The Seventies were a difficult time for Canadians (and many others, too). The oil-price shock the Organization of Petroleum-Exporting Countries produced in 1972 increased inflation around the globe. After lampooning wage and price controls in the 1974 federal election—the Progressive Conservative Leader, Robert Stanfield, had advocated controls—Prime Minister Trudeau imposed them on the country on Thanksgiving Day 1975.

From the period of wage controls in the late Seventies to the present day, there has been little buoyancy in wages for Canadians. The inflation-adjusted incomes of most Canadians are little changed from what they were in the late Seventies, thirty-five years ago. This wage stagnation is a drag on the economy made worse by tax policies, especially the Goods and Services Tax imposed by Finance Minister Michael Wilson, in 1989. This consumption tax falls on everyone at the same rate, no matter what their income may be. It falls more heavily on the poor, who spend their incomes entirely on providing what they and their families need to survive.

The combination of income stagnation and unfair taxation cannot but have a depressing effect on the Canadian economy. Is that the reason our governments are so concerned about trade agreements and resource industries? Are they hoping to improve economic activity in Canada by exporting products of all kinds to other countries? Do they not realize that the advice given the Chinese these days, to strengthen their economy by increasing home consumption, is advice that should be practiced in Canada, too?

Of course, wealthy people who have the ear of government have been doing very well. They have not experienced the income stagnation of their fellow citizens. And their refusal to pay taxes on a fair basis means that the Federal Government (together with the provincial governments) lacks the fiscal resources to play a leading role in the economy.

As the poor suffer severely, members of the middle class find themselves struggling to maintain comfortable lives by making the purchases that fuel economic activity. Too many are only a pay cheque or two away from having to go to the food banks that have been set up in city after city since the late Seventies.

One of the saddest consequences of this stagnation is the attempt by governments to “bribe” businesses with tax breaks to invest in more capacity and to hire more workers. Corporations have generally taken the money but done little, if anything, to expand their production. That is, sad to say, a rational response to the wage stagnation in our country created by our governments.

And the Harper Conservative Government wants to encourage wage stagnation! How else can one explain what companies were allowed to do in hiring foreign workers? We could understand the possibility that skilled trades people might need to be found in Europe since our own apprenticeship programs have not been well developed. To learn, however, that Tim Horton’s was bringing foreign workers into communities with significant unemployment . . .!

If economic demand were growing in our country, these tax inducements would hardly be needed. It has become all too clear that you can’t PUSH rope. The investment rope has to be PULLED by a growing demand for goods and services. And we need fair taxation and proper spending by our governments to achieve that aggregate demand!