Con­sider the mes­sen­ger as well as the mes­sage

Advertiser (Grand Falls) - - Editorial - Rus­sell Wanger­sky Rus­sell Wanger­sky’s column ap­pears in 39 SaltWire newspapers and web­sites in At­lantic Canada. He can be reached at rus­sell.wanger­sky@thetele­ — Twit­ter: @wanger­sky.

It’s sum­mer­time, and it’s hard to get enough words to fill all the spa­ces.

Hence, the Fi­nan­cial Post’s print­ing of a lengthy op-ed on equal­iza­tion by three writ­ers from two busi­ness-pos­i­tive think-tanks on the need to re­form equal­iza­tion on Wed­nes­day.

No, I’m only kid­ding. Mostly. The op-ed in ques­tion came from Marco Navarro-Ge­nie, the pres­i­dent of the At­lantic In­sti­tute of Mar­ket Stud­ies, Peter Holle, pres­i­dent and CEO of the Fron­tier Cen­tre for Pub­lic Pol­icy, and David Mack­in­non, who is a se­nior fel­low at both think-tanks.

The crux of their ar­gu­ment? That the equal­iza­tion sys­tem, which tries to en­sure that all Cana­dian provinces can have ac­cess to fund­ing to en­sure they can offer com­pa­ra­ble ser­vices to Cana­di­ans, re­gard­less of their lo­ca­tion in the coun­try, needs to be re­viewed.

Are the think-tankians right? Well, they are about some things. I think they are cor­rect that many Cana­di­ans glaze over when they hear the word “equal­iza­tion,” let alone have to try and think about how the con­cept is sup­posed to work.

I’m not so sure about the next part, where the trio ar­gues that easy equal­iza­tion money has led to a growth in pub­lic sec­tor spend­ing in the At­lantic re­gion and a cor­re­spond­ing in­crease in taxes to pay for that growth. Af­ter all, if there wasn’t equal­iza­tion money, ser­vices would still have to be pro­vided, and pro­vin­cial taxes would nec­es­sar­ily have to be even higher — un­less, of course, we’re cut­ting back on spend­ing, too. (And is it too salty to point out that three writ­ers for one op-ed is a bit of un­nec­es­sary growth in it­self?)

When the ar­gu­ment veers into the need for com­pet­i­tive­ness — a met­ric that ba­si­cally means the lo­ca­tion that has the low­est costs for busi­nesses is nec­es­sar­ily the best — I’m afraid they lose my agree­ment en­tirely.

I think we’re just look­ing at dif­fer­ent ends of the tele­scope.

The trio writes, “For ex­am­ple, self-em­ployed fish­er­men are given ac­cess to em­ploy­ment in­surance, but that kind of sup­port is not avail­able for any other group of self-em­ployed peo­ple. There is no eth­i­cal ba­sis for de­cid­ing that only self-em­ployed fish­er­men merit sup­port when they have em­ploy­ment dif­fi­cul­ties.”

In con­trast, I might ar­gue that there is no eth­i­cal rea­son for At­lantic fish pro­ces­sors to be al­lowed to profit from ar­ti­fi­cially de­pressed fish prices due to EI sub­si­diza­tion of fish­er­men, nor is there a rea­son that fish pro­ces­sors are al­lowed to ben­e­fit from cap­tive work forces funded by EI for part of the year.

There are plenty of things that con­trib­ute to ques­tions about the com­pet­i­tive­ness of the At­lantic provinces: high taxes are one, but, then again, so is the re­quire­ment for pay­ing some­thing close to a liv­ing wage. So is hav­ing to live up to first-world eco­log­i­cal and en­vi­ron­men­tal stan­dards.

The U.S. is loos­en­ing en­vi­ron­men­tal stan­dards to ben­e­fit Amer­i­can pro­duc­ers in ev­ery­thing from the coal in­dus­try to other chem­i­cal pol­luters.

Should we fol­low suit, be­cause the bat­tle to the bot­tom — to be the ideal most com­pet­i­tive ju­ris­dic­tion — might be great for the cap­tains of in­dus­try?

Ob­vi­ously I feel dif­fer­ently about that than Navarro-Ge­nie, Holle and Mack­in­non. I ac­tu­ally think there is a place for reg­u­la­tion and gov­ern­ment, for the good of all of us.

(I will just point out here, as I reg­u­larly do, that foun­da­tions like AIMS and the Fron­tier Cen­tre are ben­e­fi­cia­ries of a pe­cu­liar facet of the Cana­dian tax sys­tem: they are both regis­tered char­i­ties. In 2016, the last year for which the Canada Rev­enue Agency has posted fig­ures sup­plied by AIMS, the in­sti­tute took in $615,283 in gifts, and wrote $605,683 in char­i­ta­ble tax re­ceipts. In the same year, the Fron­tier Cen­tre took in $1,124,317 and wrote char­i­ta­ble do­na­tion re­ceipts for all of its donors.)

Should we all be reg­u­larly look­ing at how our over­all sys­tems of gov­ern­ment work? Ab­so­lutely.

But there is more at stake than cor­po­rate in­ter­ests.

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