January 31, 2011

The Pros and Cons of Corporate Tax Cuts

There is an interesting and important debate going on about corporate tax cuts. The belief of the Federal Government and the Government of Ontario is that corporate income tax rates have to be cut to spur investment, economic growth and job creation.

January 27, 2011

Globe and Mail series on prisons and mental illness

The Globe and Mail has been running a very insightful and troubling series on prisons and mental illness. The Federal Government has embarked on an expensive plan to build more prisons. Those prisons will be needed to house all the people that their "tough on crime" approach will lock away.

The argument from the Government is that the key to safe communities is locking away the "bad guys,"  to quote Prime Minister Harper.

Unfortunately, many of the people in Canada's prisons are suffering serious mental illnesses.

The Globe series is thought provoking (and the comments from readers are worth reading, too). Here are links to several of the articles in the series:

Why Canada's prisons can't cope with flood of mentally ill inmates

Prisons grapple with increase in mentally ill female inmates

Coalition of churches condemns Ottawa’s justice plan

Mennonite Central Committee Ontario has long been engaged in restorative justice -- a different approach to creating safe, healthy communities, which has been funded by Correction Service of Canada. To find out more, visit MCCO's Restorative Justice homepage.

And here is a link to the Church Council on Justice and Corrections mentioned in the article about churches condemning Ottawa's justice plan.

January 13, 2011

Poverty Free Waterloo Region events

Poverty Free Waterloo Region has couple of events happening on January 25, 2011.

January 25, 2011
1:00pm : Community Services Committee Meeting -- 150 Frederick St., Kitchener
Please attend this meeting in the audience to show your support for Council to include the creation and implementation of government-sparked, community-owned poverty elimination strategy in the 2011-2015 strategic plan. If you’d like to speak at this meeting, you can register as a delegation, and if you would like to provide a letter detailing your own perspectives and support, you can do so by submitting it directly to the Clerk, or through Poverty Free Waterloo Region.

January 25, 2011
7:00 – 9:00pm An Act to Eliminate Poverty in Canada: MP Tony Martin
Victoria Park Pavilion, 80 Schneider Ave., Kitchener. Free Parking

MP Tony Martin will speak about his Private Member’s Bill to create a Federal strategy to eliminate poverty. We are also pleased to welcome Rob Rainer of Canada Without Poverty to share his insights.

In June, 2010, Tony Martin tabled a Private Member’s bill mandating the creation of a federal poverty elimination strategy in the House of Commons, seconded by Mike Savage of the Liberal Party and Yves Lessard of the Bloc Québécois. 

Bill C-545 directs the federal government to consultatively develop a federal poverty elimination strategy, creates a new, independent Poverty Commissioner to monitor progress of the strategy, and provides a stronger advisory role for the National Council of Welfare, to be renamed the National Council of Poverty and Social Inclusion. 

The poverty elimination strategy would focus on three major elements: income security, housing and social inclusion. The bill emphasizes the need for gender-based analysis, different urban and rural responses, and a strong human rights framework.

January 11, 2011

Tackling inequality from the top and the bottom

Several recent posts on this blog have talked about the problem of inquality -- Persistent Povery and the Rise of the Richest 1% and Cutting Health Costs by Cutting Poverty, for instance.

Readers have sent me links to interesting approaches to tackling inequality from the top and the bottom.

Ben Janzen commented on the Persistent Poverty blog and directed me to some information from Meritas Mutual Funds on the "Say-on-Pay" movement among sharelholders aiming to rein in Executive Compensation. Gluttons at the Gate, an article from Macleans, looks at the efforts of Gary Hawton, Meritas' own CEO, to champion "say-on-pay" shareholder motions.

For background on the rise of Executive pay in Canada, see Hugh Mackenzie's recent report from the Canadian Centre for Policy Alternatives, Recession Proof: Canada's 100 Best Paid CEO's. It not only describes how the pay of Canada's top 100 CEOs has grown phenomenaly, both in relation to average pay for all workers and inflation, it explores what led to that rise and possible solutions. Mackenzie is not convinced that the 'say-on-pay' movement alone will bring executive compensation back to earth. Evidence from the U.K., where shareholder 'say-on-pay' has been around longer, supports that view. He recommends tax changes: changing the way stock options are taxed and increasing the tax rate on high incomes, as well.

The important thing is that as shareholders and citizens we challenge the notion that some people should get paid excessively, esecially when other people have obscenely low incomes.

Ken Ogasawara sent me a link to a story in the New York Times that examines how basic income programs in Mexico and Brazil have helped reduce inequality by giving money to poor families. The Bolsa Familia in Brazil and the Opportunidades program in Mexico give conditional cash grants to poor families. The conditions include things like children staying in school and getting regular health check-ups. These programs have had a demonstrable impact on reducing poverty and inequality.

Canada actually has its own such programs -- the Canada Child Tax Benefit (CCTB) and provincial counterparts like the Ontario Child Benefit. These programs do not include conditions that families need to meet. They are simply based on the level of family income: the lower the income, the higher the benefit. Campaign 2000 reports that Government Transfers like the CCTB lifted nearly 725,000 Canadian children and their families out of poverty in 2008. Campaign 2000 recommends raising the CCTB from its current annual maximum of $3,436 to $5,400 per child.

Old Age Security (OAS) and the Guaranteed Income Supplement (GIS) have done for seniors what child benefits are doing for children. The OAS and GIS have helped reduce poverty among Canadian seniors dramatically over the past thirty years.

What we are missing in Canada is a basic income for people 18 - 64 years of age. The expectation is that able bodied people of those ages will earn income through work. But as the Ontario social audit found, work does not work for everyone. Many jobs are precarious -- providing low wages, little or no employment security and few or no benefits. The majority of unemployed workers do not qualify for E.I. and welfare rates guarantee that you will live in poverty. Basic income security for adults 18 - 64 years of age is one gap preventing Canada from making real headway in reducing poverty and inequality.