Economic health’s a matter of perspective

Are these guys talking about the same province?

To hear Premier Stephen McNeil tell it, Nova Scotians have never had it so good. The economy is growing. Unemployment is down. Exports are up. The population is at an all-time high, and young people are staying or coming to Nova Scotia in greater numbers than ever.

The province’s two opposition party leaders tell a very different story based on different economic indicators.

Tory leader Tim Houston says the reality for many Nova Scotians looks nothing like the rosy picture painted by the premier. Unemployment, he said, is in double-digits in pockets of the province.

Premier McNeil would counter that the provincewide unemployment rate stood at 7.4 per cent in January.

Both Houston and NDP leader Gary Burrill point to the province’s low median income as proof that Nova Scotians aren’t experiencing the prosperity the premier describes. Nova Scotia has the lowest median income in Canada.

In the recent budget, the province forecast growth for 2020 at a lethargic 0.4 per cent, which prompted Houston to note that Alberta, a province everybody agrees is suffering tough economic times, expects its economy to grow by 2.5 per cent this year.

And Nova Scotia’s weak growth forecast didn’t fully account for losses in the forestry sector related to the closure of Northern Pulp, and only identified the coronavirus as a risk.

But it’s the NDP that expressed a fundamental disagreement with the government on the budget’s direction and its $70-million tax cut for corporations.

“The single defining feature of the budget is a $70-million corporate tax cut,” Burrill said, and while the corporate sector feasts at a banquet offered up by a 12.5 per cent tax reduction, the province has only crumbs for Nova Scotians who need help the most.

Cutting corporate taxes in the expectation that it will stimulate economic growth is outdated, almost universallyrejected “trickle-down economics” that’s been debunked by 40 years of failure.

Not only do they come up short as economic stimulus, corporate tax cuts exacerbate inequality by increasing the wealth of corporate shareholders, while providing few, if any, economic benefits or opportunities to the rest of society.

Economic best practice, Burrill said, is to invest in the enhancement of labour productivity, and that means investing in post-secondary education to make it more affordable and accessible.

But tuition rates in Nova Scotia are growing faster than elsewhere in the country and are already among the nation’s highest. Yet the budget offers no relief from high post-secondary tuition costs.

Burrill said the budget fails utterly to respond to the “defining features of the moment.”

Food insecurity is a bigger problem in Nova Scotia than in any other province. Food insecurity means people are either experiencing hunger or live in fear of hunger, because they worry they won’t be able to afford food.

Nova Scotians also suffer the highest credit card delinquency rates in Canada, and Nova Scotia is the only province where child poverty increased since the introduction of the Canada Child Benefit in 2016.

The budget includes about $18 million to address child poverty, mostly through the Nova Scotia child benefit which adds a little more than $20 per month, per child, and raises the ceiling so that families earning less than $34,000 a year qualify. Before the change, the ceiling was $26,000.

Burrill leaves no doubt that he believes the government’s priorities are more than a little askew when people are struggling to feed themselves and their families, or find affordable housing, while the province hands $70 million over to the corporate sector.

He suggested Nova Scotians would derive more benefits from public investments in affordable housing, long term care and mental health services, than they will ever see from a $70-million corporate tax cut.

The NDP says Nova Scotia has a full-blown housing crisis, with rent hikes in some markets forcing families to scramble for an affordable alternative, but that’s hard to find where affordable housing stock is inadequate for the demand.

The province continues to suffer a shortage of long-term care beds, and mental health services are harder to access in Nova Scotia than in neighbouring provinces.

Ronald Reagan — an architect and an advocate of trickledown economics — said a recession is when your neighbour loses his job; a depression is when you lose yours.

The premier and the opposition leaders aren’t talking about different provinces, but they are looking at this one from very different perspectives.