A spectre is haunting Europe — and the United States. And soon, I submit, it will be here in Canada. That spectre: the proposition that the time has come to stop borrowing billions of dollars every year in order to give it to rich people.

President Barack Obama put this modest proposal into the heart of his fiscal and economic policy last week. He threatened to veto future budget bills that fail to ensure that the wealthiest taxpayers pay at least as high a rate of income tax as their own domestic servants. In this, Mr. Obama is echoing a policy reversal that is gathering steam.

For example, one of the better measures the former British Labour government implemented in its last days was a high-income surtax. The current Conservative-Liberal Democrat coalition government hasn’t touched it — and the British Liberals made it clear at their conference last week (or at least, as clear as that party can ever make things) that they will not permit it to be touched in the years to come.

The time has come to have this debate in Canada. The details of tax policy can be mind-numbing. But the key issues are straightforward and face all industrial democracies in one form or another. To wit:

The recklessly, fecklessly irresponsible Reagan administration set off a round of competitive high-income tax cuts all around the world in the 1980s. Ronald Reagan’s own budget director, David Stockman, cheerfully admitted in a candid memoir that the arguments used to justify this policy were baseless.

As indeed they proved to be. Instead of increasing revenues by cutting high income taxes, as promised, American conservatives tipped the United States into a permanent structural deficit — briefly mitigated by Bill Clinton’s administration, and then made worse by George Bush.

The harvest is a multi-trillion dollar public debt, accumulated even during periods of economic growth. Sapping the ability of the American government to respond to recession and economic shock — like the shocks facing the world economy today. In the process, as intended, we have witnessed on of the greatest transfers of wealth from the poor to the rich in world history.

Not in Canada? Like all other industrial economies, Canada foolishly mirrored American tax policy and has paid many of the same prices. The Conference Board of Canada recently reported that the gap between low and high-income earners is every bit as striking in Canada as in the United States. In our modest Canadian way, we too run structural deficits to pay for annual tax giveaways to those among us who need help the least.

Mr. Reagan’s tax policies belong in his museum. If these times call for belt-tightening — a highly debatable proposition, to say the least — then let’s start among those with the largest belts. A good place would be with a new top-tier income tax bracket, and a careful look at loopholes and giveaways that embarrass even American billionaires — some of whom are now leading the growing chorus for change.

This article was first published in The Globe and Mail.