Davos, income inequality, and change in Canada
Last week, as celebrities, world leaders, cabinet ministers, and industry billionaires met in Davos, Switzerland for the World Economic Forum, Oxfam released its annual report on growing global inequality. The contrast is stark, as Oxfam’s report highlights how those with power continue to benefit from the continued marginalization of those in poverty.
Oxfam’s numbers show a bleak picture for economic equality both here in Canada and throughout the world. Globally, the 26 richest people own as much as the poorest half of humanity.
Specifically in Canada, wealthy billionaires have increased their wealth by $20 billion over the last year. In comparison, the 4.5 per cent of the country’s wealth held by the poorest half remains stagnant.
A recent survey shows that nearly half of people in Canada are $200 or less away from financial insolvency – with over half indicating they are feeling financial strain from higher interest rates and 45 per cent indicating they saw it necessary to go further into debt to pay their regular living and family expenses.
And still, by any measure, millions of people in Canada, including over one million children, are living in poverty. Four million people experience food insecurity and three million people are precariously housed. It’s hard to reconcile Canada’s recent status as the number one country for “quality of life” with these statistics. This designation clearly does not capture the daily realities for the one in ten people who can’t afford their prescription drugs, or the one in six children growing up in a food insecure household.
Consider this in light of Canada’s commitment to goal one of the Sustainable Development Goals to end poverty by 2030. We need a significant change of course to meet this goal, as we expect other, less wealthy countries to do. And as our neighbours to the south debate the introduction of wealth taxes and a 70% marginal tax rate on the highest income earners – it is clear that Canadian governments must genuinely commit to progressive taxation to achieve change on economic equality.
In the 2019 Alternative Federal Budget, a cohort of Canadian civil society organizations, including Canada Without Poverty, recommended eliminating tax loopholes, increasing the corporate sales tax to be in-line with the new rate in the United States, and introducing a wealth tax and inheritance tax that are separate to the general income tax rate. A system of progressive taxation could fund numerous social programs benefiting millions in Canada – in particular those who aren’t one of the 46 Canadian billionaires with mounting wealth.
But there remains a disconnect between the words and actions of governments in Canada.
At the WEF, Foreign Minister Chrystia Freeland talked about creating the conditions in which women can be successful. The data shows us that the best way to bridge gaps between women and men in the labour force and reduce inequality is to make childcare affordable, accessible, and available. But in the meantime the federal government continues to hold back on implementing a universal childcare framework.
In fact, childcare seems to have fallen off the federal government’s radar in favour of a piecemeal approach that falls drastically short of the ‘framework’ for affordable, high-quality, fully inclusive childcare for families that need it. Despite the tireless work of advocates to implement changes that would make a significant impact on economic inequality – particularly for women – progress is slow.
With an anticipated federal election later this year, Canada must be ambitious. In a deeply unequal world, where politicians and celebrities with power meet annually in Davos to discuss social ills, it is up to government to step up to ensure the voices of those who are the most marginalized are represented. In the face of such drastic economic inequality, it is only by making a big vision of an equal Canada a reality through equitable systems and policies that we can move forward to truly become the international human rights leader we want to be.
Laura Neidhart is the Communications and Development Coordinator for Canada Without Poverty.