In the summer of 2012, when oil was still going for over $100 a barrel, a Rex Murphy-led documentary returned from commercial break and opened with the line “he’s a symbol of [Newfoundland’s] happy reversal of fortune.” The camera cut to a shot of a rusty Bell Island Ferry and then to my mother’s home kitchen.
I had turned down a sizeable national scholarship in a decision to earn a bachelor’s degree in my home province, with the intention of running for the Bell Island town council inside of a year. Murphy saw my decision as an expression of the confidence people felt since shrugging off our status as a have-not province four years prior.
But we hadn’t all shrugged off our have-not status so easily. “Have” status in tow, every young (and old) Bell Islander can still recall someone refer to their hometown as Fraggle Rock—the setting and namesake of a Sesame Street-esque show about semi-intelligent cave dwelling creatures. Every Bell Islander has stared at their screens in shock when news articles about our derelict ferry service are met by nameless online commenters who, at the best, hit Caps Lock and type “RESETTLEMENT.” I remember one particularly foul online comment that suggested instead of a ferry service, Government ought to commission a helicopter service that flies over the island and disperses “welfare and EI cheques across the town.”
A simple Google search of Bell Island will find “bad news” stories about unstable local government, crime, and illness. It’s no surprise that when I had the fortune to associate Bell Island with “good news stories” like scholarships or appointments or work abroad, many Bell Islanders enthusiastically hit “like” and “share.” In smalls towns, individual achievements are often community achievements. The same year of Rex Murphy’s documentary, The Telegram had called me “Bell Island’s Boy Wonder,” a moniker MUN would repeat in 2017.
These stories were flattering and prompted a healthy dose of ego-checking on my part, but they also concealed a bigger problem by failing to ask the question: why is it such a “wonder” when someone from Bell Island succeeds at a high level?
Answering this question requires considering the larger problem of inequality in our province and country, and the obvious fact that the reversal of fortune Murphy alluded to was hopelessly fleeting.
In 1966 Bell Islanders lost their iron ore and fled to Cambridge, Ontario, to work in textiles until those factories were shuttered, and then after the Cod Moratorium were a part of the exodus to work in automotive plants until those assembly lines fizzled, and more recently were among the thousands who lost jobs when oil prices plummeted. As a recent opinion piece put it, “The extraction economy is an extinction economy. It has always burnt everything in its path. The people and living things on the periphery have always felt it first.” Bell Island’s working people, those hanging onto the edge of middle class life by their fingernails, with hardship close in the rearview mirror, know all too well just how unstable an income can be in our province and country. Upward social mobility—when families and individuals from poorer backgrounds can enter higher social and economics classes—can be hard to reconcile with the boom-and-bust cycle.
This is all to say that there is no one answer as to why it’s such a “wonder” to reach high when you’re from one of Newfoundland and Labrador’s struggling rural townships, but certainly a hefty portion of the blame belongs with the nature of a winner-takes-all economy and how its latent inequality undermines social mobility.
With federal and provincial elections just a year away, it’s time to recharge a call to action that won’t settle for less than a society that is more prosperous for everyone. As illustrated by new reports throughout this summer about the state of inequality, it won’t be easy.
In June, an OECD report found that it could take four generations for the poorest 10% of Canadian families to enter the middle class. You read that right. Four generations, or about 125 years. In the United States, its five generations. Since the 1990’s, social mobility “has stalled” in the world’s wealthiest nations but those with less inequality are doing better. For example, in Denmark, a country with less inequality, researchers have found it takes 2 generations for the poorest citizens to earn the middle income. We’re definitely not in Denmark. Newfoundland and Labrador’s 2017 Vital Signs Report found that children raised in the bottom fifth of incomes in our province have only an 8.7% chance of rising to the top fifth. This figure, by the way, is also below the almost equally depressing national figure for poor to affluent mobility of 11.4%. For politicians, like our Prime Minister and many others who build entire campaigns on growing the middle class, these figures should be terrifying.
In July, another report found that the richest 87 families in Canada have the same amount of wealth as 12 million people. In other terms, just 87 uber-rich families have the same collective wealth as every single person in Newfoundland and Labrador, Prince Edward Island, and New Brunswick combined.
Finally, in August, a survey of CRA tax professionals revealed that a full 9 in 10 employees believe big corporations and the rich can “evade taxes and benefit from credits and exemptions average Canadians” cannot. It’s a sentiment that helps confirm people’s fears of a rigged game. Economist David Macdonald was quoted by The Guardian as saying: “You’d expect Canada’s tax regime would try to counteract this concentration of wealth at the very top, where it’s needed the least, but in fact, federal policies encourage it.”
That “wonder” moniker should be making more sense by now. Some 12 years ago, when I was just finishing elementary school, an assessment of wellness on Bell Island found more than half of families in the community were living below the low income cut-off (LICO). In 2004, the median income was $17,500. While I believe strong grass-roots activism has improved the quality of life in the community and moved the needle on these issues, far too many Bell Island families, and countless others in Newfoundland and Labrador, are still generations away from entering the middle class.
My father is a third-generation maintenance custodian. By the time he retires, my father, grandfather, and great-grandfather will have cleaned local schools for over 100 years combined. It was only in my twenties that I started to think about this as a genuine legacy. My mother is the thirteenth of fourteen children, raised on social assistance by my impossibly resilient grandmother who endured the scourge of domestic abuse for decades. As if knowing fourth-generation’s-the-charm, when I applied for highly competitive opportunities my parents would matter-of-factly assure me I could and should attain those opportunities. Encouragement for lofty endeavours can be hard to come by in downtrodden communities where inequality keeps folks down for decades. I just happened to be born into a family where the opposite was true— they thought I could do anything.
In a recent memoir about low-income rural white America, J.D Vance writes about what psychologists call “Learned Helplessness.” It’s the idea that people from chronically scarce communities who can’t get ahead due to a lack of social mobility, start to believe that there are no choices they can make that will affect the outcome of their lives. When it can take four generations to enter the middle class, cynicism seems founded. I was fortunate to have a steady chorus of parents, teachers, and community members that was often loud enough to overwhelm local signals that I could make no choice that might help me get ahead. If we don’t address inequality, an epidemic of helplessness and indifference that keeps our young people from striving to reach their full potential will continue to pose a threat to our economy and democracy.
The proof is in the pudding when young people believe in certain expectations for their lives and have the resources to make choices that will help them achieve their goals. Just last year when Newfoundland and Labrador’s Rhodes Scholar was announced, St. Bonaventure’s College, the recipient’s former high school, tweeted it was the school’s 28th Rhodes Scholar. St. Bonaventure’s College is one of the province’s few private schools and home to more than its fair-share of high-income earning parents owing to the annual tuition rate of nearly $9,000 per student. One private school in the province accounting for 28 Rhodes Scholars speaks to the school’s reputation for fostering academic excellence and civic leadership among its student body, but it also points to the fact that the children of well-to-do folks are still the most likely to attain the highest levels of academic and financial success due to their lop-sided access to precious resources like special training, money, and networks. (Full disclosure: I myself competed for a Rhodes Scholarship and lost out to a St Bon’s Boy Wonder; someone I truly have no doubt was qualified and deserving).
Right now, this essay might sound like a rant from a baymen Bernie Sanders. A rant Hillary Clinton would have criticised with the quip: “its easy to diagnose the problem, much harder to offer solutions.” So let’s end this piece with just a few answers.
The campaign for the minimum wage (ours is the third lowest in the country) to be a living wage must forge ahead. This will always be an uphill battle. The provincial Liberal government recently tied the minimum wage to the Consumer Price Index. This change will be useless if a boost to the base amount (currently $11.15 per hour) on which future increases will fall is not considered. When thinking about the minimum wage, recall that in Canada, CEOs make more than 200 times the salary of their average employee. South of the border, Democratic Senator Elizabeth Warren is introducing legislation to give rank-and-file workers more power. Her legislation would require large corporations to allow their employees to elect 40% of the membership on boards of the directors. The move would amplify worker voices at decision-making tables and make corporations more beholden to their employees and the communities they are based in, not just to shareholders. Warren’s plan would make it harder to justify raises to executives, outsource labour overseas, or cut wages. In Germany, where shareholders do not “rein supreme” and similar regulations exist, higher levels of pay equity and innovation have been reported. Note that Warren’s legislation aims to redistribute wealth not through taxation but rather through increased accountability and a recalibration of power and corporate responsibility.
To promote legislative action on inequality, we have to mobilize in our communities and elect leaders who take the issue seriously. In the recent Windsor Lake by-election debate the divergent rhetoric of the candidates was striking. Kerri Neil (NDP) called for an end to corporate grants (like ones for Canopy Growth to the tune of $40 million) while also noting inadequate taxes on multinational energy corporations who make billions off the backs of our province’s resources. Meanwhile, Paul Antle (LIB) touted his credentials as a successful businessman and Ches Crosbie (PC) stated “low corporate taxes […] will drive prosperity.”
When it comes to taxes, we should heed the warning of our CRA tax professionals by ending exemptions that disproportionately benefit corporations and the rich and introduce new measures to unstack the deck. For example, Canada is the only country in the G7 that does not tax inherited wealth. CTV reported that the United States, U.K., Italy, Japan, and Germany tax large inheritances—usually those valued at $5 million or more—at 40%. This measure alone could mean an additional $2 billion in annual revenue. Additional revenue ought to be spent on making education, healthcare, and childcare more affordable.
Two years ago an analysis suggested there simply are not enough wealthy individuals in our province to tax in order to rescue Newfoundland and Labrador from its financial woes. The analysis noted that in our province, 12% of taxpayers pay more than half of all provincial income tax. That sentence might sound unfair only if you can forget that in Canada, the top 20% of earners own 70% of the wealth while the bottom 20% own less than 1%. Nevertheless, the analysis was right, shifting tax brackets, while being a step forward, is not a panacea for the province’s financial issues. Of course, that’s hardly a reason not to adjust tax brackets. Rather, it’s a reminder that reducing inequality will take a compliment of local, provincial, and federal mechanisms that range from getting corporate executive pay under control and ensuring employees enjoy more of the profits, to increases in social spending by governments.
The community sector is another place to look for tactical answers. This summer, I worked with the Toronto-based CivicAction who launched an innovative intervention called HireNext. Designed with large and small organizations in mind, and promoting a shift to skills-based hiring, the program has built a suite of tools and resources for HR professionals that makes it easier to hire youth who face barriers to employment. Another charity, NPower Canada, has a model that can be replicated in our province. They provide free in-demand digital and professional skills training in combination with employment matching for youth who struggled to access traditional pathways to employment and education. 100% of NPower’s 790 graduates joined the program unemployed or in so-called “survival jobs” and a full 80% of alumni now enjoy sustainable jobs in the IT sector with an average starting wage of $18 per hour. Considering Newfoundland and Labrador has the highest unemployment rate in Canada, we ought to consider programs that offer sector-specific skills development to youth who are not in education, employment, or training. Choices for Youth, a non-profit here at home, is expanding its programming and helping give more and more young people a shot. If you have dollars to donate, put them there, and here, and here, and here too.
When my mother was interviewed for Rex Murphy’s documentary she was asked about her decision to make a life on Bell Island while her friends told her she was “crazy” because there was nothing left in the community. My mother looked into the camera and said, “there must be something here because [my son] is a product of it.” And I’m not the only one. To spite the deck stacked against it, Bell Island continues to produce wunderkinds: preternaturally gifted athletes, policy makers, musicians, educators, and tradespersons. Like countless other communities who punch above their weight and produce influencers in every field, we have a lot to celebrate and a lot of work to do. Our task is to demand an unapologetic rejection of the winner-takes-all-economy in order to tackle the inequality that keeps our youth, our province, and our country from reaching its full potential.