The recent Statistics Canada report that Canada’s unemployment rate had dropped to 5.7 per cent, the lowest in four decades, was greeted with great jubilation by politicians, most economists, and the mass media.
They welcomed the “good news” that the vast majority of Canadians now have jobs and so presumably are being spared the stress and strain of destitution.
Statistics on their own, however, can be factually misleading, as they certainly are in this case. Unless they are accompanied by other pertinent information — such as the pay rate and security of an occupation — they are seriously deficient in the broad inferences they allegedly imply.
If you happen to be a doctor, a lawyer, a business executive, a banker, a professor, a high-tech specialist, even an engineer or utilities manager, you have an annual income ranging down from millions of dollars to at least $100,000. Your position is relatively secure and you have no trouble providing your family with a high living standard.
But if you are a fast-food restaurant employee, a dishwasher, a gas station attendant, a cashier, a barber, a kitchen cook, a farm labourer, or one of the millions of other workers with insecure and temporary jobs, you are lucky if you are paid much more than $15 an hour. Your family’s quality of life is often precarious and stressful.
The real extent of this income inadequacy, and its horrendous impact on nearly half of Canadian families, is not usually taken into account. There are sombre facts and figures available that paint a much darker picture of unemployment in this country than the basic statistics alone.
From paycheque to paycheque
A recent survey by the Canadian Payroll Association, for example, found that nearly half of Canadian workers are living from paycheque to paycheque. Up to 47 per cent of respondents said it would be difficult to meet their financial obligations if their paycheque was delayed by even a single week. Most admitted they felt overwhelmed by their level of debt, which they mainly attributed to their meagre incomes and the soaring cost of consumer goods.
In another recent survey by Manulife Bank, four out of 10 homeowners said they had been “caught short” in the past year without enough money to meet rising expenses. They were within $200 a month of being unable to pay their bills.
Manulife warned that these homeowners, burdened with an average mortgage rate of $181,000, were sitting on a potential land mine if interest rates also start to rise, as now seems alarmingly likely.
In even more dire conditions are the 4.8 million Canadians — including 1.2 million children — who are living in poverty because of their inadequate incomes. Most of these people have jobs, but not jobs that pay a living wage. So they struggle to meet the rent payments for their dwellings, and hundreds of thousands depend on food banks and other charities to help their families avert starvation.
Granted, Canada is not the worst “advanced” nation in the scope of its working poor. That dubious distinction is held by the United States, even though its political and business leaders recently celebrated that country’s officially low 3.8 per cent rate of unemployment.
“The typical American worker now earns around $44,500 a year,” he pointed out, “not much more than what the typical worker earned 40 years ago when adjusted for inflation. Although the U.S. economy continues to grow, most of the gains have been going to a relatively few top executives of large companies, financiers, and inventors and owners of digital devices.”
Reich, a former secretary of labour in Bill Clinton’s cabinet, added that the absurd 3.8 per cent unemployment rate overlooks “the legions of college grads overqualified for their jobs, the growing number of contract workers with no job security, and an army of part-time workers desperate for full-time jobs. Almost 80 per cent of Americans now say they live from paycheque to paycheque, many not knowing how much their next cheque will be.
“The United States doesn’t have a jobs crisis,” he declared. “It has a good jobs crisis.”
The same could be said of the millions of Canadian workers who lack adequate wages and job security, as well as the many thousands desperate for work but denied employment.
Victims of uncontrolled capitalism
They are the victims of a global economic system — capitalism — whose profit-obsessed power is virtually unchecked in both the U.S. and Canada (though not in some European countries). When corporations are as free to fire as hire their employees, minimize their pay, withhold or weaken their benefits, and in many cases prevent them from joining a union, the inevitable result is a massive increase in the working poor. The provision of jobs is regarded as a necessary evil — as a reduction of profits to be curbed as much as possible.
The federal Liberal government recently unveiled a new plan to help low-income Canadians. The promise is to lift more than two million of them (including 534,000 children) over the poverty line and thus reduce the country’s current poverty rate by 50 per cent. The target date for this accomplishment is 12 years from now, some time in 2030.
It’s a plan that’s reminiscent of a resolution unanimously passed in the House of Commons in 1989 when MPs of all the parties pledged to eliminate child poverty in Canada by the year 2000. That’s about the same time being allotted for achievement as the current government is projecting for its 50 per cent reduction in overall poverty — and just about as credible.
The unanimous commitment made by MPs in a previous government was not only broken, but their successors in Parliament actually allowed the child poverty rate to rise even higher, dooming many thousands more children to lives of pauperism and deprivation.
As much as I would like the latest federal government’s anti-poverty plan actually to be implemented, I foresee it doomed to the same utter failure. Not because of a lack of support by future governments. Not because of a future economic depression. Not even because I’m being unjustifiably pessimistic. It’s simply because such an ambitious anti-poverty project unavoidably entails a more equitable sharing of wealth, which in turn means lowering business grants and subsidies and raising corporate taxes to their previous higher levels.
These are reforms that the moguls of capitalism will never permit. Any government policy or action that significantly impedes the maximization of profits is forbidden under the neoliberal political system that prevails in North America. The basic test for corporate approval of such policies is whether their effect is to enhance profits.
Extracting and selling global-warming fossil fuels is profitable.
Plundering non-renewable resources is profitable.
Deforestation is profitable.
War is profitable.
Offshore tax havens are profitable.
Ill health is profitable.
Hooking kids on sugar is profitable.
Low wages and high unemployment are profitable.
Outsourcing jobs to low-wage, low-tax countries is profitable.
Purchasing politicians is especially profitable.
On the other hand, anything that would benefit most people but necessitate lower profits — or not as large a profit as peddling junk food or marketing the latest electronic gadgets — will not be undertaken. Neither will reducing the high rates of disease caused by poverty and malnutrition when it’s so much more profitable to treat the sick with costly drugs.
Perhaps I’m being overly cynical, but it’s clearly evident that the dominance of an economic system that puts profits ahead of the public welfare is inherently incompatible with a more equitable sharing of wealth.
It follows that the government of Justin Trudeau, or any other Canadian government, is powerless to do much to reduce poverty or inequality as long as corporations set the political as well as economic agendas. In short, the first step any government sincerely bent on reducing poverty has to take is to replace the prevailing corporate plutocracy with the kind of democratic socialism that is enjoyed by citizens of the Scandinavian countries.
Good luck with that.