Why Canadian Politicians Need to Start Capitalising on Class Warfare

Canada's opposition parties need to get their shit together sooner.

by Justin Ling
12 January 2016, 6:00am

Photo via Flickr

Was it Karl Marx – or the philosopher Gob? – who once theorized: "90K a year buys nothing but complaints."

Either way, the thesis remains as true now as it was then: "While the boss gets richer [we] get deeper in debt."

Canada is on the brink of the most inflamed, entrenched, and ignored level of income inequality in a century. Wages for many are stagnant, while income for nearly everybody else isn't rising as fast as it is for the fatcats. Wealth is beginning to pool at the top as the yacht-owners, Tesla-drivers, and dental insurance-havers all stuff their wads of cash into the mattresses and mouths of their oddly-named children.

And that [deep breath] is why Justin Trudeau got elected. The prime minister swore that he would hike taxes on the rich, cut them for the Middle Class™, and tackle income inequality.

Here's the problem: Trudeau's policies are a long way off from being the sort of egalitarian quick fix that he billed them to be.

And while Canada's isn't quite—yet—slipping down the Crisco-lubricated slope to hell like some of the deeply unequal states in Europe, there's a growing feeling in the country that things aren't working the way they're supposed to.

That means there's going to be a big gap for some other leader to step in, exploit that discontent, and promise to fix this shit themselves. The only question now: will it be the leader of Canada's New Democratic Party, or the leader of the Conservatives?

How bad is it? Pretty bad. Canada's Gini coefficient—the numerical representation of the income gap between the economy's richest earners and your high school class—is higher than that of every European country, except the United Kingdom. The richest 20 percent of Canadians make twice as much as the next 20 percent, three times as much as the middle 20, four times as much as the next 20, and nine times more than the poorest 20 percent. And that's after the country's supposedly progressive tax system evens everything out.

But is income inequality really a problem? No, not really.

Every time I say this, I get a flood of angry emails and tweets quoting Joseph Stiglitz, who I assume is either a rap producer or an economist. But emails be damned.

Despite DJ Stiglitz's calculations, there's not a whole lot of proof that income inequality is, in and of itself, a problem. It's possible that it could reduce confidence in the economy and the government, and it's quite likely that it's a symptom of other problems in an economy, but it's not a sure thing that wage disparity actually does any harm. In other words, it correlates with bad things, but it doesn't cause them, necessarily.

For example, everyone in the economy could be making 10 percent more, year-over-year, but the top one-percent could be earning 11 percent more. In that case, the Gini coefficient would grow, despite the fact that everybody is doing a-OK.

At the end of the day, it's really more of a symbolic problem. You want people to feel like they're getting a fair shake, and you want to make sure that you're maximizing your tax intake (within reason). You also want to get that money circulating through the economy.

How do you do that? Well, you could re-jig income tax levels, close tax loopholes, draw up new rich-people taxes, or release luxury wolves to hunt down anyone worth over $10 million.

What Trudeau is planning is a very weak version of that, without the wolves.

Obviously, the biggest change will be the creation of a new tax bracket for those earning over $200,000. Those gold-plated captains of industry will be paying a new rate of 33 percent. Meanwhile, the tax rate for incomes between $44,700 and $89,401 will drop slightly. Tax benefits for families with spawn will be means-tested, so lower-income families will benefit the most.

Those measures will slow, and maybe even reverse, the trend of inequality. But it will go nowhere near bringing Canada towards the egalitarian utopia that some would prefer.

But, hey, again, maybe that's OK. Maybe we don't need the government to socially engineer an economy. Maybe we can let things work themselves out.

But then again, economic inequality spills over into social inequality, which spins into a political motivation for many voters. Even if it's basically envy and jealousy, it drives cash, votes, and people yelling.

Trudeau won this last election by tapping into that dissatisfaction. He promised to hike taxes, and spend the country out of financial mediocrity. Coded language made clear to Joey Sweatshirt that this is for you. This cash won't end up in ol' Thomas Tracksuit's Italian leather wallet. This is for you. My friend. You.

Liberals, in hushed tones that turned to gleeful cackles by the end of the campaign, fretted that someone else would figure this out. They figured the NDP's Thomas Mulcair would promise a new income tax for the One Percent, or vow to melt down all rich people into a fine chocolate that would be exported, with the proceeds going toward stock car races, or whatever it is the people like these days.

But the NDP did no such thing. They ran a campaign promising the plebs that things would stay, ultimately, the same. No new taxes. No class warfare.

Stalwarts of the left and right alike are maddeningly bad at figuring this out. In America, where the problem is magnified to an even greater degree than it is in Canada—and where public trust in government and the economy is fast approaching absolute zero—the mainstream of both sides of the political divide grab their hair and moan: Donald Trump! Bernie Sanders! Politics is screwed up.

While Trump and Sanders are very different, they are mainlining the exact same political heroin.

Trump has honed in on the rural and post-industrial poor with inspired salvos against the timed-tested American scarecrows of immigration and those-bums-in-Washington. Sanders has offered a Hail Mary pass to the masters-degree-holding urban lower-class and the union agitators who have long believed that the evils of Wall Street and corporate America could be dismantled if only they had the right political savior.

But both sides will tell you that the problem with America—nay, the world—is that politicians keep politicianing, and that the rich get richer, while Joe America gets deeper in debt.

Trudeau caught that current in the most happy-go-lucky way possible, choosing to phrase his class warfare as a national building exercise in fairness and equality, instead of opening fire against the fatcats.

But that means there's room for someone else to do exactly that.

The only question now is whether it'll be the NDP or the Conservatives who capitalize on the opportunity.

Both opposition parties are currently going through a bit of a self-immolation, though. The NDP, still—somehow—helmed by Mulcair, the Great Bearded Blunder, have doubled down on middledom, and seem lost for cause. The question of why the NDP still exists has no clear answer with Trudeau in the driver's seat. "We're no longer new, we're certainly not democratic. And no one is having a party anywhere," Cheri Dinovo, a member of Ontario's provincial parliament, told the Toronto Star.

To give it one, Mulcair, or the malcontent that displaces him, needs to give the NDP a cri du coeur once more. Higher taxes on the rich, a guaranteed minimum income, a new national rail plan, nationalizing the banks—the buffet of aggressive policy options is the NDP's to peruse through. All it will take is a political spine to push it past the naysayers.

For the Conservatives, they have a choice to make.

They could find a traditionally small-c conservative, working-class hero persona to put on. A new, broad, negative income tax. Maybe a flat tax. Increased tax credits and benefits that—unlike Stephen Harper's freak show of tax code violations—benefit the poor and working classes over the upper-middle class and the rich. An industrial action plan to get the workers working again.

Or they could Trump out, blame the damn immigrants, and fire off at a bunch of potshots at some political strawmen other than the One Percent. That option is pretty odious, and I wouldn't recommend it.

Alternatively, both parties could continue down their current paths, and try to convince the public that it doesn't actually care about economic equality. Good luck with that.

If this sounds dangerous, it's not really. Trudeau won a decisive victory—a come-from-behind surprise upset thanks to optimistic messaging and broad vision. Quibble with the characterization of his campaign platform as actually being bold or significant—and quibble vigorously you should—but it certainly looked exciting. Latching onto the Liberal campaign, you believed that things would change. You believed that the crap things you've always wanted to see become good again (the Canadian Broadcasting Corporation, for instance) would become great again.

But those things will continue to suck. You will continue to go bald. Inequality will continue to exist. You will continue to see dead pigeons on the side of the road. People will continue to kill each other over stupid shit. You will continue to think the economy is unfair.

The imperative for the future leadership of the NDP and Conservative Party will be to look at those problems and figure out the most ambitious, broad, and mind-numbingly obvious solution, and then sell it to Canadians.

It's a disservice to the country to have one party offer a set of solutions, only to have its opponents sit back and nay-say. We need three radically specific and individual political parties, each proposing actual reform.

Currently, we only have one.

Follow Justin Ling on Twitter.

Justin Ling
income inequality
Views My Own
Vice Blog
income gap
canadian politics
Justin Ling VICE