Monday, February 24, 2014

The Inconvenient Truth

If the Harperites read their own internally generated research, they know why Justin Trudeau is a threat. The Globe and Mail reports that a document prepared last October by Employment and Social Development Canada concluded that between 1993 and 2007:

“The wages of middle income workers have stagnated. Middle-income families are increasingly vulnerable to financial shocks."

The report is blunt in its assessment:

The authors say middle-income families have seen their earnings rise by an average of only 1.7 per cent a year over the 15 years ending 2007.

“The market does not reward middle-income families so well,” says the report. “As a result, they get an increasingly smaller share of the earning’s pie” compared with higher-income families."

A spokeswoman for Employment Minister Jason Kenny points out that the report stops at 2007, the year after the Conservatives were elected:

"Our government has reduced taxes and made life affordable for Canadian families,” Alexandra Fortier said in an email Sunday, adding a “typical” family of four enjoys tax cuts of $3,400 a year, thanks to Conservative policies.

That “typical” family includes working parents who together earn $120,000 a year, with two children.

Canadians know that, with an average annual income of $47,000, the increase in part time work, and the hollowing out of Canadian manufacturing, the $120,000 figure is pure fiction. In fact, the middle class has stayed afloat by going into debt -- something the report stresses:

The report also refers to debt, saying “many in the middle spend more than they earn, mortgaging their future to sustain their current consumption.”

“Over the medium term, middle-income Canadians are unlikely to move to higher income brackets, i.e., the ‘Canadian dream’ is a myth more than a reality.”

In short, Canada is on the same path the United States was on before the collapse of 2008. It's true that the decline began during the Liberal ascendancy -- which will be a problem for Trudeau. Will Canadians believe the man who leads the party which engineered the decline of the middle class?

For both Liberals and Conservatives, the report simply repeats the inconvenient truth.


True Blue said...

May I commend your objectivity in dealing with the issue of income distribution. To the extent that governments can be hold accountable for iniquities, it's useful to point out that both Liberal and Conservative parties need to "fess up" before much will be done about it.

Owen Gray said...

Trudeau has diagnosed the problem, Blue. But his own party bears a great deal of responsibility for what has happened.

mogs moglio said...

I like that chart at the beginning, the real truth should unseat the harper government if enough know. Following is a link to some charts presented by Jim Stanford, but first;

"...Jim received his PhD in Economics in 1995 from the New School for Social Research in New York, and also holds economics degrees from Cambridge University and the University of Calgary. He is the author of Economics for Everyone (published in 2008 by Pluto Press and the Canadian Centre for Policy Alternatives), which has been translated into six languages. He writes an economics column for the Globe and Mail,..." -from

These charts he (Jim) presented at a work shop, teach-in on November 01 2013 starts like this "Claim: Canada's economy is a job creating machine." and the chart shows that in 2005 62.6% of the working age population of Canada was employed. In 2013 that percentage had dropped to 61.8 and is continuing a decline. It shows that finance minister Jim Flaherty's story about how many millions under the conservative government's agenda have found new employment is all smoke and mirrors. It probably is not an out right lie but when you factor in all the people that the conservative's policies have put out of work you have a net loss of employment during the harper years.

I hope you can show some of these charts Owen they are telling:

Looking forward...


mogs moglio said...

Correction, actually I believe it's Employment Minister Jason Kenny who has taken to the commercials claiming millions of new jobs, not Flaherty. Ether way there has been a net loss of jobs under the Harper government. Another 'claim' (read lie) Canada's economy survived the recession better than any other. Truth is out of 34 OECD countries Canada came in at 20, 15th from the bottom. This chart is at the same link as above:


The Mound of Sound said...

The fact remains that in most industrialized nations of the global era, the lion's share of inequality is neither merit-based or market driven. It is mainly a legislated outcome, the result of calibrated tax policies, deferrals, subsidies, grants and even gifting of public property.

One feature of steady state economics is assigning actual market values to natural capital so that, as public assets, the people will be compensated for their use.

There was a time when we understood the need for a "stick & carrot" approach to corporations. Somewhere along the road we dropped the stick and since then we've been left with nothing but to bribe business with ever more carrots.

We speak of stagnation of wages without recognizing the greater scourge that triggers - the massive transfer of unearned wealth out of the middle class and into the pockets of plutocrats.

Owen Gray said...

We didn't get to this juncture by accident, Mound. We legislated ourselves into this mess.

And now we are pawns of what John LeCarre called the Deep State -- the state which is no longer subject to political control.

Owen Gray said...

Thanks for the links, Mogs. The charts give the lie to Flaherty's claim that his budgets are about jobs and growth.

They're really about austerity and the unemployment it causes.