Middle-class dreams a ‘myth’ in troubled economy: internal government report


Goober
Free Thinker
#1
Updated
www.scribd.com/doc/208456900/Middle-class-blues (external - login to view)



Note the period covers 1993 to 06/07

Middle-class dreams a ‘myth’ in troubled economy: internal government report - The Globe and Mail

Canada’s middle-class is mortgaging its future to stay afloat, making the Canadian dream “a myth more than a reality.”

That’s the blunt assessment of an internal Conservative government report, an unvarnished account of the plight of middle-income families that’s in contrast to the rosier economic picture in this month’s budget.

The document was prepared last October by experts in Employment and Social Development Canada, the department that runs the employment insurance fund and other income-support programs. The Canadian Press obtained the report under the Access to Information Act.

“The wages of middle income workers have stagnated,” it says, referring to the period from 1993 to 2007.

“Middle-income families are increasingly vulnerable to financial shocks.”

The document, drawing on three years of “internal research,” was prepared for the department’s deputy minister, Ian Shugart, shortly before the resumption of Parliament last fall.

“In Canada, political parties are making the middle class a central piece of their agendas,” notes the presentation.

A department spokesman, Jordan Sinclair, said in an e-mail that the research “was not linked to the parliamentary schedule or topics raised within the House of Commons.”

The authors say middle-income families have seen their earnings rise by an average of only 1.7 per cent a year over the 15 years ending 2007.

“The market does not reward middle-income families so well,” says the report. “As a result, they get an increasingly smaller share of the earning’s pie” compared with higher-income families.

Shugart was also told middle-class workers “get lesser government support for their work transitions,” referring to a sharp fall-off in employment-insurance benefits compared with other economic groups.

The analysis stops short of the 2008 global recession, though other analysts have noted the economic crisis wiped out many well-paid manufacturing jobs in central Canada that have supported middle-class prosperity.

The report also refers to debt, saying “many in the middle spend more than they earn, mortgaging their future to sustain their current consumption.”

“Over the medium term, middle-income Canadians are unlikely to move to higher income brackets, i.e., the ‘Canadian dream’ is a myth more than a reality.”

Current Conservative messaging emphasizes a million new jobs created since the recession; Canada’s relative economic stability compared with other industrialized countries; and various tax cuts provided to “average” families since 2006.

A spokeswoman for Employment Minister Jason Kenney said the report reflects “the period of time under the previous Liberal government,” from 1993 forward. (The report also covers 2006-2007, the first two years under the Harper Conservatives; the department says an updated report is “not available at this time.”)

“Our government has reduced taxes and made life affordable for Canadian families,” Alexandra Fortier said in an email Sunday, adding a “typical” family of four enjoys tax cuts of $3,400 a year, thanks to Conservative policies.

That “typical” family includes working parents who together earn $120,000 a year, with two children.


This month’s budget acknowledged the need to create jobs and provide workplace training, but the budget documents never refer explicitly to the “middle class.” The term “middle income” occurs just three times in the main budget, and once in a news release.

Since becoming Liberal leader in April last year, Justin Trudeau has frequently cited the plight of the middle class, a theme repeated at the party’s weekend convention in Montreal.

Research from the Library of Parliament shows that since Jan. 1, 2013, Trudeau has used the phrase “middle class” 52 times in the House of Commons, compared with twice for Prime Minister Stephen Harper and nine times for NDP Leader Tom Mulcair. None of them used “middle income.”

Toronto Liberal MP Chrystia Freeland commended the public servants who produced the report, saying that for the Liberals “it was like getting a good grade on your homework.”

“This is a very strong, non-partisan, data-driven report, focused on Canada, which confirms our assertion, which is at the centre of our policy, that the middle class in Canada is being squeezed and that we have to do something about it,” she said in an interview from Montreal.

“The public discourse has been lagging – we’ve been in denial.”

Freeland, who won a November by-election and now is the party’s trade critic, is author of the 2012 book Plutocrats, which argues that wealth distribution has favoured the ultra-rich and left everybody else behind.
Last edited by Goober; Feb 23rd, 2014 at 05:39 PM..
 
gerryh
#2
ya, any more years of harper "leadership" will mean the middle class will be permanently screwed.
 
captain morgan
Bloc Québécois
+3
#3  Top Rated Post
Quote: Originally Posted by GooberView Post


Canada’s middle-class is mortgaging its future to stay afloat, making the Canadian dream “a myth more than a reality.”

The Liberals socialist utopia, starting with the profoundly damaging policies of Pierre Trudeau is the real mortgage that the middle class is paying off. Add in the entitlement generation whose demands are off the chain and it is the income earners (read: middle and up) that is financing the whole she-bang.
 
Goober
Free Thinker
+1
#4
Started quite some time ago. One key point is people living beyond their means- I take that to be living on credit to maintain their lifestyle.
 
captain morgan
Bloc Québécois
#5
No doubt, however, reaching back offers some insight as to why the tax base is so high right now
 
Goober
Free Thinker
#6
Quote: Originally Posted by captain morganView Post

No doubt, however, reaching back offers some insight as to why the tax base is so high right now

True and not so true.
You are the numbers guy.

AKA Corporate welfare- Loans outstanding- amounts paid back?

Countries infrastructure- we are falling behind - Myself I would suggest a cap on labor costs for multi-year contracts ( not sure how that would sell, but long term employment does sell)- Cost overruns- Not the Govts problem- You bid poorly- you lose -
I updated the OP.

www.scribd.com/doc/208456900/Middle-class-blues (external - login to view)
Last edited by Goober; Feb 23rd, 2014 at 05:39 PM..
 
captain morgan
Bloc Québécois
#7
I am curious what you believe corporate welfare is. You had mentioned a gvt loan and I don't recall hearing about those (that does not mean that they don't exist). Can you tell me about some that you are familiar with?

So, what do you really mean in talking about Corp Welfare and are there some numbers that indicate what the direct costs is to the gvt and Canadians?

I am asking this because the idea of corporate welfare that I have heard most often quoted relates to tax breaks to large companies whom they want to spend very large amounts of money. So, that brings me back to what you believe constitutes 'corporate welfare'?

As far as infrastructure is concerned, that is funded through the tax base, and as you can imagine, it is the middle and upper income earners and corporate taxes collected that pay for these items, so I am unsure about what you are really driving at here
 
Goober
Free Thinker
#8
Quote: Originally Posted by captain morganView Post

I am curious what you believe corporate welfare is. You had mentioned a gvt loan and I don't recall hearing about those (that does not mean that they don't exist). Can you tell me about some that you are familiar with?

So, what do you really mean in talking about Corp Welfare and are there some numbers that indicate what the direct costs is to the gvt and Canadians?

I am asking this because the idea of corporate welfare that I have heard most often quoted relates to tax breaks to large companies whom they want to spend very large amounts of money. So, that brings me back to what you believe constitutes 'corporate welfare'?

As far as infrastructure is concerned, that is funded through the tax base, and as you can imagine, it is the middle and upper income earners and corporate taxes collected that pay for these items, so I am unsure about what you are really driving at here

Loans to say Pratt Whitney- I recall reading the payback levels were and are low.


Pratt & Whitney deal not quite as advertised - Politics - CBC News
 
L Gilbert
No Party Affiliation
+1
#9
Quote: Originally Posted by GooberView Post

Note the period covers 1993 to 06/07

Middle-class dreams a ‘myth’ in troubled economy: internal government report - The Globe and Mail“The wages of middle income workers have stagnated,” it says, referring to the period from 1993 to 2007.

“Middle-income families are increasingly vulnerable to financial shocks.”

The document, drawing on three years of “internal research,” was prepared for the department’s deputy minister, Ian Shugart, shortly before the resumption of Parliament last fall.

So no-one noticed for the 12 years previous to 2010? Kinda says something about how much those boneheads in gov't think about the workforce of Canada. And before some pinheaded Gliberal blames it all on the Cons; this period they're referring to starts at the beginning of aPAULing Martin's appalling display.
Quote:

[B]The authors say middle-income families have seen their earnings rise by an average of only 1.7 per cent a year over the 15 years ending 2007.

I was woken up to that fact when a paramedic told wifey that her raises didn't even keep up with inflation let alone cost of living.
Quote:

[B]The analysis stops short of the 2008 global recession, though other analysts have noted the economic crisis wiped out many well-paid manufacturing jobs in central Canada that have supported middle-class prosperity.

That's the scary part.

Quote:

Freeland, who won a November by-election and now is the party’s trade critic, is author of the 2012 book Plutocrats, which argues that wealth distribution has favoured the ultra-rich and left everybody else behind.

He's not the only one who's noticed. A friend of wifey's has been juggling 3 jobs (1 full-time and 2 part-time) to keep food on the table and roof over her and her young son's heads. Quite a few friends' EIs ran out quite a while back and they are hand-to-mouthing it on odd jobs and whatever they can scrounge up.

Anyways, it's about time someone had their ears perk up over this. Now if something could be done about it .....

DIP INTO YOUR PROFIT MARGINS AND HIRE PEOPLE, YOU RICH A$$HATS!!

Quote: Originally Posted by gerryhView Post

ya, any more years of harper "leadership" will mean the middle class will be permanently screwed.

This speaks about the period starting in 1993 and ends in 2007. 1993 is when aPAULing Martin started messing around with Canada. Can't blame that on Harpy.
 
captain morgan
Bloc Québécois
+1
#10
Quote: Originally Posted by GooberView Post

Loans to say Pratt Whitney- I recall reading the payback levels were and are low.


Pratt & Whitney deal not quite as advertised - Politics - CBC News


I agree and disagree with this kind of action, but lets also be clear on some things.

My belief is that the gvt is trying to achieve a few different things here including, (attempting) to spur a new industry in areas that are have experienced a contraction in some of their traditional economic engines (ie auto mfg). These areas are also experiencing higher than average unemployment (for the specific region) and if they are successful, can that sector grow significantly (think Seattle and Boeing or even Ft Mac and the oil sands).

Obviously we would need to see the details on the agreement, however, I am generally against this kind of gvt sponsorship and prefer tax breaks on income generated.
 
L Gilbert
No Party Affiliation
#11
Quote: Originally Posted by GooberView Post

Started quite some time ago. One key point is people living beyond their means- I take that to be living on credit to maintain their lifestyle.

When wages don't keep up with prices and inflation, people start dipping into credit.
 
captain morgan
Bloc Québécois
#12
Quote: Originally Posted by L GilbertView Post

When wages don't keep up with prices and inflation, people start dipping into credit.

I believe that it has more to do with lifestyle choices.

Remember when your folks bought their first car (or telling you about it)?

Back in a time when the only credit facilities existed were for a mortgage on a home
 
Angstrom
Liberal
#13
Middle class? That was just to keep the babyboomers content and under control after all that protesting in the 60s.
If they can keep control without a middle class they wont be paying it out.
 
Goober
Free Thinker
+1
#14
Quote: Originally Posted by L GilbertView Post

When wages don't keep up with prices and inflation, people start dipping into credit.

I know quite a few that live off their home equity. Piss poor planning- These are not people getting by, these are the gotta have the toys crowd.

Consumer Price Index, by province (monthly) (Canada) (external - login to view)

Consumer Price Index, historical summary (1994 to 2013) (external - login to view)
 
L Gilbert
No Party Affiliation
#15
Quote: Originally Posted by GooberView Post

I know quite a few that live off their home equity. Piss poor planning- These are not people getting by, these are the gotta have the toys crowd.

Consumer Price Index, by province (monthly) (Canada) (external - login to view)

Consumer Price Index, historical summary (1994 to 2013) (external - login to view)

I have no doubt that there are also plenty of those. But I know a few toy-lovers who have shed their toys in order to keep afloat.
 
Angstrom
Liberal
#16
Toy lovers is what keeps a middle class alive

If you dont spend, there is no middle class. Living on credit is like being a mini stimuluss package. The middle class will be wiped out even faster without credit.
 
Goober
Free Thinker
+1
#17
Quote: Originally Posted by L GilbertView Post

I have no doubt that there are also plenty of those. But I know a few toy-lovers who have shed their toys in order to keep afloat.

I was not in disagreement- Just that as always, some are the authors of their own financial problems.
And yes, the MC has been stagnant. Wonder what the stats will show for after the bust happened??
 
L Gilbert
No Party Affiliation
+2
#18
Quote: Originally Posted by captain morganView Post

I believe that it has more to do with lifestyle choices.

I am not ignoring those folks. But there are all types being hit hard.
Personally, we don't buy anything unless we have the cash first. We simply carry the plastic around because it's easier to just put everything on them and then clear the slate at the end of the month.
 
Angstrom
Liberal
#19
In 20 years things will look totaly diffrent.
 
captain morgan
Bloc Québécois
+1
#20
Quote: Originally Posted by L GilbertView Post

I am not ignoring those folks. But there are all types being hit hard.
Personally, we don't buy anything unless we have the cash first. We simply carry the plastic around because it's easier to just put everything on them and then clear the slate at the end of the month.

You are the exception and not the rule. (Good for you by the way)

Credit cards can be a great advantage in using the banks money at no cost for a month at a time... The trouble occurs when you carry a balance and they bend you over at 18%+.
 
L Gilbert
No Party Affiliation
#21
Quote: Originally Posted by captain morganView Post

You are the exception and not the rule. (Good for you by the way)

Credit cards can be a great advantage in using the banks money at no cost for a month at a time... The trouble occurs when you carry a balance and they bend you over at 18%+.

Yep. That interest rate is a scary SOB. Not quite sure why the companies are allowed to carry the same rates on their cards as loan sharks do, but it's pretty despicable.
 
gerryh
#22
You 2 do realize that there are people in this country that only dream about prime plus rates. 18% to some is a decent rate. A hell of a lot better than 29%.
 
L Gilbert
No Party Affiliation
#23
Quote: Originally Posted by gerryhView Post

You 2 do realize that there are people in this country that only dream about prime plus rates. 18% to some is a decent rate. A hell of a lot better than 29%.

We have "prime+" cards. Both, ATM, are under 10%. And yes, I know there are cards out there with rates like 23%.
 
Goober
Free Thinker
+1
#24
Quote: Originally Posted by L GilbertView Post

We have "prime+" cards. Both, ATM, are under 10%. And yes, I know there are cards out there with rates like 23%.

Like you we pay off ahead of or on time.
We shop at Costco- 2 % on purchases and Amex 2 % as well.
More than pays the membership fee.
We wait for sales.
I d*i*c*k*er- Buy a pair of shoes, I want extra shoelaces for free. They wear out before the shoes do. And they best be on sale, or no go.
 
gerryh
+1
#25
Quote: Originally Posted by L GilbertView Post

We have "prime+" cards. Both, ATM, are under 10%. And yes, I know there are cards out there with rates like 23%.

Quote: Originally Posted by GooberView Post

Like you we pay off ahead of or on time.
We shop at Costco- 2 % on purchases and Amex 2 % as well.
More than pays the membership fee.
We wait for sales.
I ****er- Buy a pair of shoes, I want extra shoelaces for free. They wear out before the shoes do. And they best be on sale, or no go.


Missing my point gentlemen, there are a lot of people that don't get these low interest cards. If they want a CC then they don't have a choice, and these days, you HAVE to have a credit card. You HAVE to have a loan.
 
Goober
Free Thinker
#26
Quote: Originally Posted by gerryhView Post

Missing my point gentlemen, there are a lot of people that don't get these low interest cards. If they want a CC then they don't have a choice, and these days, you HAVE to have a credit card. You HAVE to have a loan.

Yes that is true- Banks consider them high cost- What is a solution?
 
gerryh
#27
Let me throw one more little curve ball to ya. You all talk about paying cash wnever possible, or using the CC's and paying them off by the end of the month so it IS like just using cash as if using cash only is the be all and end all of being fiscally responsible. I'll tell you right now, that is the furthest thing from the truth. The WORST thing someone can do is pay cash for everything. To live "within" their means.
 
Goober
Free Thinker
#28
Quote: Originally Posted by gerryhView Post

Let me throw one more little curve ball to ya. You all talk about paying cash wnever possible, or using the CC's and paying them off by the end of the month so it IS like just using cash as if using cash only is the be all and end all of being fiscally responsible. I'll tell you right now, that is the furthest thing from the truth. The WORST thing someone can do is pay cash for everything. To live "within" their means.

We live within our means.
The total saving we have increases from month to month.
I have 1 years backup saved.
I use the CC doe to cash rebate.
 
damngrumpy
No Party Affiliation
+1
#29
All the benefits of the middle class were predicated on the tax base that
included participation by individuals, business and the income from the
natural resources we had. Then the sales job began. We were told of
the New World Order (actually a term first coined by Hitler) and the idea
of a global economy that would lift the third world out of poverty and we
would all benefit.
In short we saw government abdicate its responsibility to the people it
serves and put the country in the hands of large corporations and those
speculators who haven't done a good days work in their lives.
The freed trade deals that benefit the few at the expense of the many for
little real gain, and the speculation on markets combined with the race
to the bottom for wages and working conditions has destroyed the dream
of the middle class and the working poor.
There are some differences though. These same people have continued to
plunder the economies of the world and there is about to be a massive and
harsh adjustment. The last great depression impacted about twenty fiver
percent of the workforce the impending depression will impact eighty percent.
With that will be the public's rethink of the system itself and those speculators
will find their gravy train has come to the end of track. Look at the current
market conditions they are flying at times without taking in the realities of slowing
growth. That means everyone's dream will feel the pain.
 
gerryh
#30
Quote: Originally Posted by GooberView Post

We live within our means.
The total saving we have increases from month to month.
I have 1 years backup saved.
I use the CC doe to cash rebate.


There are thousands upon thousands of people in this country that can only dream of doing what you and gilbert do.

but forget it, been down this road before, always goes the same way.
 

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