Taxes are a common good

Something is missing in the recent discussions on tax cuts and economic management occurring in light of a strong dollar and an economic downturn south of the border.

Canadians are overtaxed, we are told. Large budget surpluses in the past few years are evidence that we bear an unreasonable tax burden. If taxes aren’t cut, wealthy Canadians and their considerable resources will flee the country. If corporate taxes aren’t the lowest in the world, corporations will not choose Canada. The prime minister has even implied there is no such thing as a good tax.

But all of this rhetoric seems to be missing something crucial. Taxes don’t happen in a vacuum. They’re linked to government services – they provide the revenues that preserve our democratic institutions, that fund our public education and our public health care, that provide parks and public spaces, that maintain our roads, bridges and ports, that create crucial social infrastructure for our communities and for our families, that reduce inequalities and ensure that no one in our prosperous country is left behind. Without taxes, we could not create and maintain anything collectively.

I think I know why this is not mentioned in the debate on taxes. Imagine a politician saying that we have too much public health care. That we’re educating our children too well, and our youngest children should not have access to early childhood development and education. That our elderly citizens should be left to fend for themselves. That we have too many green spaces, too many roads, too many bridges, too much public transportation. That growing income inequality in Canada should be left unfettered. That a democratic parliament is too costly to maintain.

Many arguments in favour of tax cuts rely on economic growth and competitiveness. But in the Global Competitiveness Index of the World Economic Forum, Canada is ranked below a number of countries with significantly higher tax rates. Why haven’t taxes hurt their competitiveness?

The reality is that much of what passes as economic argument is really about underlying values. When we talk about abstract numbers, it’s easy to forget the real people, needs and services that are behind those numbers. But when we talk about taxes, we’re really talking about what kind of country we want.

Now I know there are disagreements about what the role of government should be in providing these goods and services. Certainly, the private sector and the voluntary sector have a role in many of these areas. But we should be able to have a public debate about what government’s role should be. After all, there are no timeless principles determining the role of government. Government is us, citizens, acting collectively. We have a right to decide what we do and do not want to do collectively.

In fact, there are many things that we could not do if we didn’t do them collectively. And there are many people who could not do much at all, if we didn’t do things collectively.

Despite common perceptions, it’s not just low income Canadians who benefit from taxes and public expenditures: we all benefit. Middle class and wealthy Canadians rely on public services and infrastructure for safety and protection against crime, fire protection, travel, clean water and much more. Corporations take advantage of a skilled workforce that has benefited from education, publicly funded research, government protection of intellectual property, regulation of the market and public health care. Wealthy Canadians might not like paying taxes; but then again, they might not like living in a country where they had to provide every one of these things for themselves either.

Taxes are part of our contribution to the common good. They are an investment in our shared prosperity, a prosperity that encompasses social and environmental flourishing, as well as economic vitality. This prosperity benefits us all, but it also reflects our shared responsibility toward one another.

If we don’t talk about this shared prosperity and responsibility, the exclusive emphasis on tax cuts could jeopardize the ability of government to pay for existing programs and to develop new policies to address significant challenges confronting Canadians – challenges like the possibility of a recession, the affordability of housing in many of Canada’s urban centres, access to early childhood development, the growing gap between high and low income Canadians, and even the competitiveness of Canada’s economy.

Many of these government programs and services will become even more important if we do have an economic recession. Collectively, we can support one another in a way that a few extra dollars in individual pockets from tax cuts could never do.

There’s also the issue of responsibility towards those who risk being left behind even when our economy is strong. What responsibility do we have to Canadians who are working full-time, but whose income doesn’t reach the poverty line? There are other groups, too, like newcomers to Canada who can’t get their foreign credentials recognized and must work two or three minimum wage jobs to support their families. And what about Canadians engaged in precarious employment who won’t have access to employment insurance if they lose their jobs? Living in a country of such financial prosperity, we should be compelled to determine our responsibility to these people being left behind.

These are the values that I wish we were talking about. What kind of country do we want to live in? What should our health care, education, and child care systems look like? What kind of infrastructure is essential to communities and to our economy? What level of support do we wish to ensure for our seniors? How do we assist newcomers to create a new home here? What kind of basic fairness do we want all Canadians to experience? What kind of environment do we pass on to our children? This is what’s missing when politicians and pundits talk about our economic future.