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How do we measure successful fiscal governance?

By: | April 5, 2017

Retaining and creating stable, well-paying jobs would be a good start.

Hans Rollmann
To Each Their Own examines political issues impacting Newfoundland and Labrador.

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"Government’s mishandling of the economy means that the rules of the game keep changing — often too late for those who have dedicated their youth and the better part of their lives to working hard in pursuit of the careers they were told to pursue," writes Hans Rollmann. Independent file photo by Brian Carey.

On Feb. 23, after government cut 287 public sector jobs as a first strike toward the probably hundreds or thousands it’ll cut after this week’s budget, Status of Women Council Executive Director Jenny Wright tweeted an observation.

“Talking to so many post moratorium kids who were warned to get a good gov’t job -only to be told that now they’re a drain on the province.”

“Walk away from the fishery they said. Get a good government job instead they said. You are the reason for our problems they said,” she continued.

“This is a uniquely NL experience that no one is talking about.”

Her Tweets sparked a number of similarly themed responses.

“Very true. Government jobs were supposedly the last secure thing any young people could stake their future on in NL,” said one.

“We were pushed toward university with government jobs being the salvation,” tweeted another.

“When I was in high school we were also told the trades were a sure way to gainful employment. So many can’t find work now,” tweeted another.

Jobs. Jobs. Jobs.

As she is so often, Wright is right. The sad truth of this province is that generation after generation work hard and struggle to make a life for themselves in the way the preceding generation advises them to. “Work hard in the fishery.” “Quit the fishery – learn a trade!” “Forget trades, get a degree and a government job!”

People are right to feel frustrated, because the average Newfoundlander or Labradorian has worked hard to make a life for themselves. The problem is, government’s mishandling of the economy means that the rules of the game keep changing — often too late for those who have dedicated their youth and the better part of their lives to working hard in pursuit of the careers they were told to pursue.

Whether it’s working in oil, the fishery, or government, the public is right to feel outraged when the jobs we expected to get as the result of our hard work and stoic effort are pulled out from under us.

And we ought to blame government, not each other.

How do we gauge wise fiscal policy-making?

The problem we so often face is that in a perennially embattled economy, we have no sense of how to gauge success. Our government seems forever in debt, our economy forever sinking. Success is currently gauged either in barrels of oil produced, or in millions of dollars shaved off our debt.

How do either of these scenarios actually improve Newfoundland and Labrador? Barrels of oil don’t benefit the average Newfoundlander or Labradorian if they don’t translate into stable long-term employment; millions shaved off the debt benefit the daily lives of none of us either. Neither guarantees us the one thing we all want and deserve: a stable, secure, prosperous, future.

Of course, we hear the incessant chatter of a Board of Trade and other corporate lobby groups, clapping their hands for every million dollar cut in public services; every public service shut down and sold to the private sector; every hundred workers laid off from the public service and replaced with minimum or low wage workers in the private sector.

I attended a consultation session held by the provincial government back in February, on the notion of tying the minimum wage to inflation. We currently have the lowest minimum wage of any province in Canada. And there, lined up at the presentation, were the representatives of business: the Employers’ Council, the Canadian Federation of Independent Business; the Canadian Restaurant and Food Services Association.

One after the other, they attacked the idea of any increase in minimum wage. What’s more, they attacked the meagre achievements that our poor workers in this province have made. The restauranteurs even demanded that employees in the food service industry be denied minimum wage, on the ludicrous expectation they can make up for it in tips.

The sort of nonsense coming from these lobby groups sounds like something out of a Charles Dickens Victorian-era novel. Not only are they entirely antiquated in attitude, but their antiquated and ideologically-driven ideas are sinking the provincial economy — because they have the ear of government. Instead of urging government to create jobs, they’re urging government to cut them.

Who’s really calling the shots for Dwight Ball?

On Dec. 1, 2014, then-St. John’s Board of Trade Chair Sharon Horan delivered her ideological slant on the province’s economy.

“We really think there’s more of a spending problem than there is a revenue problem,” she said.

On Jan. 5, 2017, Ball said echoed something remarkably similar.

“It’s really a spending problem, not a revenue problem,” he told the CBC St. John’s Morning Show.

It’s something other business lobbyists have been encouraging him to say as well. In response to the provincial Liberals’ December 2015 fiscal update, Newfoundland and Labrador Employers’ Council Executive Director Richard Alexander was quick to the mark: “He said Newfoundland and Labrador has a spending problem,” reported CBC.

By October’s Way Forward consultations, Alexander was pleased to hear the premier echoing his tune.

Alexander “is pleased to hear government saying the province has a spending problem and not a revenue generation issue,” VOCM reported.

So, do we have a spending problem, or a revenue problem? The answer depends on which side of the wealth divide you fall on. A small yet vocal group of wealthy business elites argue that our problem lies with spending, because they would prefer not to have their higher income brackets taxed to the extent they are in other jurisdictions.

This message, of course, is in contrast with what non-business elites have been saying, which is that operating public services in this province is always going to cost more than it does elsewhere, simply because of the nature of this province and it’s complex geography and demographics. They argue the problem is also a revenue problem, not merely a spending problem, and that government needs to do more to generate more money for the province, which includes making large corporations and wealthy individuals pay their fair share.

In essence, there has been a tug of war on this issue. Do we cut back spending (translation: hospital beds closed, surgeries cancelled, classroom sizes increased, higher everyday fees and costs), or make the wealthy and profitable corporations pay a more fair share?

Dwight Ball appears to have thrown himself wholesale onto the side of the business elites — not surprising, since he is one, as an owner of private care facilities. But by siding with business elites, it means the premier is taking his marching orders from a small segment of the disproportionately wealthy and powerful in this province, rather than those who are paying the highest price for reduced government services.

It’s a revenue problem. Get over it.

Why is the elite business community so terrified that government might label the situation a revenue problem, rather than a spending problem? Why would they be so terrified that government might actually try to increase its revenue, and have more to spend on making this province prosperous and healthy?

Because a significant part of that revenue would come from their own pockets.

The fairer share they’re expected to pay (in the form of tax increases on higher incomes, or minimum wage increases for workers), the less profit they get to put away for their expensive pleasures and luxuries. It would mean they’d have to give some things up, just like the average Newfoundlander and Labradorian.

Instead, labeling it a ‘spending problem’ and responding by cuts gives them the opportunity to increase their wealth at the public expense — because when government cuts spending on public services, that doesn’t mean the need for those public services goes away. They still need to be provided. People still need surgeries and drivers’ licences. Roads still need to be paved and cleared of snow. But government cutbacks often merely means the private sector swoops in to line their own pockets, often at tremendous public expense.

We are not to blame. We shouldn’t be the ones to suffer.

Like Wright implied, all Newfoundlanders and Labradorians want are decent, well-paying, secure jobs. It’s not unreasonable for any of us to ask for and expect. Although none of us are to blame for these crises—brought on by the backward and ideologically-driven thinking of elite corporate lobbyists who are stuffing their pockets with wealth taken from the public purse—we are time and time again the ones expected to pay for them.

Although none of us are to blame for these crises…we are time and time again the ones expected to pay for them.

When it comes to the economy, we ought not to consider dollars shaved off the debt any sort of a triumph, because the only benefits it brings are fiscal benefits on spreadsheets and lending rates. They are accompanied by no tangible, material improvements in our daily lives whatsoever.

Instead, government ought to be judged on the basis of tangible and material improvements to our lives — and let’s start with jobs. How many good, permanent, well-paying jobs has government created in the past year? That’s the measure of success by which we ought to judge our government. Not savings, not loans, not other fiscal wizardry.

We can’t eat bond ratings. We can’t cheer savings when our schools continue to be starved of funds, when our tuition fees continue to rise, when our hospital services continue to shrink. Let us stop imagining these false markers of success actually benefit us, because they don’t.

Let us judge government on the one thing that does make a difference in our lives: good, stable, secure, well-paying jobs.

It’s a simple enough measure of success.

Why is our government so incapable of delivering?

Hans Rollmann is an editor, writer, researcher and organizer with a penchant for chocolate and a knack for limericks.

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