A study authored by two York University professors points to tax cuts as the reason Canada is falling behind socially and economically.
The study, issued Dec. 7 by the Canadian Centre for Policy Alternatives, found that Canada is lagging significantly behind high-tax Nordic countries in terms of poverty rates, equal income distribution, economic security, completion of higher education and overall life satisfaction.
These categories were among 50 social and economic measures used by Professors Neil Brooks and Thaddeus Hwong to contrast high-tax Nordic countries with their lower-tax North American counterparts. Canada was out-ranked in all but eight areas.
“What a close comparison of social and economic indicators in high-tax countries with those in low-tax countries reveals is that it is not necessary for a country to trade off social justice for economic prosperity,” said Brooks, an economist and professor at York’s Osgoode Hall Law School.
In a summary of the study by the CCPA, Brooks stated that, by cutting taxes, “…the Conservative government is taking Canada in the wrong direction. It wants to make Canada more like the United States, yet our findings show that Americans bear severe social costs for living in one of the lowest taxed countries in the world.”
According to the summary, the US falls near the bottom of the 21 industrialized countries in a strikingly large number of social indicators. It also ranks as the most dysfunctional country by a considerable margin.
In contrast, Finland ranks near the top of the industrialized world in most of the social indicators and has been named the most competitive country in the world by the World Economic Forum four years in a row.
Hwong, a professor in York’s Atkinson Faculty of Liberal & Professional Studies, says the tax cut lobby has it backwards. “Not only do government social programs create a healthier society, they also create the conditions for a vibrant – and competitive – economy,” said Hwong.
The full report can be viewed here.