Tragedy can’t be viewed in isolation
It would be easy to categorize what happened in Norway last week as the actions of a lunatic, but that would miss the point.
Anders Behring Breivik, who confessed to the crimes, may have had some ideas that stray far from the norm, but the amount of planning that went into his horrendous acts says this was not just some mad notion. That concept applies, for instance, to the teenager declared insane by a court in Glasgow earlier this month for stabbing to death a man he thought was a zombie.
No, the man who planted a bomb in Oslo then shot teens at a camp appears to be someone who knew full well what he was doing. And we can expect more instances like this given growing social alienation and the pace of change in society.
As Gwynne Dyer notes in his column this week, journalists are having a field day with this story, coming during a major lull in the news, unless you count the debt-ceiling crisis that’s shining a light on the perhaps irreconcilably dysfunctional U.S. political system. The story is also fodder for all kinds of blogs and message boards. Reading through those comments – far more numerous even than the Breivik’s musings in his 1,500-page compendium – you quickly realize the so-called madman has struck a chord.
As always, conspiracy theories abound. Those on the right of the spectrum inclined to think a certain way see the tragedy as a leftist plot to discredit conservative viewpoints. Their counterparts on the right see the incident as a chance for hawks to swoop in during a time of crisis to do away with democratic processes and civil rights, employing strategies itemized in Naomi Klein’s Shock Doctrine.
We don’t know what the longer-term implications will be for Norwegian society – let alone Europe and beyond – but so far the country’s prime minister, Jens Stoltenberg, is saying all the right things, avoiding the kind of kneejerk reaction we saw in the U.S. and, to a lesser extend, in the UK following terrorist attacks there. Instead of talking about military and police-state options, he’s talking about enhancing an already enviable democratic and socially-aware society.
Still, there’s a bigger issue here, one already at play in much of Western Europe where shifting demographics and immigration have led to simmering tensions for years. Much of what Breivik wrote about in his manifesto has fuelled the growth of right-wing and nationalist political parties in England, France, Germany and even traditional neutral Switzerland and liberal Holland, among others.
While those on the fringes often make the news, the arguments Breivik makes are not restricted to the extremes. That’s especially true of anti-Islamic sentiments.
As noted in a report from Bloomberg’s Scandinavian bureau, even traditionally liberal Nordic countries have been grappling with the issue, and the revulsion from Breivik’s terrorist acts won’t stop that.
“The rise of globalization and open borders has seen a surge in support for nationalistic movements across the Nordic region, as uncertainty and fear of the unknown grip sections of society in some of the richest countries in Europe. Parties that press for restrictions on immigration or over Islam’s influence have won seats in parliament in Denmark, Norway, Finland and, since September, Sweden,” reads the report.
The growing shift in attitudes, and political activity, comes as more and more foreigners seek access to the Nordic countries’ strong, stable economies and tradition of equality. Of 44 countries surveyed by the United Nations High Commissioner for Refugees last year, Sweden received the most applications from asylum seekers per head of population.
Norway was fourth, Denmark 10th and Finland 13th.
Even though Norway boasts Europe’s lowest jobless rate and biggest budget surplus, it must now acknowledge a threat of violence more usually associated with less stable societies, Stoltenberg told reporters who prepared the Bloomberg piece.
The bombing and shooting spree could heighten concerns about immigrants, says an expert contacted for the report. Initially, people may move away from the conservative movements, but that’s likely temporary.
“National traumas tend to breed cultural fears, which project onto immigrants or the unknown,” Fredrik Erixon, director of the European Centre for International Political Economy in Brussels is quoted as saying. “The fantastic show of support for open society and the values of democracy will inevitably fade away and be overshadowed by suspicion of the unknown.”
Even now, however, there are those using the anonymity of Internet forums to praise Breivik’s philosophies, though condemnation of his methods is almost universal. What he did was heinous, but he’s not alone in his thinking, which means someone else may go down a similar road. There may be a rush to simply consider this the act of a lone psychopath, but politicians ignore the underlying issues at their peril, and that of their constituents.
Politicians occasionally roll out a good idea
It’s common practice for politicians to say one thing in opposition and to do another when in power – often just the opposite. Those inclined to give them the benefit of the doubt argue politicians meant to follow through on their promises, only to be stymied by the realities of governing. Others take it as proof politicians lie as a matter of course.
There’s probably some middle ground. Politicians do tell us what they think we want to hear: lying outright or justifying it by rationalizing that the issue is too complicated for the public to understand. Often, however, it’s a matter of trying to sell too many things to an increasingly fragmented audience. Policies such as boutique tax cuts and incentives, for instance, are aimed at cultivating specific votes. That’s just too much to follow up on when in government.
We know we’re being bought – or at least bribed – with our own money, but we keep falling for it. And politicians keep throwing ideas out there, seeing what will stick. It’s time, however, for politicians to scale back, focusing on more pressing issues.
Take, for instance, the example of the federal Liberals. Rebuked by voters in May, the party is struggling to redefine itself. A stripped-down, nation-friendly platform might be in order.
Some longer-term thinking, rather than simply eyeing the next election, is called for. At the end of the day, most of us are concerned with economic well-being and our futures, which don’t often jibe with political planning.
Priorities should include more governance, oversight and regulation, particularly of the financial services sector, the one that creates most of the economic ones. Unfortunately, it’s the corporate sector to which politicians are beholden, not the average Canadian.
In that vein, there’s much to like in this week’s pronouncements from Judy Sgro, Liberal critic for seniors and pensions, keeping in mind the opposition-vs.-government formula.
She accuses the Conservative government of opting for pension reform that will ensure that banks and insurance companies reap the maximum benefit while Canadian workers continue to get left behind.
Pension reform’s not sexy, but it is something that will have an impact on just about every Canadian, and covers an issue that will have an impact on our long-term quality of life.
“After promising pension reform for four years the Conservatives have decided to go the easy route and just let investment fund managers offer a new type of savings plan to workers,” says Sgro. “The basic idea behind the Conservative’s pooled pension plan is to create another vehicle that will allow banks to chip away at the nest eggs of Canadians with
their high management fees.”
We pay some of the highest management fees in the world on our mutual funds, she notes. In a recent survey by investment research firm Morningstar that ranks 22 countries on the management expense ratios levied on their mutual funds, Canada was the only country to receive an F.
“There is a better, low cost, high return, universal option that is trusted by Canadians from coast to coast to coast and that is to create a voluntary supplemental Canada Pension Plan,” she says. “A voluntary CPP would have the benefit of not imposing the plan on workers who don’t need the extra coverage, which the Conservatives like, and provide the security and ease of use that the NDP likes. Most importantly it is the only vehicle that will deliver the results that Canadians want and need.”
She points to the Australian model as the downside of the Harper government’s proposal.
Australia introduced a superannuation system similar to the Conservative’s Register Pooled Pension Plan proposal in 1997.
“Over their first 12 years, Australia’s pooled pension funds posted a disappointing $161 billion in net investment earnings largely because plan providers scooped up a generous $105 billion in fees. Copying Australia by allowing the investment industry to eat up 39 per cent of the growth in Canadians’ retirement plans would be disastrous for our country.
“I think the Conservatives just want to be able to tax the high management fees of these pooled pensions with the GST or HST which they wouldn’t be able to do to a voluntary supplemental CPP,” she suggests. “They’ve decided to fill the coffers in Ottawa in order to fight the deficit they created rather than fuel the retirement dreams of their constituents.”
On the whole, we’re not putting enough money away to secure the future of retirees.
There’s every reason for concern. About two-thirds of Canadian workers don’t have a company pension plan. In fact, about a third don’t have any retirement savings at all – about 30 per cent of eligible workers didn’t contribute to an RRSP last year, for instance.
For those who have no savings of their own, relying only on government sources, retirement will be a meager affair. Or simply put off altogether.
The CPP provides 25 per cent of a worker’s average annual earnings – hardly enough for a comfortable retirement. That level has been consistent since the program was introduced in 1966. Payments for current recipients come partly from invested reserves and partly from contributions from today’s workforce. In order to ensure a more stable system and to provide a decent retirement income, we’ll have to start boosting CPP contributions.
Ideally, that 25 per cent figure would become 70 per cent, the figure most often cited as the level of income needed to preserve our standard of living in retirement.
Moving in that direction is the kind of promise – and action – we need from politicians: something to benefit those who vote for the politicians, not those who finance them.
Internet spam and scams abound
This was a particularly bad week for my U.S. and overseas bank accounts. Apparently a slate of server upgrades, unauthorized attempts at access and security breaches put my accounts at risk.
Far from worrying, however, I simply took the news in stride: I don’t have a host of U.S. and overseas bank accounts. In that light, therefore, I did not feel compelled to email complete strangers all the personal information they insisted was needed to protect my holdings.
If you have an email account, chances are you’ve seen this and similar kinds of spam. The goal is to get you to provide names, passwords and credit card information the scammers – known as phishers – will later use to steal your money.
Phishing scams abound, but aren’t as numerous as the chain letters, which seem to ebb and flow these days.
You know the kind: the virus-that-will-blow-up-your-computer warnings, the sick-kid’s-dying-wish, the what’s-everyone’s-birthday list, and so on.
Typically, these messages exhort you, the reader, to pass them along to five or 10 friends, promising some form of good luck if you do so, and threatening some ill omen if you don’t. As I routinely delete these messages and have yet to be struck by lightning or the like, I have to believe the threats are empty. On the other hand, having never passed such messages along, I can’t say for sure that good luck wouldn’t come of the practice. I am, however, content to stay the course.
Most are fairly harmless, in that they’re not directly scams, though some begin circulating simply to harvest names for mailing lists: more spam will follow.
Some, however, are clearly pyramid schemes. The classic example of this is what’s known as the Dave Rhodes chain letter, a longtime staple on Usenet newsgroups. You’ve probably seen a variation of this one:
“My name is Dave Rhodes. In September 1988 my car was repossessed and the bill collectors were hounding me like you wouldn’t believe. I was laid off and my unemployment checks had run out. The only escape I had from the pressure of failure was my computer and my modem. I longed to turn my avocation into my vocation. This January 1989 my family and I went on a ten day cruise to the tropics. I bought a Lincoln Town Car for CASH in February 1989.”
The e-mail then talks about how this is not a scam, that it really works and that it’s perfectly legal. Wrong on all three counts, but there’s a sucker born every minute.
Later, the post details how you’re going to make a fortune in a matter of weeks by investing just $5. The gambit involves sending $1 to each of the first five names on the list provided. You then insert your name and address in the first spot, bumping the others down accordingly, and then begin spamming others with this message.
In time, envelopes containing cash ($1) will begin arriving at your door. You’re on your way to Easy Street. Or are you?
Not likely.
Like all pyramid schemes – all of these chain letters are pyramid schemes, but not necessarily for financial gain – this one will eventually leave at least 90 per cent of the participants high and dry, even under the best-case scenario of unanimous participation.
It’s all about the math, as explained by the Rutgers University computer science department, which maintains a list of such things.
“The reason people are even tempted by these schemes is that the human mind does not have an intuitive view of geometrical progressions. Suppose we presume the chain letter to have a list of five people. You are asked to send one postcard to the person on top of the list, and re-mail the letter to five friends. You are promised thousands of postcards from all over the world if everyone participates. Your cost: a postcard, five photocopies and envelopes, and six stamps. Not much to risk to see what comes back …”
If everyone on the list participates and makes five copies, you are one of 5x5x5x5 or 3,125 people receiving copies in your “generation” of the letter. So far, the numbers don’t seem outlandish. And looking the other way, you stand to get postcards from 3,125 people. That doesn’t seem impossible either. But view it as the “chain” you’re in the middle of, and there will be 5 to the 11th power or 48,828,125 people receiving copies in that generation of the letter. That’s already more than the population of Canada, and would surpass the population of the U.S. in the next generation.
Simply put, there aren’t enough people to keep even the most innocuous chain letter going.
So, why do we perpetuate chain letters at all? Each one you receive came from somebody, after all.
An Ohio university psychology course looked to determine just that.
“One reason is that it is a great source for obtaining new e-mail addresses. These addresses may lead to new contacts.
“Some people send chain letters simply to see how far it will go or to harass another person. There may be times when someone decided that they want to damage a person’s or organization’s reputation.”
The originators are one thing, but when we pass along these letters, we’re chewing up Internet bandwidth (again, it’s about the exponential power). Quite simply, many of us perpetuate these e-mails because of superstition – we don’t want to risk bad luck – or wishful thinking about the benefits that will come from the good luck we’ve been promised by passing the message along.
In reality, you’ll be doing yourself and everybody else down the line a favour by simply hitting the Del key.
It’s business as usual for the financial sector
Clearly we’ve learned nothing from the recent recession. Created by financial-sector greed, unfettered corporate greed and compliant governments that championed deregulation, the economic meltdown has been catastrophic to middle- and working-class people across the globe. Even though we’re technically out of a recession, the only people who have bounced back are the ones who were responsible for the mess.
Far from being penalized, they were in essence rewarded for what happened, and appear quite content to keep on doing what they’ve done before. Perhaps they’re convinced they’ll continue to reap the profits while the rest of us will pick up the tab.
We only need look at the U.S. – the epicenter of much that went wrong and continues to be
wrong – to see there’ve been no lessons learned.
A report this week shows the median pay for top executives at 200 big companies last year was $10.8 million, a 23-per-cent increase over 2009. And that’s just pay, not the generous stock options typical of those positions. By contrast, last year the average American worker made $752 a week, just half a per cent more – meaning they made less than in 2009 when inflation is taken into account.
Things were far worse for an increasing number of unemployed Americans. The official unemployment rate was nine per cent, but that number doubled when the underemployed were factored in.
The U.S. situation is obviously much worse than here, though marginally better than Greece, the poster child for financial difficulties. The measures undertaken in Greece, of course, are also a good example of the kind of policies that has the U.S. mired in economic malaise: massive debt, low tax streams, austerity programs and assaults on government institution.
In short: private profits, socialized losses.
It’s as if we’re unable to learn from the past.
In a New York Times column this week, economist Paul Krugman makes just that point in discussing the renewed vigour of trickle-down economics – aka Reagonomics and voodoo economics – in relation to a proposed tax holiday for U.S. multinationals corporations. The idea is to let the companies repatriate their overseas profits without paying the normal taxes that would follow.
“And now trickle-down economics — specifically, the idea that anything that increases corporate profits is good for the economy — is making a comeback,” he writes.
“On the face of it, this seems bizarre. Over the last two years profits have soared while unemployment has remained disastrously high. Why should anyone believe that handing even more money to corporations, no strings attached, would lead to faster job creation?”
The problem, Krugman notes, is that these measures don’t work.
“As opponents of this plan point out, we’ve already seen this movie: A similar tax holiday was offered in 2004, with a similar sales pitch. And it was a total failure. Companies did indeed take advantage of the amnesty to move a lot of money back to the United States. But they used that money to pay dividends, pay down debt, buy up other companies, buy back their own stock — pretty much everything except increasing investment and creating jobs.
Indeed, there’s no evidence that the 2004 tax holiday did anything at all to stimulate the economy.”
The well-documented failures of neo-conservative economics are an issue in Canada, as well, given the current federal government.
In successive budgets, the Harper government has pushed for lower corporate taxes and transfer of the tax burden to the middle-class. Spending increases have been largely partisan, and there’s been an emphasis on a decidedly American agenda of funneling money into defence and security contractors. Past calls and later attempts at deregulation have been largely thwarted, but there will be return trips to the well.
Of course, that’s not enough. Lobbyists and special interest groups continue to push for lower corporate tax rates. Competitiveness is the mantra: we’re told taxes must be lower or businesses will flee the province or country, and that new ventures will go elsewhere. The argument has been successful, as rates fall year after year, though the promised investment and other dividends rarely appear.
In years past, groups such as the chamber of commerce and right-wing think tanks such as the Fraser Institute stressed that our corporate taxes must be competitive with the United States. We’ve now got rates lower than the U.S., our major trading partner. Not surprisingly, the comparisons began with other countries, initially with the 29 other members of the Organisation for Economic Co-operation and Development (OECD). As Canada’s rates fell below the average of those industrialized nations, the net was cast wider still.
In that vein, the C.D. Howe Institute – another pro-market organization funded by businesses – releases a tax competitiveness report now encompasses 80 countries, including developing nations with programs and infrastructure requirements completely different from Canada’s.
Even then, when weighted averages are used to compare the disparate economies, the 2009 marginal effective tax rate in Canada was 28 per cent, slightly lower than then 28.7 per cent average.
Krugman argues corporations and their army of lobbyists – a major influence in America’s dysfunctional political system – are pushing an agenda harmful to the country and some 98 per cent of its citizens. The same players and same agenda are at work here.
Summers create best childhood memories
As this paper makes its way to you, I’ll be enjoying the Canada Day weekend in Montreal. At this very moment, I might be sitting in the yard belonging to my longtime neighbours, taking in the view of the home where I spent my entire childhood. I’ll certainly be enjoying in the sights of that suburban neighbourhood, visiting with old friends, summer easily being the most nostalgic time.
I won’t have to go far to summon my childhood years. There are, of course, the neighbours’ homes: most of those people have moved away, but the houses remain. There’s the recreation facility – playgrounds, pools, sports fields, community centre – just across the road. A small park out back where the poplar trees still stand despite many purloined branches fashioned into makeshift bows and arrows – not really a great choice of wood, in retrospect. A path that runs right behind the house, perfect for kids on foot and bikes.
Nearby, there’s a natural area – now shrinking due to development – where we’d pick wild berries, eating them on the spot. The wetlands provided toads and tadpoles.
Walking through those areas will bring back the pace of very casual, unstructured summers. Something I’ve not enjoyed for many years. Something many kids don’t experience at all today.
With school out this week, you’ll probably see kids placed into structured programs, such as day camps and bible schools. All-day recreational activities abound. Let’s hope, however, that there remain plenty of opportunities for kids to be kids, to enjoy what summer vacation is all about.
It seems to me many adults have forgotten the simple joy of pure, unvarnished fun that comes with being a kid in summertime. Plenty of time to do whatever you want … or nothing at all.
I know I’ve lost touch with the simple pleasures. Summer seems to slip by in an instant. As winter drags on, I can’t wait for the hot stuff to arrive. The next thing you know, it’s Labour Day, with all the downside that entails.
I love the heat of midsummer, but in some ways I dread its arrival. A warm May – not in the cards this year – elevates the spirits. June signals summer’s arrival. For some reason, however, I experience a twinge of regret when the calendar flips to July, as it did this week. July is great, but it leads to August.
And we know what comes next.
Undoubtedly, there’s some kind of psychological issue associated with anticipating the end of something even as it’s just getting underway.
Such thoughts never occurred to me when I was a kid. Time was different then. Not so fast. And each day was to be enjoyed, not filled with obligations. The weeks didn’t streak by as they do now.
When you’re a kid out having fun, the day can fly by. But the summer lasts forever. As adults, the day can drag on, particularly those hours between 9 a.m. and 5 p.m. But the weeks and months are here and then gone.
As a kid, your summers are environmentally friendly and good for you, body and spirit.
Think about it, summers – at least as I knew them – were spent being active outdoors. At that time, we were literarily in touch with the earth – and we had the grass stains on our knees to prove it.
Lest I be accused of falling into the things-were-much-better-when-I-was-a-kid trap, I’m not alone in my assessment. There’s a bit of a movement to let kids be kids, to break out of the over-protective mode – see this week’s piece on the parking issues at John Mahood PS – and to stop micromanaging children’s lives.
Groups such as Free-Range Kids in New York come to mind.
Scottish-born Canadian writer Carl Honoré chronicles the worldwide phenomenon of childhood micromanagement in his book “Under Pressure: Rescuing Our Children from the Culture of Hyper-Parenting,” in which he suggests we need to slow down, allowing kids to do their own thing.
“Childhood is always evolving and it has always been defined by adults. But we seem to have reached a point now where childhood is being warped more than ever before by adult fantasies and fears, anxieties and agendas. Every aspect of childhood – education, safety, discipline, sports, play, etc – is now set up to suit grown-ups rather than children. We are living in a culture that tells us that childhood is too precious to be left to children and children are too precious to be left alone,” he writes.
As children, my friends and I were usually left to our own devices, and we managed to do just fine, please and thank you. That’s not to say there’s no room for structure from time to time – if that’s what the kids want.
For the most part, there’s nothing wrong with letting them find their own ways: it will probably lead to the best memories when they get old enough to be nostalgic about their childhood.
Blue W program takes aim at bottled water
Local municipalities want you to drink more tap water. Well, they’d rather you use less of the stuff – sort of, because conservation, while a nice goal, reduces revenues, and bringing in money is an even nicer goal for most politicians. Anyway, they’d rather you drink from the tap than use bottled water, which creates environmental issues above and beyond all those empty, single-use containers. On the other hand, there’s money to be made producing and selling bottled water …
Convoluted? Certainly. As are the reasons we need governments to tell us to drink our tap water, something we’ve long taken for granted.
Waterloo Region’s latest foray into getting us off the bottle is membership in the Blue W program, a tap-water refilling network that identifies local businesses and public facilities that will refill your reusable bottle with tap water free of charge.
Participating locations will sport a Blue W sign. You can also visit bluew.org and use the online mapping tool (supports computer and smart phones) to find locations.
Our love of bottled water is undoubtedly behind this move and other public relations campaigns such as the Municipal Tap Water Providers group (www.waterontap.ca). Municipalities have been debated banning the bottled stuff, typically removing that choice from government facilities as a symbolic gesture.
Officials assure us our drinking water is safe, tested far more often and rigourously than the bottled variety. In fact, much of what we buy is simply municipal tap water that’s been filtered, bottled and sold for thousands of times what the company paid the municipality.
Does bottled water taste better than what comes out of the tap? Usually. The stuff coming out of the taps in Waterloo Region varies in taste, typically less-than-stellar. My solution is to filter the stuff used for drinking. A reusable bottle is handy if I need to take it with me, which, really, isn’t as often as many people seem to think is warranted.
That same reusable water will come in handy at the sign of the Blue W, says Eric Hodgins, the region’s manager of hydrogeology and source water. The program is just in its infancy here, and he recognizes it will take time to wean us from our bottled water.
“This is a social change that has to occur over many years,” he says, noting the initial focus is lining up a network of locations where water is available. He sees restaurants and municipal buildings as the logical first steps.
“This is a multi-year initiative. We have to go out and start making businesses aware of it.”
Enough businesses have to get onboard or the program won’t work, he adds. The region has committed $20,000 to the program to assist with the construction of the network.
The goal is to make obtaining tap water easy and convenient, taking away one of bottled water’s selling points, though Hodgins acknowledges that’s just one of the issues at play.
Despite the assurances tap water is just fine, we’re not convinced. There are the taste, smell and appearance issues: our senses are in conflict with the official party line.
This relates to the hodgepodge of chemicals in our water. Miniscule amounts, to be sure – levels the government says are safe. Unfortunately, experience tells us that today’s assurances become tomorrow’s apologies: from food additives to asbestos, we’ve seen further studies reveal what was previously “safe” become unhealthy or even carcinogenic.
Of course, tap water is often held to a higher standard than the bottled variety. Because it’s a straightforward and pure product, we’re able to better monitor the quality of what comes out of our taps, unlike packaged water.
While there are minute traces of contaminants such as heavy metals in our water, the allowable levels really aren’t a health risk, experts suggest. For instance, you would need to drink a million glasses of water to equal the mercury in one serving of fish.
That doesn’t mean we should get complacent. There are emerging concerns about the impact of chemicals associated with our use of pharmaceuticals and personal-care products. For example, large amounts of estrogen associated with birth control pills have ended up in the environment, leading to the discovery of male fish with ovaries.
Ideally, we would start cutting back on the use of these chemicals – use natural cleaners and cosmetics, for instance – while working on new technology to treat our waste, she suggests, though warning against counting too much on technological fixes in order to avoid changing our lifestyles.
In Waterloo Region, we treat 170 million litres of wastewater each day; it’s easy to see how quickly small amounts of toxins can add up as they’re released into the environment.
As for issues of taste, odour and clarity, that can vary from day to day and from location to location – and with individual preferences – as the region has some 120 different supply wells, says Hodgins. But every drop has the same standards applied to it.
For cost and a host of environmental reasons, tap water is the choice. With the Blue W program, the region hopes to add convenience to the list of upsides.
Government policies attack the middle class
When it comes to finances, do you feel like you’re treading water? You’re not alone.
A growing number of Canadians are feeling the economic crunch, with household debt reaching an all-time high of $1.5 trillion, according to a report releases this week by the Certified General Accountants Association of Canada.
Fueled by more than our consumer society’s lust for trinkets, the debt load is increasingly tied to everyday purchases as we try to deal with our sinking standard of living.
“The report confirms that more than half of indebted Canadians are borrowing just to afford day-to-day living expenses like food, housing and transportation,” says Anthony Ariganello, president and CEO of the association. “For these individuals, there is little hope for improved financial condition.”
The survey-based report reveals several alarming trends, as single-parent families, retired Canadians, and those with annual household income of less than $50,000 face a bleak financial situation.
This is no accident, however, as the middle class has been under assault for more than three decades.
Studies in Canada and the U.S. show parents today are increasingly convinced their children will be less well off than they were. The figures back up that sentiment, as the great prosperity that flowed out of the postwar years in particular succumbs to constant attack.
The majority of us have seen real incomes decline. Studies show the gap between rich and poor is growing, even during the best of economic conditions. The trend that started in earnest 30 years ago has been exacerbated by the recession.
Canada’s richest one per cent are taking more of the gains from economic growth than ever before in recorded history, says the report by the Canadian Centre for Policy Alternatives (CCPA).
“The Rise of Canada’s Richest 1%” looks at income trends over the past 90 years and reveals the 246,000 privileged few who rank among the country’s richest one per cent took almost a third (32 per cent) of all growth in incomes between 1997 and 2007.
“That’s a bigger piece of the action than any other generation of rich Canadians has taken,” says Armine Yalnizyan, CCPA senior economist and the report’s author.
“The last time Canada’s elite held so much of the nation’s income in their hands was in the 1920s. Even then, their incomes didn’t soar as fast as they are today. It’s a first in Canadian history and it underscores a dramatic reversal of long-term trends.”
Among the report’s findings: from the beginning of the Second World War to 1977, the income share of the richest one per cent dropped from 14 per cent to 7.7 per cent; by 2007 they’d made a comeback, as the richest one per cent held 13.8 per cent of incomes; since the late 1970s, the richest one per cent has almost doubled its share of total income; the richest 0.1 per cent has almost tripled its share of total income; and the richest 0.01 per cent has more than quintupled its share of income.
The average earnings of the richest 10 per cent of Canada’s families raising children were 82 times that earned by the poorest 10 per cent of families. That is approaching triple the ratio of 1976, when the ratio was around 31 times. The after-tax income gap has never been this high in at least 30 years, and it has been growing faster than ever since the late 1990s.
Essentially, we’re spending more time at work, but 80 per cent of us are getting a smaller share of Canada’s economy, in good times and in bad. Only the richest 20 per cent are experiencing gains, and most of those gains are concentrated in the top 10 per cent.
That richest 10 per cent of Canadian families are getting richer. They enjoyed a 30-per-cent earnings increase compared to a generation ago, the only group to experience such gains.
This is creating a new phenomenon in income distribution in Canada: the rich are breaking away from the rest of society, in a way not seen since such information began to be collected 35 years ago.
You can expect that trend to continue in earnest, aided by the recession. The wealthy are already recovering nicely, thank you very much, as the financial sector resumes business as usual, as seen by the large increase in the derivatives market – aka speculation. Instead of regulating the industry, eliminating some of the most egregious practices, governments in effect handed a blank cheque to those who caused the meltdown.
Now, it will be the average Canadian – those on the hook for the guarantees and loans – who will cover the costs directly through their taxes and loss of services, and indirectly through the coming decreases in our standard of living.
As with drops in corporate taxes and shifts to consumer taxes, the goal is to shift the burden to you. This will continue transferring wealth to those already making the biggest gains while contributing to the debt loads of middle-class Canadians trying to maintain their position as real incomes – both pre- and after-tax – continue to fall.
Governments of all stripes have been pushing the same agenda, though watch for it to accelerate over the next four years courtesy of the government in Ottawa.
Losing respect long before Senate stunt
Those who oppose the Harper government – a sizable and growing contingency – have adopted Brigette DePape as their new poster girl.
DePape is the 21-year-old former Senate Page who held up an octagonal sign bearing the message “Stop Harper!” during the June 3 Throne Speech. She managed to do so for about 20 seconds before being escorted from the chamber and subsequently sacked.
Those who miss the point decry the move as disrespectful. Some of the law-and-order types – the ones gunning to spend tens of billions to house the perpetrators of unreported crimes – tried to spin the story as a security breach. But most of us saw it for what it was: a young woman with the guts to make a statement in the midst of the powerful and privileged.
She exercised her democratic right to express her opinion, paying a price for her act of civil disobedience.
Her statement falls well short of the kind of thing we’re seeing in the Middle East and North Africa, where people have been putting their lives on the line to end the rule of oppressive regimes. We’re not in that kind of state here, though successive governments have adopted policies that are lowering the standard of living for middle-class Canadians while restricting our freedoms. That’s something worth protesting, and many more of us will need to do so to prevent further sliding.
To be sure, we’re democratic on the surface. And we don’t live under the kind of oppressive, dictatorial regimes seen in the Middle East, though the West is much to blame for the state of those nations. But our democratic freedoms are always imperiled by our own complacency, allowing power-hungry politicians and greedy corporations to wield increasingly more influence over our system of government.
It’s no wonder we’re losing respect for institutions such as government, big business, the legal system and, truth be told, the media.
Fewer than 40 per cent of Canadians trust the legal system, for instance. That number drops below 30 for business and union leaders, as well as the media. It’s lower still for government, with trust for politicians typically hovering in the 10 per cent range, pretty much at the bottom of the list.
In the 1960s, 80 percent of Canadians trusted governments to ‘do the right thing’. These days, the level of support has fallen to less than 30 per cent, according to research by University of Ottawa Professor David Zussman, who holds the Jarislowsky chair on management in the public sector.
Most Canadians distrust government and big business and their cynicism towards politicians is increasing, he found in a widely-published study from 2005. According to his research, trust in government has plummeted from a high of 58 per cent of Canadians in the late 1960s to only 27 per cent in 2005 who state that they trust government always/most of the time.
People in “help positions” are viewed as having high ethical standards compared to those in politics and big business. Some 78 per cent of Canadians rate NGO volunteers as having high ethical standards, followed closely by doctors and scientists. Forty-five per cent rate civil servants as having high ethical standards, whereas only 25 per cent say that of big business executives and a mere 21 per cent say that of politicians.
There’s something intrinsically Canadian about deferral to authority. We’ve long assumed government, business and other institutions are doing what they’re supposed to do. Add to that an increasing sense of disconnectedness and shrinking sense of community and you have a recipe for a world in which few in power are looking out for your best interests.
Instead, they’re looking out for themselves, and their wallets. That much is clear in figures released last month by Berlin-based Transparency International, which looks at a broad range of corruption issues, ranking countries accordingly. For 2010, Canada comes in at number six, behind Denmark, New Zealand and Singapore in the top three, and Finland and Sweden as four and five. For comparison purposes, Germany was 16th, the UK number 20, the U.S. 23rd and France rounding out the top 25.
The 2010 rankings show nearly three quarters of the 178 countries in the index score below five, on a scale from 0 (perceived to be highly corrupt) to 10 (perceived to have low levels of corruption), indicating a serious corruption problem. The corruption involves all facets of the society, including government and business.
Although scoring relatively well, Canada was cited for weak legislation and poor enforcement in matters of corruption, falling in that regard over the past few years. Much talk about the law-and-order agenda, but little action on what would have an impact on corporate interests.
For the government to speak of Brigette DePape as disrespectful is more than a little disingenuous. I’d wager more Canadians have respect for her actions than for the politicians questioning her stance.
Debate based on Ponzi-scheme economics
In rejecting a referendum on public transit, Waterloo Region councillors have set the stage for a fateful vote June 15. Some of them will undoubtedly support the light rail scheme floated by planners. In doing so, they are simply contributing to the degradation of the environment and quality of life.
That’s because all the arguments made in favour of the LRT are predicated on the most harmful of human constructs: growth.
Nowhere in the plans of regional government – or any other government, for that matter – is there an argument for curtailing growth. Instead, we have policies that favour an ever-increasing number of people flowing into the region (and the province and the country). The transit scheme itself requires a huge influx just to meet the optimistic – but still low – ridership numbers and to justify the spending of massive amounts of money.
In building an LRT system, there’s no going back – well, not without a quick acknowledgement of failure, an uncommon event even without the kind of monetary and civil penalties that should accompany failures by politicians and bureaucrats.
While proponents of the LRT – and a host of other planning decisions – pat themselves on the back for being forward thinkers, what we really have is the local offshoot of the giant Ponzi scheme that is our economy and the fallacy of perpetual growth. Much of the thinking stems from population growth in general and immigration policies in the West specifically, which fuel the growth mantra. But what we’re doing is unsustainable, as experts as diverse as Dr. Joseph Chamie, who worked for the UN in the field of population for 25 years; economists Herman Daly and Joseph Stiglitz and physicist Joe Romm have argued for years.
Chamie, director of research at the New York-based Center for Migration Studies, calls our population-based growth fixation “Ponzi demography.”
“While more visible in industrialized economies, particularly in Australia, Canada and the United States, Ponzi demography also operates in developing countries. The underlying strategy of Ponzi demography is to privatize the profits and socialize the costs incurred from increased population growth,” he writes in a recent article.
“According to Ponzi demography, population growth – through natural increase and immigration – means more people leading to increased demands for goods and services, more material consumption, more borrowing, more on credit and of course more profits. Everything seems fantastic for a while – but like all Ponzi schemes, Ponzi demography is unsustainable.”
He recommends population stabilization, an end to the growth mentality. It’s akin to Daly’s call for a steady-state economy.
A former World Bank economist, Daly knows firsthand the failings of traditional economic thinking. At its root, the currently-accepted viewpoint sees growth as something infinite on a finite planet. That’s just not possible, especially when we’re using up the planet’s stored capital of resources at a breakneck pace, polluting our environment every step of the way.
In a report for the UK’s Sustainable Development Commission, he outlines a new way of economic thinking, one that moves away from a growth pattern that can’t go on indefinitely. And one that separates good economic activity from undesirable activity, something not done in traditional use of gross domestic product (GDP) figures, which give equal weight to the financial impact of a new lifesaving technology and the costs associated with a natural disaster. Both generate economic activity, but we would prefer much more of the former and less of the latter (though we’re likely to see more disasters, however, as climate change cashes in on the IOU we’ve been writing to the planet for the last two centuries).
“We have lived for 200 years in a growth economy. That makes it hard to imagine what a steady-state economy (SSE) would be like, even though for most of our history mankind has lived in an economy in which annual growth was negligible. Some think a SSE would mean freezing in the dark under communist tyranny. Some say that huge improvements in technology (energy efficiency, recycling) are so easy that it will make the adjustment both profitable and fun,” Daly writes.
“Regardless of whether it will be hard or easy we have to attempt a SSE because we cannot continue growing, and in fact so-called ‘economic’ growth already has become uneconomic. The growth economy is failing. In other words, the quantitative expansion of the economic subsystem increases environmental and social costs faster than production benefits, making us poorer not richer, at least in high consumption countries.”
This last bit is in keeping with what municipalities here have been experiencing for a number of years: growth costs more than it contributes to the local economy. The expansion of hard services such as roads, water and sewers and schools and the resultant maintenance costs, coupled with social services, policing and fire protection outstrip the benefits of new development.
And that’s just in direct dollars, never mind the environmental and quality of life impacts, neither of which is beneficial.
You can bet, however, that such considerations won’t be on the table June 15.
We’re rarely treated like adults
It must be an election year: the province is talking about modernizing its liquor laws, treating Ontarians like adults.
Attorney General Chris Bentley this week said the government plans to loosen restrictions on how alcohol is sold and consumed at festival and other special occasions. Specifically, the goal is to remove the need for beer tents at events and festivals so people can walk around freely with drinks; extend the hours that alcohol can be served at special events, such as weddings or charity fundraisers, to 2 a.m. from 1 a.m., to be consistent with licensed establishments; and allow people to circulate in retail booth areas of festivals with beverages.
Can that other election favourite – the sale of beer and wine in convenience stores – be far behind?
Certainly there are those who would like to see power wrested from The Beer Store, which holds a virtual monopoly on the sale of beer. Proponents of corner store sales say greater convenience and lower prices would flow from competition. Currently the distribution and retail systems are owned by the three largest brewers, Labatt, Molson and Sleeman. Once Canadian companies, the three are now foreign-owned: InBevSA of Belgium, U.S.-based Molson Coors Brewing and Japan’s Sapporo respectively.
If beer was sold in grocery and convenience stores, it would benefit smaller breweries, which are now dependent on a retail channel owned and controlled by their much larger competitors.
The sale of beer and wine in corner stores is a political hot potato. Under previous Conservative governments, the Liberals suggested the change, with the Tories opposed. In power, the Liberals shunned the idea.
We now have a situation where Conservative leader Tim Hudak – who’s mused about the return of the buck-a-beer option – has suggested changing the rules, while Premier Dalton McGuinty maintains it’s steady as she goes.
Supporters of the status quo usually point to the prospects of minors buying beer, believing it’s easier to police The Beer Store than thousands of smaller outlets.
While monitoring is easier with some 450 beer stores versus an estimated 10,000 convenience stores, we don’t know that the changes would lead to rampant abuse. Having grown up in Montreal, where beer and wine are available in every dépanneur, I certainly saw no evidence of that; underage drinking goes on everywhere.
In Quebec, convenience is certainly a factor. You can nip down to the corner and grab some wine for dinner, albeit not the selection you’d find at the liquor store, the friendly-sounding Société des alcools du Québec (SAQ), as opposed to the Liquor Control Board of Ontario.
Critics take aim at the convenience factor, claiming it would increase the amount of drinking.
Again, the numbers don’t bear out that argument.
It certainly doesn’t take much extra planning to stop by a beer or liquor store, and hours have been extended due to public demand; the convenience angle is overplayed. From an environmental standpoint, however, there is an upside to being able to walk to the corner store to pick something up rather than having to climb in your car to do so. Especially advantageous for all concerned if you’re going for a refill.
The best arguments in favour of beer and wine in supermarkets and convenience stores are economic.
Unlike the LCBO, which is owned by the province and looks after so-called hard liquor, The Beer Store is a near-monopoly in private hands. And, due to mergers and buyouts, control is now offshore. Allowing craft breweries and wineries direct access to a new retail channel that excludes the big players who control Brewers Retail Inc (BRI).
Originally a co-operative formed in 1927 to warehouse and distribute the beer produced by hundreds of brewers, BRI now represents two major shareholders – Labatt and Molson – and a minor one, Sleeman. In 2005, a provincial study showed the company had become “essentially a private monopoly for the retailing of beer in Ontario.” The year prior, BRI had gross sales of $2.6 billion, accounting for 83.4 per cent of Ontario’s beer sales by volume.
Small breweries have argued for years they don’t get a fair shake at retail stores owned by the big players. Perhaps changing the rules to allow the craft brewers access to corner stores would increase their profile, and their profits. Such sales would also be a boon to the retailers, especially the mom-and-pop shops that struggle with retaining business – even more so with new restrictions on tobacco sales.
Such changes seem like a no-brainer. For the government, however, there is risk in change, especially when it has anything to do with anything resembling moral implications – even after all these years, the ghost of prohibition still haunts us.
The government sees little upside to making the sale of beer and wine an issue. Under the current system, we can indeed get our hands on our beverage of choice, albeit at the high prices mandated by the province and the near-monopoly it has allowed to develop.
Perhaps this summer we can console ourselves with a beverage free from the confines of a festival beer tent.
