Friday, May 23, 2014

Death and Taxes. How Did We Get it So Wrong?

The old adage that nothing is certain but death and taxes, was first used by author Daniel Defoe, but in a different context.

In his The Political History of the Devil (1726), Defoe dismisses the popular notion that the Devil has a cloven foot, or any other characteristic bestowed on him by humans.

He suggests that the Devil himself must laugh at "... the frightful shapes and figures we dress him up in ... especially to see how willingly we are first to paint him as black, and make him as ugly as we can, and then start at the spectrum of our own making."

By believing in this spectrum so infallibly, they refused to see the Devil working in anyone not fitting the description. Thus, the cloven foot et al, became as certain as death and taxes.

This week I attended a Canadian Club luncheon, where Kevin Page, former Canadian Parliamentary Budget Officer, was speaking. I have a lot more to say about his address later, and thank my friend Norma for inviting me to be her guest.

I had an opportunity to speak with Mr. Page personally and asked him how we get governments to take raising taxes seriously, when tax is now a four letter word. He said that it was funny I asked, because in fact, there was a book published recently, Tax Is Not a Four-Letter Word, that addresses that very topic.

In the introduction, editors Alex and Jordan Himelfarb, ask how paying taxes went from ".. being an irritant to a four-letter-word, not to be uttered in public or spoken of favourably in politics".

The problem of course is in the counter revolution of Neoconservatism and Libertarianism, with their message of personal freedom and reduction of "government control". Government is bad, so why should we be giving them our money?

And because of the enormous benefits to corporations, and the wealthiest citizens due to this new philosophy; they had a lot of money to sell their platform to those who would be hurt the most by its implementation.

Taxes became dark and ugly with cloven feet, and that notion has become so embedded in our thinking that we now gravitate to those promising to free us from them, without seeing how devilish the whole thing is.

The idea that reducing corporate taxes as a way to create jobs is nonsense. Research has shown that corporations are hoarding their money and headlines of "record profits" have become the norm. Jobs are still being outsourced overseas, and as we have seen recently, corporations are depending more and more on Temporary Foreign Workers.

As Alex Himelfarb states in his book promotion for the Star, we need to ask what we will have to give up to pay for those tax cuts. They'll tell you that they'll only get rid of the gravy, but all that gravy was sopped up long ago, in the name of austerity.

But What of that Cloven Hoof?

The upcoming provincial election in Ontario, is a good place to start questioning the logic of further tax cuts.

Tim Hudak is promising an additional 30% reduction in corporate taxes. (10% for us but only if he balances the budget).

We need to ask him what we will have to give up, setting aside the ridiculous notion of firing 100,000 public servants, wiping out the, albeit fictitious, jobs created through his cuts.

When he was with the Mike Harris government, their 30% tax cut had to be borrowed, increasing our debt by 40%. Cost of borrowing for taxpayers was 800,000,000 a year.

Yet 57% of those tax cuts went to the top 10%' income earners, while only the top 25% saw any gain at all. The average household actually lost ground because of increased user fees and the downloading of services to municipalities, which increased our property taxes.

Harris came to power at the end of a damaging recession. We were already rebounding by 1995. But during the eight year PC reign, from 1995-2003, wages stagnated, especially for lower income. According to the Caledon Institute of Social Policy, the minimum wage in Ontario was the highest in Canada in 1995. By 2003 we had dropped to 5th place.

Instead of the minimum wage going up, the number of those earning minimum wage skyrocketed, as privatization swelled the ranks of the working poor. And while Harris refused to raise the minimum wage, the buying power of the $7.89 per hour, was reduced to $6.85 by 2003, due to inflation.

So what did that 30% gift to the wealthy cost us?

Remember when a political platform includes cuts to Public Service - WE ARE THE PUBLIC!

The Ontario Liberals plan to raise taxes for those earning $150,000 a year. A small step in the right direction. However, we need to make this an election priority for all parties challenging the Neocon Revolution.

NDP leader Andrea Horvath, after quoting George Bush's "job creators", is suggesting that taxpayers need to be respected. Part of showing us respect is treating us like adults.

We're not stupid. We know the deficit has to be dealt with and as with any budget, that means increasing our revenue. That's the conversation that has to take place. Lowering the HST at this point will be just as damaging as lowering the GST was.

We have to decide what kind of province, and indeed country, we want to live in. One where the rich keep getting richer or one where we all reap the rewards from our vast natural resources.

We don't need lower taxes, we need fairer ones, so that everyone can prosper.

Defoe wanted his readers to remove the imagery of the cloven hoof or they might not recognize the Devil when he appeared. We need to remove the image of the Devil in taxes, or we might not recognize their good.

"Taxes are the price we pay for a civilized society" Oliver Wendall Holmes


  1. "We don't need lower taxes, we need fairer ones, so that everyone can prosper."
    You are so right, Em. Why do so few people understand that Harper is the Canadian equivalent of a dictator, and he's laughing at all of us because the people of Canada are so easily fooled, so easily led, and buy his lies so easily.
    Breaks my little small-L-liberal heart.

  2. I agree wholeheartedly, Emily. I was a community services employee during the horrible Harris years, and witnessed the devastation.
    I do disagree with the above comment, as not all Canadians are easily fooled.