Inkshedders: I hope that I'm not proselytizing with my economic
pronouncements, but I feel that, given the concern and alarm shown on this
list during the neverendum, the deficit hysteria we are facing in this
country must be of equal concern. (Both of these issues threaten Canada
as we know it).
Also, and further challenging prevailing definitions of literacy, this is
an exercise in "economic literacy." My partner, who keeps me up to date on
this material, has just had her job description changed to work in
economic literacy. The feeling in the low-income East Toronto community
she works in is that if people are not provided the tools to decipher the
rhetoric of monetarism, etc., they will not be able to fight the local
cutbacks scrums let alone the larger battles. Of course, economic
literacy is no less important for those of us who work in universities,
colleges, schools, etc.
Again, mea culpa, this is a recycled posting I sent to OISE.
The percentage of the Canadian tax bill paid by corporations in 1961 was
25%. By 1992, this had dropped to 7%.
In the mid-70s, just as the post-war economic boom was winding down, the
federal govt. came under intense pressure from corporations and wealthy
Canadians to decrease taxes. So called "tax expenditures" (better known as
loopholes) were introduced and the result was that the federal govt. ran
deficit budgets from 1976-85. Even though federal govts. were able to run
some balanced budgets in the late 80s, escalating interest rates drove the
debt further skyward.
A Stats-Can report in 1991 stated that the federal debt was the result of
tax loopholes which had been in effect since the mid-70s (50%), escalating
interest rates (44%) and program spending (6%) of which social spending
was only a small part (2%).
The provincial debt results from external factors such as the impact of
globalization and NAFTA on the Ontario tax base, but also from the
downloading of financial responsibility from the federal govt. to the
provincial one. For example, in 1989, the federal govt. introduced the cap
on CAP (Canada Assistance Plan) to the three "wealthiest" provinces:
Alberta, BC and Ontario. Now, with EPF (Established Program Funding)
block transfers reduced, all provinces are taking a big hit.
In this period of flux and transition, govts. across Canada are in the
position to reshuffle the deck of their respective social contracts.
Changes are happening all at once at so many levels that it is easy to
point the finger of blame elsewhere while hacking apart the social
In New Zealand, the social engineers who tore the social fabric apart used
the motto "hit fast, hit hard, hit all sectors simultaneously." The idea
was to keep people reeling under the drastic cuts and to pit social groups
against one another. It is no secret that some of the gurus of that
NONSENSICAL DEVOLUTION have been invited to Canada to advise the Kleins
and the Harrises. (It has been a lose-lose scenario for the majority of
We are witnessing the NONSENSICAL DEVOLUTION of the mediating role of
govt. (between the interests of private capital and the needs of workers),
of the social infrastructure and of the public sphere (in so much as the
arts and education are also facing the axe). It's as though Canadian
govts. want to take the words of Mr. Fund (the young financial analyst who
wrote in the Wall Street Journal last year that Canada is an honorary
Third World nation) as self-fulfilling prophecy.
In the brave new world of the globalizing economy, it's a race to the
bottom. Fasten your seatbelts!
P.S. The TORONTO STAR reported today that Harris does admit that the
economy will take a downturn because of the cuts, but he argues that this
is a result of ten years of "overspending." Unfortunately, with all of the
jobshedding that is going on, the taxbase will continue to shrink and the
deficit is unlikely to diminish, despite the drop in our standard of
As Bart Simpson would say: "Ay, caramba!"