What's Left

October 16, 2002

Canada racks up another surplus as social programs wither

By Stephen Gowans

Had the outcome been different, we surely would have heard about it. "Federal surplus disappears," or "Country sinks into red," would scream from the front page of every newspaper, as if everyone of us was being warned bikers were about to move next door. Teeth would be gnashed, political panels urgently assembled, and Stephen Harper would struggle to conceal a smile.

As it was, there was nothing frightening in this news, nothing to send a frisson of fear skittering along the collective vertebrae of Canadians, nothing to galvanize them to accept more belt tightening. Instead, this news was more likely to raise questions.

And so newspapers did what they always do when reality clashes with whatever tall tale the establishment spins to justify its elevation at the expense of everyone else. They minimized it.

The Globe and Mail ran a short story, "Federal surplus almost $9-billion," the significance of this news dwarfed, it seemed, by the more pressing issue of former Olympic cyclist Louis Garneau breaking protocol to put his arm around the Queen.

And yet wasn't another year of Ottawa taking in billions of dollars more than it spent worthy of more than a ho-hum acknowledgement?

It seemed so out of step with the zeitgeist. Weren't schools being closed and emergency rooms shut down for...want of money? Wasn't there a trial balloon floated to see how Canadians would react to an increase in the GST...to raise new money for health care, money we apparently didn't have? Didn't the editorial pages of the country's newspapers ring out with alarm when the Chretien government announced new spending plans in its Throne Speech because...we can't afford it?

The days of big surpluses are over, it was announced not too many months ago, by the same economists who tell us sticking it to the poor while elevating the rich is the golden road to prosperity for all (well, at least for the all the rich, anyway.)

For years, governments have been in belt-tightening mode. We can no longer afford our lavish lifestyles, we were told, a lavishness that included such extravagances as bussing kids to schools instead of making them walk miles, and offering special help to kids with learning disabilities. And so hospitals were closed, waiting lists for surgery allowed to balloon, environmental protection made to wither, post-secondary tuition fees jacked up, public schools shut down, user fees imposed.  Inevitably, surplusses started to roll in.

It started out in response to year after year of budgetary deficits, deficits that had more to do with a punishing monetary policy favoured by the elite for its disciplinary power, than runaway social spending. It has become a cruel farce, with Canadians awash in surplus funds as social programs are left to fall apart.

We need to get our house in order, Ralph Klein, the original deficit-slayer once told Albertans. Once we do that, we can spend on social programs again. Except social programs were allowed to atrophy long after Alberta's house was put in order. So, new excuses were invented to explain why belt-tightening couldn't be a temporary inconvenience.

Tax cuts, too, would be ongoing. Not cuts in consumption taxes, like the GST, cuts that would benefit average Canadians. Instead, the tax-cutting zeal would be directed at slashing taxes that had a progressive character, so that the richest made off like bandits, while the tax load was shifted increasingly onto the backs of ordinary Canadians; and this, in some provinces, when deficits absolutely dictated (it was said) that spending on social programs be reined in. That cutting taxes would have the same impact as spending more, was dismissed. Tax cuts will generate more revenue, we were assured. We need to cut taxes to be "competitive." If we don't cut income taxes, the best and brightest will leave, and then where will we be? And so, with the deficit-slayers' axes vigorously hacking away at social spending, taxes were cut and surpluses accumulated.

At first we were told this was a matter for rejoicing. How much better off we must be to wait months for surgery, to pay skyrocketing tuition fees, and to shell out more and more for text books and school supplies. The debt was being paid down, the "best and brightest" were happier, and The Wall Street Journal was making approving noises. Could we ask for more than the approbation of the financial elite of a  country our leaders yearned to make Canada a replica of? Say what you want about the Americans, they sure know how to do right by their wealthiest citizens. Canadians, it seemed, could learn from that.

But, after a time, as each new surplus was recorded, the holes in the story became more difficult to conceal, like the tears in a favourite sweater that had been patched over one too many times. And so new arguments were pressed into service.

The federal government couldn't spend more on health-care because the provinces would squander the extra on tax cuts and lawnmowers and ice-machines. The provinces couldn't spend more, because they relied on the feds. Amid the finger pointing, public health care underwent passive--and sometimes, not so passive--privatization. And Canadians--those who couldn't afford to pay for a private MRI or a trip to the US for cancer treatment--suffered. And as they suffered, they unfailingly contributed to the federal government's surplus. And the feds unfailingly contributed to the deception that "the system was unsustainable" and more funds could not be made available. This was called "democracy."

As for public education, it too was being slowly starved under the banner, "we have to root out inefficiencies."

What an odd argument. It says the best way to deal with inefficiencies is to make matters worse. So, an Ottawa family with two kids in middle-school will shell out $1,000 in bus tickets over the next year because funding cuts have led to the cancellation of their school busses. The schoolboard says it doesn't get enough money to do all it needs to do. The province, which took over funding from the schoolboard, says it does. It's just a matter of spending efficiently, the province says. And so programs are cut, as the school board works out how to do more with less. Meanwhile, Joe Canadian picks up the pieces.

More than a decade ago, Canadians were presented with two views. One, shouted from the halls of government, from corporate boardrooms and from the front pages of newspapers, said a little short-term pain would have to be endured, for long term gain.

The other, barely heard above the din of the first, said warnings about deficits and debt were part of a larger scheme to railroad Canadians into accepting the makeover of their country into something more closely resembling the United States. There would be fewer social supports for the many, and more rewards for the wealthy. This view was looked upon with suspicion, if it was heard at all.

Today, with Canada's social programs crumbling despite another multi-billion dollar surplus, you don't have to strain to figure out which view was right.


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