Its official: Ontario is a have not province

[Trex]

quote:
Ontario to get first 'have-not' handout next year

Province will receive $347-million
unquote

In my opinion this pretty much insures that Canada's confederation as we know it is totally defunct.

First lets deal with Newfoundland. Danny Williams wants to keep all the offshore oil and gas revenue offshore Newfoundland. And then he doesn't want it counted as income for the province. Then (not counting the billions of offshore revenue) he can continue to claim his province is "have not" and continue to claim transfer payments.
For the sake of argument lets say Danny succeeds with that.

That means that 3 western provinces (Alberta, Saskatchewan and British Columbia) with a combined population of about 7.8 million have to support 7 provinces and 3 territories( I think) with a combined population of about 23.9 million or so.
So 24% of the population are having to subsidize 76% of the population.

As to sharing of Federal seats the three western provinces have a grand total of 78 seats out of 308 or so.
That's around 24% of the total number of seats.

So 24% of the population only gets 1/4 of the political power and yet funds the entire country.

Now I just don't see that working out in the long haul.

I think the entire working populations of BC, Sask and Alberta should form a massive union and go on strike.
Say triple the pay for everyone right across the board.
Never work of course and so we basically shut down the all the industries in the West with our strike.
Then we can all go on welfare or pogy; there are no "have and have not provinces" and we are all equal.
Brothers so to speak.
The Feds can just print more money and we all will be equal and harmonious.

Or perhaps not.

Realistically speaking I favour much more decentralization in Canada.
Something like the Swiss Canton system.
Keep the Federal Government out of our pockets and bedrooms.
Let local politicians call the shots.
When their kids have to go to school with your kids they are much more likely to make responsible decisions.
And the ones that make responsible decisions are the ones that should hold the purse strings.

Forget about trying to stick people who live 5,000km away from you with your civic infrastructure costs.

I am not suggesting we scrap Canadas social safety net.

But surely we need to revist how this country functions.

Trex

 

[Risus]

You can blame McSquinty and his fiberals for that...

 

[DurkaDurka]

How could have McGuinty prevented the manufacturing sector from crashing? Short of giving them even more money?

 

[Ron in Regina]

Many of the provinces receiving equalization (like Ontario this time, for the first time ever) will
receive back in equalizations payments less than they actually pay into the equalization fund.
They just get to keep some of the cash (on a very basic level) that they're already paying in...
Saskatchewan was in that boat for quite some time, receiving back in equalization payments
only a portion of what it was paying in, if I understand the system correctly.

Some provinces receive way more than they contribute, but Ontario isn't one of them...This
is a temporary setback (fingers are crossed) before they bounce back. A hand-up, not a
hand-out by any means. The dollar figure is comparable to what P.E.I. will receive. Tiny.

Equalization payments by province ($ millions):
Prince Edward Island
2008-09: 322
2009-10: 340
Nova Scotia
2008-09: 1,571
2009-10: 1,571
New Brunswick
2008-09: 1,584
2009-10: 1,689
Quebec
2008-09: 8,028
2009-10: 8,355
Ontario
2008-09: 0
2009-10: 347
Manitoba
2008-09: 2,063
2009-10: 2,063

 

[Risus]

No wonder quebec isn't pushing for separation. Look at what they are getting!

 

[Trex]

Many of the provinces receiving equalization (like Ontario this time, for the first time ever) will
receive back in equalization payments less than they actually pay into the equalization fund.
They just get to keep some of the cash (on a very basic level) that they're already paying in...
Saskatchewan was in that boat for quite some time, receiving back in equalization payments
only a portion of what it was paying in, if I understand the system correctly.

Some provinces receive way more than they contribute, but Ontario isn't one of them...This
is a temporary setback (fingers are crossed) before they bounce back. A hand-up, not a
hand-out by any means. The dollar figure is comparable to what P.E.I. will receive. Tiny.

Equalization payments by province ($ millions):
Prince Edward Island
2008-09: 322
2009-10: 340
Nova Scotia
2008-09: 1,571
2009-10: 1,571
New Brunswick
2008-09: 1,584
2009-10: 1,689
Quebec
2008-09: 8,028
2009-10: 8,355
Ontario
2008-09: 0
2009-10: 347
Manitoba
2008-09: 2,063
2009-10: 2,063

Umm I dunno,
Maybe that's how it works but it doesn't really make too much sense that way.

Your saying "Ontario will receive back in equalization payments less than they pay into the fund" and the Feds are going to announce that as a $347 million payment to a new "have not " province.

Math doesn't work.
Would mean all the provinces pay more than they receive under equalization wouldn't it?
I don't think McGinty would go for that one.
I think Ontario got a net $347 million more than it paid myself.
But I freely admit I am not really sure how it works.

On another note I sure hope it is a "temporary" setback for Ontario but I really don't know.
Are the car and manufacturing business's going to be better next year?
Probably not.
Are the Big Three auto manufacturers ever going to completely recover?
Probably not for a while and they better whip a newer, cheaper more environmentally friendly product line pretty quick.

And sure I realize the amount of the equalization payment to Ontario is tiny.
But it still means only the three western provinces contribute financially to confederation.
Everyone else takes.

Trex

 

[Tonington]

Would mean all the provinces pay more than they receive under equalization wouldn't it?

Do you pay income tax? Which portion on your pay cheque is the largest deduction?

 

[Scott Free]

Socialism - gotta' love it.

 

[fubbleskag]

this is not an example of a broken system, this is an example of the system working exactly as designed. wtp?

 

[Walter]

McGuillicutty will blame it on Harris.

 

[darkbeaver]

No it isn't official, Ontario is not a 'have not" province it is a "have less" province. Characterizations like that make it seem that we're not interested in the welfare of our less fortunate sister provinces. Investment in less affluent parts of the nation are essential building blocks of the grand Canadian patchwork quilt. I would suggest that those complaining about transfer payments to the chronically needy sectors redouble their efforts to find viable solutrions to the provincia/regional deficits. I suggest stripping capitalists of their assets and redistributing that wealth, irrecting trade barriers, and heavy dutys on all imported manufactured goods and doing it before the birds come back in the spring. I almost forgot the trials for treason for anyone involved in SPP agreements and various other secret agreements done behind the citizens back by the white collar gangs.

 

[Ron in Regina]

Umm I dunno,
Maybe that's how it works but it doesn't really make too much sense that way.

Your saying "Ontario will receive back in equalization payments less than they pay into the fund" and the Feds are going to announce that as a $347 million payment to a new "have not " province.

Math doesn't work.
Would mean all the provinces pay more than they receive under equalization wouldn't it?
I don't think McGinty would go for that one.
I think Ontario got a net $347 million more than it paid myself.
But I freely admit I am not really sure how it works.

On another note I sure hope it is a "temporary" setback for Ontario but I really don't know.
Are the car and manufacturing business's going to be better next year?
Probably not.
Are the Big Three auto manufacturers ever going to completely recover?
Probably not for a while and they better whip a newer, cheaper more environmentally friendly product line pretty quick.

And sure I realize the amount of the equalization payment to Ontario is tiny.
But it still means only the three western provinces contribute financially to confederation.
Everyone else takes.

Trex

Trex, I can see where the confusion is happening, & I'm the first to admit that I do not
understand the formula's completely by any means. Here's where the conflict lies...

When I said "many," you interoperated that as "all" and that's not what I said. Take Ontario
in that, with it's large population, it's pay'n in a Shwack-o-Cash, but it'll only receive back
1/3 of a billion. It's pay'n in much more than it'll receive back in its "have not" status. Most
of the time, when Saskatchewan was "have not" with it's much smaller population, it paid in
a comparable amount (per capita) but received even less back as it didn't have the exemptions
like Alberta did on its oil, or Quebec on its Hydro, etc...Saskatchewan still dug itself out of the
"have not" status to "have" status due to the tiny fraction of its non-renewable resourse revenue
that wasn't clawed away Federally, and taxing the living snot out of its own population for decades.
At times, due to the way the formula worked, over 100% of Saskatchewans non-renewable resource
revenue was clawed back by the Feds against equilization, making the climb to "have" status a very
uphill battle.

Now when I said "many," I didn't say "all." There are provinces that receive much more than they
contribute due to small populations pay'n in, or side deal exceptions of resources that other provinces
have pay on and they don't have to pay on (does that make sense?). I can't even start to explain the
reasoning behind Quebec receiving over half of all equalization revenues as I don't get that one myself.

 

[Ron in Regina]

OK Trex, I know I explained that poorly in my own stumble along sort'a way...Let me try
this again in the "cut&paste" version by someone much more articulate than myself.

From: Equalization Program (Federal Transfers to Provinces and Territories, December 2007)

Equalization is the Government of Canada’s transfer program for addressing fiscal disparities

among provinces. Equalization payments enable less prosperous provincial governments to provide
their residents with public services that are reasonably comparable to those in other provinces, at
reasonably comparable levels of taxation.

How Equalization Works

• Equalization entitlements are determined by measuring provinces’ ability to raise revenues – known as "fiscal capacity".
• A province’s Equalization entitlement is equal to the difference between its fiscal capacity and the average fiscal capacity of all provinces – known as the "10 province standard".
• Provinces whose fiscal capacity is above the standard do not receive Equalization payments.

Ontario's "fiscal capacity" to raise revenues is much greater than, say P.E.I. due to the
population of each province (respectively) that can be taxed. Even though Ontario may
be a "have not" province at this point, it still has the largest population of any province
(to tax to raise revenues) and even in these shaky times, it's still an economic powerhouse.

Now this is from: Equalization payments - Wikipedia, the free encyclopedia

CriticismsEqualization payments have mostly been criticized by leaders and residents of the wealthy provinces. The premiers of oil-rich Alberta and of Ontario, with its large manufacturing and service sectors, have criticized a perceived drain on local finances. However, money is collected for equalization payments by federal taxation and is collected regardless of whether or not the province is a 'have' or 'have not' province. The difference is whether the provincial government receives money from the federal treasury. Residents of Alberta and Ontario are not necessarily taxed more by the federal government. However, since those provincial governments receive less total dollars per capita from the federal government than 'have not' provinces, they are required to collect more taxes from their residents than otherwise would be required if the equalization program did not exist.

This is what was try'n to say with respect to Saskatchewan. We clawed our way out anyway!
From: http://www.eqtff-pfft.ca/submissions/GovernmentOfSaskatchewan.pdf

The retention of the proceeds from non-renewable resource revenues presents an opportunity
for a province to invest in its long-term economic future, as has been aptly demonstrated in
Alberta over the years. However, our province is confronted with Equalization clawback
rates averaging close to 100 per cent, while Alberta retains 100 per cent of the financial
rewards from its vast resource wealth. This significantly impairs our province’s ability to​

compete with Alberta in attracting future resource developments.

The existing program also allows other recipient provinces to benefit from Saskatchewan’s
natural resources, given our substantial contribution to the 5-province standard in many of
the resource bases. Even as the incremental benefits to Newfoundland and Labrador and
Nova Scotia from their new accords accrue outside the Equalization program, these
provinces continue to benefit additionally inside the program from Saskatchewan’s energy​

revenues.

Over the past ten years, Saskatchewan would have received an additional $4 billion in
Equalization entitlements if we had been allowed to retain 100 per cent of our energy
revenues in the years for which the province was a recipient province. This money would
have been of significant benefit to Saskatchewan in addressing the relatively high debt levels
experienced in the 1990s. Instead, Saskatchewan was forced to rely on a relatively high tax​

effort to reduce debt that limits future economic development opportunities.

The current treatment of energy revenues in Canada is inequitable. Newfoundland and
Labrador and Nova Scotia are guaranteed to retain at least 100 per cent of their energy
revenues while Alberta is unaffected by Equalization clawbacks. Saskatchewan is left with
little financial return from its non-renewable resources to achieve a competitive tax and
royalty environment to encourage new exploration and development and adequately service​

and regulate this sector.

In Saskatchewan’s view, there is fundamentally no difference between offshore and onshore
ownership of non-renewable resources. The federal government long ago transferred​

ownership and custody of resources to the provinces for the benefit of their residents.

 

[Avro]

You can blame McSquinty and his fiberals for that...

Wow, are you ever dumb.:roll:

 

[Trex]

Trex, I can see where the confusion is happening, & I'm the first to admit that I do not
understand the formula's completely by any means. Here's where the conflict lies...

When I said "many," you interoperated that as "all" and that's not what I said. Take Ontario
in that, with it's large population, it's pay'n in a Shwack-o-Cash, but it'll only receive back
1/3 of a billion. It's pay'n in much more than it'll receive back in its "have not" status. Most
of the time, when Saskatchewan was "have not" with it's much smaller population, it paid in
a comparable amount (per capita) but received even less back as it didn't have the exemptions
like Alberta did on its oil, or Quebec on its Hydro, etc...Saskatchewan still dug itself out of the
"have not" status to "have" status due to the tiny fraction of its non-renewable resourse revenue
that wasn't clawed away Federally, and taxing the living snot out of its own population for decades.
At times, due to the way the formula worked, over 100% of Saskatchewans non-renewable resource
revenue was clawed back by the Feds against equilization, making the climb to "have" status a very
uphill battle.

Now when I said "many," I didn't say "all." There are provinces that receive much more than they
contribute due to small populations pay'n in, or side deal exceptions of resources that other provinces
have pay on and they don't have to pay on (does that make sense?). I can't even start to explain the
reasoning behind Quebec receiving over half of all equalization revenues as I don't get that one myself.

Ron your getting me more confused by the minute.

Now I always knew the equalization formula was one of the most convoluted, side deal stuffed mutant formula's on the planet.

But I assumed the following: Everybody's Fed taxes go into a pool. Then all the side deals, under the table deals, kickbacks, local pork , distant pork and exemptions get paid out.
Once that is done total remaining Fed costs are deducted from the pool.
Now come the transfer payments to the provinces.
If you get more than your fair share on a per capita basis of the remainder your a have not.
If you get less your a have.
Thus the haves subsidize the system over and above their fair share.
Horribly simplified I know but I thought it was something like that.
Or maybe not.

Moving right along.
Are you saying all Provinces have retained control of their natural resources except Sask?
That's outrageous...how can that be?
Surely Sask always retained control over all her natural resources?

If so combine that with the fact that offshore resources are NOT owned by the adjacent Provinces under our negotiated confederation.It was always at most a shared ownership in conjunction with the Feds.
And yet Newfoundland and Nova Scotia have managed to negotiate sole ownership of offshore resources.

And Sask got somehow got screwed out of her resources?
Why did I not know about this?

Trex

 

[Ron in Regina]

What I was getting at is this. Even with the obstacles planted in Saskatchewan's way, we
STILL dug our way out of "have not" status to "have" status but it took a Loooong time.
I wasn't kidding either when I said that, at times, the Federal claw-back on Saskatchewan's
non-renewable resources (oil, natural gas, mining, being the largest uranium exporter on the
planet, potash, etc...) exceeded 100%.


If Saskatchewan could do it, then Ontario will do it....and I'm assuming much faster with
a much larger population to tax to death to accomplish this than Saskatchewan had. I'm
not saying it'll be pleasant, but it's very do-able. With the shear number of Feraral Seats
located in Ontario due to its population, it wont get the same end of the stick with
constantly changing rules like Saskatchewan faced, or Ontario will just vote out that
Federal Govenment the next go around and roll the dice on the next one.

 

[lone wolf]

You can blame McSquinty and his fiberals for that...

I've got an idea you'd blame "McSquinty" and Rae for your willknots ... even if you don't know who's in at the time

 

[Ron in Regina]

Sorry Trex if I'm confusing you....but you're sort'a getting onto the right track. I hope I don't
make things worse, but I'm going to wing it here and try to boil it down....

Everybody pays in. Those that are in great shape (usually Alberta & Ontario) don't get back
any (above fed $$$ for health care, etc) moneys that they've already paid to Ottawa.

Some Provinces that are close (but not quite great) get a small portion of the moneys they've
paid back from Ottawa (like Saskatchewan was, and Ontario is now).

Some have these side deals like you've mentioned (NL & NS accords, Quebec & Manitoba's
Hydro) that get excepted from the Equalization Formula's so they get a disproportionally
larger share than they would if the revenues from those excepted resources where included.

I never claimed to be an expert here, & I sure never claimed the system was unconvoluted or
even remotely fair in the least. Saskatchewan got repeatedly royally scr*wed on this front. If
you don't think it could happen, check this out:
http://www.eqtff-pfft.ca/submissions/GovernmentOfSaskatchewan.pdf

In spite of what you'll find at the above link, we STILL dug out way through to "have" status.
If we could do it completely uphill, then Ontario can do it with its much larger population.

As far as the Accords in the Maritimes, the exception for Alberta's oil revenue, the exception
for Manitoba's & Quebec's Hydro (due to these being non-renewable) verses Saskatchewan
dealing with close to (and at times in excess of) a 100% claw-back on its non-renewable
resources and you not knowing about this...I don't know. Maybe it never came up at your
dinner table growing up. If you know it exists (like you do now), it's very easy to verify in
today's day and age with the access to information that we have at our fingertips now.

 

[mt_pockets1000]

Ah what the hell....why not...
Lowell Green and Margaret Wendt must be having convulsions these days.

 

[Ron in Regina]

These are Links to Public Service Announcements that have been playing on the radio
out here this morning. If we can't laugh at ourselves, who can we laugh at?

Public Service Announcement #1: Ontario, The Have Not Province - PSA 1 | News Talk 980

Public Service Announcement #2: Ontario, The Have Not Province - PSA 2 | News Talk 980