It’s not the economy, stupid. It’s who’s getting rich
TheStar.com – news/canada
Published On Thu Jan 20 2011. By James Travers National Affairs Columnist – OTTAWA
Stephen Harper and Michael Ignatieff share something surprising. Both are wrong about the economy, the issue that loomed largest over the Prime Minister’s first five years in power and is now emerging as the next election’s ballot question.
Obscured by partisan rhetoric is a plausible proposition. Harper’s financial stewardship hasn’t been as good as he says or as bad as Ignatieff claims.
Nestled against that proposition is another calming probability. It’s reasonable to assume Canadians would be roughly as well off today no matter who won the last two elections.
Michael Veall, an economics professor at Hamilton’s McMaster University, makes the case this way. “Had the Liberals been in charge of the last few budgets, it’s arguable that the differences today would be very small.”
As Veall agrees, the single most significant point of departure was the politically popular, fiscally suspect Conservative decision to twice trim the GST. Savaged by most economists as regressive, those cuts, coupled with record spending, set the country’s return course for deficits long before the 2008 recession.
It’s also true Conservatives spread the loose change of small tax cuts more widely than program-oriented Liberals. But on the big buck stuff — stimulating the economy, bailing out the auto industry, rebuilding the military and lightening the corporate tax load — Liberals made or would have made similar choices.
Parallel courses lead to more or less the same destination. In Canada’s case, that’s a place where the wealth divide is widening and inequality, with its inherent threats to social cohesion and collective advancement, is rising.
No matter which party penned the policies, the current reality is that the very rich are getting richer. The rest of us are just muddling along.
Stale statistics make it impossible to fully chart that trend or precisely calibrate the impact of Conservative rule. Still, what’s known is unsettling and worth considering in the context of the coming campaign.
On average, Canada’s CEOs, the 21st Century’s income rock stars, lugged home 2009 rewards averaging $6.6 million. In sharp and growing contrast, working stiffs typically pocketed about $43,000 — more than 150 times less.
Wealth, too, is concentrating. Less than four per cent of Canadian households now control more than 65 per cent of our net worth, excluding real estate. That’s up from less than 61 per cent five years ago.
Numbers may prove less persuasive than impressions when voters ultimately mark ballots. How secure Canadians feel and how much confidence they have in party leaders will surely be more influential than damned lies and statistics.
Still, the similarities in economic policies and the differences in stated, if not necessarily practiced, ideologies suggest Conservatives and Liberals are arguing about the wrong thing. Instead of shouting about relatively minor economic variations, they could be demonstrating their seminal difference by detailing how they would respond to the growing income gap.
Given their druthers, and freed from coping with global financial collapse, Conservatives would more closely resemble what they are: a party that tilts toward trickle-down economics, provincial autonomy and libertarian values.
Despite their history of campaigning from the political left and governing from the right, Liberals still cling to an image of themselves as what they were: a party steeped in the belief government is a necessary catalyst for financial prosperity, national unity and social progress.
Settling on which of those bundles best positions Canada for the challenges at hand and ahead is vital; the rhetorical bickering is just politics.
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