Paying More Taxes

Sorry folks. Keeping up with work, e-mails, and 2 blogs (join my Social and Environmental Justice Book Club at http://sejbooks.blogspot.com/) keeps me busy. Add a family into the mix, and not everything gets done. I saw Richard Smol's interesting post on the CBC website on "Why I should pay more taxes."

I too recognize the importance of paying taxes to build a functioning civil society. That's why I get so upset when neo-liberal ideologues like the Fraser Institute use the media to spread the notion of "Tax Freedom Day." Here are a few alternative names we could use:

Freedom from Public Healthcare Day

Freedom from Police Force Day

Freedom from Clean Water Day

Freedom from Environmental Regulation and Enforcement Day

Crumbling Bridges Day

Taxes pay for stuff we all use. Blame our governments for investing tax dollars unwisely, ask them to to account for their investments, but don't buy into the simplistic notion that "taxes are bad."

Comment to CBC's SHIFT

On Tax Freedom Day

Over the last few days, the CBC has celebrated the Fraser Institute's "Tax Freedom Day."

I admit the name is catchy, but it disguises some real facts. How about instead we call it "Freedom from Firefighters Day," or "Road Repair Free Day," or "Freedom from Literacy Day." These are the services and programs that are provided through our taxes. Taxes pay for the investments we collectively make as Canadians. (Whether we invest wisely or not is a separate question.)

To see this point another way, why don't we create "Food Freedom Day" which would be the last day in the year that the typical Canadian family stops devoting it's hard-earned dollars toward food consumption (to spend on rides at the fair perhaps)?

I am not trying to argue that taxes should go up, down, or sideways, but I do feel it is important that we work to remove loaded language when it comes to taxes. If we do not, then we pave the way for successive governments come in and indiscriminately cut taxes, generally for those at the upper end of the income distribution, market it to us as a good thing (e.g., "tax relief"), and then have us each individually pay a greater amount for services. Our taxes fall, we pay an even greater amount to live, we thank our governments for the "relief," and we stare in wonder at our empty pocketbooks.

Then again, maybe we've already started down that road.

According to the Fraser Institute, New Brunswick is the second province in Canada to "arrive" at Tax Freedom Day - a few days behind Alberta. If I am wrong in my above analysis, then the NB government will conclude that while we may want to fiddle with taxes a bit, we do not need wholesale tax reform as proposed in their "Green Paper." However, if the real goal is just lower taxes (for lower taxes sake), then they will permit us a few weeks of "public input and consultation" and they will likely implement the middle-of-the-road ideas. We'll see.

Decommissioning fund is no panacea

I sent this to the TJ in early May. So far, no action.

I was intrigued by Professor Lowe’s letter on safe uranium mining (28 April), especially his comments on decommissioning funding for uranium mines.

Quite by coincidence, I have been preparing for a talk on energy alternatives and was reading a paper entitled, “U.S. nuclear plant decommissioning funding adequacy …” This paper was written by D. Williams (an economics researcher in the U.S. Government Accountability Office) and was published in Energy Economics in 2007.

To quote his findings, “the initial decommissioning cost estimates have been cited by many industry observers as being far too low [and] [t]he tax-paying public, future ratepayers, and/or stockholders may be assessed for funding shortfalls.”

Furthermore “a small - but not inconsequential - number of the 222 funds show balances (and/or contributions) that are below, and some far below, their benchmark levels …” and “the risk is not inconsequential that [economic] conditions could be well below average, leading to large numbers of underfunded trust funds.”

The paper uses data up to 2004. We certainly know that economic conditions have been “below average” since then.

Granted, this is U.S. research, and it deals with the reactor, as opposed to the mining end of the nuclear power cycle, but the conclusion is clear that the simple existence of decommissioning funding is insufficient to safeguard the public from ultimately paying for cleanup.

My guess is that the nuclear industry is fairly similar both across nations and within the nuclear power cycle from mining to power generation and ultimately disposal. Until similar thorough research is conducted upon the health and management of decommissioning funding for the Canadian uranium mining industry, then our best bet is to err on the side of caution.

A Letter Exchange

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The following 3 letters appeared in the Telegraph Journal. They highlight an important and fundamental difference in opinion regarding taxes. I see the taxes I pay as money the government can invest in Canada and Canadians. Others see taxes as just spending. What's your opinion?

Tax cuts will cause programs to suffer (TJ, 2 Nov.)

I teach economics at UNBSJ. In my courses, I use a smattering of Latin, including the phrase ceteris paribus - all other things being equal. Mr. Harper's tax-break treat is good for Canadians, ceteris paribus.

My problem is that all other things are not equal - the trick follows the treat. When Mr. Harper's government could still be called "new" they made significant tax cuts.

Months later we saw the "benefits" accruing from tax cuts: under-funded day care, dangerous overpasses, decreased funding for literacy (especially important in New Brunswick if we care about self-sufficiency), decreased funding for women's groups, decreased funding for environmental groups, a student summer work program in virtual collapse, nothing but political spin on issues of climate change, and a new equalization package that will cost New Brunswickers $1.1 billion, according to the Atlantic Provinces Economic Council.

I am in complete agreement with letter-writer David Beaudin (Telegraph-Journal, Nov. 1). We don't necessarily need tax cuts. What we need is a government that takes our taxes, treats them as an investment in our country, and then makes wise investment decisions that benefit all Canadians.

ROB MOIR
Clifton Royal


Tax cuts are the way to go (TJ, 6 Nov.)

I cannot allow Rob Moir's letter of Nov. 2 to go unchallenged.

He advocates against tax cuts on the idea that - (and I paraphrase) - 'government should take our taxes and make wise decisions that benefit all Canadians.' That is just another way of pushing the old socialist propaganda that government knows best how to spend taxpayers' hard earned money.

The fact is, whatever the government, the more money they have, the more they waste. If my money is to be wasted then I would like to do it myself.

Of course tax cuts are the way to go. Surpluses just mean that taxes are too high.

Thank goodness, after decades of tax and spend, we at last have a government that is prepared to return the money where it belongs, back to the taxpayer, with large amounts being used to reduce the debt that previous governments burdened us with.

As for the 'cuts' he mentions: in many cases more money is actually being spent on many of the causes, it is just not being spent on unnecessary offices and activists but on the real people in need. How overpasses suddenly became dangerous because of a tax cut I cannot imagine. Climate change? Well, the previous government signed Kyoto and then did absolutely nothing to follow through. Is that a better solution?

BRIAN STONE
Saint John


Be wary of what follows tax cuts (15 Nov.)

I feel I should respond to Mr. Stone's letter (Nov. 6) as I believe he misread the intent of my piece.

I am not against tax cuts per se, and he may note that I actually suggest tax cuts in a Commentary article (Oct. 26). Nevertheless, we should be wary of what typically follows tax cuts.

Tax cuts combined with decreased investment in programs and infrastructure also lead to large surpluses.

Large surpluses on their own are not necessarily indicative of over taxation - they may represent under investment.

I do not rely on my own opinion as a source for this policy advice. The "Father of Capitalism," Adam Smith, recognized the need for a "sovereign" or government to co-ordinate investment in public projects for which the returns to an individual are too small, but the returns to society are large enough to warrant investment. Our transportation network is one such investment; investment in literacy, which promotes future business location in New Brunswick, is another.

My point isn't that we need to increase, decrease, or even maintain taxes, but rather we should be careful what such tax cuts lead to.

Ultimately we should demand that our government wisely invest our taxes to the betterment of our country. If the government cannot find wise investment opportunities, then it should rightfully return the money to Canadians.

ROB MOIR
Clifton Royal