I listen to Michael Campbell (an investment adviser, and the ex-Premier’s brother) give his personal business opinions on CFAX 1070 nearly every weekday morning. I get my daily shot of righteous indignation, and it makes me think, refuting him helping me to clarify my own position on economic matters.
For Michael Campbell, business/capitalism is always right; while government (with the possible exception of the B.C. Liberals and the Harper Administration), the ‘left’, unions, the media (except for Mr. Campbell, of course) and the Canadian public are always wrong.
This morning Mr. Campbell was going on about pensions—how large they are, how under-funded, how taxpayers will have to fill the gap. While acknowledging that adequately-funded pension plans are preferable, the fact remains that whatever money we tax-payers inject into pensions will help support considerable purchasing power, which in turn will help support economic activity of all kinds. Far too many business people seem incapable of seeing beyond their immediate costs to how maintaining purchasing power benefits them all, whether by raising the minimum wage, increasing social assistance rates, or supporting pensions.
Thinking about pensions got me thinking about social assistance rates. If they were more far-sighted, small businesses would be lobbying the government to substantially increase them, including those for the disabled, as this would boost the revenues of local businesses across the province.
I suggest that in B.C. the rates be doubled (for example, from $610 to $1220 per month for a single employable person, which would still be under the poverty line); that every recipient be allowed to keep at least $1,000 a month of any money earned ($1,500 for families with children) before their social assistance cheque is docked; and that the artificial division between rent support and all other costs be eliminated.
(I do not understand the mind that stipulates that if a recipient of social assistance should, by some miracle, find a place to rent for less than the present allowance of $375, they should forfeit the difference, instead of that saving being available to cover other costs.)
Allowing an earnings exemption of $1,000 would provide a strong incentive to find work, while doubling the rate to $1220 would help provide the means—a place to live, a phone, a bus pass, decent clothes—all of which are necessary for finding a job.
Although a doubling of rates would double the provincial budget for social assistance from $1.6 billion to $3.2 billion, the multiplier effect would increase economic activity even more, while doubling the bang we’d get for our buck—significantly-decreased poverty and significantly-increased economic activity.
At the moment, we’re spending $1.6 billion to keep people in poverty; double the rate, and many recipients will finally have a realistic chance of getting off social assistance for good, in the long run saving us considerably more than the original investments.
