|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…”