincial and federal governments to re-examine corporate taxes.
Bring back the carrot and the stick.
If corporations balk, incentivize them the old-fashioned way: Cut their taxes when they reinvest in R&D, hire full-time workers and provide employee benefits.
Governments can provide better services, but they need the revenue from taxes. Corporate taxes.
As we have seen, not funding our social security safety net adequately puts people on the street and reduces the number who are helped.
If we ask the government to do more for us, then it needs the money.
It is time to ask more from those who have been benefiting from the system for 40 years.
Dave Glover is a well known cultural and political commentator in Northumberland. Thousands of listeners, both locally and worldwide, know Dave because of his “Drive Time” radio broadcast that ran for more than 8 years and his 15 years hosting political programs on a local cable channel.
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