I’ve got news for you, Ontario, when it comes to being jobbed by Confederation, you’ve got nothing on Alberta. Last year Mowat calculated that Albertans sent a similar amount more to Ottawa than the province received in return – and Alberta has one-quarter of Ontario’s population.
But the issue here is the folly of Canada’s vast system of interprovincial wealth transfers called equalization. When even Ontario begins whining that it deserves billions more in equalization, you know the system has become so dysfunctional that the best action would just be to dismantle the whole scheme.
The stupid bastards at the TorStar and the UofT Mowat institute have fallen into a trap. PMSH now has license to reform equalization and with little political damage since the biggest teat suckers don’t vote CPC anyways. They definately didn’t think this one through…lol!
Not sure.Maybe some of the legal beagles on SDA can answer this question: Can Alberta use “the not withstanding clause” to opt out of this theft?
Normally I agree with Lorne Gunter, but he’s made a few errors in this one.
“Last year Mowat calculated that Albertans sent a similar amount more to Ottawa than the province received in return – and Alberta has one-quarter of Ontario’s population.”
So what? This has nothing to do with population and everything to do with fiscal capacity. The fact of the matter is that over the past 20 years Ontario has slipped from being the province with the highest fiscal capacity to that of second-lowest. Ontario can no longer afford those public services which its tax revenues provide to others. Ontario’s fiscal capacity has declined under all four previous premiers, McGuinty, Harris, Rae and Peterson.
“Yes, Ontario has recently fallen on semi-hard times.”
Understating the case to say the least. Ontario is in a severe industrial recession no different than those of 1982, 1987, 1991. This time, it’s not getting out because the US economy remains stagnant.
Gunter is right that green energy follies have contributed significantly to Ontario’s problems. But the major cause is still the staganant US economy and manufacturing activity. And with Obama in office, there’s little sign of that ending.
But Gunter is absolutely correct that equalization is completely broken.
An inherent unfairness to Alberta is that the government has to spend large amounts on infrastructure to serve a rapidly growing population and must pay considerably more for contractors than in other provinces. I realize that equalization is indirect but essentially Alberta ends up borrowing money so the luddite provinces can have services that Alberta lacks. The only aid the failing economies in eastern Canada should receive are bus tickets to Alberta. The people would have jobs that pay considerably more and have some self respect and the eastern provinces would lose population they choose not to create employment for. Strange thing about Alberta, while Quebecois sit on their a$$es and do nothing but whine back home, many are gainfully employed in Alberta and think Canada isn’t such a bad place.
jobbed by Dalton McSpendy & his public service unions.
Far as any welfare recipients better look to MB, PQ and their gross malfeasance before even considering ON. How long as AB or SK been paying more than they get? hashtagLOL
Don’t forget the “transient oil patch worker”, who resides in their home province.
And being taxed there.
“Equalization”? Interprovincial socialism is a more accurate discription.
Just wait Alberta. Instead of sending it all east when the Dippers get elected in BC you will be able to send some west as well. I strongly suggest you get title to Rupert and Kitimat in exchange.
I always wondered why statists believe that it’s ok to confiscate and re-distribute wealth on an individual level, but all of a sudden it’s a bad idea when it happens to their particular jurisdiction.
I have long wondered about Canada, “cui bono”? I am not sure that it is the people of Canada broadly speaking. Certainly our chartered banks – just as Germany was once described as a country supporting an army, we are a country whose purpose often seems to be nothing but the support of our banks. Throw in the Toronto legal community, including Alfred Apps, long the head of the Liberal Party of Canada, and we may have it. Broadly, we can describe these people as parasites who need a warm but not sentient body to feed upon.
If you could actually make the government stop sticking it’s nose into things it should leave alone, at all levels, they might actually find they had more than enough tax dollars to do their jobs. My Municipal Government collects taxes, and then gives out money in grants to selected organizations or groups each year, they gave a local golf course $30K to improve their parking lot, how the hell is that something I should pay for? Same goes for the Feds giving money to curling rinks and arenas. Personally, I don’t lend, let alone give people money if I’m going to have to borrow it to do it, how can we run deficit budgets and give money away?
Dump all the trendy ideas, quit giving funding to those you will have to fight in court to get any development approved, get off the subsidy train for anything business, stop funding the “Wellness” nanny state themed items and turn health care back to the private sector, stop believing you create jobs, quite giving money overseas to people that hate our guts, etc…
They’d have enough to do what they should be doing.
Quebec and the Maritime provinces (except for Newfoundland of late) have been gaming the program for decades. The politicians in these provinces have quite deliberately amped up their own social programs, fully understanding that taxpayers in other parts of Canada would have to work more to pay for the lifestyles of others. That’s sick. Yet dare bring this up to someone in one of these “Have Not” provinces are you’re called uncaring and selfish. Canada 180. 🙁
“…Yes, Ontario has recently fallen on semi-hard times…”
Fallen? FALLEN?
Let’s face it, when it comes to hard tmes, Ontario did everything it could to get there.
Ignoring all the signs that were coming out of the US, The Dildo did everything he possibly could to make a bad situation worse.
He increased the tax-burden on the private sector; he hired more bureaucrats to enforce the counter-productive laws that he and his trained seals churned out; he introduced the HST that took an extra $960 per year out of the average family’s already shrinking disposable income; he brought in a Green Energy Act that saddles industries and consumers alike with the highest electric bills in North America; and I could go on, and on, and on.
And the arseholes who voted for him apparently couldn’t get enough of him – the put the serial liar in office three times.
So, Ontario didn’t ‘fall’ on hard times…it fell on its sword.
Exactly…hence the irony of the equalization protestations…and Ally Redford is following on Dalton’s heels but I think she’ll only get this one shot.
Don’t be kind to Newfoundland. Their non-gaming may be stupidity not morality. Though I will say that Kathy and Jerome, after stupidly overestimating oil revenues (yes, Jerome, the oil industry is cyclical) are attempting to get provincial finances under control, laying off 1200 out of 9000 civil servants for example (fairly recent hires I might add).
And you should hear the squeals!! The oinkers are filling the media with their cries of indignation! Newfs aren’t bright but they sure are verbal! So in three years or so we will have an NDP government here, and there will be no doubts about gaming the system, or borrowing up to the hilt. The present provincial NDP leader is about as bright as a fencepost but she knows what her voters want! OINK! And a year after the NDP gain power, you will hear demands for transfer payments, to a once-again have-not province – a year is about how long it will take the NDP to wreck the provincial finances.
Thank you Jamie. The parallel between individual welfare and inter-provincial welfare is astounding, is it not? Similar causes (in many cases, not all) and similar results (in a depressing percentage of cases).
What? Only 40 years too late……………..
Jamie MacMaster said: “Ontario is in a severe industrial recession no different than those of 1982, 1987, 1991.”
Perhaps you give Duhlton too much credit Jamie. If anything it is worse. I lived through those recessions here in Ontario myself as a young man, none of them felt like the world was changing. It was just a little harder to find a job is all. I lost many jobs as the small companies I worked for went out of business or cut back, but the big ones were not affected.
This time the big companies like Stelco, Dofasco, National Steel Car, Bell, they are all getting dinged. Little to middling companies are getting crushed. Just drive through any town in Ontario other than Kitchener or Mississauga, you can see it. Even Toronto is looking dingy these days.
100% to blame is the Ontario Liberal Party. Their policies drove this province from Numero Uno moneymaker to Maritimes status in ten years.
On the bright side perhaps there will be cottages on Lake Roseau and Lake Muskoka available for reasonable prices soon. Always wanted one of those…
We have asked for everything that’s dragging Ontario down. Other tax payers from other provinces would be farther ahead burning their money, than sending it to the second most spoiled province in Canada.
The bottom is the only thing that’s going to wake up many people here, we have had it good for way to long.
AAAAAND ANOTHER THING… we’d hate you guys less if you stopped calling yourselves “central Canada”. Check out a map sometime.
Pre Klein Alberta was a teat sucker for more than 40 years. Payback’s a bitch!
Consider this about equalization payments: they are all done using borrowed money.
That’s right. Since we have deficit budgets, we spend 12 bucks for every 10 bucks we bring in (or so), and “borrow” the 2 bucks to make the math work. Not from the Feds but from private equity funds. That charge interest.
(In what follows, forget the details. Just follow the bulging sacks of money to where it leads. And, yes, the $14 billion of federal transfer/equalization payments spread across Canada the other year are just PART of the “2 bucks” we borrow, but let us just look to the “gift” of equalization payments. It is bad enough.)
Last year Ontario received last year about $5 billion. All borrowed. Now that has to be paid back, with interest. So the $5 billion becomes in real terms perhaps $7 billion. With what? The feds use future taxes to do that. How do they get it?
Good question. If federal taxes amount to, say, 15% of whatever is earned in the economy, then for every dollar feds receive, the taxpaying individuals and companies have to EARN 7 times that amount. So the $7 billion that was “gifted” to them as an equalization payment, requires everyone to earn $49 billion more. Not just $49 billion, but $49 billion more than they would have had to had they not received $5 billion. But since Ontario is a “have-not” province, they won’t have to pay it all back themselves, as the “have” provinces kick in extra. Let us say Ontario has to pay back 75% of the “gift”. Only $38 billion.
So this is what happens: Ontario citizens are given $5 billion as a “gift” of federal transfer payments, that costs the federal government $7 billion, who have to take it from, amongst others, Ontario citizens. In order to do so they have to generate more work beyond their previously expected effort by about $38 billion dollars.
In 2011 Ontario’s GDP was $655 billion. $38 billion represents 7% of one year’s GDP, or about 3 weeks. So for every year that the feds “gift” Ontario, everyone has to work 3 more weeks before retirement.
For a start, it is no gift. And if you add up all the “gifts” that were given with borrowed money, you will find the reason the feds want to get the retirement age up to 70: you will have to work that long to pay for all the “free” stuff they have you over the years.
Could you have lived without all that stuff had you understood where the money was going to come from to pay for it? Would you have preferred to CHOOSE to retire at 65 instead of HAVING TO work until you were 70?
Absolutely.
When someone gives you something they borrowed in your name, it is neither a gift nor free.
scar says…”The only aid the failing economies in eastern Canada should receive are bus tickets to Alberta.”
Not a f%$&*%g chance! We have enough CINO’s and other assorted leftards out here now. Keep the scum.The best came here many,many,many moons ago.
Dismantle the whole thing?? Lets start by having a national vote on whether or not Quebec can stay in confederation. After all they’ve had two such votes and sadly the last one did not quite do the job. The only problem is – should we have such a vote – Ontario would carry the day keeping Quebec in the family because they know they would probably be next to go.
Its probably going to have to be a break of the 3 westernmost provinces. I doubt Manitoba would come along – and maybe not even BC. Fine – SaskAlta would still be a formideable and wealthy country in its own right with the USA its major trading partner and closest ally.
Transfer payments are cash rewards for inept/inefficient governments. There is no penalty for running budget shortfalls in this nation. We breed irresponsible spend happy government.
This business of “Alberta good, the rest of you suck” is not productive. Instead, let’s recognize that you get more of whatever you subsidize, particularly failure. That alone is reason enough to end the equalization program.
“Jamie MacMaster said: “Ontario is in a severe industrial recession…”
Nope, not I, said the fox.
Methinks it was cgh.
I only go back as far as Pearson but the country has been structured to benefit Ontario and Quebec from the beginning of European colonization. Westerners are very aware of the reality.
The true irony of the current situation is that no politician wants to address the obvious. The economic development plan that this country has funded for over 60 years is a massive failure. The country has poured untold $ billions into the auto industry in Ontario and Quebec and this industry cannot compete. One can argue the concept of public money being spent to subsidize private investment but this is what has happened. Why are the Liebels losing their grip on Ontario? The middle class is descending into poverty that’s why. They are actually starting to question the political fluff these morons are so good at putting out. The ones that aren’t questioning the situation are the same ones prepared to put another Turdeau into power. ???
Canada is in an incredibly weak international economic situation. The only reason the country has done better than the Americans over the past 5 years has been the increased commodity pricing that China caused. That boom is winding down, international trade is declining. The SE Asia tigers cannot kick start a world economy mired in unpayable debt. If PMSH had done a better job of explaining the reality the country faces he might not have been blamed for the coming recession/depression. He has not and will probably be tagged for the fallout.
While I agree with cgh that the condition of the United States is a major problem for the Ontario economy, that factor is an externality over which we have little control. You are absolutely correct in your assessment about how we’ve played our own hand miserably and utterly ineptly, and there is no excuse for that.
Overlay, if you would, the blind stupidity of Mr. McGuinty, other Ontario Liberals (both provincial and federal) and the electors who support them, with the inanities which regularly erupt from Mr. Mulcair and his ilk. What emerges is a sense that the lazy local blame-shifting attitude in central Canada (towards its regional economic weakness) is a threat to national unity. At the end of the day, it’s this blase and willfully ignorant local attitude that lurks just below the surface of the subject of this thread.
Whether things could be great again in Ontario (particularly in the manufacturing sector), or just better, if that is all that is on the table, is hardly the issue. The question we need to ask ourselves is this: are we doing all we can to position ourselves to be able to ensure our own economic success, and contribute to that of others? I think I know the answer to that question, and I think I know what Matthew Mendelsohn thinks is the answer to that question, judging by his look of pure contempt for his fellow panelists — Peter Kormos, David Kaplan and Chris Stockwell — on the February 15, 2012 edition of “The Agenda” concerning the Drummond Report (Don Drummond was also a panelist). The link is here:
http://theagenda.tvo.org/episode/141109/a-post-drummond-ontario
Whatever the outcome, we need to adopt policies that will create a new birth of productivity, and we need to do that now.
Alberta and Sask as a country, A beautiful dream one day I would love to wake up to.