The Economic Price of the Double Standard

Crashed_sports_car

By User Dawidl on en.wikipedia

Our metaphor today is that running a country is like running a car. Money spent in the right places is money well spent. A penny saved can end up a dollar wasted. If you spend your money on a new paint job instead of a wheel alignment, you may look good now, but in the long run you’re heading for a serious crash.

Our health care and judicial systems, especially where they deal with the lowest economic level of the populace, are beginning to give us the look of a hand-rubbed, candy-apple red lacquer job on bald tires. Our government’s assumption that “To the rich all shall be given, from the poor all shall be taken away,” is pushing us towards a crash.

I always like it when some editor with a sense of irony puts two conflicting articles on the same page. In Tuesday’s Vancouver Sun, for example:

First Report: “Drug Treatment Court Builds Record of Success.”

Vancouver has a special court – presided over by Judge Harbans Dhillon, a highly qualified jurist – to deal with addiction-related criminal activities such as drug dealing and theft. In return for a guilty plea the offenders are offered all sorts of treatment, supervision and help to cure their disease. They receive their sentence after the treatment is finished. Great motivation to attend those meetings! So all the money and resources that traditionally would be put into court fees and jail upkeep is spent on rehabilitation.

And the results are good: in 2014 average recidivism was lowered by 56%, criminal activities by 35%. And it can never be considered a “nicey-nicey” program. Judge Dhillon suggests that “sometimes it is easier just to do time in jail.”

A friend of mine is a judge in a similar program for troubled youth in California, with similar results. It’s obviously the way we should be dealing with the disadvantaged. However…

Second Report: “Richly Rewarded Politicians No Benefit to B.C.’s Disabled”

In the past 15 years in B. C., assistance to the disabled has increased 15 per cent while the premier’s salary grew 54 per cent. At a time when the cost of living rose 30%.

Need I say more?

Moose Jaw’s (Former) Homeless Program.

The city council of Moose Jaw, Saskatchewan has decided that it will cost them less to provide their homeless with housing than it does to leave them on the streets. Confirming data has been around for years, and more governments should be taking note. By the time you add up police patrols, ambulances, crime, Emergency visits, legal aid, and all the other costs, a homeless person is a rather large drag on government coffers.

And on top of that, as one proponent of the program suggested, it’s pretty stupid to expect someone to clean himself up, get a job, quit his addictions and cure his mental health problems when he doesn’t have anywhere to live.

Maybe Canada needs its own version of Bernie Sanders to do a little rant and rave on the economics of socialism!

Student Loans

Andrew Coyne was proposing the other day that, instead of giving out student loans and expecting payback immediately after graduation when the graduates have no jobs, we should consider university students to be small businesses. Those fees would then be an investment that graduates would pay back in small dividends for the rest of their working careers, thus postponing their debt until he they can afford to pay it.

That sounds rather complex, until it occurs to me that France has a similar system, but much simpler. Tuition fees are free, and everyone just pays higher income tax to cover it. People with higher educations pay more tax over their careers, and it all balances out.

The Tax Man’s Slant

And now the latest: Revenue Canada has discovered a couple of different companies offering great tax write-offs that are scams. In both cases, claims were made that were completely bogus, resulting in false tax savings. The difference was that one company was dealing with some of the richest people in Canada. The other was dealing with average middle-class people.

In the case of the big company and their rich clients, Revenue Canada offered them a deal. If KPMG turned over the names of everyone who participated, and if everyone paid back the taxes they owed, there would be no penalties.

For the less fortunate group, the tax department decided that they should have known better than to deal with criminals, and assessed them penalties of two to three times the disputed amount, on top of repayment.

Now, I can see the tax department making a deal with the big company: 100% compliance, no legal fees, no hassles, no political pushback. For the taxpayers of Canada, a real deal.

But for the little people, it’s simply another case of bureaucratic over-enthusiasm. One is led to suspect that, like traffic control officers, there are people in Revenue Canada who have a quota of tax dollars that they are supposed to collect. They go about it the easiest way possible, looking for people who don’t have the resources to fight back. They target young entrepreneurs who have received grants and might not have known how to claim the taxes properly. They look for senior citizens whose children have taken over their financial affairs and might have made mistakes. And in this case they target average citizens who have been taken in by a smooth operator.

Double Standard Strikes Again.

All of these examples point towards a need for a different attitude in our government funding allocations. Our present system is based on the old Victorian attitude that the successful deserve everything because they are completely responsible for their own success, and the needy don’t deserve anything because they are the cause of their own failures.

The unfortunate fact is that such a system is very expensive. Factory owners know that if you keep your plant in good running order and your employees well trained, you can make money from your enterprise. If you don’t, you fail. To put it more into the common citizen’s experience, running your car on bald tires can be very expensive economy if you run it off the road.

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