Real tax re­form will ben­e­fit real peo­ple

The Amherst News - - OPINION - Per­spec­tives Shirley Hallee Shirley Hallee’s col­umn ap­pears bi-weekly in the Amherst News.

There has been a fair amount of news cov­er­age re­gard­ing tax re­form in the United States, and also here in Canada. Justin Trudeau has been crit­i­cized for want­ing to tax some folks at a higher rate; and this is draw­ing the ire of doc­tors, lawyers, shop own­ers and other in­cor­po­rated small busi­ness own­ers. These are peo­ple who are mid­dle class and up­per mid­dle class. It is not clear if the su­per wealthy will be pay­ing their fair share. To the south of us, Don­ald Trump is draw­ing at­ten­tion with his plan which would give tax re­lief to the very wealthy... es­pe­cially those with own­er­ship in large cor­po­ra­tions.

Ac­cord­ing to Trump’s think­ing, a tax break for the wealthy would re­sult in more money in­vested in their com­pa­nies so that more jobs can be cre­ated.

The more likely oc­cur­rence would be that the well-heeled own­ers would sim­ply pocket the funds, re­sult­ing in more wealth — and power.

There are a num­ber of ways in which the wealthy – par­tic­u­larly those who have own­er­ship in cor­po­ra­tions — can as­sert their in­flu­ence. A re­cently pub­lished book, Academia, Inc., by Jamie Brown­lee points to the chang­ing in­flu­ence large Cor­po­ra­tions are hav­ing on uni­ver­si­ties, in­clud­ing those across Canada. These or­ga­ni­za­tions are sig­nif­i­cant con­trib­u­tors to academia.

This is not a new sit­u­a­tion. In fact, do­na­tions from the mar­ket place have gone to uni­ver­si­ties since the early 20th cen­tury. How­ever, since the 1970’s the amount of cor­po­rate fund­ing has in­creased big time, and uni­ver­si­ties have be­come cen­tres of train­ well as cen­tres for re­search for the ben­e­fit of the cor­po­rate world. From the 1970’s to the early 1990’s both the Lib­eral and Con­ser­va­tive gov­ern­ments were re­spon­si­ble for re­duced pub­lic mone­tary com­mit­ment to post-se­condary ed­u­ca­tion.

As noted by Brown­lee, the bil­lions cut by the Con­ser­va­tives un­der Brian Mul­roney was es­pe­cially note­wor­thy. Be­tween 1983-84 and 1994-95, the fed­eral con­tri­bu­tion to post-se­condary ed­u­ca­tion was re­duced by nearly $13.5 bil­lion (Tu­diver 1999). In the 1970’s and 1980’s grants to full-time stu­dents were re­duced by an av­er­age of more than 20 per­cent na­tion­wide, and tu­ition costs have in­creased. At the present time the uni­ver­si­ties across Canada are com­pet­ing for cor­po­rate dol­lars.

The fund­ing by cor­po­ra­tions has come at a cost. With this reliance on cor­po­rate fund­ing there has been a shift in re­search. In other words, much of the fo­cus of re­search has been cho­sen for those who do the re­search. Mar­ket-based ed­u­ca­tional pro­grams has re­sulted in less fund­ing for lib­eral arts based dis­ci­plines. Ac­cord­ing to Brown­lee the So­cial Sciences and Hu­man­i­ties pro­grams have been par­tic­u­larly hard hit.

I am not a tax ex­pert. In all like­li­hood, there are sig­nif­i­cant tax breaks for large cor­po­ra­tions who do­nate funds to uni­ver­si­ties. Those cor­po­ra­tions also likely ben­e­fit from the re­search done on their be­half. If tax­a­tion is to be re­formed it might be good to put a bit more power back into the hands of those who are the av­er­age cit­i­zens...and those who are prob­a­bly pay­ing more than their share of funds to keep this coun­try and its in­sti­tu­tions func­tion­ing.

At this time Canada has one of the high­est pro­por­tions of pri­vate univer­sity fund­ing in the world (CCL 2010b; Met­calf 2010). In 1979 pub­lic fund­ing (our tax dol­lars) made up 84 per­cent of univer­sity op­er­at­ing rev­enues. By 2009 this fig­ure was re­duced to 58 per­cent. Over this same pe­riod, tu­ition fees rose from 12 to 35 per­cent of op­er­at­ing rev­enues. Fund­ing through do­na­tions, grants and be­quests grew from $54 mil­lion in 1972 to $2.9 bil­lion in 2008. In 2008 al­most 40 per­cent of this to­tal came from cor­po­ra­tions. Stu­dent debt has sky­rock­eted.

It would seem that the smart thing gov­ern­ment could do is to make sure that cor­po­ra­tions and the very wealthy pay their fair share in taxes, and then di­rect those funds to­ward ed­u­ca­tion and re­search that ben­e­fits all cit­i­zens.

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