BC FORUM News - From The Advocate, Winter 2020
Building the Canada we want
We must build a fairer, more equitable society
With the world in the throes of the worst economic shock since the Great Depression and a raging global pandemic, even conservative commentators are calling for new solutions.
The deficit hawks are increasingly isolated in their calls for belt tightening, an approach that would spell disaster for millions of people.
“As western leaders learnt in the Great Depression, and after the second world war, to demand collective sacrifice you must offer a social contract that benefits everyone,” says an editorial in the conservative Financial Times.
“Radical reforms – reversing the prevailing policy direction of the last four decades – will need to be put on the table.
“Governments will have to accept a more active role in the economy. They must see public services as investments rather than liabilities, and look for ways to make labour markets less insecure,” said the Times.
A new report from the Broadbent Institute notes that before the pandemic, the world was just starting to come to terms with the extent of change that would be needed to avoid widespread ecosystem collapse due to climate change.
“Indeed, the pandemic has provided a sobering appraisal of the deep cracks in our systems, from education and health to employment standards and income supports,” says Paying for the recovery we want, prepared by a team of four economists and public policy veterans.
“We have been forced to face up to longstanding inequities and injustices that Indigenous people, women, Black people and other racialized groups have borne for years. They have suffered some of the worst impacts of the virus.”
The road ahead
Continued deficit spending will be a necessity for the foreseeable future, and with interest rates for federal spending near zero, it is also good fiscal policy,” says the report.
“Plenty of research has shown that bold investment now in core social supports such as health, education and housing will reap long-term economic and social rewards. So, too, will investing in a low-carbon economy.
“Such investment relies on a simple truth: preventing problems is usually less expensive than fixing them,” it says.
A massive transformation is required. It cannot be funded indefinitely through deficit spending, so significant new sources of revenue are needed.
“A well-balanced, well-designed, and fair tax system can support a society that is also well-balanced, smart and fair,” says the report. “Most Canadians endorse such an arrangement, but our current tax system misses the mark.”
The report says many decisions made by governments in Canada and other industrialized democracies have not delivered on their promised benefits, but have delivered great costs.
“Above all, since the 1980s we have managed to engineer an unprecedented transfer of wealth to a small minority that needed help the least while imposing austerity on the majority of the population. The result has been growing inequality and insecurity.
“We have also paid huge opportunity costs by giving away the net value of our natural resources for free.
“In some sense, these were two trillion dollar thefts from the majority of us to the rich, and from all Canadians as collective owners of our resources to a handful of mostly foreign private shareholders. To achieve what we need to achieve in these times, we will need to establish more balanced and sensible public revenue policies.” The full report, with specific measures to make taxes more fair, can be found at www.broadbentinstitute.ca.