Ottawa steps forward as COVID-19 crisis puts provinces in desperate straits
“In Canada’s history, great crises have invariably led to the concentration of power in Ottawa. It’s happening again.
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In normal times, provincial governments are dominant players on the federal scene, responsible for the things that matter most in people’s lives: schools, hospitals, highways, welfare. But in times of crisis, the normally weak federal government takes centre stage, because of its greater ability to borrow money and levy taxes.
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In such an environment, said William Robson, president and chief executive officer of the C.D. Howe Institute, a think tank, Ottawa could help the provinces out in three ways.
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Through the Canadian Emergency Response Benefit, which pays suddenly unemployed workers $2,000 a month, “we might have backed ourselves into some sort of universal basic income,” Mr. Robson believes. We may have accidentally federalized welfare.
Something like this happened at least once before, when Ottawa took over responsibility for relief for the poor from bankrupt provinces during the Great Depression, creating what today we call Employment Insurance.
The problem with creating a basic income more or less by accident is that no one knows how to pay for it, or how it would adapt to regional realities….”
Read John Ibbitson article in The Globe and Mail
and, what’s more, check Policy Options of Basic Income Canada Network to see how we can pay for it.
John Ibbitson, Globe and Mail
Excerpt from Policy Options, Basic Income Canada Network
“…The tax/transfer system is a powerful government tool to gather and invest revenue needed for the well-being of a society and its members. It enables us to have roads, schools and hospitals, democratic institutions and much more. In Canada, a wealthy country, it should be a priority to enable us all to have decent lives. But our tax/transfer system has become very complex and contradictory; modelling change is a big challenge. It does not treat all Canadians with dignity and respect. On the one hand, seniors benefits and child benefits provide stability to millions of Canadians, helping them weather the ups and downs of life. Social assistance, on the other hand, traps people in deep poverty. There are also billions of dollars of tax breaks that go primarily to the wealthiest individuals and corporations, a situation that was not always like this—they used to contribute a fairer share. The other key reason to focus on the tax/transfer system is that by using Statistics Canada’s Social Policy Simulation Database and Model (SPSD/M) we can see, in detail, the impact of our modelled options. Other ways to help pay for a basic income may be more difficult to estimate but they include, for example, cost-savings over time as people’s health and well-being improves. Canadians know that inequality, insecurity and poverty have a high price tag that we are already paying. Governments must take that into account as well in efforts to build a more fair and equitable society….”
check Policy Options of Basic Income Canada Network to see how we can pay for it.
