A particularly insightful lead letter is found in today's Toronto Star. Because most letters seem to be available online for but a short time, I am reproducing writer Stephen Douglas' thoughts on the folly of our pseudo-economist Prime Minister's tax giveaways to the corporate sector, which continues its relentless mission of eradicating good-paying jobs from Canada:
On Jan. 1, 2012 the last of five annual corporate tax cuts took effect, reducing the federal rate by another 1.5 points to 15 per cent, now among the lowest rates in the industrialized world. This amounts to a total $2.85 billion in tax savings for the most profitable of Canadian business.
The notion that this will spur new jobs is a fallacy; tax breaks don’t benefit those businesses starting up who are not yet in a profitable position. Nor will it lead to increased capital expenditure by those business who do receive it; Stephen Harper himself was recently complaining about all the private business money “sitting on the sidelines” in Canada during these recent difficult times. His solution? Give them more.
At the same time, Harper’s government is proceeding with increases in employment insurance premiums. The Canadian Federation of Independent Business, representing those small- and medium-sized businesses least likely to benefit from the new lower corporate tax rate, are protesting loudly with a 15,000 signature petition that this will, in fact, deter the hiring of any new employees. It is completely without merit, they add, as they have been overpaying into EI for years. As evidence, Employment Insurance currently has a robust surplus of $57 billion (2009-10), which our own auditor general has described as excessive.
The net effect of Harper’s New Year 2012 package is yet another transfer of several billion dollars in annual income from Canadian workers and small business to the largest of corporations, which are already reaping the highest profits. To add salt to the wound, these big players that Harper is generously rewarding are also significantly held by foreign-ownership (some estimates are that foreign ownership holds more than 50 per cent of the petroleum and gas industry shares and more than 50 per cent of all manufacturing in Canada).
Without any justification, for there is no economic analysis pointing toward any type of capital exodus out of Canada (to the contrary, we are traditionally considered a safe haven in turbulent periods), this New Year’s Day package pinches hard-earned dollars out of the pockets of low- and middle-class workers and pads the war chest of corporations and the wallets of their shareholders, among whom disproportionately are the wealthy, the elite and the foreign financiers.
For the last 25 years in the U.S. and Canada — under both Conservative and Liberal administrations — economic policy has been dominated by the economic philosophy of neoliberalism, emphasizing the primacy of market competition while vilifying government intervention and regulation of markets. Neoliberals insist that price adjustments ensure full employment.
In contrast, to quote Thomas Palley, what we have witnessed has seen “a slip between the cup and the lip” as the wealthiest have concentrated their power; a fall in real wages, the undermining of unions and the erosion of workers’ rights, and growing problems of poverty alongside an increase in wealth amassed by a very small minority. What neoliberalism has failed to account for is the abuse of power that accompanies the control of media and the funding of politicians.
Money does not have a conscience, and those who act to increase their personal wealth at the expense of their neighbour will find their rationalization within neoliberalism.
Harper and his cadre of conservative ideologues share this collective denial. In these hard economic times where concern is growing about the disparity of wealth, when one in nine Canadian children live below the poverty line while fewer than 4 per cent of the households hold 67 per cent of our total financial wealth (estimated total holdings of $1.8 trillion), he is thrusting us back toward a harsh Dickensian world and hopes we will be grateful for the crumbs we receive.
Stephen Douglas, Toronto
No comments:
Post a Comment