The underlying reason for the Great Recession was that real household wages were incongruously flat or even declining, all through a boom fueled by an orgy of consumer spending (consumption and house-construction). Total social wealth grew strongly, but in the absence of a balanced sharing-out of that new wealth, it could only be financed by unsustainable consumer debt. It was really the bursting of that bubble, and not just reckless practices by banks, which caused the collapse in the financial structure.

Issuing, bundling and re-selling sub-prime mortgages was not just a moral failure by bankers, but was part of the engine that made the economic boom of the Clinton/Bush years possible. That’s what you have to resort to if you want to sell housing to people whose wages cannot sustain the cost of building it.

Generally, it’s how you get rich, in the short term, off people who you don’t pay enough money to buy your goods. You extend them credit.

A key economic recovery strategy of governments is to prod consumers to resume their former, unsustainable levels of consumption. In the medium term, that is like trying to put out a fire with gasoline. We are supposed to see rising house prices as a sign of recovery — but all they mean is that the underlying problem is still doing its destructive work.

The only way to produce stable and sustainable growth is to adopt a strategy of redistribution to flatten out real incomes, so that people can afford to buy the stuff they purchase. Without that, the only thing that can propel spurts of strong economic growth is bubbles (which invariably collapse).

That means reversing the decades of anti-labour legislation, increasing income taxes on the highest brackets, raising minimum wages and welfare rates, and expanding socialized access to health services, transportation and other essentials. These are the measures that our economic system needs: it recognized this to be the case in the decades after WWII, but has abandoned that strategy and its own long-term health.

So in my opinion, while Canada’s growing income disparity is subjectively a moral outrage, it is also objectively a fundamental weakness of the economic system, which undermines the entire economy.