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Trudeau and Morneau did a good job of having Canada in great financial shape to deal with the pandemic spending. We are the envy of the world.

Unfortunately, the wealth and income gaps continue to create widening disparities and they have reached a critical point.

It was a situation that was predicable and well understood by economists. Wealth gaps are a natural side effect of any capitalist system.

Some economists have suggested a tax on production, instead of labor. Others have suggested a universal basic income as a solution.

It will be interesting to see if November's financial budget provides some insight into how the government plans to address the problem.

They may choose to sweep the problem under the rug, as past governments have done for decades, or they may boldly initiate a solution.
You fail to explain why weath or income gap is a problem.

If someone does something more valuable, why shouldn't they get paid more?

I'm sorry, but it's a lot of work to become a doctor, I think they should have a higher income than some unemployed pothead. That's just me.

The thing with people who complain about the "wealth gap", they're just jealous that others have more. It's simple envy.

It's like "student loan debt", do you know how much debt I had when I graduated?
None.
It was simple, I saved during HS (ie no car)
I then worked while at school, and lived really really cheaply.
My wife went to school, and did the same thing.

The thing is I wonder how many of these "wealth gap" whiners actually have multiple jobs, or a side hustle, or do they just complain about it.
 

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When you complain about rising insolvencies and that people don't have $200 a month in discretionary income, you are identifying the problem of wealth and income gaps.

Canada's economic system is a consumer driven economy. The economy depends on consumers having discretionary income to buy goods and services.

When people don't have money to spend, the economy goes into a a self fulfilling downward spiral.

The solution isn't a "side hustle". It is working people earning enough to support themselves and the economy.

People work to live. They don't live to work.
 

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The US has 10 times the population of Canada.

The US national debt is $30 Trillion dollars, and they have an additional unfunded liability of Trillions more for their bankrupt Social Security program.

Canada has a national debt of $1 Trillion and the CPP is stand alone and fully funded.

If people want to worry about national debt......they should worry about the US.
 

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When you complain about rising insolvencies and that people don't have $200 a month in discretionary income, you are identifying the problem of wealth and income gaps.

Canada's economic system is a consumer driven economy. The economy depends on consumers having discretionary income to buy goods and services.

When people don't have money to spend, the economy goes into a a self fulfilling downward spiral.

The solution isn't a "side hustle". It is working people earning enough to support themselves and the economy.

People work to live. They don't live to work.
No I'm identifying that they aren't making good financial choices.

I know people who live paycheck to paycheck, they still have a big screen TV, and expensive cable packages.
You cancel cable, or don't buy that TV, and you'll have your $200 very quickly.

It is about choices and trade offs, not a lack of money.
People make enough to support themselves, they just spend it poorly.

I know many people who declared bankruptcy.
They ALL have newer more expensive cars than I do, they all have a bigger TV, and fancy cable packages.
They spend like maniacs, and wonder why they're in debt. They honestly don't see it.

It's a failure to accept responsibility for your choices.


I'm not saying there aren't those in need. But I am saying most Canadians have sufficient money to live comfortably, they're just making bad choices.
 

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The statistics don't support your view. If "bad choice spending" were a significant problem, the economists would be already taking that into consideration.

The rising cost of the basics of shelter, food, utilities are outstripping any wage gains and working people are falling further behind year after year.

People have supplanted debt for insufficient wages, but that isn't a viable solution for the long term.

It has only created a bigger problem with diminishing disposable income due to debt repayment from earnings.
 

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The statistics don't support your view. If "bad choice spending" were a significant problem, the economists would be already taking that into consideration.

The rising cost of the basics of shelter, food, utilities are outstripping any wage gains and working people are falling further behind year after year.

People have supplanted debt for insufficient wages, but that isn't a viable solution for the long term.

It has only created a bigger problem with diminishing disposable income due to debt repayment from earnings.
What stats?


Yes lots of poor people file bankruptcy, but many don't, I didn't when I was poor.
But many people with higher incomes also file bankruptcy.
I'd bet most people here didn't declare bankruptcy when they were lower income either.


If it was just a lack of income, you'd see bankruptcies disappear at a certain income level, but they don't.
I contend that higher income bankruptcies are largely due to bad decisions.

while some people simply don't have enough, and I can accept that, many Canadians have enough, they just manage it very poorly.
As I've stated, if you're $200 from insolvency, and you have cable TV, or even a physical TV, you're making bad choices.

I saved up my full emergency fund (3+ months of living expenses) before I replaced my TV.
If you didn't do that, it's a choice, and IMO a bad choice.
 

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The US has 10 times the population of Canada.

The US national debt is $30 Trillion dollars, and they have an additional unfunded liability of Trillions more for their bankrupt Social Security program.

Canada has a national debt of $1 Trillion and the CPP is stand alone and fully funded.

If people want to worry about national debt......they should worry about the US.
When looking at debt to gdp, according to the article below, canada is in worse shape that the US.

 

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When looking at debt to gdp, according to the article below, canada is in worse shape that the US.

That is the "rise" in debt to GDP during the pandemic.

It is true that Canada provided more financial support to Canadians than the US did for it's citizens.

Maybe that is why there are tens of thousands lined up in the US for food handouts. They are still arguing about a support package in the Congress.

 

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What stats?


Yes lots of poor people file bankruptcy, but many don't, I didn't when I was poor.
But many people with higher incomes also file bankruptcy.
I'd bet most people here didn't declare bankruptcy when they were lower income either.


If it was just a lack of income, you'd see bankruptcies disappear at a certain income level, but they don't.
I contend that higher income bankruptcies are largely due to bad decisions.

while some people simply don't have enough, and I can accept that, many Canadians have enough, they just manage it very poorly.
As I've stated, if you're $200 from insolvency, and you have cable TV, or even a physical TV, you're making bad choices.

I saved up my full emergency fund (3+ months of living expenses) before I replaced my TV.
If you didn't do that, it's a choice, and IMO a bad choice.
That is exactly why the Liberals have discussed a targeted financial support program for low income working folks.

The Federal government is only able to provide support within it's jurisdiction, so a hike in the minimum wage is not possible.

Raising the minimum wage is also hard on struggling small businesses. It is a better plan to get revenues from major corporations that pay no taxes in Canada.

Let's start by taxing the freeloaders and go from there.
 

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Wealth gap and the income gap are not Canadian made, they are due to forces we cannot control:
  • Globalization forces average wages of the middle class down in developed nations and up in undeveloped nations (Capital moves freely)
  • Technology also has the same trend line driving down average wages in the middle. (Who has an admin, when Microsoft has a calendar?)
  • Particular to Canada, the rise of the income gap in the US (much bigger divide) has a downward pressure in Canada (The upper middle move to the higher incomes in Canada as well).
  • Current businesses in Canada are largely based on Commodities exports or individual (CCPC) where production outputs are falling due to the lack of technology investment
No amount of taxation or wealth distribution will fix this problem.

Canada needs to pull up its big boy pants and create a better capital growth environment, one where entrepreneurship is leading the way along with production improvements by adoption of technology. Canada needs to grow the capital and income pie.
 

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I agree it is a global problem, and companies should "pull on their big boy pants" as GM just did in negotiating new truck production in Oshawa creating thousands of good paying jobs.

Some of the largest corporations in the world have taken advantage of manufacturing in low wage countries and selling their products in higher wage countries.

If those companies depended on selling within the markets where they manufacture their products, they would go bankrupt.

It has been a good "gig" while they got away with it, but the time has come for it to stop.

Canada loses an estimated $8 billion to $25 billion a year from corporations hiding their profits.

That would pay for a small targeted UBI to low income folks that would be spent and circulate through the economy.

Instead, the CEOs of these corporations and wealthy people wave at us from their island paradise tax haven in Bermuda.

The least we can expect from them is that they pay a "fair" share of taxes in Canada.......where they peddle their goods.

 

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Wealth gap and the income gap are not Canadian made, they are due to forces we cannot control:
yes, it's called reality.
The reality is that different people provide different amounts of value.
What we CAN do is try to help people create more value.

Punishing the rich because we're envious is just evil, and counter-productive.
 

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yes, it's called reality.
The reality is that different people provide different amounts of value.
What we CAN do is try to help people create more value.

Punishing the rich because we're envious is just evil, and counter-productive.
Agreed. And that is why I said

"...No amount of taxation or wealth distribution will fix this problem..."
 

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Agreed. And that is why I said

"...No amount of taxation or wealth distribution will fix this problem..."
Yes, but I think the issue is even more fundamental.

Some people think it's an artificial factor that's driving differential outcomes.
The truth is that there will always be differences, and you can't and don't even want to eliminate them.

We're richer and better than ever before, yet people keep pretending things like our abundant wealth is somehow a problem. It really shows an astonishing level of ignorance and lack of perspective.
 

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If the asset owners "deserve" their wealth, do not the workers deserve their "share" for creating that wealth ?

Unless the wealthy person is a sole proprietor with no employees, they are depending on the work of others to earn their wealth.

There is no logic that the owner should always own an increasing share while the workers split a decreasing share.

If capitalism was founded on that ideal........they might as well stayed in Europe and lived under the feudal system.

Please kind sir....might I have some more ?
 

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If the asset owners "deserve" their wealth, do not the workers deserve their "share" for creating that wealth ?
Well I think if you create an asset, you should own it.
I also think if you work on creating an asset, you should be compensated it. That's actually the underlying concept behind paid work.

I think owners and workers both deserve a share of the value they create.

I've never really understood this "worker vs owner" thing, it's really quite weird.
The owners need workers, and the workers need owners. They can be the same person, or different people.
Under our current system, you can be either or both, it's YOUR CHOICE.
 

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And when things get extreme, like in revolutionary France, the workers put the owners' heads on sticks.
 

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If the asset owners "deserve" their wealth, do not the workers deserve their "share" for creating that wealth ?
To the risk takers (who created the asset) goes the spoils. The worker (human tech) is only a byproduct of fluctuating need of the asset owner that could be discarded at any time. It is unfortunate, that workers can be found nearly anywhere for lower and lower prices or replaced by non-bio tech, but true. You cannot stop the world at the border. This is why I believe entrepreneurship is the only way out of this dilemma. Canada workers need to walk away from the traditional/regular employment" of working for someone/megacorp" and created their own money making asset. Sounds easy, but it is not. Short term support by the government would be useful during that transition.

In the not too distant past, I was listening to a podcast where Craig Alexander (former chief Economist at TD) made the point that one of the reasons Canada has been a productivity laggard was that asset owners in Canada unexpectedly shared their wealth with the workers at the expense of productivity.

So are we forgetting history? One thread to the luddite movement, two hundred years ago, was the fight against technology because it was tearing apart how people lived in favour of working 6am to 10pm during the industrial revolution. I find it rather ironic, from that point of view of a luddite today might be able to have the cake and eat it to. The great, great, great grand sons/daughters of a luddite father now can use technology ironically, to create their own assets (cake) and still live in mom's basement and eating that cake.

All that needs to happen is today's human tech needs to use their brains for themselves rather than renting them to someone else for exploitation.
 

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Small business owners haven't fared well. They have been crushed by mega-corporations like fast food companies and large store retailers. Now the large store retailers are under attack from huge online retailers like Amazon. Starting a small business is almost impossible today. There is no funding available and unless a person has their own or family assets it isn't going to happen. There are a fortunate few who manage to become successful, but if you look at the origins of many successful small businesses today, they were started many years ago and passed on to the family members who are operating them today. The same is true in the farming sector.

A few years ago, we considered starting a company with our son, who is a skilled tradesman. After investigating, we discovered there is no financial aid available for startups and without financial aid to purchase the necessary equipment to do the job......it is a pointless exercise. It takes time and money to build a business......lots of money in his case.

I know there are some who say.....just go start a business, but it is hardly that easy to support yourself and family, while trying to build a business.

I don't necessarily disagree that the situation is going to get worse with the development of technology.......but there is still the million dollar question.

As full time well paid jobs disappear for whatever reason........how are people going to make money to live, pay taxes, and save for retirement ?

Maybe we will just pretend all those unemployed people don't exist.
 

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Small business owners haven't fared well. They have been crushed by mega-corporations like fast food companies and large store retailers. Now the large store retailers are under attack from huge online retailers like Amazon. Starting a small business is almost impossible today. There is no funding available and unless a person has their own or family assets it isn't going to happen. There are a fortunate few who manage to become successful, but if you look at the origins of many successful small businesses today, they were started many years ago and passed on to the family members who are operating them today. The same is true in the farming sector.

A few years ago, we considered starting a company with our son, who is a skilled tradesman. After investigating, we discovered there is no financial aid available for startups and without financial aid to purchase the necessary equipment to do the job......it is a pointless exercise. It takes time and money to build a business......lots of money in his case.

I know there are some who say.....just go start a business, but it is hardly that easy to support yourself and family, while trying to build a business.

I don't necessarily disagree that the situation is going to get worse with the development of technology.......but there is still the million dollar question.

As full time well paid jobs disappear for whatever reason........how are people going to make money to live, pay taxes, and save for retirement ?

Maybe we will just pretend all those unemployed people don't exist.
I'm sad for you, you've lost before you even started.

Starting a business is hard work. When your poor, its extremely difficult, but not impossible. I know from experience. Pulling yourself up by your own boot straps, may permit you the luxury to live in a tent for a year-and Canada isn't that cold if you get a couple of sleeping bags. Too many people want the big hat, but are unhappy trying to earn the hat pushing the manure out of the way. Why should anyone feel entitled to magically be a winner without failing? Being hungry has its benefits and being driven by a hungry family perhaps even more benefits.

But all is not lost, companies can grow quickly if you put in the work. Shopify built itself into a mega corporation in less than 16 years from a dead start in 2004 after failing selling their snowboards....Right now I'm betting some of the most successful companies are being built in basements and behind garages during this pandemic. Its a great time to start a business, when everyone claims its too hard.
 
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