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BC's regressive tax system

In 2007, CCPA-BC economist Marc Lee studied tax incidence in Canada and discovered that our tax system had become an inverted u-shape, with middle-income Canadians paying the highest proportion of their income in taxes and the richest Canadians paying the lowest proportion of their income in taxes.

Yesterday, CCPA-BC released an even more disturbing report – a study of tax incidence in BC reveals that the tax system in BC is downright regressive. Not only does the richest 20% of British Columbians pay the smallest proportion of their income in tax, but the poor pay the highest! This shift has taken place over the last decade as the province has cut income taxes (which are still modestly progressive) and increasingly relied on regressive sales taxes. Read more about BC's regressive tax system

Chandra's picture

How tough on crime squeezes the budget

In this week’s web feature, I highlight the increased spending on prisons, noting that in terms of effectiveness, we’d be better off investing in cheaper approaches such as crime prevention and restorative justice. In choosing to put more people in prison for longer periods, Canada is emulating our neighbour to the south, which has the highest rate of incarceration in the world. But just as we are moving in this direction, some US states are starting to back away from it. Their primary motivation? They just can’t afford to be “tough on crime” any longer.

One in 100 adults in the US is now in county jail, state or federal prison, compared to 1 in 400 in the 1970s. This incarceration boom had a significant impact on prison budgets – according to a study by the Pew Center on the States, 1 in every 15 state dollars is now going to corrections. In 1987, the 50 states spent $10.6 billion of their general funds on corrections; but 2007, they were spending $44 billion, an increase of 127% when adjusted for inflation.

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Investing in childcare pays dividends

When I was expecting my daughter, I was asked on more than one occasion if I had put my name on a list for childcare yet. Here in Ottawa, the waiting lists for some childcare centres can be more than a year – requiring parents who need childcare to signup before their child is even born. Parents who can’t afford the fees (which for young children can outstrip university tuition!) can wait even longer for a subsidized childcare space.

Meanwhile, just across the river in Gatineau, all parents have access to $7 a day childcare. Approximately 50% of children under 5 receive this care, which can take place in many different settings from home-based care to a regulated daycare centre. While other Canadians gaze jealously in the direction of Quebec, the argument is often made that a government-funded childcare program is expensive and unwieldy and doesn’t facilitate “true choice.” Read more about Investing in childcare pays dividends

Chandra's picture

Drummond on corporate tax rates: What difference do a few points make?

Don Drummond had a bit of a strange op-ed in the Toronto Star on Sunday. On the one hand, he acknowledged the debate over the option of corporate tax cuts and called for the impact of cuts to be monitored so that we know whether or not they are actually delivering on their goals. On the other, he reviewed and dismissed all of the arguments against corporate tax cuts as negligible. Read more about Drummond on corporate tax rates: What difference do a few points make?

Chandra's picture

Chandra is reading... Empire of Illusion

My mother-in-law passed me Empire of Illusion by Chris Hedges, saying “You just have to read this one.” The next day, before I had even had the chance to crack the covers, Bob Goudzwaard referenced the book twice in his AGM speech, calling it “a most excellent little book.” With two such ringing endorsements, I could hardly put off reading the book. And having done so, I would echo Bob Goudzwaard: it is indeed a most excellent book.

Empire of Illusion is a stinging indictment of our celebrity-obsessed, narcissistic culture that has lost sight of how the values we preach have been perverted and replaced with consumerism, corporatism and militarism. Hedges laments the state of democracy, the power of corporations and the wealthy, the growing class divide, the unwillingness or inability of our elites to stop the slide, and the illiteracy and obsession with illusion over reality that prevent most of us from identifying the problems. Read more about Chandra is reading... Empire of Illusion

Chandra's picture

Tough on poverty, tough on crime?

Earlier this year, Senator Hugh Segal published a great op-ed in the Toronto Star calling for those concerned about crime to get tough on poverty. “Less than 10 per cent of Canadians live beneath the poverty line but almost 100 per cent of our prison inmates come from that 10 per cent. There is no political ideology, on the right or left, that would make the case that people living in poverty belong in jail,” the Senator argued. “To be tough on crime means we must first be tough on the causes of poverty,” he concludes.

Segal argues for a Guaranteed Annual Income, also known as a Guaranteed Livable Income, noting that it would take only $12,000-$20,000 annually to bring a person above the poverty line but we spend $147,000 a year per federal prisoner. Read more about Tough on poverty, tough on crime?

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French presidential candidate proposes citizen's income

The Basic Income Earth Network Newsflash arrived in my mailbox this morning, and I was surprised to learn that one of the candidates pursuing the French presidency in the 2012 election is basing his campaign on a citizen’s income, also known as a Guaranteed Livable Income. And not just any candidate: former prime minister Dominique de Villepin, best known for his opposition to the Iraq war as France’s Foreign Minister in 2003.

I went to school in France for a year and a half and witnessed a historic presidential campaign up close, and I have retained a fascination with French politics ever since. The French political system is quite different than the Canadian system, with an elected President who selects the Prime Minister who may or may not be elected him/herself. Read more about French presidential candidate proposes citizen's income

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"False majority?" Thinking seriously about electoral reform

With the Conservatives winning a majority government by virtue of 6,102 votes and only 39.6% of votes cast, talk of electoral reform is surfacing once again. In fact, rallies were held across the country on May 14 calling for electoral reform and some form of proportional representation in Canada.

Meanwhile, a referendum in the United Kingdom – a key component of the coalition agreement between the Conservatives and the Liberal-Democrats – saw Alternative Vote go down to defeat on May 5 with 68% of voters opting in favour of first-past-the-post (FPTP).

Chandra's picture

Trickle down's complete and utter failure

The OECD released a report last week highlighting the rapid growth of inequality in Canada and other rich OECD countries. The report covers the period from the mid-1980s to the late 2000s, meaning that this rapid growth of inequality took place during a period of strong economic growth. In other words, trickle down is a complete and utter failure – it’s led to the rich getting richer, not to a rising tide that lifted all boats.

The OECD report offers several reasons for the rapid growth of inequality. Not surprisingly, distribution of salaries and wages is primarily responsible (that’s not hard to figure out when the best paid CEOs make 155 times more than the average worker). This also reflects the growing trend of precarious labour, in which nearly one-third of jobs are low paid, part-time or temporary, offering few or no benefits, and provide no job security. The OECD report identifies globalization as a driver of change in employment structure impacting wages. Read more about Trickle down's complete and utter failure

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Fighting poverty = good social benefits

The Globe and Mail has an excellent article today looking at the costs of poverty and the social and economic benefits of fighting poverty and income inequality, "How paying people's way out of poverty can help us all." In particular, the authors look at the issue of widening inequality and the political unrest it can cause, concluding "Despite Canada’s reputation for a strong social safety net, the country is becoming economically polari Read more about Fighting poverty = good social benefits

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