Signs of the times

by Stephen Kimber

On Tuesday, a beaming federal Finance Minister Jim Flaherty and his Treasury Board President colleague John Baird stood proudly in front of an oversized $13.2-billion stage-prop cheque made out to Canadians. While the cameras rolled and the flashes popped, Flaherty declared: "We are trimming the fat and refocusing spending on the priorities of Canadians."

On the very same day that the government announced it was directing all of that near-record budget surplus to paying down the national debt, it also — and not coincidentally — slashed $1 billion worth of federal spending on everything from adult literacy, to native antismoking programs, to medical marijuana research, to the court challenges program. The purpose of those cuts, among other government ideological goals, is to help pay for last year’s various tax cuts and the many future tax cuts to come in the wonderful new world Stephen Harper wants to build for us all.

On that same day, with considerably less fanfare but no less coincidentally, Statistics Canada released a report that put those other numbers in stark contrast. It showed that the average income of the top 20 per cent of Canadians rose dramatically in the past 20 years — from $123,000 for a two-parent family in 1986 to $170,000 in 2003 — while the average income for a two-parent family at the other end of the scale flatlined at $25,000 per year.

That reality is, of course, reflected in other, more depressing and even more ominous numbers. A two-parent family at the top end of the income scale increased their annual contributions toward their personal retirement savings from $8,000 to $11,300 per year while those on the bottom of the pyramid could not scrape together any more cash in 2003 than the $1,200 they were able to put toward their pensions in 1986. For single mothers, the situation was even worse. In 1986, they were able to contribute $300 to their pension funds; in 2003, the amount had fallen to $200.

"As a result," Statistics Canada says, stating the obvious, the degree to which the poor "are prepared financially for retirement has likely become increasingly unequal since the mid-1980s… The growing inequality in contributions," the report adds, "could, in the absence of offsetting factors, make the distribution of family income among seniors more unequal in years to come than it currently is."

Welcome to Stephen Harper’s Canada. Stephen Harper, of course, isn’t responsible for creating these trends, but the ultimate if unstated goal is to exacerbate them.

The broader backdrop for those numbers is another number: this one from still another Statistics Canada report that says that 15.5 per cent of Canadians live in poverty. "Why does a wealthy nations such as Canada have 15 per cent of its children living in internationally defined poverty, while far less wealthy nations such as Denmark and Finland have fewer than three per cent of its children living under such conditions?" Dennis Raphael, a professor of health policy and management at York University, asks in a recent article in the magazine Policy Options. His obvious answer: "The high numbers result from governmental decisions on how to distribute economic resources among Canadians."

There is nothing wrong — and much right — with Ottawa’s decision to use the larger-than-expected budget surplus to help reduce the national debt. Doing so could, in theory, free up money to provide much-needed long-term secure funding for social programs that would otherwise have had to be wasted paying interest on that debt.

Just as there is nothing intrinsically wrong with reevaluating existing programs on an annual basis to make sure that they are meeting their original objectives. Flaherty may be right when he says the $78-million goods and services tax rebate program has been "ineffective" in attracting American tourists to come to Canada, or that antismoking programs directed at aboriginals have not reduced smoking or improved health.

The problem is that this government does not wish to use the savings generated by reducing the national debt to reduce inequality, or to replace ineffective social programs with more effective ones. Their goal is to cut those social programs and use the savings to reduce the taxes paid by corporations and the wealthy, making the disparity between rich and poor even more dramatic.

Welcome to our future.

Stephen Kimber, the Maclean Hunter Professor of Journalism at the University of King’s College, is the author of five nonfiction books as well as a novel, Reparations, which was published this spring by HarperCollins.