As winds of financial havoc loom south of the border, we have to wonder if Canadians will take the opportunity to learn at someone else’s expense about the perils of grants and deficit financing.
The United States faces the prospect of not having enough money to pay its bills in less than a month’s time. Cooperation will be needed to expand its debt limit past the present number forecast at $14-trillion. Republicans, forced in part by the Tea Party groups that sprouted up across the country over out of control spending, and Democrats will need to decide what entitlement programs are worth keeping. It is really that simple.
We have all been there at one time or another – coming up a little short on the revenue stream. That pain however, is felt more acutely on the bottom rung of the economic ladder. Seniors without suitable investments, people crippled with staggering health costs and medical problems, young families getting by on low wages and a rising cost of living – it all adds up to a life of scraping by. Paycheque to paycheque is a tough way to live, let alone exist in a measure of comfort. One slip or one missed day, or another challenge presented, and a snowball effect begins.
For government, the levers for aiding that discomfort have historically been increasing taxes on the payers, and expanding programs for the troubled; all under the premise of income redistribution. Basically, those that have should pay, because they can.
On the face of it, stepping up and helping others makes sense and is the right thing to do. Many who crow about government largesse happen to also talk about North America’s Christian values and how that was the foundation on which this country was built. It always struck us as ironic, how some conservative Christians rail against programs to help the poor. Perhaps a healthier conversation is needed about what constitutes help and what feeds a systemic problem of using Band-Aids to solve larger problems.
In recent months, our own MP for Wellington-Halton Hills, Michael Chong, spoke to a local Rotary group about the perils of household debt. Minister of Finance Jim Flaherty noted recently we need to get the debt under control and that could well mean a reduction in grants for arts groups. Similarly, Mark Carney, Governor of the Bank of Canada, has suggested debt should be a great concern for Canadians because pending interest rate increases would be harmful to homeowners and business.
The underlying theme is that we should not be too comfortable or complacent with today’s economic climate.
We have marvelled recently about the inability to live cheaply, as in pay off a mortgage or have a predictable rent, maybe enjoy a garden seasonally, and enjoy a simple existence. Property tax reform over a decade ago blew that novel notion out of the water.
As local government evolved in a post-amalgamation climate, people seemed to want more. Recreation facilities expanded or were built from scratch, programming was expanded, scads of non-profit ventures were established that needed regular infusions of cash and, basically, local government added to the burden on taxpayers.
Provincially, spending increases and program expansion has been horrendous. In a matter of a short decade, programs such as health and safety, minimum wage increases, general regulatory burdens, the introduction of LHINs (Local Health Integration Networks), green energy policies and their associated costs, Hydro reorganization and the eHealth boondoggle have all added to the burden faced by residents of Ontario.
We viewed much of that as false mini-economies that have masked underlying systemic problems of affordability.
The recent stimulus plan was a tri-partite attempt by all three levels of government to generate enough money to pay for projects that would not have happened without that prop-up from above. More than one mayor has noted the good fortune of receiving money for projects that would have never gotten off the ground if funded only at the local level. Remember, all “one-thirds” of that arrangement need to pay their way.
All of those elements lead to our belief that better projects result from really needing something and a community of interest deciding to pursue a goal.
A road, a bridge, a water or sewer project – those are all necessary elements of local governments. Undeniably those projects need access to a form of sustainable funding.
By focusing effort and talent away from chasing a dollar from government (a mighty expensive way to fundraise) citizens and local groups need to innovate and achieve excellence where everyone stands to win – not just the connected.
The days of grants need to end, certainly in their present form.
