Employment insurance, which once softened the blow of losing a job, has dwindled to the point that only a minority of the unemployed are eligible for benefits.
Welfare, which once prevented people from hitting rock bottom, now leaves recipients 60 per cent below the poverty line.
The income tax system has become flatter and more rigid. There were 13 income brackets in 1981. Today there are four. This means people’s tax bills don’t go down as quickly when their earnings fall. Governments at all levels say it would be a costly mistake to protect Canadians from the jolts of a volatile economy.
A more progressive tax system would deter people from working harder and earning more, Finance Minister Jim Flaherty argues. A more generous employment insurance program would encourage laid-off workers to stay at home and loaf, Human Resources Minister Diane Finley insists. Higher welfare rates would only perpetuate poverty, Ontario’s last six social services ministers have maintained.
Despite these discouraging signals, there is a faint stirring of hope that this budget season will bring modest relief.
It is unlikely to come from Ottawa. Flaherty has ruled out “risky new spending schemes” — by which he means improved social programs. His March budget might include a couple of targeted poverty-alleviation measures for aboriginal Canadians, but nothing broadly based. On the tax side, he aims to reduce the number of brackets, making it less progressive and allowing high-income earners to keep more of their money. (Canada and the U.S. are going in opposite directions on this issue. Washington’s top personal tax rate is 35 per cent. It is slated to rise to 39.6 per cent next year. Ottawa’s top rate is 29 per cent. It is expected to remain stable or go down.)
While the finance minister holds down the brakes, his colleagues seem bent on yanking the tubes out of Canada’s diminished shock absorbers.
Finley is making it harder to get employment insurance. Immigration Minister Jason Kenney is making it harder for new Canadians to rebuild their family support networks in this country. Revenue Minister Gail Shea is making it harder for Canadians without Internet access — typically the poor and the elderly — to claim tax refunds and credits. Infrastructure Minister Denis Lebel is making it harder for the provinces and municipalities to plan public works projects and hire workers. And Labour Minister Lisa Raitt is weakening the collective bargaining system.
Curious, isn't it? Obama has just pledged to use his second term to restore "the basic bargain" between his state and its blue and white collar working class.
The president made wide-ranging proposals for investments in schools and infrastructure, and a sharp increase in the minimum wage to ensure that "no one who works full-time should have to live in poverty" as he told Congress that it is this generation's task to return to a time when US governments represented all the people. But he also pledged that his proposals will not add to the US's burgeoning deficit.
"It is our unfinished task to restore the basic bargain that built this country – the idea that if you work hard and meet your responsibilities, you can get ahead, no matter where you come from, what you look like, or who you love," the president said. "It is our unfinished task to make sure that this government works on behalf of the many, and not just the few; that it encourages free enterprise, rewards individual initiative, and opens the doors of opportunity to every child across this great nation of ours."
Obama used the speech to call for fairness and decency in other areas of American political life – from immigration reform and gay rights to legislation to protect women from violence and to reduce the terrible toll in lives claimed by guns.
"Our economy is adding jobs – but too many people still can't find full-time employment. Corporate profits have rocketed to all-time highs – but for more than a decade, wages and incomes have barely budged," he said.
The president said it was wrong that in such a rich country working people should live hand-to-mouth.
"Tonight, let's declare that in the wealthiest nation on Earth, no one who works full-time should have to live in poverty, and raise the federal minimum wage to $9 an hour. This single step would raise the incomes of millions of working families. It could mean the difference between groceries or the food bank; rent or eviction; scraping by or finally getting ahead. For businesses across the country, it would mean customers with more money in their pockets," he said.
...Instead of cuts to services, the president said that what is required is to make the rich and big business pay their fair share. "To hit the rest of our deficit reduction target, we should do what leaders in both parties have already suggested, and save hundreds of billions of dollars by getting rid of tax loopholes and deductions for the well-off and well-connected. After all, why would we choose to make deeper cuts to education and Medicare just to protect special interest tax breaks? How is that fair? How does that promote growth?" he said.
But, in Canada, who makes Steve Harper explain why we should make deeper cuts to Canada's social safety net and progressive taxation "just to protect special interest tax breaks? How is that fair? How does that promote growth?" Who will restore Canada's "basic bargain"?