By Ray Rivers
October 29th, 2016
BURLINGTON, ON
“… we live in a world where we make our own future and the role of government is to facilitate each of us in being the best we can be.”
Former Prime Minister Kim Campbell – she chose to tell the public what the real issues were – and they booted her out of office.
Kim Campbell, shortly after becoming Canada’s first female PM in 1993, announced that it was unlikely the deficit or unemployment would be much reduced before the end of the century. That statement was the first shovel of dirt from the grave she was digging for herself and her party – taking it from its highest poll numbers in decades to a miserable two seats in Parliament. Eventually that election marked the sunset of the Progressive Conservative party.
Canada’s finance minister Bill Morneau, recently told an assembly of Liberal party faithful that high labour turnover and short-term employment contracts are here to stay, and the government should prepare for it. Of course the opposition parties have jumped on that statement as being out of touch with today’s youth, much as Campbell’s comment was out of touch with everyday Canadians hoping to make their lives better.
You chop here and you chop there – and before you know it that square peg will fit into that round hole.
It’s true that the big corporations and the broader public service (including health and education) are the historical providers of that proverbial job for life. Yet today big business makes up only 0.1 percent of all Canadian businesses and they employ only 10 percent of Canada’s non-government sector workforce. We are a nation of small and medium companies, counting some 10 million employees, by contrast. And indeed these enterprises are fraught with volatility, some closing down as quickly as others start up – literally in the thousands every year. So there should be nothing too shocking in what the Finance Minister had to say – it is reality.
Except that judging from the public reaction, we don’t think it is acceptable that today’s high school, college or university graduate should go on to live their lives under the shadow of job insecurity. That is unless they join the broader public service or are one of the lucky one million to land a career in banking, insurance, oil, and auto manufacturing. Otherwise one will have to find employment or create a business opportunity in a small to medium sized business. And that means minimal benefits, and even rarer, a company pension.
And when it comes to pensions, no one knows more than Mr. Morneau, who used to be part of the largest administrator of defined benefit plans (fixed pension) in Canada. And he is also, de facto, the author of the newly augmented Canada Pension Plan (CPP). Eligible benefits under the new plan will bring the CPP up to a third of one’s former salary. And Morneau understands that the day of company defined benefit pensions are numbered and that the CPP will be expected to play even a greater role in our lives.
And this is what might be left when all is said and done.
Morneau talked about the need for government to support training and retraining programs. But didn’t mention the need to reform the current EI program. If steady employment for most Canadians is a thing of the past, isn’t it time to send the old complicated EI into the dustbin of history, and to replace it with a national guaranteed annual income? An economy where people make their career choices based on maximizing their potential rather than economic desperation can only lead to greater productivity.
Kim Campbell was just trying to be honest and frank with Canadians when she told them to suck it up. But she underestimated Canadians ability to do better, looking into the distance using her reading glasses. Indeed the Chretien government slew both the deficit and high unemployment beyond her expectations. And she paid a big price and learned a big lesson for speaking her mind.
Kim Campbell has, in fact, lived the kind of career that Morneau could have been talking about. University lecturer, politician, diplomat, lawyer and writer, lawyer, diplomat and more. In addition to being Canada’s first female PM, she was the first from B.C., and the first baby boomer to take that office. And if we remember her for nothing else it should be how she effectively brought an end to the endless debate on abortion in this country, something our American neighbours must envy.
She has appeared on talk shows (Bill Maher), sounding more like a Liberal than from the party on the right which rose from the ashes of her failed election campaign. And indeed, the Trudeau government made her the chairperson for the new Supreme Court Advisory Board, leading the transparent process which has just seen our latest appointment to the highest bench in the land.
Not everybody will be fortunate enough to have that kind of resume when they hit 70, which Campbell will be doing next year. But we live in a world where we make our own future and the role of government is to facilitate each of us in being the best we can be.
So yes, Mr. Morneau, it’s federal support for training and education. But it’s also additional tax reform to favour the middle class. And if we are really serious, about this issue, it’s time to implement Canada’s first guaranteed annual income. Then those young people protesting their lot in life will have only themselves to blame.
Ray Rivers is an economist and author who writes weekly on federal and provincial issues, applying his 25 years of involvement with federal and provincial ministries. Rivers’ involvement in city matters led to his appointment as founding chair of Burlington’s Sustainable Development Committee. He was also a candidate in a past provincial election
Background links:
Kim Campbell – Canadian Business –
Pierre Trudeau effectively pioneered a version of this in the maritimes by lowering the bar to collect unemployment insurance and greatly increasing the largesse both amount and period of collection. The result was an enormous increase in people selecting to live on the dole.
In 2012, Stephen Harper made deep cuts to the unemployment insurance program. The cuts were meant to encourage workers in high unemployment regions to relocate to low unemployment regions, like Alberta.
That change to E.I. tore families apart and forced workers to leave their communities for employment. It also had a negative effect on small businesses. One e-mail, ”… Do you know how difficult it is to get a experienced, loyal and trusted employee to work in a seasonal business and to hold on to them, PLEASE CONSIDER THE BUSINESS OWNERS POINT OF VIEW AND THE GREAT IMPACT THESE CHANGES WILL HAVE FOR THEM!”
The result was an enormous increase in families being torn apart, small businesses closing down and small communities being destroyed.
Canada already has a Guaranteed Annual Income program in place. It’s called the G.I.S. or Guaranteed Income Supplement but it’s only for seniors over 65 that have a very low monthly income. I believe it guarantees them about $17,000.00 minimum per year. They have to apply every year by filling out their income tax return. The 17K includes their C.P.P. and their O.A.S.
Instead of the cost of adding the whole country all at one time to the existing plan, we could add people one age category at a time. We could lower the eligibility to 60 this year and then 55 etc.
We don’t need to reinvent the wheel.
Kim Campbell’s fate in office reminded me of Jimmy Carter. A lesson she could have learned from him would have been: Never speak honestly to the people.
Regarding job security, I think those interested in that should apply themselves to trade schools, even including higher tech fields.My view of a college education is the development of a flexible and broadly capable person, not a lifelong drone to be fitted into a workplace architecture.
Comparing Kim Campbell’s career to the career prospects facing recent graduates is not only inaccurate it is somewhat disingenuous.
To begin with, Kim Campbell graduated in the 1960’s in a time and era when jobs were more plentiful and the prospects of long-term employment were much more likely than today. Campbell made the transition into law and later the public service and academia not so much out of necessity as out of interest. She could easily have retired but chose not to do so. Kim Campbell also had business and networking connections that most of us could only dream of.
Today’s economic reality is much different. Older workers such as those in the financial sector are being displaced as banks and insurance companies she experienced employees in favour of lower paid staff. Young people can’t find good entry-level opportunities, and are having to cobble together a career with “bits and pieces” of part-time and contract work. Aboriginal peoples, Persons with Disabilities and others are finding employment opportunities blocked due to systemic barriers to employment or rampant stereotyping by employers.
Morneau’s “suck it up buttercup” advice is neither helpful nor informative, but frankly, coming from an entitled elitist with a silver spoon upbringing none of us should be especially surprised. The lack of understanding politicians have regarding the churn that is going on in today’s private sector is truly amazing.
If Morneau and his boss want to do something useful then start a positive dialogue around how we generate more high-paying, good quality employment in this country for everyone. Teaching coding in schools is a good start. Providing tax incentives to employers to hire hard to employ young people, or displaced older workers, or Aboriginal Peoples or Persons with Disabilities, would also be helpful. Changes to the tax code that would provide a 5 year grace period or reduced taxation for young people after graduation would help them re-pay student loans and establish a bit of a financial nest egg. And while we’re at it, isn’t it time to consider a flat tax and substantive changes to the Income Tax Act to promote greater understanding, simplicity and ease of interpretation?
Trotting out worn out homilies advising taxpayers to “suck it up” may garner headlines but in the long run it is neither helpful nor particularly useful to those dealing with harsh economic realities.
If what he believes is true, time for Canada’s finance minister Bill Morneau to move on and find another job!