Thursday, October 16, 2014

Thursday Morning Links

This and that for your Thursday reading.

- Michal Rozworski responds to idealized views of Canadian equality with the reality that we fall well short of the Scandinavian model:
Canada appears on many accounts much closer to the US than Sweden, the stand-in for a more robust social democratic and redistributive state. Indeed, looking at the three top rows of the table, there is a clear link between the higher share of income going to the top (inequality) and the higher share of taxes paid for by those at the top (redistribution a la Vox authors Martin and Hertel-Fernandez). On both of these measures Canada is roughly in the middle between the US and Sweden and slightly above the OECD-24 average.

Looking lower, however, it is clear that Sweden still easily beats both the US and Canada in terms of tax rates on the highest earners. While Sweden “recycles” more of its income through the state (total tax revenue as percentage of GDP), it does not do it without soaking the rich in the process. Sweden does not lack of high taxes but, rather, it lacks more extreme inequality. Canada, more akin to the US, gets more of its total tax income from the rich only because the rich are richer – indeed despite taxing each individual rich person less. In fact, if we take into account an interesting recent study on how Canada’s wealthiest use private corporations to avoid paying tax, it turns out that our system is even less redistributive: the official data has Canada’s top 10% taking in 32.7% of after-tax income, they are actually getting 36.5% adjusting for the effect of tax-dodging via private corporations.

The final three lines of the table show a common way to measure redistribution and these confirm that Canada is no Sweden. The Gini is a (convenient and imperfect) way to measure inequality in a single number on a scale from 0 to 1, where 0 is perfect equality and 1 is perfect inequality. The difference between the Gini of market incomes and the Gini of after-tax-and-transfer incomes shows how much redistribution is decreasing inequality. While even Sweden has a high inequality of market incomes, it redistributes quite a lot; Canada, on the other hand, is right behind the US and its comparatively paltry level of redistribution.
- Eric Reguly points out that we're seeing the inevitable side effects of overreliance on a commodity economy - as predictable price drops can lead to fiscal disaster when public planning is based on nothing but the bare hope that prices and associated revenues will rise in perpetuity. And Jason Fekete confirms that the Cons' destructive environmental choices are based solely on the desire to let Alberta oil operators dictate public policy.

- Meanwhile, Justine Hunter reports that the choice to tie social funding to public approval of controversial resource projects is rather a losing proposition from a political perspective as well.

- Deirdre Fulton writes about the Center for Media and Democracy's study (PDF) into the harm done by ideological privatization of public services. And Jacob Swenson observes that in order to ensure that the public interest is protected, we need to see government as a solution (and indeed a prize) rather than a problem.

- Finally, Frances Russell laments the state of Canada's non-responsible Parliament - and the Prime Minister who's determined to make the problem worse:
The most corrosive and dangerous development in Canada’s fully Americanized parliamentary system is the highly centralized power of the PMO and cabinet with a majority government. Add the now-complete stifling of the rights of ordinary MPs to say or do anything on their own, and Canada has degenerated into a virtual dictatorship.

And that’s without including the ability of the prime minister to prorogue, recess and dissolve parliament at whim.
The dysfunction of the current parliament has its origins in the authoritarian mindset of the prime minister and the 100 or so individuals who staff his office. Rathgeber is merciless when it comes to describing the culture that has sprung up within it.

“The socialization and indoctrination effects of the PMO sub-culture cannot be overstated,” he writes. I have witnessed young, seemingly normal and well-adjusted college graduates enter the PMO and within six months, morph into arrogant, self-absorbed zealots, with an inflated sense of importance and ability.”

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