'Our public services are an unbeatable deal.... we get back much more than the amount we pay in taxes.'
By Larry Brown
National Union of Public and General Employees (NUPGE)
Ottawa (21 April 2009) - We’ve always known that when we pay taxes, we’re paying for some pretty important things, things that add to our life in tangible ways. Now we have documented proof that our public services are an unbeatable deal, that we get back much more than the amount we pay in taxes.
We’re not supposed to figure this out, of course. Over the past few months we’ve all been bombarded with both print and TV ads extolling the virtues of the Harper Conservative’s tax cuts.
You know the ones – happy people wandering through the frame, picking their personal tax cut out of the air above them, from a cloud wherein float all kinds of tax cuts aimed at helping seniors and students and people who take the bus and so on. After people reach into the air for their very own personal tax cut, they blissfully amble off screen.
It’s kind of interesting to wonder how much taxpayer money has been spent to have those ads run, endlessly, unsubtly reminding us that (a) taxes are bad; and (b) the Conservatives are good because they cut those nasty taxes.
Conservative governments have had allies in their campaign to convince folks that taxes are intrinsically bad. The right-wing Fraser Institute has its idiotic ‘tax freedom day’. The Canadian Taxpayers Federation, who represent almost nobody, gets respectful coverage every time it beats their one and only anti-tax, anti-public service drum.
It’s gotten so bad for a politician to acknowledge that raising public revenue might mean raising taxes that to do so is considered heresy or political suicide — or both.
Of course the simple fact is that almost every tax cut in the last 20 years – and there have been a ton – has benefitted the wealthy far more than the middle income earner. In the last federal budget alone, the average family gets a tax cut of $300 while those earning more than $150,000 will get a cut of $900.
But leave that simple inequity aside for the moment. Canadians have been bombarded for years by the proposition that we are overtaxed, and that it is an unqualified good idea for the government to leave more of our own money in our pockets.
In the abstract, this simple message sometimes works. Ask people if they’d like to pay less in taxes and they will usually agree. But if you put that question into a sensible context, a context that deals with the trade-offs, the answer will be very different.
For example, people invariably chose better health care over tax cuts. Better education, better environmental protection and better food safety all trump tax cuts too.
No matter what we might have wanted, what we’ve gotten is tax cuts, year after year after year. The independent budget officer for the federal government has calculated that we would not have a deficit right now, even with the recession, if governments had not cut taxes so mindlessly and repeatedly.
But we do have a deficit, in spades. Governments, especially the Conservatives under Harper, have dug our public accounts into a deep hole with their fixation on tax cuts destined mostly for the pockets of the already wealthy. So now we face a stark choice.
We can either rebuild our tax system to give governments enough revenue to provide essential public services – or we can kiss those public services goodbye. Because the element that’s missed by the anti-tax crowd is that we actually get real tangible benefits from our tax dollars.
The Canadian Centre for Policy Alternatives (CCPA) has now given us the complete context in which to fairly evaluate taxes. The CCPA’s recent study of the benefits of public spending should go a long way to eliminating the simplistic notion that taxes are always a negative, and that the only good tax is a tax cut.
The simple but compelling fact is that none of us could afford to buy on our own the services we get through our tax dollars.
On a straightforward costing, most people in Canada get a return, for their tax dollars, of approximately $16,000 in value, per person, from the public services their tax dollars provide.
For an average household in this country, the direct economic benefit of public services — health, education, food safety, police, national defence, roads, parks and so on — is equal to two thirds of household income. You read that right. The average household would have to pay two thirds of its income to afford the things that their tax dollars provide.
Almost 75% of Canadians would have to pay, out of their own pockets, at least 50% of what they earn to pay for the things that they get from public services. How many people pay taxes at the rate of 50% of their income?
The deal of the century
Seriously, folks, taxes are the deal of the century.
And really, how many of us actually believed that a $300 tax cut was doing us much good? How many days of education can we provide for our kids with $300? How much health care could we buy with that amount? It’s only when that money is pooled and used for the common good that our $300 can have a serious impact on our quality of life.
We may not be gleeful when we fill out our tax returns, any more than we enjoy buying a car for several thousand dollars. But when we buy a car, we’re buying transportation. When we pay taxes, we’re buying all of the things that make our lives better and our communities stronger.
And each year we get back far more than we ever come close to paying.
The National Union of Public and General Employees (NUPGE) is one of Canada's largest labour organizations with over 340,000 members. Our mission is to improve the lives of working families and to build a stronger Canada by ensuring our common wealth is used for the common good. NUPGE
CCPA study: Canada's Quiet Bargain: The benefits of public spendings