Our broken economy

The greatest period of prosperity in Canada was in the 1950’s and 60’s. Quantity and quality of excellent paying jobs were high, post-secondary tuition fees were low and health care was easily accessible and affordable for governments.

Public funds were invested in roads, freeways, bridges, telephones, electricity, natural gas, power generating plants, water treatment plants, airlines, national parks, seniors residences, research and development, schools and hospitals.

Today the Canadian economy is broken and no matter how the truth is spun, it’s not an easy fix. The United States and Saudi Arabia are producing enough oil and gas to make our costly oil sands output irrelevant, China’s economy is faltering, and with globalization our primary export has become unrefined raw materials.

It was the big lie

You see, it was the big lie we’ve been sold since the 1970s that globalization and low taxes are the economic saviours of the world. That “trickle down” wealth will raise everybody’s standard of living.

If you pull the veil away, middle class Canadians are not doing well. In terms of real wage growth in the last 20 years it’s been virtually stagnate. Sure we like to believe we’re wealthy, but for many our “show of wealth” is heavily indebted. Servicing debt does not create jobs over the long-term, it just keeps bankers rich and us their slaves.

” The most significant ramification of globalization was the exodus of good-paying manufacturing jobs. Without these jobs, millions of men, women and children have dropped near or below the poverty level.”

Now needing social assistance and food banks they become slaves to political will.  A political party’s ideology has the power to leave those on the margins down or help pull them up.

Then there are those who have the desire and ability to go to post-secondary institutions but not the financial resources. Most students come out of post-secondary schools today bogged down with student debt. With governments’ abdication of education, graduates become economic slaves to banks rather than immediate agents of economic growth.

We can make ourselves feel better by arguing that globalization has lifted millions of people in third world countries from earning .02 cents a day to .22 cents a day and many factory workers now support their families. But there is also that inconvenient truth. Our goods, that we like to buy cheap, are being produced primarily by children who are forced to work long hours in unsafe, poorly lit sweatshops.

Then there is the pollution that we’ve transferred with these jobs. With lax or non-existent environmental laws, water, land and air are so heavily polluted in industrialized third world countries that people die painfully from previously unknown diseases.

In the 1950s and 60’s, corporations and individuals paid higher taxes, governments invested in infrastructure, medical care was available without wait times, our children were educated without going deep in debt, citizens saved for their retirement, the middle class grew and inequality shrunk.

So where did all the prosperity go?  Today the top one per cent of the population own almost 50 per cent of the world’s total wealth. The top 20 per cent own just over 75 per cent of the world’s total wealth. The fact is the “trickle down” lie has made a small group of international corporate elites very wealthy.

Apple Corporation is and has been sitting on $30 billion dollars cash. Compare that to the federal government that just announced a meager $1.9 billion dollar surplus. Many other corporations in North America have large cash balances and are using their excess to buy back shares. That does absolutely nothing for job growth, but it does push their personal wealth even higher.

So who can grow the economy and create jobs when our low tax regime has left the majority of investable money in private hands, oil prices are predicted to stay low for 15 years and China has reached physical limits to double digit growth? Well common sense says you have to put the money into the hands of the people who will spend it, not hoard it.

After the dirty 30’s, the United States was in just such a mess.  Money was in the hands of a few, Americans were out of work, there were two classes of people, rich and poor. Then President Franklin D. Roosevelt brought in the New Deal, which was a massive infrastructure program funded by the federal government.  It created jobs, prosperity and the middle class, but most importantly re-established capitalism which had gone amuck the previous two decades.

Today capitalism has again gone amuck and we have become slaves to the one per cent of the wealthiest people in the world and the banks. They have been aided and abetted by governments who have foolishly bought into the lie that low taxes, no regulations, globalization at any cost and unfettered free markets (the definition of neo-liberalism) will cause economic growth and prosperity for everyone.

More and more people are starting to see through the “trickle down” lie.  This recognition of who’s really getting ahead could explain the New Democratic ‘surprise’ victory in Alberta this spring and why Harper’s election campaign has picked up little traction beyond it’s base.

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ECA Review