Disclaimer: I did not write this, I am merely posting this essay here for convenience sake; it’s nowhere else online, except in Google Books inside of a book. If I am breaking any laws, and someone wants me to take it down, I will comply. Onwards!
On one subject everyone will agree. The deficit is a disaster and mus be lowered, through wage rollbacks if necessary. The last time so many people agreed, it was over another disaster — one so clear and obvious that anyone who disagreed was branded as lacking in mental acuity – the 1970s energy crisis. world was going to run out of oil and we were all going to freeze in the dark. There were long line-ups at the pumps, the price of gasoline went through the roof, half the world changed its heating methods and people traded their cars in for even smaller ones. Then, a few years later, the world was suddenly awash in a glut of oil and fortunes were made by a lot of people.
Twenty years ago the corporate class in Canada agreed on one thing: wages in Canada were outrageous, and something had to be done about them. Quite unconsciously, I am sure, the language used came right out of Karl Marx: “Greedy, bloated, unproductive, lazy workers are ripping us off. We own the capital, so we create the value, and the workers’ wages are ripping off our surplus value so that a capitalist can hardly make a billion anymore. Something’s got to be done! We need a revolution! Break out the blue flags. It’s hard for us rich to start a revolution against the poor. But we have certain advantages: we are wealthy, and so we can buy anything; we are clever and can come up with good strategies; and, finally, we have governments and the media in our pockets. So we should be able to manage it.” Successive governments have heeded the call. Their plan has included five stages.
Stage one is to secure free trade with the United States, where there are weak unions, low wages and no social programs. That should cool of wage demands, and if it doesn’t, there is always free trade with Mexico, where workers earn eighty-eight cents an hour and they shoot labour leaders for breakfast. “Ha! Ha! Make our peons compete with their peons. That’s competitiveness for you! That’s globalization! That’s free-market capitalism for you!”
The second stage is tax reform. Lower the taxes on the rich and corporations. High taxes on us lead to lower income, which reduces our incentive to work and invest. So, make the rich richer and they’ll work harder, invest more and create jobs (Of course, as everyone knows, if you make the poor richer, they will work less. So to get the poor to work harder, cut their wages; to make the rich work harder, raise their incomes. Funny how the works, but then we aren’t really the same species, are we.) So raise taxes on the poor. Sales taxes will hit them every time they shop. And while we’re at it, tax services too. Call it the GST. Don’t tax services for the rich, of course, like banking, stock broking and currency speculation. Tax the workers’ labour. Tax haircuts, car repairs and schoolbooks. And for the ultra-rich and their family trust, tell them they DON’T have to pay the first $70 billion they owed in 1992 until halfway through the twenty-first century.
In the third stage the realization hits that if we continue government spending and cutting revenues, we are going to end up with a budget deficit. We can predict a total surprise: “Who would ever have predicted a budget deficit?” But with a budget deficit we will have to cut spending, which means laying off workers. This will cut tax revenues and increase benefits on unemployment benefits, so the deficit gets worse, not better! “Who would have predicted it?” But, don’t worry. This will produce the Golden Key: the budget crisis.
The fourth stage occurs when we finally have the Golden Key in hand, the key that will unlock every door. With a good budget crisis running we can do almost everything we want. We can savagely cut spending and roll wages back to the 1978 level – or lower. Spending too much on schools? Slash. Don’t you know we have a budget crisis? Doctors making too many people well? Cut their salaries. Close half the hospitals. Don’t you know we have a budget crisis? Any public service workers still working? Lay them off. Don’t you know we got a serious budget crisis? Cut! Slash! Downsize! Start with the public service. Everyone knows those teachers and hospital workers don’t work. Make it easy. Start with a really vicious campaign against the them and everyone will cheer. Don’t forget. We’ve got a really serious budget crisis!
Finally, there is stage five. With a proper budget crisis and wages rolled back a decade or so, we have the final master stroke. A generalized wage collapse. Wages in Canada will fall to be bare subsistence level, where they were in the 1930s. And we will make as much money as they do in Third World dictatorships. It’s that simple!
