Opinion
A6 Hope Standard Thursday, October 31, 2013
Published at Hope, Boston Bar, Yale and surrounding area by Black Press
Scandal damage significant The ongoing Senate scandal has certainly done its share of damage — to the prime minister, the Conservative Party, the institution of the Senate and politicians in general. The damage may not spread past that group, but it is significant and it may be lasting. The Senate is certainly at its low point. It has never been popular with Canadians, being seen as a repository for bagmen, party hacks and failed politicians. While a few individual senators have done important and significant work, as a whole the institution does little of lasting importance. Now it has clearly been shown that many senators, and this goes far beyond Mike Duffy, Pamela Wallin and Patrick Brazeau, have had their hands in the cookie jar. Even when they get caught, the Senate and indeed the prime minister do little or nothing to change the culture of entitlement, which is widespread through the federal government. It isn’t just politicians who feel they are entitled to benefits that most other Canadians don’t get. Public servants have clauses in their contracts relating to sick leave, indexed pensions, severance and extended health care that most others can only dream of. The prime minister first took office in 2006 on a pledge to reform the Senate. It is now clear he has no idea of how to do so. A court decision in Quebec has basically ruled all his reform ideas cannot be implemented, and the court decision implies that the Senate will never be abolished, unless most provinces agree. Even if, in the court of public opinion, Stephen Harper is cleared of direct knowledge of off-the-books payments to senators, the public won’t soon forget that he appointed these three senators, and that he campaigned vigorously on Senate reform. As for the Conservative Party, in the next election its fortunes are totally tied to Harper. If he falters, so does the party. It has no plan B. - Black Press
Perils of an ‘entitlement state’
B.C. VIEWS
Tom Fletcher With the B.C. and federal governments once again struggling to climb out of deep operating deficits, it’s a good time for the release of Mark Milke’s book Tax Me, I’m Canadian. An update of the same title published 12 years ago, the book retains the history of taxes in Canada, detailing how Canada’s tax system was initially built to mimic the United States system in the late 19th century. Beyond the history, it is mostly new material. Included are chapters on the global meltdown of 2009, the surge of pension liabilities as the baby boomers retire and the flawed logic behind the “Occupy” and “Idle
No More” protests. Some readers will immediately note that Milke works for the Fraser Institute and was previously B.C. director of the Canadian Taxpayers’ Federation. But the book is not just an argument for cutting taxes. It also dismantles persistent myths that income taxes are illegal, and launches a broadside on what Milke calls “Canada’s corporate welfare carnival.” Many people will be able to identify some top names in the government subsidy game: Bombardier, General Motors, even poor old Rolls Royce Canada. Some will also be well aware that our supposedly tight-fisted Conservative federal government has continued to pour out “regional development” and other funds to every part of the country. But I did not know that Industry Canada grants were handed out to
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pizza parlours (including the remote pizza-starved village of Kamloops), or to help open gas stations or convenience stores in Kelowna, Vernon and Chilliwack. Milke makes a useful point for B.C. about royalty rates for timber, natural gas and other resources. They are resource rents, and if they are too high the tenants will move out. Reducing them isn’t a subsidy, especially if it leads to big revenue gains as B.C.’s unconventional shale gas incentives have done. On the Occupy movement: The infamous “one per cent,” who in Canada earn $250,000 a year or more, earned 10 per cent of all income and paid 20 per cent of all taxes in 2010. The bottom 73 per cent of tax filers paid just 17 per cent of all taxes. About a third paid no tax at all. On Idle No More: When Attawapiskat Chief Teresa Spence
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played to the Ottawa media with her soup strike, former Liberal leader Bob Rae suggested a nearby diamond mine should share more revenue. Milke omits the substantial support and employment that mine provides, and glosses over the misguided blockades that disrupted that and other job-creating enterprises. But he does detail the disastrous effects of passive resource wealth bestowed on impoverished aboriginal communities, and contrasts it with the success stories of reserves that build their own enterprises through hard work. On public sector pensions: Milke notes that historically, public employees traded higher wages for better benefits and job security. Now their wages are generally higher, and taxpayers have to cover their personal pension contributions (as a portion of those wages) as well as
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the employer contributions, plus the “defined benefit” payout, which has to be subsidized far beyond what the pension fund can support. On the debt-financed welfare state, there are memorable observations, like this one: “For the record, the generous Quebec welfare state and its ostensibly more progressive model are paid for in part with the taxes of other Canadians; Quebec is merely the North American equivalent of Greece.” The recent B.C. political crisis over adoption of the harmonized sales tax showed that there is too much emotion and too little knowledge about how taxes work. This book is a step towards addressing that. Tom Fletcher is legislature reporter and columnist for Black Press and BCLocalNews.com Twitter:@tomfletcherbc E-mail: tfletcher@blackpress.ca
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