Sunday, December 16, 2012

Evidence Suggests Now Is The Time For Pension Reform

Martin Regg Cohn writes that federal bureaucrats have presented Finance Minister Jim Flaherty with a plan to shore up the faltering Canadian pension system. Private pensions have been decimated by the Neo Conservative Revolution. Cohn writes:

The world of pensions is collapsing around us. Traditional “defined-benefit” pensions that reliably promise to pay a fixed amount in future — really the only payments worthy of the name “pension” — are being phased out in the private sector. The registered savings and pooled plans offered up as alternatives are merely Potemkin pensions — glorified savings plans that expose workers to the risk of stock market volatility and the madness of high management fees charged by Bay St.

The bureaucrats argue that Canada is in the unique position of being able to afford an overhaul of the pension system:

“Canada’s current social security contributions and payroll taxes are relatively low compared to other OECD (Organization for Economic Co-operation and Development) countries,” the paper notes pointedly.

Currently, Canada allocates a mere 5.5 per cent of its economic activity (GDP) to social security and payroll taxes. If all the improvements outlined in the paper were phased in, the percentage would rise to 6.3 per cent. Even under this improved scenario, Canada’s contributions would still be low by OECD standards — and remain at the very bottom of the G-7 group of industrialized countries.

Mr. Flaherty's prime directive, however, is to keep Bay Street happy:

He announced yet again Friday that “this is not the time to put another burden on employers and dampen employment prospects of Canadians,” citing the supposed “softness of the economy.”

Flaherty is adamantly opposed to reform, even though he recently admitted that those profits on Bay Street are, in truth, nothing but "dead money." For a man who was trained as a lawyer, Mr Flaherty has an astounding immunity to evidence.


Lorne said...

I suspect there is no dissuading 'true believers' like Flaherty from their ideological blindness, Owen.

Owen Gray said...

True, Lorne, He believes -- despite all evidence to the contrary -- that wealth, not customers, creates jobs.

Anonymous said...

Flaherty is forever bleating. Giant corporations are sitting on all of the money. Meanwhile. Harper gives billions of our tax dollars to, corrupt greedy banks, mines, big business, and his favorite charity big oil. They are also given huge tax reductions. No point in lying about it. That was seen on the House of Commons TV channel some time ago. That motion was passed, by the entire House. That's why I have always said. It doesn't matter what party is in office. The results will all be the same.

The only politician I have heard speak against Harper's treachery is, Elizabeth May. She warned Canadians of Harper giving Communist China, the right to sue any Canadians, blocking China's takeover of Canada.

Owen Gray said...

Ms. May is waging a lonely battle, Anon.

Beijing York said...

I'm finding it increasingly harder to believe that I will live modestly well beyond the next few years. But I'm the type of taxpayer the Harper Regime hates. I don't buy more than basic insurance, don't invest in the stock market, don't earn lucratively, etc. I am an average person trying to make my present life as fulfilling as possible within my means. Wish me good health so I can work well beyond 65.

Owen Gray said...

Given that Harper recently raised the age of eligibility for OAS, Bejiing, it's not too much to assume that he expects all people who live modestly to work well beyond age 65.

It's only his patrons who will be able to retire comfortably -- and early.