Grapevine: Taxes
One of the things that annoys me is the overwhelming success of Conservatives in convincing so many people that paying your taxes is a burden, not a bargain. Think of the multitude of services we all use without really seeing—medical, educational, transportational, water and sewage, public parks, etc. We know that private organizations will never commit to make such services available universally, so to believe that taxes are not a bargain is cutting off your nose despite your face.
Of course historically taxation has sometimes become a burden, nearly always under an authoritarian government, but the current belief relies on two extremely suspect pillars: governments are unable to run anything as efficiently as private organizations spurred by greed; nothing good ever comes of co-operative structures, only individuals are responsible for efficient organization. Are private businesses more efficient? In assessing the answer one might keep in mind the average 10,000 business bankruptcies annually in Canada, and anecdotally, the Edsel, Iridium, Blackberry, and Enron et al. These examples representing both inefficiency and wastage (6 billion dollars in the case of Iridium) should make us question the business chorus of ‘Efficiency, efficiency’ and ‘Incompetent Government’. And just as Conservatives blame the government for wasting ‘your’ money so these companies also waste ‘your’ money as that is where they get most of their income. We are all human and incompetency, inefficiency, and wastage are characteristics of everything we attempt, whether private or government. As for co-operative efficiency one has only to look at our armed forces and indeed all the services mentioned above but you can’t measure by dollar cost alone.
But many still complain of over-taxation. The only useful figures are comparative: the OECD of 38 nations measures ‘All-in average income tax rates at average wage’ and places Canada as 20th for single individuals and 23rd for married with two children—roughly the middle of the pack (2022). Among all nations a measure of taxation as a percentage of GDP puts Canada at 33% once again in the middle of the developed nations. The Tax Foundation rates Canada 17th on overall taxation amongst the 38 OECD countries. So if we are in the middle of the developed nations where would the complainers have us be? Should we be the lowest taxed country of the 38? To get there we would have to cut even more government revenue as well as the services for which it pays.
Of course the real problem is ‘universality’. No private company will ever promise it because no profit is to be gained from unprofitable parts of the citizen universe. An easy example is SaskPower. It was formed in 1929 to figure out how to supply electricity to everyone in Saskatchewan which the multitude of cherry-picking private companies would not do. Depression and the war intervened and it was only in 1949 that SaskPower bought out the last of the private companies and began to string line all over the province. Although cost conscious and wisely adopting a single line ground return system (as New Zealand had done) cutting the cost of wire needed in half, it did not measure efficiency by cost alone; more important was providing service to the entire population. And, of course the inefficient private producers—inefficient as measured by the thousands of citizens they would never service—did very well; my father’s friend who owned the National Light and Power Company supplying Moose Jaw with power, had a ‘golden’ rule: if you lived 12 miles from his plant you got no power. With the money paid for his company he retired to the Bahamas from whence he sallied forth each year to remind us of his tropical pleasures.
Universality is the one measure private companies will never accede to. For military services, medical services, highways, sewer and water services, postal delivery and public education universality is the abiding measure of public services delivered at the lowest cost to the individual by asking everyone to pay a small portion even they do not have a personal need for the service directly: adults and elders without children, persons in near perfect health, civilians who won’t be soldiers, etc. But the service will be there at lower cost if they ever do need it. However to work well it requires a population which can put self-interest aside for communal need. In a culture bombarding us every day with the exceptional individual as alone responsible for everything good and efficient, dividing us into so-called ‘identity’ groups often at odds with one another, and minimizing the obvious creative successes of group effort, the attempt to put communal need up front has become increasing difficult, if not impossible. Suggesting an area of universality which could be attempted brings out numerous ‘identity’ groups who claim they won’t pay for it because they themselves don’t want it and won’t use it and who seemingly have no compassion for those who do need it, often dismissing them as too lazy to earn enough to pay for the service; i.e. blaming the victim.
Taxes are a government’s main revenue and the constant cutting of them by Conservative governments is like asking Ford to eventually sell trucks below cost; cuts are one of the major sources of government debt as bonds are then issued to make up the short fall of lower taxes and to keep the services we have going. And it has been suggested that the conservative clamour to constantly reduce taxes is indeed a method of making public services less and less manageable and setting the stage for a Thatcher-life sell off of public services to private industry. We see nefarious danger in China’s government supported ‘private’ industries building our ferries but seemingly have little problem with the vast inroads private companies have already made into our public services, for example our wonderful Federal Dental plan turned over to Sun Life to run, our BC MSP accounting run by Maximus. or Accenture running BC Hydro’s accounting—BC Hydro terminated Accenture’s contract in 1917 after 15 years of non-compliance with the performance standards set by the Liberal government and then happily ignored by the same Liberals who touted it as a more efficient than deliver by civil service employees.
Currently we have Canada Post mandated by law to service all Canadians and then expected to compete financially with private couriers who work under no such constraint and would likely withdraw their services if asked to do so. Rather than asking our politicians to cut taxes we should be demanding real accountability and increased taxation to fund efficient universal services.
