Time to Narrow Canada's Growing Income Gap

It's not just a Canadian problem. From America to India the income gap between the rich and the poor is widening rapidly. In the US, the percentage classified as extremely poor has grown rapidly since George Bush took office.

According to a report in the Toronto Star, a staggering four out of five Canadians families are working more and earning a smaller share of the national wealth than they did thirty years ago:

"What's more, the growing income gap has hit a record high during an economic boom, a period when traditionally the gap between rich and poor has shrunk.

"'The rich are getting richer, the poor aren't going anywhere and there are fewer people in the middle to mediate the two extremes. We ignore these trends at our collective peril,' says the study by the Canadian Centre for Policy Alternatives, an independent research institute concerned with issues of social and economic justice.

"The report, titled 'The Rich and the Rest of Us,' shows that the richest 10 per cent of families with children – those with incomes more than $131,200 in 2004 – earned 82 times the amount earned by the poorest 10 per cent. In 1976, the richest families earned 31 times the amount of the poorest families.

"The bottom half of families raising children, those earning less than $60,000 in 2004, earned less or stayed the same, in inflation-adjusted terms, compared to a generation ago. Those in-between worked more hours just to keep pace."

Even addressing this situation as a problem is enough, these days, to get a person branded a raving socialist but it is a problem that has to be addressed by the next federal government. Harpo would kiss Satan's feet before he'd take any meaningful action on this problem.

The report cites four factors contributing to the problem: minimum wages that have fallen behind inflation; the loss of well-paid manufacturing jobs and the increase of poorly-paid jobs in the service sector; the decline in the unionized work force; and the increase in temporary and contract (no benefits) employment.

"The study's focus on families is deliberate. Families busy raising children are among the most time-pressed of Canadians. And yet, the report notes, all but the richest Canadian families are spending more time at work.

"The average Canadian family with children clocked almost 200 more hours of work in 2004 compared to nine years earlier. Only the richest 10 per cent of families didn't work more hours between 1996 and 2004. And yet they were the only ones to see major increases in earnings."

While I don't expect Harpo to do much to reverse this problem, I wonder whether in the world of globalization and free trade there is much that any federal government can do.