There Are Solutions

In my previous post, I mused about how much better society could be if we had fair and progressive taxation, taxation that forced those who make a lot to pay a little more. It almost seems as if such talk today is heretical, given the anti-tax mania that is cultivated by the far-right.

But you get what you pay or don't pay for, and today that means multitudes of homeless who cannot afford the usurious rents being demanded, families lacking support or waiting for years on a list while their children grow up without the aid they need, overburdened healthcare systems that one strives to avoid except in extreme circumstances, etc., etc. - a dystopian nightmare that seems to only be getting worse.

In today's Star, a reader offers a sound suggestion that would help ameliorate our current crises:

If huge wage 'earners' paid their fair share, it could make a difference 

Swelling CEO salaries highlight income inequality, Jan. 22

Sadly, your editorial, truthful as it is, is not breaking news. For more than a decade, the Canadian Centre for Policy Alternatives (CCPA) has been telling its readers that the growing salary gap between the top one per cent and the rest of us is becoming more and more massive.

It is hard to believe, even for a cynical observer of world news, that in 2024, so many CEOs have earned more than $60,000 by Jan. 2, 2024 — more than the average worker earns in a year.

We’ve known this almost obscene fact for all these years, so we can’t plead ignorance. How fortunate that we have the CCPA to prod the consciences of our politicians and business leaders. These people with power do have some means to create a slightly less unbalanced society, smoothing that gaping wage gap even a little — by taxing the rich a bit more — most would not even notice the difference if they paid another $10,000 more in taxes each year. And if all of these huge wage “earners” actually paid their fair share, it could make a difference for the rest of us. Even billionaire Warren Buffett is famous for saying that his office staff pay more taxes, proportionally, than he does.

In this "Theatre of the Absurd" scenario, who will take the first step and raise the minimum wage to $25 or $30 per hour? This radical move might assure that the everyday worker, many with no sick days or health benefits, can at least avoid food banks and clothe their families for the winter weather.

Della Golland, Toronto

Clearly, there are at least partial solutions to the problems people confront on a daily basis. Unfortunately, those we elect to represent us are listening to only a small part of their constituency as they strive to perpetuate political careers that serve, not the common good, but only their own selfish interests. 

A Monday Thought Experiment

As a matter of course, I allow myself one hour of television news per evening, 30 minutes local and 30 minutes of either American or Canadian national news. It is a practice I highly recommend, not simply as a means of keeping up with events in this tortured world, but also as a window into the lives of others.

One conclusion I have drawn from this habit is that we can never know the lives of others, especially the burdens they must bear on a daily basis. In this, I am not talking solely about the very public problem of the homeless, but they certainly count. I am also talking about windows into the often fraught lives of people caring for special-needs children,  elderly parents, waiting in the ER, or any number of other exigencies that comprise life. The common denominator is insufficient funding for the support they need.

In my more wistful moments I imagine a regime of fair and progressive taxation, where those who are more than comfortable pay a little more for programs directed toward the public good. At the very least, some of the aforementioned problems would be ameliorated. Yet we live in times where we have little control over how our money is spent, as, truth be told, we are not the ones calling the shots, political theatre notwithstanding.

This post was prompted by two letters in today's Star, which I reproduce below:

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Dental program leads to inequity

Federal dental care program will exclude 4.4 million uninsured Canadians: report, Jan. 17

Canada’s proposal for expanding health care coverage to dental and medical drugs is flawed. The law would have handsomely fed politicians arbitrarily sitting in judgment over who beneath them can afford dental care unassisted and who cannot. Further the plan cuts out any Canadian currently paying private insurance premiums, under the facile presumption that anyone — let’s say, a retiree struggling to support a live-in parent with dementia, and put food on the table under roof that is beginning to leak, heated by a furnace nearing the end of it’s projected life — who has private health insurance can comfortably afford it.

We live under the rule of governments that take their policy orders from corporate economists and boardrooms. We are told that fulsome public health care would be too costly, in the same breath that we are told the inflated prices corporations charge us for essentials must only be combatted by using interest rates to make those essentials too expensive, and that modest homes must be taxed yearly on speculated values.

Canada can afford universal dental, vision, medical care but taxing all wealth equitably. Level the field.

Darcy McLenaghen, Toronto

 

Health care crisis

No end to the ER crisis without investments and addressing workers’ concerns, Jan. 17

The conclusion of the authors of this article is that we just need to invest $1.25 billion annually to solve the health-care crisis. Where will the money come from? I would gladly pay a reinstated licence plate renewal fee of $120 per year, as would most people I suspect, if the billion dollars saved by cancelling it would be put toward our health care system. If that will reduce wait times, improve worker incomes and boost staffing levels across the province, I don't see a downside. Politicians are the only thing standing in the way.

Ken Beckim, Oshawa, Ont.

What Fair Taxation Could Achieve

From the print edition of the Toronto Star comes this response to a recent column by Linda McQuaig, a response that strikes me as eminently reasonable:

Re Debunking billionaire claims of heroic capitalism, McQuaig, March 14

Linda McQuaig is right on the money. Since1980, the top federal tax rate has been cut by almost 50 per cent. If the progressive tax system had not been changed, there would be no deficits and we’d have a surplus nationally.

Inequality is at an all-time high. There is a massive concentration of wealth in the hands of the few.

We don’t have a wealth-creation crisis; there is more wealth than ever before. We have a severe distribution-of-wealth crisis. This concentration of wealth in the hands of the few is simply not sustainable.

Conservatives are always claiming the deficit is a crisis, yet they continue to claim that tax cuts are good for everyone.

Trickle-down economics has been completely discredited. It is a ridiculous belief that when the wealthiest have crammed as much money as they can into their pockets from tax cuts, the rest of us will get the odd $20 bill that falls out.

In the upcoming election, where’s the promise to restore a progressive tax system, where everyone pays their fair share of taxes? Reversing tax cuts is not raising taxes, it’s restoring funding to build a civil, more just and equitable society.

If everyone was paying their fair share, no one would mind paying taxes.

Paul Kahnert, Markham

We have been persistently fed the line that a rising tide lifts all boats. Reality, however, suggests something quite, quite different.

It's Time To Ask The Right Questions

The old myth that tax cuts, especially of the corporate kind, create jobs, continues to be circulated. Indeed, here in Ontario, PC leader Doug Ford is promising to reduce the corporate rate from the already historically-low 11.5% to 10.5% "to bring jobs back to Ontario."

In Australia The Canberra Times' Ben Oquist says it is time to reframe the tax discussion by posing a series of questions aimed at showing the destructive nature of such cutting:

Every proponent and lobbyist for the policy should be asked what social program or infrastructure project should be cut, or what other tax should go up to pay for boosting post-tax profits of large business. Indeed Treasury’s own modelling - often cited to support the tax cut legislation - assumes that either personal income taxes will increase or government services will be cut.

We hear almost exclusively from the "winners" of a company tax cut. But the public cannot be expected to make an informed choice as to whether this is the best way to create ‘jobs and growth’ if we do not know, specifically, where the off-setting cuts will be made. Will it be billions less for schools, or hospitals? Or will it be the infrastructure spend for our fast growing population that misses out?

Only the untutored mind will accept Doug Ford's bromide of tax cuts with no pain:

... while Ford likes the tax cuts, he doesn’t like the carbon tax (or any other tax), leaving a $10-billion hole in his budget.

Not to worry, says the self-proclaimed stopper of gravy trains. Ford insists the better part of the shortfall – about $6 billion – could be covered through the elimination of so-called inefficiencies.

In Australia, by contrast, some of the corporate sector is beginning to understand the folly of such short-sighted tax measures:

This week a survey of Australian company directors found that infrastructure spending, not tax cuts, should be the priority in this year’s federal budget.

Many company directors also know that ultimately business can only flourish if a decent society is maintained and that this requires a strong role for government providing quality services, training, education and modern infrastructure. This of course requires a strong revenue and taxation base to fund it.

Why don't corporate tax cuts work in creating jobs, jobs, jobs?

History shows that corporate tax cuts are largely spent on stock buybacks, increased dividendsand acquisitions, all of which only helps to benefit wealthier shareholders – not workers or the community.

That has been the Australian experience, and the same reality is unfolding in Trump's America:

Figures already released following Trump’s tax cut show that investment is down but there has been a frenzy of share buybacks, increased dividends combined with mergers and acquisitions that increase CEO power and drive inequality even higher.

For more discussion of the above, check out this New York Times article, which observes that

American companies have announced more than $178 billion in planned buybacks — the largest amount unveiled in a single quarter, according to Birinyi Associates, a market research firm.

Informed and serious discussion of taxation is hard to come by these days. Instead, shrill pronouncements from demagogues predicting financial Armageddon if fair taxation is imposed hold sway.

Clearly, it is time for all of us to put on our thinking caps, pierce through the hysterical proclamations and begin behaving like adults, not children who favour sweet lies over bitter truths.

Not A Dirty Word

In his column the other day, Rick Salutin wrote a stout defence of taxes, making it very clear that for him and many others, the word and the concept are hardly obscenities.

Public programs need to be adequately funded and expanded, the opposite of the American mentality:

Take tax reform. To U.S. Republicans, it means one thing: cuts. It’s their ultimate “reason for existing” (Financial Times). They staggered into the light this week to say (again) that Americans should keep their hard-earned money to pay their medical and university bills. Ha ha ha. There’s no way tax cuts will cover most such costs, though you might be able to repave your carport. What would help? More taxes. That could fund national “free” health care or tuition. But it would mean bigger government, levying higher taxes.

Here in Canada, the need for an expansion, not a contraction, of government intervention in people's lives is becoming increasingly obvious. Salutin cites the sad situation of dismissed Sears workers who are facing loss of severance and reduced pensions as a result of the chain's bankruptcy. This dire situation is mirrored in larger society by the growth of precarious work and the fact that company pensions are fast becoming relics of an earlier era. Echoing a sentiment recently expressed by his colleague, Thomas Walkom, he offers this:

The obvious solution is the health-care model: public programs like CPP not to supplement private pensions but to replace and amplify them — i.e., bigger government.

The mystery is why anyone ever thought private companies were the way to cover huge costs like health or pensions. It’s costly and patchwork; public programs make far more sense. They’re stabler, better funded and include some democratic oversight.

The rub in all of this is that such transformation requires something far too many have become allergic to: increased taxation.

Public programs, however, mean you need revenues to fund them. And presto, you’re back to taxes...to run national programs, taxes must be accumulated, not just endlessly cut.

It’s a simple picture and it’s amazing how Finance Minister Bill Morneau managed not to paint it with his summer tax “reform” rollout: get more tax revenues from the rich, who can afford it, to fund big programs; and give cuts to those who’ll spend to stimulate the economy, generating more revenues.

Salutin ends his piece by a personal testament to the need for properly-funded programs:

In recent weeks I’ve had (public sector) fire trucks at the house twice — for a fallen branch on power lines, then two false CO alarms in two days. They came swiftly, cheerily and competently, unlike my private gas provider, who effectively said, from wherever on the globe, that they didn’t give a flying leap.

I will close with a letter from today's Star that echoes Salutin's sentiments:

The big government era isn’t over. It may just be getting started, Salutin, Oct. 27

For the love of our aging and long-lived demographic, Rick Salutin has nailed it. We need to reframe the tax conversation. I don’t know where we’ve lost our way about this as a country or even as a society, but I remain confused when people say such things as, “but taxes will increase,” like a venomous accusation, rather than recognizing what it means to enjoy things such as clean drinking water and not having to build in a $50,000 rainy-day fund just in case we slip and break our hip (in the middle of the forest, no less, with no one to sue).

It scares me to think that if Canada had tried to socialize health care in this day and age, society is at a point where we would have said no and cried out for “lower taxes, not my money” instead.

If all we ever hear about is scandals and corruption, it’s little wonder why no one trusts government to handle the public purse anymore. I say keep at it, let’s talk about the privileges our society gets to enjoy for the value of its tax money and how much we’re going to need it in the decades to come.

Jennifer Ng, Richmond Hill

Time To Reject Magical Thinking

Canadians, along with the West in general, have been fed a neoliberal diet of propaganda and policy for so long that far too many have succumbed to magical thinking, the belief that we can have it all with only minimal pain, the later in the form of low taxation rates. A steady barrage of government waste stories, coupled with the extolment of the individualist giants who walk among us, all, as the mythology goes, self-made men and women, has created the unfortunate but quite intentional effect of equating taxation with government theft of its citizenry.

All of which, of course, is arrant nonsense.

As my friend Dom says about capitalist titans who 'made it on their own,' "Oh, and did they build their owns roads? Were they educated by universities they built? Did they personally educate their skilled employees?

And as one of our finest Canadian thinkers, Alex Himelfarb, has repeatedly asserted, the concept of taxation is not a profanity but an absolutely integral part of a fair, just and balanced democracy. If you haven't read or heard him, be sure to check out my blog links to some of his work.

There is no substitute for critical thinking about such matters, but the cost of riding the low-tax bandwagon can be very high, as this Star letter writer reminds us:

What do Montreal sewage, the Gardiner expressway, the Lac-Mégantic derailment and Walkerton water have in common?

They are the legacy of cynical politicians elected by gullible voters. For decades, the likes of Mike Harris, Rob Ford and Stephen Harper have peddled the Thatcher-Reagan lie that government budgets can be pared without limit until we all live tax-free in Eden North and the wealth trickles down for the good of all.

The troublesome truth is, no matter what book-keeping tricks we use, public debts inevitably come due in the form of failed infrastructure, lowered quality of life, disease and death.

Perhaps the most heartening implication of the Harper Party’s ouster is that most voters now accept that there is a price for being Canadian – one that is well worth paying for the privilege of living in what is still one of the best countries on earth.

Paul Collier, Toronto

UPDATED: The 'Robin-Hood Tax' Gains Traction

In a declaration that will likely earn him the designation 'Enemy of the Capitalist State,' Pope Francis recently called upon the world to redistribute its wealth in order to reduce what is likely the greatest socio-economic scourge of our times, income inequality.

In his address to U.N. Secretary-General Ban Ki-moon and other U.N. leaders, the Pope said:

“Specifically, this involves challenging all forms of injustices and resisting the economy of exclusion, the throwaway culture and the culture of death which nowadays sadly risk becoming passively accepted” .

While Francis hinted that a more equitable tax regime would help in this goal, he was short on specifics. Perhaps progressive states in Europe have hit upon an elegant yet simple solution: the Robin Hood Tax, a.k.a. The Tobin Tax, also called, within its Eurpoean context, the European Financial Transaction Tax.

The levy, about which I have written previously on this blog, would be a painless and very progressive measure that could be used not only to address the aforementioned inequality, but also a host of other urgent issues confronting the world. It could create jobs; spur economic development beyond the financial industry; and combat climate change, global poverty and HIV/AIDS.

While it would be naive to believe that any one measure could solve all of our problems, the ability to mitigate them is clearly within the tax's purview.

In the current proposed version backed by an 11-nation coalition, here is how it would work, as reported by Katrina vanden Heuvel in The National:


The proposed tax includes a 0.1 percent tax on stock and bond trades and a tax of 0.01 percent on derivatives. It’s now expected that the tax will indeed be phased in, with the levy on stock-trades comprising the first step. Reportedly, the finance ministers involved in the negotiations plan to use the rest of the year to negotiate over taxes on derivative-trading, which could be introduced later in a second phase. While the German government is reportedly determined to get an agreement from the outset to include derivatives, there has been some resistance, including from the supposedly more left-wing French government.


Its benefits would be many. Opposition to it is fierce and passionate. But with every indication that it is rapidly moving toward a European implementation, a critical mass is being reached. The fact that progressivity is not dead in Europe should give us all enough heart to reignite our passion for a more equitable world, a world in which the neo-liberal agenda no longer completely holds sway as it gives to the few while willfully withholding from the many.

UPDATE: Well, it certainly didn't take long for the right-wing to react to the Pope's suggestion. Let's just say, they didn't take it well:

Two Takes On Taxation

The contrast couldn't be more striking. As announced by federal Fiance Minister Joe Oliver the other day, Ottawa is well on its way to posting a $9 billion surplus, but Canadians shouldn’t expect any massive new spending programs. Instead, he plans to reduce taxes once the deficit is eliminated in the 2015-16 budget, likely next winter.

On the other hand, the Ontario government, under Premier Wynne, proposes a host of new spending and moderate tax increases under the budget it brought down yesterday.

Progressive measures include raising the wages of home care workers, more money for infrastructure, welfare hikes, new health benefits for children and a plan to hire at-risk youth in provincially funded infrastructure projects.

Perhaps the boldest proposal is an Ontario Pension Plan that will, years down the road, alleviate a good deal of the poverty faced by retirees who currently don't have company pension plans, it is the same model that the Harper regime rejected as "too risky for our fragile economy."

Two competing visions of the role of government; the federal one, which appeals to the selfishness that resides in all of us, and a provincial one which, albeit an election budget, appeals to our better natures.

Which one will prevail? Who knows? But now might be a good time to watch the following TVO podcast, taken from Alex's Blog, in which Alex Himelfarb talks with Steve Paikin about why taxes should not be considered a four-letter word:

A Reading Recommendation.

I have a deep respect for Alex Himelfarb, the director of the Glendon School of International and Public Affairs and tireless proponent of responsible, progressive taxation. The latter, as one can well-imagine, likely makes him persona non grata in many circles, but those are likely the same circles that close out responsible thought or discussion on any topics that might threaten to puncture the artificial and insular world they encase themselves in.

It is, of course, easy to take the expedient route, as have politicians like Stephen Harper, Justin Trudeau, and Thomas Mulcair at the federal level, and, here in Ontario, Tim Hudak and Andrea Horwath, all essentially proclaiming the evils of taxation, some more stridently than others, as they promise no tax increases. Clearly, in taking such positions, they are playing to our basest impulses.

Alex Himelfarb refuses to play that game. In his latest reminder of things our political leaders would rather we not contemplate, Without a tax debate, we risk sleepwalking into the future, Alex and his son Jordan present this thesis:

Canadians have a right to know what they’re giving up before celebrating the next round of tax cuts.

The article makes reference to the Himelfarbs' book, Tax Is Not a Four-Letter Word, a collection of essays that explores the tax question; its central purpose is perhaps best expressed here:

In the book we do try to counter the view that taxes are simply a burden from which people must be relieved. Simply, they are the way we pay for things we have decided to do together because we cannot do them at all or as well alone. Our approach has yielded reactions both positive and negative.

And this is the crux of today's Star article as they argue that we cannot have an honest discussion about taxation because we do not have a clear understanding of the relationship between taxes and what they buy:

Two successive parliamentary budget officers, whose job it is to know, admit they cannot get the information they need to determine the costs and consequences of tax and spending cuts. So how are we expected to know? And without information about the trade-offs, how do we make informed democratic decisions?

They argue that without this basic knowledge, we as a society cannot make an informed decision on what constitutes proper taxation:

Whether we’re taxed too much or too little is a perennial debate that now needs rebalancing. It’s all well and good to say that many Canadians want smaller government but that means nothing unless it’s based on some understanding of how this will affect our ability to pursue our shared goals. We ought to know what we’re giving up before we celebrate the next round of tax cuts.

That seems to me to be the crux of the problem we face today as a society. The Harper government would have us believe that the only thing we are giving up when tax rates go down is an unwarranted intrusion of government into our lives. The Himelfarbs argue that if we look beyond the self-serving rhetoric of our political overseers, what we lose in embracing that mentality is something much different and ultimately much more costly to all of us.

Wisdom From A 91-Year-Old

Don't worry. This is not one of those bromides on how to live a long and happy life. It is, however, a realistic recipe for social cohesion and progress. The letter, from Joy Taylor of Scarborough, was published in today's Toronto Star:

Today I turned 91. My friends and I celebrated with laughter, and good food. How lucky I am to have had such a good life. I wish that everyone could be as lucky as I.

I often think of the working poor. I think of their struggle to try to make ends meet. I think of the children not having enough to fill their stomachs and no second helpings at mealtime. Of going to bed hungry. Living in places that should be condemned. No TV, no sports or hobbies of any kind to help overcome the sadness and dreariness of their lives. They struggle with education. Some turn to crime.

I think of CEOs and bankers and wealthy people in general. They lack for nothing. Their interests lie in money. Making it, saving it and how to avoid paying taxes.

Many of them admit that they could never exist in the lives of every day people. They are not aware of how some people live — they avoid thinking about them. I cannot avoid thinking of them.

Is it a fantasy or could all Canadian families be given a chance at a decent life. Working people could earn a wage that allows them a decent place to live, good food and education for the children. Those unable to work could be well looked after and not despised by society.

If everyone paid their fair share of taxes and worked together with a major plan, just think that we could become the most perfect country in the world. The envy of people everywhere. It is possible.

Maybe this is what we were intended to do before it is too late. If not, perhaps a meteorite will carry us off to begin again until we get it right.

Millions of dollars is such a waste, lying offshore when it could be helping Canadians realize that there is a better living for us all. Why don’t we try it. We may learn to like it.

A Timely Reminder About Taxation

Responding to a column the other day by the Star's Thomas Walkom, letter-writer Bruna Nota of Toronto offers us some timely reminders:

Re: Tax a dirty word in these Thatcherite political times, March 15

Yes, most unfortunately, the culture has developed in Canada, fully supported by all big media to depict taxes as evil rather than as a necessary social contribution to the community and to future generations. As the inscription on the Washington Internal Revenue Services building says: “Taxes are what we pay for a civilized society.”

We need to correct the timidity of our elected representative and strengthen their resolve to do what is right. Taxes, now or in the future, are a necessity if we still value community. And they have to be progressive taxes paid by the people and entities who can most afford them. The alternative is not a pretty one.
When we do not pay taxes our infrastructure crumbles. Our research ability disappears. Our students are saddled with unbearable debts. Our universities are beholden to the dictates of corporations. More and more of our citizens are left bereft of housing, food, education, basic services. This is not a society worth living in. We need to have more articles decrying the present regressive state of affair.

In this context, I recommend the excellent book published by Canadians for Tax Fairness: The Great Revenue Robbery. It is a series of very thoughtful and insightful essays about how the public domain is diminished because taxes are been avoided.

Perhaps the Fram oil filter man put it best back in 1972 when he talked about the folly of pursing a false economy:

The Right-Wing Propaganda Machine Gears Up

Deeply affronted, perhaps even frightened by the recent change to the Ontario budget that will impose an increase of 2% on the income of those making over $500,000 per year, the right-wing has been busy cranking out its anti-tax propaganda. Lest anyone think that a return to some form of progressive taxation is a good idea, two groups with charitable institution status are most charitably taking the time to point out the error of our thinking.

The first out of the gate was The Fraser Institute, which recently released a 'study' telling Canadians that we are paying far too much tax as it is. According to that study, we hapless citizens are paying more in taxes at all levels than we are on the basic necessities of life.

Following in their footsteps, the Macdonald-Laurier Institute kindly informs us that the rich pay more than their fair share of taxes, and hitting them harder won’t solve all the problems of the poor.

While you can read both reports through the links provided, I'd like to offer a few of my own observations here. First, the Fraser report conveniently ignores the fact that in terms of total tax burden, Canada ranks in the middle of countries listed in a Forbes-commissioned study for 2009. Coming in at #33 out of 65 countries measured, the study provides some much-need context absent from the Frasier hysteria.

Next, the above-mentioned study shows that the United States, coming in at #21 in the rankings, has a significantly higher tax burden, much of it apparently allocated in ways that do not benefit the majority of people. (Wars in Iraq, Afghanistan, on Terror, on Drugs and against Occupiers, corporate tax cuts and subsidies readily come to mind as quick examples.)

Despite that higher tax burden, U.S. citizens are mired in much higher costs for health care, the cause of 60% of their bankruptcies in 2009, thanks both to the occurrence of catastrophic illness and the absence of taxpayer-supported public health insurance.

In terms of education, while annual tuition for a basic undergraduate degree in Canada ranges from just over $2000 to about $6000, those in the United States are anywhere from about $13000 to over $41,000, excluding Florida, which appears to have the lowest tuition at $5700.

Of course, one of the key reasons for the disparity in educational costs is the proportion of taxation each country allocates to education; Canada sees subsidized education as a worthwhile investment since society as a whole stands to benefit.

Finally, the Macdonald-Laurier Institute avers that increasing taxes on the wealthy won’t solve all the problems of the poor. I can't think that anyone has suggested it will; what has been asserted, however, is that having a truly progressive system of taxation that is wisely administered will, in fact, allow for the continuation and expansion of programs to help the disenfranchised become fully-participating members of our society, something that those inhabiting right-wing towers seem to forget is a core value the majority of Canadians hold dear.

So no, speaking as a member of the middle class who wants to maintain and enhance the quality of life in this country, taxation is not a dirty word. Contrary to the fraught hyperbole of the so-called think tanks that are subsidized through my taxes, all I ask and expect is that my dollars be used for the betterment of all, not to simply bolster the net worth of the wealthy.

Thomas Walkom on Fair Taxation

Long a taboo subject, increasing tax rates for the wealthy is back on the agenda, in no small part due to the Occupy Movement and, more recently, Andrea Horwath. In today's Star, Thomas Walkom presents an interesting perspective on the issue. You can click here to read it.

An Inconvenient Truth For The Right Wing To Digest

Over the past several years, most notably since the ascension to power of the Harper regime, taxation, especially the concept of progressive taxation, has fallen into bad odour, Thanks to the ethos espoused by the right, we have been consistently bombarded with messages that we are unfairly burdened with oppressive tax rates, that we have the right to keep more of our money, etc. etc. ad nauseam. At the same time, of course, as has been amply demonstrated by the Occupy Movement, the very wealthy have benefitted most, while the rest of us have been witness to the insidious erosion of the social fabric.

Finally, the inconvenient truth that many of us believe is held by the majority of Canadians is emerging: most agree that a moderate increase in income taxation is both acceptable and desirable.

While I am sure that there are, even now, strategies afoot in the PMO to discredit it, The Broadbent Institute, the progressive analogue to the Manning Institute, has released the following poll results:

...a majority of Canadians — including most Conservative voters and wealthy individuals — would support higher taxes to fight income inequality.

Higher taxes are supposedly political dynamite but the poll — the first major survey for the newly founded left-leaning Broadbent Institute — suggests the toxicity of taxation has been exaggerated and is the product of a concerted “ideological” campaign, says Ed Broadbent, the institute’s namesake.

You can read the entire story in this morning's Toronto Star.

Where Do Justice and Morality Reside?

On this Easter Sunday, when many turn their thoughts from the secular to the sacred, it is perhaps a propitious time to remember that the elusive goals of justice and morality, so often seemingly absent from the world, can and must be pursued, however imperfectly, only by those living in the world; it is a heavy obligation that each of us must bear, no matter how busy our lives may be, no matter what social or economic tier we may occupy. To simply shrug off that responsibility and let others with baser motivations decide for us is to surrender a major component of what makes us human.

My reflections were in part prompted by an excellent piece by Martin Regg Cohn in today's Toronto Star about the Ontario government's addiction to gambling, or, more accurately, the putative profits that arise from it. Says Cohn,

We’ve lost our moral compass in recent years — not by embracing gambling, but eschewing taxes. We have been contaminated by the anti-tax compulsions of American political culture that prevent governments from maintaining a progressive taxation system. This pathological aversion to taxation has driven the explosion of casinos everywhere, as governments rely on gambling to take money from the poor while sparing the rich.

Something to think about as we contemplate the dismantling of Canadian values and traditions currently underway at both the federal and the provincial levels.

Andrea Horwath's Dance With Dalton

While I continue to remain dubious of what will happen when the Ontario Legislature votes on Dalton McGuinty's budget, I give the leader of the Ontario NDP, Andrea Horwath, top marks for what she says are her demands for NDP support.

It is, however, interesting to note how her plan, especially regarding a two-point increase in the marginal tax rates for those earning more than $500,000 per annum, is being met. Today's editorial in The Hamilton Spectator is a case study of the reactionary mind. The writer, Howard Elliott, while claiming to endorse her noble goals of increasing day-care spaces and boosting social assistance rates, decries her methodology, dismissing any prospect of raising taxes on the rich as "blatant wealth redistribution and social engineering," code words undoubtedly designed to appeal to and provoke the extreme right-wing.

A much more mature and nuanced assessment is offered by The Star's Martin Regg Cohn. While giving approval of her initiative to put "taxes back on the agenda," he does offer an additional suggestion for the use of some of the monies raised - defraying the deficit.

A tale of two newspapers, and a telling distinction between the bush league and the major league players.

A New Call For a Return to Progressive Taxation

I suppose one has to be of a certain age to remember that progressive taxation has been a mainstay, until fairly recently, of our taxation system. Little by little over the past two decades, probably starting with the introduction of the GST, that principle has been on the wane, to the point where we have flattened the tax brackets and derive much of our revenue from consumption taxes and business growth, both of which have their obvious limitations.

Today, it is very rare for politicians of any stripe to even broach the subject of tax increases, as opposed to spending cuts, as a means of helping to address deficits. That is why I was so pleased to read Thomas Walkom's column in today's Star. Using a group called Doctors for Fair Taxation, Walkom examines the case for a return to true progressive taxation.

I highly recommend it for your consideration.

Why the Occupy Movement Has Relevance in Canada

Thee are many who assert that the Occupy Movement has no relevance in Canada because we have a social safety net and other measures that provide a modicum of protection to the most vulnerable. They also argue for the superiority of our banking system, which required no government bailouts because it is more tightly regulated than in the United States and other jurisdictions. However, those espousing this perspective ignore a larger truth about the relationship between the powerful wealthy and government policy:

As long as provincial governments and the federal government continue to lower corporate tax rates despite the fact that current rates are more than competitive with those in the U.S. and despite the fact that we have a growing national debt;

As long as government tells its citizens that some hard choices are going to have to be made (i.e., health care spending, federal transfers to the provinces, etc.) because of that debt and deficit;

As long as the poor are made to pay by living on benefits that keep them well below the poverty line;

As long as government refuses to even consider increasing taxes on the ultra wealthy;

And as long as the working and middle classes are made to subsidize the lifestyle of the power elite while suffering a steady decline in their own standard of living, job and retirement prospects, there will be a need for an Occupy Movement that attempts to speak for those who have lost their voice.

TruthDig For A Different Kind Of Truth

I recently wrote a couple of blog posts on Warren Buffett and the need for higher taxation of the very wealthy, an idea that is gaining currency in a number of countries, including France and Spain, the latter actually recently imposing a new tax on the wealthy. While conventional news formats are reluctant to pursue the issue in any depth, alternative sites for news and opinions like our own rabble.ca and Truthdig, an American-based site, are not shying away from this contentious topic.

A Truthdig article entitled Why They Hate Warren Buffett examines the backlash from the right provoked by Buffett's plea for higher taxation of people like him, and is well worth perusal.

Fair Taxation

Democratic Senate hopeful Elizabeth Warren speaks on the topic of fair taxation: