Where Have All the Dollars Gone

Sir Robert Borden addressing the troops, 1917 Biblioarchives
Sir Robert Borden addressing the troops, 1917
Biblioarchives

In March of this year, lawyers acting on behalf of the Canadian government asserted that the government has no special obligation to Afghan military veterans as a result of a pledge made by Prime Minister Robert Borden back in 1917, on the eve of The Battle of Vimy Ridge. Borden assured the soldiers then preparing for battle in France (more than 10,000 of them would be killed or wounded) that none of them would subsequently “have just cause to reproach the government for having broken faith with the men who won and the men who died.”

The March court filing came about as a result of Canadian soldiers earlier suing over the government’s new “veterans charter,” which changes the pension-for-life settlements provided to soldiers from previous wars to a system where Afghan veterans receive lump sum payments for non-economic losses, such as losing limbs. It’s not difficult for any of us to understand that this change is all about our government saving money.

Also in March of this year, the Vancouver School Board announced a budget shortfall of $18.2 million. Reluctantly, the Board is considering an array of cutbacks, including school closures, ending music programs, and keeping schools closed for the entire week surrounding Remembrance Day. My kids have now moved on past public schools, but I clearly remember, for all the years they were enrolled in Vancouver schools, a steady and discouraging series of annual cutbacks; librarians disappearing, field trips becoming rare events indeed; at one point even the announcement that the temperature in schools would be turned down.

I lack the expertise to offer any detailed economic analysis as to why our governments are these days unable to meet obligations to veterans and school children that they were able to meet in the past, but here’s one bit of crude economic breakdown that causes even greater wonder. The Gross Domestic Product per capita in Canada in 1960 averaged $12,931 US; in 2012 it averaged $35,992 US, adjusted for inflation. In other words, the country is today producing three times as much in the way of goods and services per citizen as it was back in 1960, presumably enabling the government to collect far more in the way of taxes, per person, than it could four-plus decades ago. And yet we can no longer support veterans and school children in the way we did back then.

A large part of the explanation is of course that governments these days are addressing a whole lot of social concerns that they weren’t in 1960, never mind in 1917, everything from drug and alcohol treatment centres, to the parents of autistic children, to modern dance troupes. It may well be that this growing list of demands outstrips the three-times-bigger ratio of available government funds. It may even be enough for one to lament what Washington Post columnist Charles Krauthammer (an example of that rare beast, the genuinely thoughtful conservative pundit) calls “the ever-growing Leviathan state.” It may… or it may not.

One theory has it that, in the post-war decades, right up until the 70s, the Canadian economy was legitimately growing, more products, more services, more jobs. Since the 80s, any increase in or even maintaining of profit ratios (and thus disposable incomes) has come as the result of increased ‘efficiency,’ fewer people producing more goods and services through better technology and less waste. (More cutbacks anyone?) If that’s true, then things are only going to get worse, as these finite efficiencies produce ever-diminishing returns.

Whatever the final explanation, it’s not likely a simple one, and whatever the economic answer, it’s not likely to be easily achieved. Too often a current government has only to promise fewer taxes for voters to flock in their direction, regardless of known scandal, evident mean-spiritedness, or obvious cronyism. We tend to assume that the ensuing government cutbacks won’t arrive at our door. And so long as they don’t we remain generally unrepentant for our self-centeredness. The moment they do—the moment an alcoholic, or autistic child, or modern dancer appears inside our door—our attitudes tend to shift.

Thus, as we stand witnessing a time of waning of western economic domination (see DEP, from the archives of this blog), it seems we can be sure of only one thing: it’s a matter of priorities. If school-age children and wounded veterans are not our priority, then who is?