The federal government’s Speech from the Throne, which was read on Wednesday afternoon in the House of Commons, was short on specifics, and even the generalities were less than sweeping. And compared to some of our international partners, such as Australia and China, Canada’s federal government is coming up far short in responding to the global recession. Those countries recognize that the economic crisis is hurting people, and they are investing in policies and programs that help people, while our federal government is propping up the financial sector, even as it proclaims in today’s Throne Speech, that “our banks are among the strongest and best regulated in the world.”
Angel Gurría, the secretary-general of the Organization for Economic Co-operation and Development (the club of 30 of the richest economies in the world, including Canada) recently warned: “The current economic crisis demands tough decisions now, but it must not distract our attention from the other grave structural challenges that we confront.” Growing health inequities and growing housing insecurity are two of the biggest structural challenges facing Canada – and the Throne Speech was mostly silent on these issues, merely repeating previous announcements (which were very limited).
Just a few weeks ago, the OECD released a powerful new research report on poverty and income inequality. The OECD reported that poverty in Canada has been growing in the past decade, and so has income inequality; adding that the poor in Canada are more likely to remain poorer for longer than in other OECD countries.
The Wellesley Institute has supported research that links poverty and income inequality to growing health disparities and a rise in the number of Canadians who are precariously housed; and many other research reports in Canada and internationally have made the links.
Throne Speeches are supposed to give a flavour of the legislative priorities of the government as a new session of Parliament is opened, but today’s Speech was noticeably thin. The global economic tsunami that is washing over Canada is a major (though not the only) concern of Canadians, and this is acknowledged in the Speech:
“Embarking on its renewed mandate, our Government is committed to providing the strong leadership that Canadians expect. It will protect Canadians in difficult times. It will work with Canadians to secure our future prosperity. It will support Canadian workers and businesses in their pursuit of a better future. And our Government will continue its pursuit of distinctly Canadian policies that will contribute to a better economy.”
To date, the “distinctly Canadian policies” of the federal government and the Bank of Canada have consisted of an $85 billion bailout for banks and the financial sector. Now, restoring stability to the financial markets and easing the credit crunch are important initiatives, but they are not the only parts of the economy that require attention.
Compare Canada with the economic stimulus package announced by Australian Prime Minister Kevin Rudd on October 14 to “strengthen the national economy and support Australian households, given the risk of a deep and prolonged global economic slowdown” – a total of AU$10.4 billion, or one per cent of that country’s Gross Domestic Product.
Rudd’s economic rescue plan has five key elements:
* “$4.8 billion for an immediate down payment on long term pension reform.”
* “$3.9 billion in support payments for low and middle-income families.”
* “$1.5 billion investment to help first home-buyers purchase a home.”
* “$187 million to create 56,000 new training places in 2008-09.”
* “Accelerate the implementation of the Government’s three nation-building funds and bring forward, the commencement of investment in nation building projects to 2009.
The Chinese government announced on November 9 that it was investing four trillion yuan (about US$580 billion) in a financial rescue plan that includes, as a key component, investment in affordable housing for low-income households.
Meanwhile, back in Canada, on October 10, October 14 and November 12, federal finance minister James Flaherty and the Bank of Canada announced plans to buy $75 billion in mortgage-backed securities from banks and to pump $10 billion in liquidity into the financial sector. That $85 billion in one month to rescue the financial sector is equal to the entire federal spending over a year in all these areas combined:
* labour ($2.2 billion)
* health ($25.8 billion)
* housing ($2 billion)
* education ($5.6 billion)
* environment ($3.8 billion)
* recreation and culture ($4.4 billion)
* foreign affairs ($5.9 billion)
* regional support ($554 million)
* research ($3.6 billion)
* protection for people ($28.6 billion)
* transportation and communications ($2.8 billion)
A final observation: The government stresses its “renewed mandate” from the recent federal election no fewer than four times throughout the Speech. The real numbers tell a slightly different story:
In 2008, the Conservatives earned fewer votes than the last election, but received more seats in Parliament. In 2008, the Conservatives received 5,205,334 votes – that’s 168,737 votes less than the 5,374,071 they received in 2006. The Tories got fewer votes, but they received 143 seats, up 19 from the number of MPs elected in 2006. So, they didn’t get more votes, but they got more seats in Parliament thanks to some lucky vote splits in various ridings. In 2008, the Conservatives received 37.6% of the national vote, a slight increase over 36.3% in 2006 – but that is a statistical aberration created by a drop in the number of voters who bothered to turn out in 2008.