Civil Society in Canada

Stephen Gordon, professor of economics at l'Université Laval in Quebec City has a blog, Worthwhile Canadian Initiative. His latest posting offers advice to the NDP and focuses on the problem of rising inequality in Canada:

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The problem remains unsolved. This is why I get very nervous when people like Ed Broadbent call for an 'all-out attack' on inequality. The sentiment is laudable, but there's little reason to think that a bold, comprehensive policy based on a partial understanding of the problem will lead anywhere but disaster.

So what can be done? One thing would be simply to focus attention on the problem: the gains in national income have been concentrated among a very, very small fraction of the population. Not enough people know this.

Given our still-fragmentary understanding of the problem, the only concrete proposal that I can think of that is unlikely to be completely stupid is to add another income tax bracket at the very high end of the income distribution, say those making more than $500,000/year. Make it clear that this measure will be felt by only one person in 200, and that this group has seen their incomes grow at a rate ten times faster than the rest of the population.

Nobody wants to undercut initiative or devalue success, but when a tiny segment of society begins to grab a bigger and bigger piece of the economic pie, the society as a whole should be aware of this fact and ask itself what are its core values. Fundamentally I agree with Gordon that a short term measure to add a more progressive tax on super-incomes should be taken as well as more investigation to understand the phenomenon.

I have no problem with one generation being richly rewarded for economic effort, but I do have a very big problem with setting up future generations behind the fortress of great wealth and with an interest to separate themselves from the rest of society via their wealth. I understand wealth as a reward, but I don't accept wealth as a tool to create privilege across generations.

Canada has caught the disease of trickle-down economics from the US. We need to struggle hard to change course and ensure that we don't fall victim to this self congratulatory and self justifying ideology that the rich as different and deserve a "special place". I don't want any Leona Helmsley declaring that taxes are for "little people" with the hint that with great wealth you get a separate-and-superior treatment from the civil government.

I want to live in a middle class society. A society that strives to give every child the best chance to a future. A society that accepts that some will fail and some succeed better than others. But one in which we are there to help those that stumble and remind those who win the accolades of honour and wealth that they have an obligation to give back to the society that enabled their success.