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Bow Down Canadians, Corporations Are King
Harper's creed: 'Ask not what your economy can do for you, ask what you can do for your economy.'
Cartoon by Greg Perry.
Two recent stories out of Ottawa underline the ongoing political and economic assault on ordinary Canadians. More Canadians are now working for low wages than at any time in decades, continuing a trend that began in the early 1990s, and Stephen Harper has announced major changes to retirement benefits -- including delaying Old Age Security (OAS) eligibility to age 67. What kind of society beggars those of its citizens who worked all their lives and now want to retire in dignity while privileging the rich and super-rich by slashing their income taxes and allowing them to transfer wealth to their children untouched?
Since the mid-1980s, and accelerating with the signing of the Canada-U.S. "free trade" deal, the guiding principle of neo-liberalism seems to have been "Ask not what your economy can do for you, ask what you can do for your economy." This reframing of the relationship between the economy, society and democracy has been largely successful, with most Canadians accepting this personification of the economy and willing to adjust their lives to accommodate it. The economy is now defined as the narrow interests of global corporations. The old notion that economy should serve the national interest and that of workers and their communities now seems almost quaint.
But the results of this remaking of the world of work are increasingly disastrous for working people and the economy, even using capitalism's own measures. Capitalism has to grow just to survive and the fact that the biggest firms in Canada are sitting on up to half a trillion dollars of cash that they cannot or will not invest does not bode well for growth. Ultimately that's a good thing as the obsession with growth is at the root of climate change and the rapid depletion of resources. But until we have governments which recognize this, we are all trapped in a growth paradigm and suffer when it fails.
Yet there is precious little recognition that deregulation and the endless promotion of the interests of capital are at the root of the problem. The half trillion in unusable capital represents part of the distortion of the economy caused by policies of labour flexibility and the suppression of wages and salaries. That much and more has no doubt been accumulated by the wealthy, as their share of annual income continues to grow -- from seven per cent in the 1970s to close to 15 per cent today (just above the level of 1929). Like the cash-bloated corporations, the wealthy will only spend so much. The rest they squirrel away in stocks and bonds.
Hastening the divide
This inequality train is picking up speed, according to the OECD, which in a recent study pointed out not only that the wage gap here is at a record high (and well above the 34 country OECD average), but acknowledged its impact on stable economic recovery. Nations with high levels of income inequality experience shorter, less sustained periods of economic growth.
But neo-liberal ideology is immune to rational analysis and mere facts. There is no interest shown by governments or corporations in the question of inequality. The federal government is set to fire some 30,000 federal public employees (How many will end up "self-employed?"), and Caterpillar Inc. feels completely at ease demanding an almost 60 per cent roll-back in wages and benefits at its Electromotive plant in London.
So having succeeded in giving capitalists everything they asked for (and some things they didn't ask for), what do we have? Keep in mind that the object of consumer capitalism is to sell stuff. It seems that the captains of industry have forgotten this. But while the advertising and marketing of more and more stuff goes on apace, the facts facing working and middle class families paint a totally unsustainable spending picture.
Some 60 per cent of wage and salary earners state that they are one paycheque away from financial insolvency.
The Canadian savings rate is the lowest it's been for decades.
The debt to income level is the highest it's ever been, as people try to maintain their standards of living through borrowing.
The net real increase in average pay between 1980 and 2005 was a grand total of $51.
'Social wage' slashed
And, of course, the criminal greed of the financial industry is still threatening the world economy. Its aftermath here has resulted in Canadian un- and underemployment, which averaged 10.6 per cent in 2011, and for youth aged 15-24 a brutal 19.7 per cent.
But it is not just private sector income that has declined. The social wage -- public services provided by our taxes -- has also been dropping thanks to labour flexibility policies and spending cutbacks. Cuts to EI eligibility and social assistance were made in the mid-1990s on the unsupported assumption that they provided a disincentive for workers to work. By 2005, a quarter of Canadian workers were putting in 50 hour weeks, often for no extra pay. Again, these measures enhanced the corporate bottom line and filled corporate coffers -- with the money they now can't invest because there is no new demand.
The rationale for these policies in the 1990s was to enhance Canada's competitiveness in its trading relationship with the U.S. Indeed, Paul Martin made it clear that pushing international trade was the country's only economic development strategy. But when the country you want to export to is pursuing the same policies of driving incomes down, exports decline just as domestic consumer spending does.
What is needed
There is a solution to this ideological insanity, but don't hold your breath for any Canadian government, federal or provincial, to implement it any time soon. If private capital refuses to invest because its policy preferences have snuffed out demand, then governments must do two things. First, they must reverse labour flexibility policies and return the social safety net to, at least, its previous state. This goes beyond providing dignity for ordinary Canadians. For tens of thousands of small and medium businesses, it actually means more money being spent in their stores.
Secondly, if the private sector refuses to invest the money it has accumulated (with the help of government policies), then this is the time to massively increase public investment. This cannot simply be temporary stimulus but a permanent policy shift back towards a coherent and creative -- and high wage -- industrial policy that directs the economy rather than assuming allocation of capital can only be done by the market. Public investment must also bring back some dignity to working people in the form of child care, home care, Pharmacare and accessible post-secondary education -- all measures that would also enhance the economy.
Public investment could also begin address the crisis of over-production by gradually exploring a long term de-growth strategy (including a different kind of growth) which addresses climate change and the rapid depletion of resources that scientists tell us is threatening the planet. Only by radically reducing the role of private capital can such an outcome even be imagined.
[Tags: Politics.] ![]()




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igbymac
16 weeks ago
We have political stalemate in Canada
Everything in Canada is designed to serve the interests of the Imperialists and its yes-men: the laws, the schooling, the media, the industrial base, its electoral system.
What we need is a war measures effort by the Federal government to reinstate Canadian sovereignty on all fronts without giving a damn for US hegemonic pursuits.
We first must openly declare ourselves to the world to be a nation of Peace.
We need to exit NAFTA, NATO, dismantle our standing military, and reclaim full control over our money supply. We need to entrench into law the Federal responsibility, which cannot be farmed out under any circumstance, to prudently control out money. Paying private institutions for the use of their money when our own nation can do it for free is absolutely criminal.
Our nation is rich in resources and poverty struck of leadership. We should be working on becoming a humanitarian super power -- we need to seek full employment through research and broad development in the renewable fields (which would break our link with oil), education, health, the arts, cleaning our environment, always striving for domestic value-added to our resource based industries, and pursue national self-sustaining farming practises.
On these fronts, we need to address the entire validity of corporate existence anywhere in the country.
Instead we seem to be doing everything but...
Our governance is a colossal joke. And no Party in Canada seems able to even identify the scope of our dilemma. Surely a progressive entity which could stand up and frankly and honestly proclaim a wholesale change of our national direction would be greeted as a liberator, no?
Is it simply too much to ask for a government to always have an eye on serving the security of the people at large (homes, employment, opportunity, a clean environment, healthcare) rather than the security of the nation (role of lick-spittle to the Empire's global hegemonic ambition) would be welcomed by most IF we had a clue about what was going on.
Fiat lux
16 weeks ago
People are usually shocked
People are usually shocked when I say that communism and capitalism are brother ideologies.
The alleged theories may sound different , to fool the suckers who follow them, but the leaderships are the same predators, as those who have used other religious and economic theories to usurp power and enslave others through history.
The communists collectivized the economy with the force of arms against people, while telling them that they never had it better.
The capitalists are using the perceived power of imaginary capital to collectivize, rob, steal and mass murder by starvation.
The mega corporations are not using their obscene hoardings to feed people, because they now have just about complete control of the world's resources, given to them by bought, pimp governments, with bank deregulations.
They know that the cash hoardings they have are only worthless computer figures, and it won't make any difference if they lose them, so they can now cause a major crash and depression
With their control over resources and economies, they can now force the world to beg for their total dictatorship, that began with the fraud of the "free trade" rackets and similar "wealth creating" criminal activities.
And we certainly have the politicians who are willing to serve them, as we always had them under every known religious and economic theories, from day one.
But all empires in history have self destructed, because they all went that fatal one step too far...........
So, where are the politicians and the so called "economists" with the understanding, and plans, to warn the world, how to pick up the pieces, and save lives with a new, cooperative system, based on physical laws and self sufficiency, not on harebrained theories ?
Ed Deak.
realisticman
16 weeks ago
Massive De-Growth. Your choice.
" ...this is the time to massively increase public investment. This cannot simply be temporary stimulus but a permanent policy shift back towards a coherent and creative -- and high wage -- industrial policy that directs the economy. ... Public investment could also begin address the crisis of over-production by gradually exploring a long term de-growth strategy."
kasi_visvanath
16 weeks ago
good luck
thanks Murray for that cogent and reasonable line of ideas re: the economy, and how the rich capitalists with their pals in government continue ever more oppressively to squeeze the working and middle classes out of even the small cash flow they have, and to provide little if anything in the way of jobs, other than cheap, minimum wage "service sector" jobs...
your argument is good. i agree entirely with it...however the chance that the current Conservative/Fascist Federal Government, and the current neo Liberal/Fascist government in B.C. are going to listen to those of us who have so little power and money is that of a snowball's chance in hell....absolutely ZIP...
these Fascists never let a fact stand in the way of their ideology....the ideology is everything...facts get in the way, and get ignored....if they do not support the Conservative/Fascist ideology...of BUSINESS FIRST at all costs.
kasi_visvanath
16 weeks ago
re: Fascism
if you wonder why i appended the word "Fascist" to the above Canadian Political parties, it is because i believe in calling a spade a spade....they are Fascists, and their actions prove it.
Okanagan Orchardist
16 weeks ago
To Ed and igbymac------
I’m in the process of reading a book in which you might be interested.
FROM MONDRAGON TO AMERICA –"Experiments in Community Economic Development," first written by Greg MacLeod in 1997 but now in its 3rd or 4th printing, describes a system of corporate co-operation that has been used by some of the Basque population in Spain for a number of years now and is proving amazingly successful. Amazing in its simplicity, the establishment of a corporate business structure utilizing the co-operation of all of its members, has not failed in its goals or business since it was begun in 1956. MONDRAGON is a complex of companies with over 30,000 members and over $6 billion in annual sales, and while other companies were laying people off or going bankrupt, it added over 8000 new jobs between 1996 and 2000. And this is the fascinating part, the total complex is owned by the workers AND the customers. Definitely not your ordinary Co-op, this “society” is responsible for its membership from the cradle to the grave and thereafter in the form of continuous pensions for spouses.
I had never heard of it before, and I suspect a lot of others have not. It is not communist, nor Marxist, or even Hutterite (althugh it has some similarities, but it is far more diversified). Totally unique!
Eduard Hiebert
16 weeks ago
Murray, are you preaching helplessness and inaction?
The picture Murray paints on how bad off we the 99% are is clear enough. However, to deplore and do no more as the rest of his column seems to suggest is not enough. And two sentences seem to capture all that Murray foresees regarding what is ahead of us. First, “until we have governments which recognize this (our obsession with growth), we are all trapped in a growth paradigm and suffer when it fails”. Secondly, “There is a solution to this ideological insanity, but don't hold your breath for any Canadian government, federal or provincial, to implement it any time soon.”
Approximately 25 minutes into the 2011 English leaders debate, Harper unmistakably offered Canadians a balanced approach forward with no need to choose between a list of dualities like between “employers and employees”! Harper’s record regarding the Post Office, Air Canada and Caterpillar are more than enough to show he lied to gain his “election”.
Fortunately, he actually only mislead a small proportion of Canadians. No one can say so differently and bases Elections Canada data make it stick. Less than 30% of all Canadians who voted, voted for the 167 Conservatives declared elected. That is, a mere 18.33% of Canada’s total electorate actually went to the polls and voted for the 167 Conservatives now standing in parliament as MPs.
Civil action like the community based Winnipeg strike are within our power. As a warm up to the next Federal election, both Alberta and BC provincial elections could serve as a people’s opportunity to occupy the election outcomes using the means already at our disposal as identified at www.vote123.ca.
To avoid google’s big brother arm you can review the site using www.pagewash.com as a filter and use https://startpage.com as your search engine thereby avoiding google’s snooping to see who is doing what.
Fiat lux
16 weeks ago
Okanagan.....Thanks for the
Okanagan.....Thanks for the suggestion. I've known about Mondragon for many years. We're self sufficient to a large degree, with the growing and making of things for ourselves, as we haven't trusted any ideology since the war. Cooperating with our friends and neighbours all the way.
Something will be done, not by us old people, but by the young, if they want to survive. And it has to be cooperative and not competitive, where the main purpose is to knock people down and the winner takes all. But they'll have to figure it out for themselves and not taking orders from us, or anybody.
As for r/m's usual "conservative" propaganda message about "de-growth"
The only growth we have today is in destruction and poverty. I was apprenticing in Vancouver in 1955-56, making .75 cents/hr. My wife was making about the same
in different jobs.
We rented 2 decent rooms, had good food on the table, ran a small car, had no debts and when we crossed to the States, all they were asking where we were going and then waved us trough.
I opened my first manufacturing shop with a $500. bankloan in Nov. 1957 and was employing a half dozen skilled tradesmen within weeks, all with decent wages. Bought our first house in Vancouver in 1966 for $500. down and $45/mo. Most of my guys owned homes.
That was before the present criminal gang, and theory, took over Canada and the world in the 70s and the destruction started by our "conservatives" and their economic priesthood. Now we have "free trade" and "growth" and a million in foodbank lines.
Is the present system fascistic? Damn right it is. I grew up under fascism and under the thumps of ruling elites, who may have called themselves nobility, or communists, and now can see the same handiwork under the present gang of nuts and crooks, who may, or may not know what they're doing, while destroying people and the Earth with their idiocies.
Ed Deak.
Eduard Hiebert
16 weeks ago
To igbymac
Under the Reichstag column you posted: "However, I would welcome the strict application of the rule of law".
To deplore and do no more is not enough. Through my earlier post you have the means at your dispossal to prepare yourself together with your neighbours and going forward with democratic certainty actually elect better candidates.
Luck
16 weeks ago
CANADIAN PEOPLE YOUR FUTURE
LETS FACE IT WE HAVE NOT SHOWN UP AT THE VOTING POLLS.
AND WE GET WHAT WE DESERVE THEN.
GET OUT AND VOTE NEXT ELECTION AND EVERY ELECTION AT ALL LEVELS OF GOV ACROSS OUR GREAT LAND.
SOME POLITICIANS THINK ONCE YOU ELECT THEM, YOU REPORT TO THEM? WELL,
IF WE DO NOT GET OFF OUR DUFFS IT IS GOING TO GET WORSE.
ENOUGH IS ENOUGH,
IF YOU DON'T SEE WHAT IS GOING ON, AND WANT TO CHANGE IT FOR THE BETTER, THEN YOU MAY AS WELL CURL UP AND DIE.
Name goes here
16 weeks ago
Low taxes destroy jobs
I remember reading once that a corporate tax rate that is too low actually destroys jobs. That’s because a higher tax rate encourages businesses (who don’t want to pay taxes) to keep the profits in the business and reinvest, rather than pull them out as profits and have to pay high taxes.
John Corman
16 weeks ago
What about the taxes Murray
Mr Dobbin is very selective with his economic data and likes to show concern for the middle class and its lack of an increase standard of living during the last couple of decades.
But, of course, he will never factor in the benefits of income tax decreases during that period. To Mr Dobbin, any tax decrease is the Devel incarnate.
Here's where the middle class has benefitted from Government initiatives over that same period.
If a middle class person in BC earns $70,000 in 2012 the fed/prov income taxes will be about $14,600. (only basic personal exemption claimed but more available in 2012)
Under the NDP of 1996, in 2012 dollars, the tax bill would have been $20,300.
Whether Mr Dobbin likes it or not that works out to be about a 14% increase in real wages.
That is a huge increase in disposal income and Mr Dobbin wants to take it away from these people and spend it as he deems appropriate.
John Corman
16 weeks ago
Mr/s Names goes here
You've been reading too many Murray Dobbin essays.
In 2011 the Scandinavian countries and the Manitoba NDP had lower corporate tax rates than BC.
I'd be surprised if their motive was to increase unemployment.
Think about it, seriously, if you're really interested.
Skywalker
16 weeks ago
Taxes shmaxes!
You also never include all the increases in fees that result from a phoney tax decrease. Talk about being selective on economic data.
Whenever we hear somebody mention that we need to cut services because of "ability to pay" there is never a discussion about who determined the ability to pay. We insist on lower taxes, lower royalties, exporting logs, exporting oil and exporting hydro power but can't seem to understand that wealth of the provinces if it is taken, should provide a sustainable economy for all. It is not just for the upper class.
Cynic
16 weeks ago
Nice one, Murray. As usual,
Nice one, Murray. As usual, your analysis is peppered with the money facts and figures that are well known and well worn to the point of tedium. And there's this: "there is precious little recognition that deregulation and the endless promotion of the interests of capital are at the root of the problem."
That's just one root. Another root is articles like this one that avoid (studiously?) any mention of the taproot, that money itself is loaned into existence by the private banks, principal only with no accomodation for the extra burden of interest, and thereby perpetuating elite rule and debt slavery for the people. There's a root for you.
So what is the purpose of this regurgitation of some facts that we already know so well yet omits the most crucial facts?
Wake Up
16 weeks ago
John Corman
I think income tax decreases are the only thing the BC nonLiberals can make a claim to fame for. Do people really buy that it made things better?
Instead of paying that $5000 income tax, I am paying $75 for my driver's license instead of $35, increased fees for birth certificates and all ministry paperwork, higher medical care plan fees, much higher CPP and EI monthly payments, A LOT of carbon taxes which go straight to general revenue in BC, my child gets fewer services in elementary school, WAY higher bus and skytrain fares, unbelievably high parking fees at hospital which any visitor or family member of a sick person will tell you is a tax grab, ... need I go on? Oh and what about this continued HST debacle which BCians democratically voted DOWN. We are still paying, over and over.
Who cares that the income tax is lower, when we are nickel and dimed at EVERY turn. Having it on one bill, income tax, is more predictable and expected AND PROBABLY LESS MONEY. Having it increase by stealth on everything is despicable.
Fiat lux
16 weeks ago
One of these days people, who
One of these days people, who knows even "conservatives", may wake up to the fact that costs can not be cut, only transferred on others, the environment and future generations.
E.g. The real costs of those "cheap" products from China we're flooded with are paid for by the millions of unemployed in North America, the tens of thousands businesses lost and closed, the loss of skills and lands, the drug wars in Mexico, the incredible waste of resources and pollution caused by the transports, topped up by the millionaires of the communist cadre bringing our money back to buy the country up from under our feet, preventing our young people to own homes etc. etc.
Called "wealth creating foreign investment" by our "conservatives" and brainwashed economists who have no accounting system to calculate losses and liabilities, because calculating the losses wouldn't be "economically efficient" and may cut into the phony GDP figures that account losses as "growth".
40-50 years ago people were earning $3, to 5,000/yr. owned homes, one breadwinner per family was enough. Executives making $25, to 50,000/yr. or about 10 times of their workers. Something even Plato advocated thousands of years ago.
Today, the same executive positions are paying 2-300 times of the ordinary wages, corporations are stealing obscene profits from the public's pockets, which is also a form of "taxation without representation", totally ignored by our politicians and "conservatives".
Everybody pays for everybody on the long run and down the line, because there's no such thing as the fraudulent claim the the "users pay".
Ed Deak.
Name goes here
16 weeks ago
something seems wrong when...
the only increase in income for the middle class comes from lowering their taxes. There is no increase in gross income, just net income. (And we probably don't even have lower taxes overall when all the small fees have increased to hide that shift in the taxes.)
Corporations may not say out loud that they want to increase the unemployment rate, but by insisting on lower taxes, that seems to be the result. It's all about maximizing profits isn't it? Satisfying the share holders?
Increasing productivity comes from lowering expenses while increasing profits, so fewer people doing the same work more people used to perform. It's been well documented that people now work longer hours, and often unpaid hours for the employee, but that extra work benefits the corporation. Fewer vacations taken, and no one takes the three week family vacation anymore. Now holidays are taken a couple of days at a time spread over the year. And it's all argued by the brainwashers (corporations) that it's good for the economy.
John Corman
16 weeks ago
People. Please Think About It.
Each of you that have responded has attempted to argue that increases in various government fees/taxes have offset the income tax decreases.
Keep in mind that the 14% increase in wages is in 2012 dollars. So when you say that the cost of a driver's license has increased during the last couple of decades you must also translate that increase into current dollars. Doing so reduces the real increase substantially. And, the real total of all of these government fees/taxes doesn't come close to 14% of your income.
The middle class in BC should be very pleased with the Prov/Fed governments over the last ten years and incredibly grateful that Mr Dobbin has not been in a position to enforce his poverty regime on them.
Fiat lux
16 weeks ago
In the 3 years I've spent in
In the 3 years I've spent in Austria after the war, all I could hear was how good they had it under Hitler and what a great guy he was.
In other words, there's never been a time when there was any point in arguing with the faithful, because faith conquers all.
Just as the Afghan family of the convicted daughter killers was outraged that they have been convicted, when it was their duty to do what they have done.
Anybody who claims that conditions are better now than they were 40-50 years ago, before the neoclassical market economic theory and the free trade fraud was forced on us, has serious mental problems.
Ed Deak.
John Corman
16 weeks ago
Those were the good ole days weren't they Ed?
Consider what has really changed in those 40-50 years. Wouldn't the single biggest difference between then and now be the massive size of the various levels of governments.
Fifty years ago this country had virtually no debt. The governments spent a relatively small portion of the nation's GDP.
Then came Trudeau.
So, the fact is I agree with you. There has been a significant deterioration in the quality of life in this country and it will likely continue on that path until we come to our senses and stop this idiotic reliance on governments to look after us.
Always think of Greece before you vote.
igbymac
16 weeks ago
John Corman
Nobody but the ideologue give a rats ass about the size of government. All people want is a government that works for the people, and puts the peoples' interests first.
John Corman
16 weeks ago
igbymac
That's a statement made by someone who hasn't given the concept even the slightest consideration.
Are you that simple that any government that states that their only concern is your well being and screw everything else then you're prepared to fall in love with them?
Eduard Hiebert
16 weeks ago
Right on igbymac!
Without quibbling on any word-smithing, right on igbymac!
Given your own admiration for the rule of law, I am curious, when does that work begin?