Income gap growing wider in Canada

This is from the Star.
Well Harper can be comforted. Canada is indeed becoming a more Conservative country. There is less government intervention. We have a war on terror that provides welfare for the military industrial complex but have lost the war on poverty and left it to be waged by charities and soup kitchens. Of course the Conservatives or Tweedle-Dee do not deserve all the credit since much was accomplished under the Liberals or Tweedle-Dum as well.
The marvel of global competition has provided great opportunities for invesment and also great opportunities to cut wages, weaken unions, and dismantle the social safety net that was won by the working class over decades. Thus we get a bigger spread between the well off and the lower income percentiles.


Income gap growing wider


Canada lags behind 17 developed countries; has no detailed plan to fight poverty, study finds
Oct 21, 2008 04:30 AM
Laurie Monsebraaten Social Justice Reporter
Poverty and inequality rates in Canada have been on the rise since 1995 and are now higher than the average developed nation, according to a new study.
The income gap is growing throughout the developed world, but the gap between rich and poor in Canada widened more dramatically than in most countries between 1995 and 2005, according to the report released in Paris today.
The 20-year analysis by the 30-member Organization for Economic Co-Operation and Development found only Germany saw a similar rate of increase during the past 10 years.
"After 20 years of continuous decline, both inequality and poverty rates (in Canada) have increased rapidly in the past 10 years, now reaching levels above the OECD average," says the report.
As in other countries, more single-parent households and people living alone are contributing to income inequality in Canada.
And wages for the rich are increasing, while they have been stagnating or dropping for middle and lower income workers, the report says.
Most affected have been young adults and families with children.
Canada spends less on cash transfers, such as unemployment and family benefits, than other OECD countries and that may be one of the reasons the country fares worse than others, the report suggests.
The report echoes concerns raised by Canadian social research groups about growing income disparity in Canada at a time of strong economic growth.
"It's a consistent repudiation of the trickle-down theory," said Armine Yalnizyan, an economist with the Canadian Centre for Policy Alternatives, which has written several reports on the issue.
"Even in a period of dramatic growth in the job market – and Canada has been a leader in job growth in the G-7 in the last 10 years – trickle down has not happened," she said.
The OECD report underscores the need for federal action, she said, adding every political party except the recently elected federal Conservatives had plans to cut poverty in their campaign platforms.
"It will be interesting to see how the other parties form a coalition of interest on this issue, or if they do," Yalnizyan said.
With U.S. Democratic leader Barack Obama ahead in the polls and promising to cut poverty in half in that country within 10 years, Canada may soon be one of the only developed countries without a detailed plan to address the problem.
But Lesley Harmer, a spokesperson for retiring Human Resources Minister Monte Solberg, said the government is "taking real action to support Canadians who need help."
In an email, she listed "vital social programs" the government is strengthening: the Working Income Tax Benefit; the recent extension of affordable housing and homelessness programs; the new retired disability savings program; $100 monthly child care benefits; and supports for seniors, skills training and post-secondary education.
When asked if the government plans to introduce a strategy with goals and timetables she said: "I think what I sent you stands."

Canada: Income gap widening

Rising tides of economic activity do not raise all boats equally. Some may even sink!
Perhaps the gap will not hurt future economic growth. Production will just shift to luxury goods where there is more demand. Also, there may be just a larger load of individual debt as people buy what they cannot afford. Conservative tax cuts will no doubt exacerbate the income gap. All this shows is that a market economy plus conservative governments that cut social spending, taxes, weak unions, and lack of political action except by the well off means that the income gap will widen.


Canada's wage gap widening despite boom: study
Last Updated: Thursday, March 1, 2007 | 6:33 AM ET
CBC News
Canada's rich are getting richer while the incomes of poor people continue to stagnate in a time when the wage gap should be shrinking, a new report on the Canadian economy said Thursday.

Inequality is continuing to grow year after year in spite of the current economic boom — a period of prosperity that would traditionally see the extremes between the wealthy and the poor drawing closer together, the Canadian Centre for Policy Alternatives said in the study.

The Ottawa-based independent research institute's report, titled The Rich and the Rest of Us, says it has been 30 years since the wealthy and the poor were so far divided in how much they earn. What's more, the share of overall income going to 80 per cent of Canadian families is less than it was a generation ago.

Armine Yalnizyan, the author of the study, said most Canadians are not participating in the economic gains they are helping to create "and that is simply not an economic recipe for future economic success."

The CCPA commissioned Statistics Canada to analyze the economic health of families raising children under 18 years of age — roughly half of all Canadians. They found that on average, Canadian families are putting in 200 more hours a year on the job than a decade ago.

That's a far cry from the situation the nation's economic elite are in, Yalnizyan said.



"The top 10 per cent is the only group that has not worked more weeks or more hours than they worked a generation ago," he said. "Everyone else is working more and they're the ones that are unable to command higher incomes."

Last fall, the CCPA released a poll suggesting three-quarters of Canadians believe inequality is growing.

Still, there is some hope, the study notes. Nearly half of Canadians who are raising children have not experienced a freefall in their incomes thanks largely to the government's tax and transfer system, and especially the tax-free monthly Canada Child Tax Benefit, the study said.