Frank Stronach: Socialism is not the solution to inequality
February 14th 2023
Most of us seek balance in all aspects of our lives. But that same ongoing quest to attain balance should also guide the functioning of our society, our government and our economy. And right now, Canada is unbalanced in many areas that shape the quality of our lives.
Take wealth, for example. According to a report from the Office of the Parliamentary Budget Officer, in 2019, the top one per cent of Canadians held 25 per cent of the country’s net wealth, while the bottom 40 per cent of Canadian families barely owned more than one per cent.
The report also found that the household wealth gap — the difference in the share of net wealth owned by households at the upper end versus households at the lower end — is widening. Is it any wonder that so many Canadians feel the system is rigged against them?
That same disparity exists across many other facets of our society and our economy, such as the number of Canadians seeking specialized medical care versus the actual number of health specialists available to treat them, or the dollar value of the manufactured goods we import versus the dollar value of the manufactured products we export to other countries. Too many aspects of our political, social and economic affairs are off kilter.
If we think of our country as a public company, then Canadian citizens are its shareholders and our elected representatives are the equivalent of its board of directors, responsible for overseeing governance and protecting the interests of the shareholders. But the interests of average Canadians are getting crowded out by the demands of special interest groups. The priorities of these special interest groups — everything from tax loopholes for the rich to subsidies and exemptions for big businesses — take precedence more often than not.
This is one of the main reasons for the growing imbalance that’s harming our society. It should come as no surprise, therefore, that a growing number of Canadians are turning to socialist policies as a way to restore balance and fairness. But the fact is that government can’t give you anything unless it takes it from you in the first place, and in the process of providing you with a certain benefit or service, the government inevitably squanders a lot of the money it took.
I understand the impulse to turn toward socialism as a cure-all for society’s economic injustices. I come from a working-class family. My father was a labour activist and a socialist during a time when workers were beaten or jailed for seeking higher wages and greater workplace safety. But I don’t believe that socialism can raise living standards or eliminate poverty.
At the end of the day, socialism is based on the distribution of wealth rather than the creation of wealth, and what socialism fails to account for is that we must first create wealth before we can distribute it. It’s the reason why socialism always fails wherever it is implemented.
Instead, we can begin to restore balance in a steady and measured way by simply enacting the sort of reforms that most Canadian citizens would overwhelmingly endorse. I’ve chaired a number of publicly traded companies over the years, and the one thing I know for sure is that shareholders always vote in their own best interests.
The one reform we should start with is our broken tax system, which is overly complicated and riddled with loopholes that provide tax breaks for special interests and the large financial institutions that feed off the system. Restoring balance to our tax system means making it fair, simple and transparent. No more exemptions and deductions. No more grey zones.
We need to unshackle small businesses by freeing them from as many rules, regulations and permits as possible, while removing corporate income taxes for any company with fewer than 300 people. In other words, it’s time to put the “free” back into “free enterprise.” And we have to address the growing levels of income inequality by requiring large corporations to share 20 per cent of their annual profits with employees and managers.
We also need to reduce bureaucracy at every level of government by at least five per cent per year over the next decade. And lastly, we need to bring technical skills training back into our high schools to expose young Canadians to lucrative careers in various trades. By enacting these reforms, we could restore a level of balance that has been absent for many decades now.
Credits to National Post, Frank Stronach
nationalpost.com
Photo Credit to Elena Mozhvilo
unsplash.com
Take wealth, for example. According to a report from the Office of the Parliamentary Budget Officer, in 2019, the top one per cent of Canadians held 25 per cent of the country’s net wealth, while the bottom 40 per cent of Canadian families barely owned more than one per cent.
The report also found that the household wealth gap — the difference in the share of net wealth owned by households at the upper end versus households at the lower end — is widening. Is it any wonder that so many Canadians feel the system is rigged against them?
That same disparity exists across many other facets of our society and our economy, such as the number of Canadians seeking specialized medical care versus the actual number of health specialists available to treat them, or the dollar value of the manufactured goods we import versus the dollar value of the manufactured products we export to other countries. Too many aspects of our political, social and economic affairs are off kilter.
If we think of our country as a public company, then Canadian citizens are its shareholders and our elected representatives are the equivalent of its board of directors, responsible for overseeing governance and protecting the interests of the shareholders. But the interests of average Canadians are getting crowded out by the demands of special interest groups. The priorities of these special interest groups — everything from tax loopholes for the rich to subsidies and exemptions for big businesses — take precedence more often than not.
This is one of the main reasons for the growing imbalance that’s harming our society. It should come as no surprise, therefore, that a growing number of Canadians are turning to socialist policies as a way to restore balance and fairness. But the fact is that government can’t give you anything unless it takes it from you in the first place, and in the process of providing you with a certain benefit or service, the government inevitably squanders a lot of the money it took.
I understand the impulse to turn toward socialism as a cure-all for society’s economic injustices. I come from a working-class family. My father was a labour activist and a socialist during a time when workers were beaten or jailed for seeking higher wages and greater workplace safety. But I don’t believe that socialism can raise living standards or eliminate poverty.
At the end of the day, socialism is based on the distribution of wealth rather than the creation of wealth, and what socialism fails to account for is that we must first create wealth before we can distribute it. It’s the reason why socialism always fails wherever it is implemented.
Instead, we can begin to restore balance in a steady and measured way by simply enacting the sort of reforms that most Canadian citizens would overwhelmingly endorse. I’ve chaired a number of publicly traded companies over the years, and the one thing I know for sure is that shareholders always vote in their own best interests.
The one reform we should start with is our broken tax system, which is overly complicated and riddled with loopholes that provide tax breaks for special interests and the large financial institutions that feed off the system. Restoring balance to our tax system means making it fair, simple and transparent. No more exemptions and deductions. No more grey zones.
We need to unshackle small businesses by freeing them from as many rules, regulations and permits as possible, while removing corporate income taxes for any company with fewer than 300 people. In other words, it’s time to put the “free” back into “free enterprise.” And we have to address the growing levels of income inequality by requiring large corporations to share 20 per cent of their annual profits with employees and managers.
We also need to reduce bureaucracy at every level of government by at least five per cent per year over the next decade. And lastly, we need to bring technical skills training back into our high schools to expose young Canadians to lucrative careers in various trades. By enacting these reforms, we could restore a level of balance that has been absent for many decades now.
Credits to National Post, Frank Stronach
nationalpost.com
Photo Credit to Elena Mozhvilo
unsplash.com
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