Four things that can help Canadians

The fall economic statement comes out today and, regardless of what’s in this mini-budget, it promises to be a big deal.

The federal government’s regular fiscal update on how the budgetary year is unfolding usually doesn’t merit much of your time or attention. This year is different because so much has happened since April, when the federal budget was tabled.

Inflation is rising at a pace not seen in 40 years; though, unlike 40 years ago, the problem isn’t soaring wages, which today are badly lagging price hikes. Today the problem is a stubbornly inadequate supply of food, fuel and affordable housing — as well as an unknown degree of corporate price-fixing.

Russia’s invasion of Ukraine has choked off a surprisingly large share of global exports of wheat, fertilizer, maize, oil and gas.

The Bank of Canada has hiked borrowing costs six times since March, its most aggressive campaign to tame inflation since the early 1990s.

Reports from the International Monetary Fund forecast a world economy in decline. People are anxious. The world is talking about recession. No matter Canada’s economic fundamentals — we are doing better on growth, inflation and even government borrowing than most places — we won’t duck bad times if the economies of the U.S., U.K., EU and China stall, or worse.

What can the government do about any of it? Help those struggling to choose between heating or eating, or even between food or shelter, by asking a bit more from those who saw a windfall in corporate profits and shareholder dividends.

Here are four ways to do just that, focusing on the most impact for the most people.

Employment insurance The Bank of Canada gives us a 50-50 chance of recession now to mid-2023. We are not recession-ready. In September, the federal government reverted to pre-pandemic eligibility rules, meaning fewer than four in 10 jobless people will find shelter from the coming economic storm. As in the early 1990s when the rules were last changed to cut access, more women than men will be affected. The time is long past due to solve the coverage problem, including who gets help and who doesn’t, how much and for how long.

The care economy Social infrastructure is crumbling at a rate that would prompt rapid and generous investment if it were physical infrastructure. Do we have enough people providing the care we need? No. Are we supporting current workers, so we don’t lose more? No. Fund jurisdictions that have a plan for more training, better wages and working conditions and expansion of critical health-care and health promotion services.

Housing Lending-rate hikes mean more people are in the rental market because they can’t afford a mortgage. Their relatively higher incomes put upward pressure on rents, and crowd out existing renters. A clear price escalation target should be established that triggers another rental benefit. Higher lending rates also stall construction on affordable housing. Fund the differences in borrowing rates to ensure these desperately needed projects go ahead.

Windfall taxes The federal government could extend the spring budget’s temporary tax on windfall profits in the financial and insurance sectors to energy companies and grocery conglomerates, or any company with a windfall in revenue due to soaring global inflation. Those revenues could be recycled to support the voluntary sector providing food bank and shelter services, which are at record levels.

I know the finance minister and the Government of Canada have to balance a broader set of interests. But this government has already delivered on its “we’ve got your back” claim in such important ways: expanding the Canada Child Benefit and dramatically reducing child poverty; introducing the Canada Emergency Response Benefit during a global pandemic, which helped employment rates bounce back and Gross Domestic Product grow long before our peer nations; and launching an overdue national child-care strategy that could transform our economic future.

Mini-budget makers, Canadians are counting on you to not lose your nerve or focus now.

ARMINE YALNIZYAN IS A LEADING VOICE IN CANADA’S ECONOMIC SCENE AND ATKINSON FELLOW ON THE FUTURE OF WORKERS.