There may be people still deciding who to vote for and unfortunately there are still a large number of people who may not vote at all. Those individuals are most likely the young and marginalized. It is important that everyone vote. On the surface it may appear that politics and the promises don’t impact you but in reality, Canada is changing. We are in time when our current government policies are divisive and favour a small segment of the population.

Let’s examine a few of those policies, statements that raise our fears:

The Conservatives and our current Prime Minister boast that they are the only party that we can TRUST with the economy. In this age of information it is often hard to get through the Propaganda to the Truth.

Propaganda: Conservatives and their Low Corporate Tax pledge is good for Canada. They are promising more of the same. Is it good for all Canadians.

Truth: In 2006 Canada’s net debt was $492-billion (and falling). In 2015 is at 6.2 billion

Benefits the Few:

• The general federal corporate income tax (CIT) rate has been cut by one third from 22.1% in 2006 to 15% today. According to the Parliamentary Budget Office, the annual cost is $12 billion of reduced tax revenues

• Canada’s combined federal-provincial corporate tax rate is now 26%, far lower than the 39% rate in the United States.

• Investment in machinery and equipment and in intellectual property combined is below the 2006 level in real dollar terms, and has fallen from 7.2% to 6.2% of GDP

• At tax time, corporate insiders get to play by different rules. They only pay tax on 50%of their stock option income. Just as a note: If you or I got a bonus or a cash buyout we would have to pay at the designated Progressive Tax Rate based on our income.

• There is $199Billion of Canadian money in the top ten tax havens.

The Rest of Us:

Tax cuts are not for us: In 2014, for the first time in Canada’s history, more than half of the federal government’s revenue was shouldered by personal income taxes.

• Record-high levels of student debt and a post-secondary education system that is out of reach for an increasing number of Canadians threaten Canada’s long-term prosperity. Canadian youth unemployment is double that of the general population.
• Household Debt is a major problem. The median family owed 110 per cent of its after-tax income in 2012, compared with 78 per cent in 1999.
• The Risk – Current policies has put Canada in the position of the United States in 2008. A fall in housing prices (most Canadians biggest Assets), an increase in interest rates would bankrupt many Canadians. As well many Canadians are unable to put away for retirement be it in RRSPs, Tax Free Savings and many have part-time jobs and jobs without company pensions. Their sole source of Retirement may be CPP and OAS.
• Risk of underfunding Canada Pension Plan and Old Age Security. Our current Government see CPP contributions as a tax rather than an investment and would handcuff this government and next governments in raising CPP contributions to address the needs of the aging population. The current government has already raised OAS eligibility has already gone from 65 to 67 meaning many of us will have to work longer before we retire….This would be part of Harper’s Balanced Budget Legislation.

Evidence:

It is important to note that there is no current research that supports providing tax breaks to the few provides long-term sustainable growth. In fact the research supports it is not only not currently working but from a historical perspective has never worked.

In fact as in Thomas Piketty book Capital in the Twenty-First Century discusses at length the risk of economic and government policies that creates wealth for a few rather than works towards diminishing inequalities. It is a recommended read that reorients our understanding of economic history and confronts us with sobering lessons for today. Takes us past the propaganda and a little closer to the truth.

Next blog will look at where we are with Human Rights.

Research and Suggested Reading:

Fixing Canada Without Raising Taxes on (Most) Canadians

Corporate Tax Cuts: Big Price Tag, Little Return

Conservative Economic Action Plan: success or disaster?

Capital in the Twenty-First Century

79 economists who think balanced budget laws are bad economics