- Jim Stanford points out how the corporate tax pendulum is swinging back toward asking business to make an equitable contribution to Canadian society:
- Meanwhile, Robert Reich discusses how public giveaways to the corporate sector make our economy both less fair and less effective. Paul Krugman again highlights how Kansas would offer conclusive evidence against right-wing economics if corporate apologists were willing to accept evidence as a basis for evaluating their constant demands for more. And Ian Welsh offers a worrisome set of bullet points on where the global economy stands as Canada, the U.S. and other countries see promised growth evaporate.The federal rate was cut virtually in half after 2000 (to just 15 per cent today). Several provincial governments followed suit. Alberta was the most aggressive, slashing its rate by more than one-third (to just 10 per cent) by 2006. This sparked a destructive race to the bottom among provinces – aided by explicit threats from companies to move head offices to Alberta if other provinces didn’t follow suit. Combined, Canada’s average federal-provincial rate is now the second lowest in the Group of Seven.But despite this dramatic change, the promised payoff in business investment is nowhere to be found. Capital spending has consistently disappointed – and it’s getting worse. Last year, business non-residential investment declined in real terms. Innovation investment has been shrinking for a decade. In fact, non-residential business capital spending has grown more slowly under the Conservatives (and their CIT cuts) than any other government in Canadian postwar history.In today’s constrained fiscal environment, however, the political calculus of CIT has changed dramatically. Now, most Canadians are getting less from government while being asked to pay more for it. Their willingness to watch corporations receive favourable treatment has evaporated....
Alberta’s new 12-per-cent rate may become a new effective minimum for the provinces. Indeed, formally agreeing on a new interprovincial floor would prevent the destructive competition that undercut provincial coffers so badly in recent years. In any event, we can expect more hikes in the coming years.Meanwhile, at the federal level, Canadians will have another chance to debate CIT rates this fall. The New Democrats will propose a modest hike, and even the Liberals might consider revenue-boosting CIT reforms – if not raising the rate, then at least restricting some loopholes. That would leave Prime Minister Stephen Harper and his Conservatives as the lone champions of this failed trickle-down theory. Mr. Prentice’s experience is surely causing them considerable trepidation.
- Maude Barlow and Meena Karunananthan warn that more corporate rights over the environment will do nothing but exacerbate an impending water crisis. Murray Dobbin writes that the Cons' focus on corporate control agreements reflects their desire to ensure that future governments can't respond to the needs of the Canadian public. And Ralph Surette contrasts the Cons' moderate spin with their extreme anti-social views and policies.
- The Globe and Mail rightly argues that we should be seeking a broad-based mandatory expansion of the Canada Pension Plan, not settling for the Cons' plan to allow workers to put their own money into the CPP with no corresponding employer contributions.
- Finally, Michelle Zilio reports on the impending Truth and Reconciliation Commission Report on Canada's shameful legacy of residential schools. And Mike Hogeterp discusses the importance of treating the report as the beginning of a permanent change toward fairness and inclusion for First Nations, rather than considering it to be the end of the story.
[Edit: fixed wording.]