Friday, April 17, 2009


For those who think I may have gotten a little too conservative in my old age (and you know who you are), it's time to put down the government-bashing hammer and all the talk of tea parties for a moment or two and take a look at this.
A new study just published by the Canadian Centre for Policy Alternatives, titled Canada's Quiet Bargain: The Benefits of Public Spending [PDF link],has sought to quantify just how much value Canadian citizens get from the taxes they pay.

Overturning received wisdom, the study concludes that the public services Canadians receive would be far more expensive if they had to pay out of pocket.

A family earning the median family income in Canada receives a public benefit that would amount to $41,000 if they had to pay for it - an amount equal to 63 percent of their total income and far higher than the total cost of the taxes the family pays.

Apparently even income earners in the $80-90,000 range receive a public benefit equal to half their income, again higher than the taxes they pay. And if we had to pay out of pocket for education, health care, infrastructure, etc., we would receive less value and have less disposable income than we enjoy today.

Of course, not everyone agrees. Just see the comments here.

I particularly enjoyed this one, from Capitlalist.
The Canadian Centre for Policy Alternatives is a very left wing organization, so what do you expect? Of course taxes are a good bargain if you are some low income loser who uses a lot of services and pays zero in taxes. But if you are middle class (or higher income) and pay tax out your ass to fund everybody else how is that a bargain? Usually people who agree with these studies are people with low incomes and have a disdain for money.
So I was thinking, it's always good to know be reminded that I am a low income loser. And have a disdain for money. Because, otherwise, I just might forget.

And before someone tries arguing that these figures are skewed because Americans have higher incomes than Canadians, I offer this.

US Census results for 2006 show the median household income as $46,326. And the great Wikepedia gods tell us that in 2007, the median annual household income In the United States was $50,233.00. While the median Canadian household income in 2006 was $53, 634. Or $66,000 in a 2.6 person household according to the 2009 study.

Well you know what they say about statistics ... one of my favourites being that they can be made to prove anything - even the truth.

Still, I'm just saying. I thought it was interesting.


Pogue said...

From where I stand the tea parties are less about taxes and more about spending. I don't have a problem with paying taxes for infrastructure and I certainly benefit from them. I am a fan of strangling the federal (US) government income in favor of the state governments who better represent our needs. I'm also a fan of everyone paying taxes, a condition we don't remotely approach here. I wouldn't be opposed even to something like the VAT Great Britain has so long as the income tax was eliminated. Of course, it's almost impossible to kill a tax once the government starts feeding off of it.
The only question I have about the articles on the benefits of public spending is when you talk about how much value and service you receive for your taxes it is assumed you use all of the services available. I don't believe this is usually the case, but that's how you make statistics do their tricks. ;-)

eileen said...

I found this piece and the links interesting -of course there'll always be some who benefit more and others who benefit less, but ... how do you know when you might need to use the services offered? I don't mind having a service a don't usually use, because this means I am either better off, very healthy or whatever, I don't mind others using it, in fact I'm glad they do. I'm sure it's working very well in Canada :)

Isabelle said...

I don’t begrudge paying taxes because we democratically elect a government that is supposed to provide us with the services we would not have otherwise. The fact that this does not happen according to our ideals aggravates me but I do not support cynical arguments made by the likes of “Capitalist” who believe they are somehow morally superior because he/she values money over the greater good. “Capitalist” would be the first guy demanding his needs be met if he were stricken with a catastrophic illness (see today’s Chronicle Herald for the cancer story). I read this report on Wednesday purely by chance … thanks for commenting on it.