Horgan, John

Special treatment for special people

First Call Advocacy Coalition

I write here about natural resource giveaways that amount to billions of dollars. Meanwhile, the Premier stands in the Legislature to justify monthly clawbacks of $187 from a disabled single parent whose family must live on far less than Christy Clark pays for her only child to attend Vancouver’s St. George’s private school, where annual fees range from $16K to more than $50K. RossK at The Gazetteer has a more complete account but this quote from the Opposition Leader caught my attention:

J. Horgan: I would argue that the $17 million this government spent on partisan advertising last year would have been better spent for children living in poverty. So too $342 million in cost overruns on the northwest transmission line; $341 million in cost overruns on the Vancouver Convention Centre; $464 million in cost overruns on the South Fraser Perimeter Road. That would pay for the clawback for 60 years. How is that respecting taxpayers? How is a billion dollars of cost overruns while people are going without in this province…? How is that respecting taxpayers?

Horgan counts nearly $1.2 billion in cost overruns and RossK adds the $182 million spent on BC’s ineffectual ICM system, which the Auditor General is now investigating.

In effect, Christy Clark is saying that disabled single parents are better off when the province foregoes resource revenues and spends hundreds of million in subsidies, with billions pending for LNG, so multinational corporations can export BC’s raw materials for overseas processing and manufacturing. Yet, much of the value realized by beneficiaries of BC resource policies leaves the province faster than a speeding bullet.

Teck Resources pockets billions not paying coal, copper, molybdenum, gold, and silver royalties, and pays dividends to major shareholders in Japan, China, and USA. The company’s cash rich position, much from BC coal, allowed it to acquire operations in Alberta, Ontario, Newfoundland, Alaska, Washington, Peru, and Chile. When British Columbia foregoes resource revenue, there is no certainty that money stays in the province. In fact, the opposite is frequently true.

However, when a disabled and deprived family has a few dollars more to spend, you can be certain they spend that money quickly and very close to home. The website Economic Online explains:

Every time there is an injection of new demand into the circular flow there is likely to be a multiplier effect. This is because an injection of extra income leads to more spending, which creates more income, and so on. The multiplier effect refers to the increase in final income arising from any new injection of spending.

The size of the multiplier depends upon household’s marginal decisions to spend, called the marginal propensity to consume…

That last phrase needs little explanation. Money in the hands of people lacking necessities quickly enters circulation. It does not purchase expensive cars, foreign holidays, and luxury goods with designer labels. Nor does it go into RRSP and others savings plans, or take flight to the nearest tax shelter. In the word of economist Doug Elmendorf, Director of the Congressional Budget Office (USA), “Increases in disposable income are likely to boost purchases more for lower-income than for higher-income households.”

Five hundred million in the accounts of Teck Resources achieves certain outcomes; $500 million in the hands of the province’s poor people would realize entirely different results. Politicians who favour the former do not desire general improvement of the economy. At worst, they corruptly intend to reward sponsors. More likely, they hold the belief that poor people deserve their fates.

At the blog Understanding Society, Daniel Little commented,

“This tenor of our politics indicates an overt hostility and animus towards poor people. How is it possible to explain this part of contemporary politics on the right? What can account for this persistent and unblinking hostility towards poor people?

“One piece of the puzzle seems to come down to ideology and a passionate and unquestioning faith in “the market”. If you are poor in a market system, this ideology implies you’ve done something wrong; you aren’t productive; you don’t deserve a better quality of life. You are probably a drug addict, a welfare queen, a slacker…”


7 replies »

  1. From a Christmas Carol by Charles Dickens. 175 years later, nothing really has changed.

    First Collector: At this festive time of year, Mr. Scrooge, it is more than usually desirable that we should make some slight provision for the poor and destitute.

    Ebenezer: Are there no prisons?

    First Collector: Plenty of prisons.

    Ebenezer: And the union workhouses – are they still in operation?

    First Collector: They are. I wish I could say they were not.

    Ebenezer: Oh, from what you said at first I was afraid that something had happened to stop them in their useful course. I'm very glad to hear it.

    First Collector: I don't think you quite understand us, sir. A few of us are endeavoring to buy the poor some meat and drink, and means of warmth.

    Ebenezer: Why?

    First Collector: Because it is at Christmastime that want is most keenly felt, and abundance rejoices. Now what can I put you down for?

    Ebenezer: Huh! Nothing!

    Second Collector: You wish to be anonymous?

    Ebenezer: [firmly, but calmly] I wish to be left alone. Since you ask me what I wish sir, that is my answer. I help to support the establishments I have named; those who are badly off must go there.

    First Collector: Many can't go there.

    Second Collector: And some would rather die.

    Ebenezer: Then they should die and decrease the surplus population.


  2. To understand who owns the company gaining the most from the province's low resource taxes, I looked through a few SEC documents. Teck has two classes of common shares: 9.3M Class A with 100 votes per share and 567M Class B with 1 vote per share.

    The most influential shareholders are Japanese industrial giant Sumitoma and a Canadian company controlled by the Keevil familly. The largest shareholder is the state owned China Investment company and the second largest is Blackrock Inc., a New York based company that has more than 4 trillion dollars in assets.

    While Teck may be a headquartered in Vancouver, it is a multinational organization with a majority of its shares beneficially owned outside Canada.


  3. It is.

    I'm going to get behind John Horgan, he's our best hope to oust the beyond shameful Liberals — each and every one of them.
    July Morning.


  4. And British Columbia voted these Lieberal morons back in to rape and pillage for another four years. It’s pretty hard to get up and try again when some slime ball government has its foot on your neck holding you down. The NDP opposition has enough horror stories on Madam Bird Brain and her flock to keep the Legislature entertained for years. Horgan's comments were a good start.
    Excellent work Norm.


  5. With BC leading the rest of Canada with the highest child poverty rate, the BC Liberals underfunding students education by $1000 less than the national average, while the HypoChristy Clark regime claws back spousal support payments from single moms on disability or income assistance, it would appear the C.J. Clark and W.C. Fields actually share the same sentiment:
    “Children should neither be seen nor heard from – ever again. ”
    ― W.C. Fields


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