At the recent Conference on employment policy at IAM Headquarters in Washington, D.C., a Canadian perspective was provided by two research associates of the Canadian Centre for Policy Alternatives, Andrew Jackson, who is Senior Economist for the Canadian Labour Congress, and David Robinson, a researcher with the Canadian Association of University Teachers.

They pointed out that Canadian economic performance, and particularly job creation, has been much better than in the U.S. over the last year, an indication that Canada’s greater income equality and social support programs were no impediment to growth and job creation. In fact, our more efficient public health care system is an important competitive advantage vs. the U.S.

This is an important point, since corporate flaks are continually saying that we need to harmonize to the U.S. (i.e., lower taxes for the wealthy) if we are to be competitive.

Canadians can’t be complacent about our recent economic performance, since some of our relative prosperity has been the result of the competitive advantage provided by our artificially low Canadian dollar. Much of our recent employment growth has been in the public sector, where there has been some expansion after the drastic cutbacks of the 1990s.

Recent economic news hasn’t generally been very positive for Canadian I.A.M. members. Key sectors like air transport and aerospace have been slammed by the economic slowdown and the aftermath of 9/11. Trade agreements have made it easier to move manufacturing jobs to cheap labour locations in Mexico and slave labour conditions in China. Most IAM members have seen no economic boom, but rather shutdowns, lay-offs, and insecurity for those still working.

It is hard to be optimistic about a strong economic upturn in the near future. Most world economies are performing poorly, and the U.S., the world’s economic motor over the last decade, has been powered by an unsustainable trade deficit. The U.S. right-wing Republican model – inequality, weak unions, and tax giveaways to the wealthy – is running into problems – rising unemployment and growing budget deficit to go with the trade deficit, which is one reason that Bush is looking for the diversion of a foreign war.

Corporate interests in Canada will use economic weakness as a tool and an excuse to further their goals – lower taxes for the wealthy and corporations, weaker unions and weaker social supports. They say we need to “harmonize” our policies with those of the U.S., but the evidence is that we can do as well or better following a Canadian model of greater equality and social solidarity.

WHERE DO YOU FIT IN?

The centrepiece of the Bush administration’s plan for U.S. economic recovery is a tax break on dividends that would cut the taxes of only the very wealthiest U.S. families, particularly the top 1% of income-earners and wealth-holders. How is it politically possible for Bush propose reducing the tax burden of the top 1% by billions of dollars, and shifting it onto everyone else?

One commentator referred to a poll of Americans in which 19% thought that they were in the top 1% of income earners, and another 20% believed that they soon would be. The commentator suggested that the poll was a sign of Americans’ basic optimistic, but it is probably more realistic to call it delusional.

It is, however, a good strategy for the very wealthy to convince a lot of people that they are better off than they really are. It makes it easier politically to promote things like tax cuts for rich people, if a lot of people think they are rich.

Well, according to the Statistics Canada figures for 1997, you needed to earn over $137, 942 a year to be in the top 10% of Canadian families with children.

Here are the cutoff points for income (before taxes and government transfers) for families with children in 1997 (to bring them up to 2003 levels, increase them by about 10%):

So half of all Canadian families with children earn less than $50,000 a year. To be in the top 10%, you need to be earning $150,000+.

Where do you fit in?