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May 31, 2005

Equalization Illustrated

Via commentor Majere

Posted by Kate at May 31, 2005 2:15 AM
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Holy *bleep*!

Posted by: etownie at May 31, 2005 3:17 AM

That's a "formula"? Socialism for Dummies I guess, great way to kill incentive.

Posted by: Jay at May 31, 2005 5:40 AM

How do you get one to vote for small government, lower taxes and still maintain present day social services?

Does one have to consider increasing ones' "freedom of choices" (individual soverignty) through less Government restrictions as an, an enticement?

Would one consider voting for the Conservatives increased if they maintained their Right Wing small Government but moved all their Social Policies much further to the "Left" than it is now"? Or is that not plausble do to beliefs within the Party?

Would the electorate consider the Conservatives more if they knew today that ALL the corrupt Liberals will be arrested,charged and prosecuted by them immediately?

Why have not the Consevatives arrested and charged Belinda for accepting "graft" as in the Cabinet Position for Her defection? Is it just because she said it was her conscience versus the talk to the PM that made her accept it? Is it just because she said so???????

On a side note, I voted Conservatives while a young one in the military and the only thing that peeved me off of them was when they brought in the "6 and 5" wage and price controls while inflation was running at double that. I would definately vote Conservative next election if I knew for a fact that all the corrupt Liberals ended up in jail or at least lost all their personal belongings, empoloyment and pensions. In the meantime, no Party affiliations, but am waiting on one that will actually increase my, as in I, personal Rights.

cheers from a happily married, military disabled pensioned off, old hippie who has lived in the West and East :) majere

PS, sorry for the bandwith with my rambling Kate.

Posted by: roger m roeder at May 31, 2005 7:04 AM

I want my money back!

Posted by: Richard Evans at May 31, 2005 8:39 AM

the gist is right but the data driving the graph is out of date.

As of fiscal 04 both BC & Sask should be in the blue. Sask because of the bonus energy revenues and BC because they kicked out the NDP and returned to profitability - BC historically has been a +contributor to this Federal ponzi scheme - but after one term of NDP economics they economy nosedived.

Posted by: paul at May 31, 2005 8:48 AM

I alwlay thought Manitoba was closer to Saskatchewan on these payments. Was I wrong, Manitoba is a welfare basket case, no wonder they elect so many dippers and libranos.

Posted by: qwerty at May 31, 2005 9:06 AM

Thanks for the graph Kate

Perhaps some of those Ontarians will see why we want in - and why they aren't carrying the country - we are!!!

Posted by: sheila at May 31, 2005 9:31 AM

Why isn't Alberta's separatist movement much, much stronger?

?

Posted by: Hershblogger at May 31, 2005 9:40 AM

Folks, the big story is being missed by all.

Unless I miss my guess, the ONT is falling, while BC and SASK are rising (the latter has laready been covered). Meaning, in say 2-5 years, Ontario will slip into have-not status, just as BC and Sask become haves.

So the three western and most conservative provinces will be the only net contributors.
Ooooh.

Oh, one thing, majere and others are noting that the Tories don't get majority support in SASK, MAN, and BC. Less to that than meets the eye. Sask and BC especially have local NDPs that look a lot like federal liberals, while the BC Libs are right of center (SASK libs did once too, until Romanow got them to join him in coalition, the party has seince collapsed there). I know fed parties and provincial parties are not the same, but they do have an effect: Nova Scotia had the most NDP MPs just when Bobby Chisholm veered the party past the local Liberals and right next to the Hamm Tories.

I don't mean to be rude or alarmist, but this could get really, really, ugly.

Posted by: The exiled American at May 31, 2005 9:45 AM

Alberta separatism isn't all-consuming...yet...because we ARE Canadians and most prefer to remain so, if at all possible.
As mentioned earlier the gist of this graph is clear. We can live with being a net contributor but not with being ruled by thieves.
The choice may already be a liberal government OR a united Canada.

Posted by: Polly at May 31, 2005 10:22 AM

Here are the the latest dollars in absolute terms.

Equalization Transfers 2002-2003 - $10.3 Billion
B.C. 488,000,000
Sask. 325,000,000
Man. 1,158,000,000
Que. 4,678,000,000
N.B. 1,174,000,000
N.S 1,260,000,000
P.E.I. 248,000,000
Nfld. 1,019,000,000

Posted by: CET at May 31, 2005 10:22 AM

Wow! I had no idea Sask was doing so well and ahead of both BC and MB. It's amazing how an NDP gov't can kill an economy like BC's.
Note to The Exiled American: BC's NDP are NOT ANYTHING like the federal Libs. They are some of the most left-wing nutcases in Canada. And the Liberal Party of BC is not right of centre. They're fiscally conservative, but very socially very "progressive" (left-leaning).

Posted by: King Richard at May 31, 2005 10:32 AM

Saskatchewan is riding the oil boom and high potash prices at the moment. Calvert is busy using the excess cash to hire as many new NDP voters er.. civil servants... as he can afford.

Posted by: Kate at May 31, 2005 10:35 AM

Sask would be right up to Alberta's level if it wasn't for Calvert and the commies. Plenty of oil drillers and producers thumb their nose at Sask. even though Castro and the NDP think they have lowered royalties and taxes.

Posted by: wasp at May 31, 2005 11:01 AM

Didn't Sask come *this close* to electing the Saskatchewan Party (right wing) last time out? Seems to me, that just a bit of convincing, and Kate's province could be saved from Calvert's idiocy.

Posted by: Shabbadoo at May 31, 2005 11:29 AM

Viewing the Chart it becomes starkly clear why PEI is a vast federal civil services play ground, retirement camp and golf course.

You can also guage equalization reliance to political support for liberals and acceptance of their gross corruption. The real equilization formula is: Dependence=acceptance of corrupt federalism

Posted by: WL Mackenzie Redux at May 31, 2005 11:35 AM

Manitoba should not get equalization.


Make our welfare bums/corporations go to work!

Posted by: DrWright at May 31, 2005 12:01 PM

King Richard - do you need to be reminded that your friendly neighborhood Minister of Federal Health and Bribery Attempts is none other than Ujjal Dosanjh, onetime NDP Premier of BC? The relationship between BC's NDP and the Federal Liberal Machine is actually quite cozy.

Posted by: kakola at May 31, 2005 12:06 PM

PEI elects four MPs, their ridings average less than 30,000 registered voters each. Alberta's average over 100,000.
'Buy three votes for the price of one'!

http://www.elections.ca/scripts/pss/FindED.aspx?L=e

Posted by: Rat Lander at May 31, 2005 12:11 PM

Sorry, folks, but I get the impression some of you think this graph shows who are the sucklers versus the sucklees. It does not. And it most certainly doesn’t show that Alberta is “carrying the country”.

All it shows is "fiscal capacity" (i.e. ability to fleece taxpayers) for each province, one factor upon which equalization payments are based. Please see:

http://www.fin.gc.ca/transfers/transfers_how_eq_calc_e.html

for an outline. Neither Alberta nor Ontario pays a specific levy to fund provincial equalization payments – it comes out of the vast cesspool into which we all throw our taxes.

The explanation on that web page also shows that the only way Ontario could become a have-not province is if its fiscal (taxing) capacity fell below the average of the five “middle-income” provinces: Quebec, Ontario, Manitoba, Saskatchewan and British Columbia. Technically possible, I guess…but something tells me the feds would come up with a new equalization formula right around that time.

As for how much each province receives from the feds, see:

http://www.fin.gc.ca/FEDPROV/mtpe.html

which covers all types of transfers. On a per capita basis, Alberta is there at the hind teat, right beside Ontario. For a graphical look, see the bottom of:

http://www.fin.gc.ca/FEDPROV/ftpte.html.

It shows the estimate for 2005-2006 where Alberta will receive (gasp) $1 less per head than Ontario and Saskatchewan.

I truly empathize with Alberta’s frustration about the current state of Canadian politics, and Ontario politics in particular, but let’s not try to claim the financial high-ground.

Posted by: 2Sheds at May 31, 2005 1:55 PM

Thanks for the excellent links 2Sheds.

I see some posters (Scott at the Shotgun anyone?) complaining about ON bleeding AB. I've always argued that it isn't true. It's nice to see that my gut feel is backed up with some hard numbers!

(If Scott wants my extra federal dollar, he's welcome to it. I'll even pay the postage to mail it to him.)

Posted by: MIke at May 31, 2005 2:49 PM

"the only way Ontario could become a have-not province is if its fiscal (taxing) capacity fell below the average of the five “middle-income” provinces: Quebec, Ontario, Manitoba, Saskatchewan and British Columbia. Technically possible, I guess…but something tells me the feds would come up with a new equalization formula right around that time."

You mean Ottowa would force "vote-rich Ontario" to contribute more?

I live 1500 miles south of the 49th, and even I can see through that.

Posted by: The exiled American at May 31, 2005 3:05 PM

kakola, good point on Ujjal Dosanj, however I *believe* Ujjals decision to move to the fed Libs has more to do with him gaining power than ideology. Can't prove it, but that's my guess.

Posted by: King Richard at May 31, 2005 4:39 PM

2sheds,

You're argument isn't that strong. Equalization payments, by their very nature, involve haves and have-nots. Someone needs to put more in than others in order for wealth to be equalized.
As well, there are some Federal spending, such as health, that has been cornored by the government. If I were living in Canada, I couldn't buy health insurance, or other health-related services, on my own. The government does this, and federal payments are bound to make their way in there. The question isn't whether Alberta receives federal money, the question is why Alberta contributes so much more than the other provinces. Currently, who would suffer the most if equalization payments were cut off? Alberta would notice it the least, and if Alberta could actually keep the revenue it is sending to rest of Canada, it would be better off.
Of course, it's also ridiculous to have an equalization scheme in which only 2 provinces contribute more than they take.
In the end, however, I agree with Polly. It's one thing to assist other provinces, quite another to be ruled by thieves. Equalization payments isn't a rallying cry for seperatism (it's a bonus). Corrupt government, however, is. And as it stands, it appears that Canadian voters are content with a corrupt government.

Posted by: Half Canadian at May 31, 2005 5:27 PM

HC, the point of my post (which I may not have made very clearly) was that graph does NOT show that “Alberta contributes so much more as a province”. It only shows that Alberta has a higher “fiscal capacity”, not a higher per capita contribution.

Unlike transfers, our contributions to the federal coffers are based on income, not geography. Albertans do not pay any more or less federal income tax than anyone else in the country who earns the same amount of income. The people who fund equalization, just like most other government expenditures, are high income taxpayers, regardless of where they live.

Now I guess one could argue that Alberta has proportionately more high-income earners, and therefore contributes more as a group – but one would also have to prove that. Personally, I’d be surprised if Alberta pays much more federal income tax per capita than Ontario.

It also doesn’t mean that Alberta would have the option of keeping all that federal income tax money if it pulled out of Canada. If it did, I imagine the new Republic’s taxpayers would be mightily pissed. (Ontario’s Premier McGuinty tries to use a similar argument: that the feds shouldn’t get all those Ontario taxpayer dollars to squander, that’s the province’s job.)

Having said all that, I absolutely share your disgust that citizens are prepared to support a corrupt government, and distress at having to pay for it all with our tax dollars. For the sake of a united Canada, I hope we can clean this mess up.

Posted by: 2Sheds at May 31, 2005 6:54 PM

"It shows the estimate for 2005-2006 where Alberta will receive (gasp) $1 less per head than Ontario and Saskatchewan."... Exactly! *Equalization* at work! We contribute nearly twice what they do but get back about the same as them when we should actually be getting twice what they get, not $1 less (much less being spat on and called rednecks)! Alberta could be a filthy rich little country, so much so that, if we kept taxes low and government small, we would actually attract people and businesses from the US and Canada (imagine reverse brain/job drain).

Posted by: etownie at May 31, 2005 9:48 PM

Are you related to Arthur 2Sheds Jackson of Monty Python fame?

Posted by: Cal at May 31, 2005 10:26 PM

Etwonie, please support your claim that “We contribute nearly twice what they do”, or that everyone is supposed to get back what they pay in. (Boy, based on my annual tax bill, I would REALLY like that.)

Also, please note that I (many? most?) have never thought of Alberta as anything but a great province with some really great people. Please don’t base your opinion on what you read in idiotic articles by leftist twits like the Globe and Mail’s John Barber (anti-western nonsense recently reported in many blogs).

Cal, very astute call. But unlike Mr. Jackson, I actually have two sheds…not just thinking of getting another one. And I haven't written this in either shed. ;-)

Posted by: 2Sheds at June 1, 2005 12:05 AM

2Sheds - "please support your...", it's not necessary to support anything, it's an emotional appeal to radical right wing Alberta separatists and a venting of my extreme displeasure at being taxed at all. But here, I'll try anyway;

"We contribute nearly twice what they do" - looking at the graph and rounding up (generously).. Alberta's bar looks about twice as tall as the others (but to be more honest, it seems more like a 10/6 and not 2/1, but close enough for fist shaking).

And that "everyone is supposed to get back what they pay in" - I honestly don't see why not, I hold it as self evident that any association where a person or group gets back less than they put in is not in their best interest (counting 'intangibles' too).

"Boy, based on my annual tax bill, I would REALLY like that" - exactly... why the **** not! Is there any legitimate reason why the government should forcibly take $X dollars away from you to fund the likes of CBC and 'the arts'? Not to mention the gun registry, corruption, waste, etc... the government is wasteful because they have access to unlimited funds and our citizens don't demand better.

Posted by: etownie at June 1, 2005 10:39 AM

Etownie (sorry for my previous misspelling) thanks for your comments…some good chuckles.

You certainly won’t hear me defending governments that fritter away our tax dollars on things like the CBC, waste (there’s a tautology), and the other things you mentioned. Although, being realistic, I know I’ll never get back everything I put in, dollar for dollar, tangible or intangible. (In a democracy, there is always going to be money spent on something you think is a waste of resources.) But you’re right, we should expect and demand much better.

The only other point I’ll make (repeat) is that the graph DOES NOT not show what Alberta contributes. So whether that bar is 10/6ths, or double, or whatever, it doesn’t matter. It’s NOT an indicator of what Alberta kicks in towards equalization. Please see my earlier post for an explanation.

Posted by: 2Sheds at June 1, 2005 11:44 AM

If we were in a true democracy the government would be restricted to what it should be doing and nothing more.

Provide for the common defence of the nation from enemies both foreign and domestic (armie and police)

Create and enforce laws (parliment and the courts)

Anytime the "government" steps outside of these boundaries you end up with CORRUPTION and CRIMINALS running our country.

Free medicare or FREEDOM (pick 1)

A man with a gun is a citizen
A man without a gun is a subject

Posted by: FREE at June 2, 2005 12:34 PM
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