Published Nov 6/2010, updated Nov 10/2010.

A repeating argument made at Northern Insights is that Gordon Campbell’s government cares too much for its wealthy supporters and too little for the province’s neediest citizens. Mainstream media sells the BC Liberal strategy as desirable because owners and executives are part of the pampered elite. They are further encouraged by wealthy think-tanks and foundations supported by business and, through “charitable” status, by taxpayers.

The federal government publishes statistics and analysis of economic well-being in Canada. The latest numbers show that the Province of British Columbia has Canada’s highest income disparity between the top and bottom 20 percent. Human Resources and Skills Development Canada provides this comment:

The well-being of Canadian families depends on both their level of income and the distribution of income within the population. Differences in the distribution of income, or ‘income disparities’, are often considered a measure of a society’s fairness. High income disparities are often associated with high unemployment but may also indicate that large numbers of people are trapped in low-paid and low-skilled jobs.

Even more worrisome than the existing disparity, is the trend. Recent policies will accelerate the rate of increase. BC Liberals move steadily to aggravate the divergence between rich and poor. The most recent policy choices, transferring billions in tax dollars from corporations to consumers through HST is compounded by Campbell’s recent income tax cut that gives 50% of the benefit to the top 20% of earners.

Other regressive policies of BC Liberals heighten the pain of the unprosperous. Those include:

• minimum wage lower now than ten years ago,
• new hospital user fees and higher medical premiums,
• public service fees and user charges, particularly road and ferry tolls and transit fares, 
• diversion of school funding from public to private schools,
• transferring taxpayer support of impoverished community arts groups to foreign film and video producers, loyal only to the region offering the highest public subsidies,
• reduction in legal aid and court costs so high that most private citizens are denied access to civil courts,
• large increases in residential electric rates,
• preventing BC’s public utility (BC Hydro) from developing new power while allowing an Alberta public utility (Epcor) to take a large share in BC,
• reduced corporate income taxes,
• reduced gas royalties, increased exploration tax credits and less environmental oversight
• reduced sales taxes on luxury vehicles,
• higher executive salaries and benefits,
• significant increases to MLA salaries and retroactive pension benefits worth an average of $800,000 to each MLA participant;
• discouragement of unionization in private sector,
• eased labor standards and reduced enforcement,
• etc.

BC Liberals are financially supported mostly by corporations and citizens, not of the top 20%, but the top 1%. Is it any surprise that income disparity is highest in Canada and getting worse?

Income Distribution Trend

Source: http://www.hrsdc.gc.ca

Northern Insights reader Chris passed along a link to the New York Times article Our Banana Republic by Nicholas D. Kristof.  It makes a point that I had intended to write about because Canada is experiencing similar trends in income disparity. Kristof also links to The Great Divergance, an excellent series at the online magazine Slate.

Kristof  writes:

In my reporting, I regularly travel to banana republics notorious for their inequality. In some of these plutocracies, the richest 1 percent of the population gobbles up 20 percent of the national pie.

But guess what? You no longer need to travel to distant and dangerous countries to observe such rapacious inequality. We now have it right here at home . . . The richest 1 percent of Americans now take home almost 24 percent of income, up from almost 9 percent in 1976. . . a more unequal distribution of wealth than traditional banana republics like Nicaragua, Venezuela and Guyana.