Tuesday, 10 June 2014

Five problems with the PC campaign

With the Provincial election campaign in full swing, we’re all being asked to consider a lot of campaign platforms. But how to see the truths from the falsehoods can be a chore. It’s not often this chore is simplified by leaders of a political campaign. In this respect, if for no other reason, Tim Hudak stands out. His candour in opening up the PC’s Million Jobs Plan has made plain the flaws, distortions and outright falsehoods in Hudak’s promises. Of the litany of flaws in the PC platform, we have selected our view of the top 5 problems with the PC platform:


1.      Basic arithmetic. The so-called Million Jobs Plan, on a basic level, promises to create 1 million jobs in the province over a course of 8 years. But one glaring problem with the plan is that it uses false math to support that promise.

The plan has been assailed by economists for confusing jobs with job years. Basically, if someone gets a job and then keeps that job over the span of 8 years, most of us would think that the person got “a” job. Not the PC’s. The PC’s count every year of the 8 years as a job. For example, if you were a postal worker for 8 years, the PC platform would say 8 postal worker jobs were created. This is clearly a distortion and it skews the math to falsely support the PC’s claims. This kind of double-counting by the PC’s is either deceptive, at best, or is, at worst, incompetent.

 

2.      Taking bogus credit for job gains. The Million Jobs Plan promises to create 1 million jobs. What’s less frequently touted by the PC’s is that roughly 500,000 jobs will be created over the next 8 years if the province simply stays the course it’s on now. So obviously the promised job creation is automatically half as impressive as we, as voters, are being led to believe.

 

3.      Cutting 100,000 public sector jobs. This promise seems to have gained some traction with voters. But is it for the right reasons? For many of us, when we hear of the “public sector”, we think of a trimming of government bureaucracy. But these are not the only jobs that would be under the knife. Public service jobs include teachers and bus drivers and a whole host of other jobs that the public needs to keep functioning. The workers filling these jobs are not the recipients of bloated salaries – they are regular people with families and bills to pay. Cutting their jobs would not diminish government bureaucracy.

 

4.      Trickle down economics.   It’s not only public sector jobs Hudak so proudly promises to cut. He also promises to cut corporate taxes by a whopping 30%[1]. His plan here is to make Ontario the lowest corporate tax jurisdiction in North America. This, Hudak claims, would encourage so-called “job creators” to set up shop in Ontario.

Hudak is clearly subscribing to the largely debunked theory of trickle down economics. Cutting corporate taxes in this way will do little more than provide a boon for wealthy corporations and increase the burden on the average taxpayer. As Ha-Joon Chang, an economics professor at Cambridge University, has stated: “Once you realize that trickle-down economics does not work, you will see the excessive tax cuts for the rich as what they are -- a simple upward redistribution of income, rather than a way to make all of us richer, as we were told.”[2]

 

5.      Confusing Deficit reduction with Job Creation. Hudak has said that, “The biggest thing that we can do to actually create jobs in the province of Ontario is to balance the budget.” This statement reveals a profound confusion of the engines of job creation. Deficit reduction does not equal job creation. In fact, conventional wisdom holds that it does exactly the opposite. This is especially so in Hudak’s case when considering that he plans to reduce the deficit through austerity measures and cutbacks.

According to economist Jim Stanford, to balance the budget in a present sense, one of two things would be necessary: either more taxes or less spending. Seeing as how Hudak is intent on cutting corporate taxes, his preferred option to balance the budget must be less government spending. But there is no evidence this would create jobs. In fact, Stanford finds that “simply and aggressively balancing the budget (through spending cuts) would eliminate about 165,000 jobs in Ontario.[3]

1 comment:

  1. Hmm... pretty interesting article. I want to add here that it is merely not an issue that present job is not giving expected wages to the employees. it is in fact a least of my concern. The main problem is that employees who work in a company are not emphasized on taking safety precautions, which eventually causes an accident.

    Regards,
    Arnold Brame
    Health and Safety Risk Assessments

    ReplyDelete