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Thursday, April 23, 2015

State-entitlement: a little less of the same, please









Let’s use a few examples to illustrate my point.

















What? The NDP plan benefits the rich? Shocking!




  1. I don't think the Liberals and NDP so much want a bigger state per se, but rather a large number of Canadians unfortunately feel its the government's job to re-distribute wealth so a bigger government is just the intermediary to transfer wealth from the wealthy and corporations to all others. Likewise with slow economic growth, many false believe that bigger government would create more growth when in fact the opposite would likely happen. Nonetheless I am disappointed that Conservatives in general aren't hitting back against many on the left's false statements and this is not just federally, but just small c conservatives in general.

    Most Canadians think income inequality is a huge issue and want government to play a far more active response to lessen it, but when you look at the actual facts, we are doing extremely well by both historical comparison and comparisons to other countries. Income inequality saw its sharpest increase in the late 90s when everyone's incomes rose including the poor while since Harper took power in 2006 the top 1% share of the national income has declined from 12.1% to 10.6% yet the overwhelming majority of Canadians including Conservatives think its increased. It is a serious problem in the US but Canada isn't even remotely similar in income distribution.

    Our Corporate tax rate is lower than the US (which is the highest in the OECD) but is slightly above the OECD average and higher than four of the five Nordic Countries. Our federal corporate tax rate is only lower than most countries as we are a federation not a unitary state. The rich aren't paying their fair share ignores the rich pay almost 50% of their income to the government if you take combined federal + provincial and while its true they pay a lot less than in the 60s, that was when every country had much higher rates. Besides Canada has the highest median income ever and one of the highest in the world while poverty is the lowest it's ever been in Canadian history. Unemployment throughout the 70s, 80s, and even early 90s was usually in double digits but today is around 7%.

    On infrastructure where the left says we need a lot more spending, our spending as a percent of GDP has doubled since 1995 and is the fifth highest in the OECD only behind US, South Korea, Poland, and Estonia.

    Finally the big problem I see with many is the grass is greener on the other side when its not. The two comparisons which small c conservatives need to start debunking is the Nordic Countries are proof left wing policies work and the stronger middle class in the 60s is proof they work. Nordic Countries are not nearly as socialistic as most think. Their corporate tax rate is lower than ours while top marginal tax rate only 5% higher. The big difference is their VAT is 25% which is why they can afford better social programs. Also they are way more expensive than Canada to live in which most don't realize. As for the 60s, incomes were more equal but we were less prosperous. The biggest difference is we lived much simpler lives thus didn't take on as much debt. We didn't buy the latest iPad, the latest fashion designer, we had stay cations not going to the Caribbean every winter and Europe every summer, we had one car per family, and we cooked our own meals not ate out.

    Finally in closing, here is the real way small c conservatives can beat Liberals and NDP, point out on income mobility, we are at the top comparable if not higher than the Nordic Countries so even if we are less equal, opportunity to move up the ladder is as good if not better. Otherwise point out Conservatives are for equality of opportunity (which Canada excels at), not equality of outcome (which we don't do as well at).