According to Statistics Canada figures released this month, almost 3.5 million Canadians live below the poverty line.
Young children are among the most likely to be poor, with 14.5 per cent of children under five living in poverty.
The same census found that while rich Canadians enjoyed a 16.4 per cent increase in income between 1980 and 2005, the poor suffered a drop of 20.6 per cent over the same period, while the middle class simply flatlined.
In an interview with the Globe and Mail, Tony Frost, a professor at the Richard Ivey School of Business at the University of Western Ontario, gave two reasons for the rapid growth in the income gap: globalization and a restructuring of the economy.
Since the largest factor affecting the restructuring of the economy is globalization, these two reasons are really one.
Simply put, working Canadians are doing worse than they were before 1980, because their jobs have been shipped to some of the poorest countries in the world.
The existence of all that cheap Third World labour helped to create the new big North American employer — the big-box store.
Canadians thrown out of work by globalization can take solace in knowing that there are always jobs at Wal-Mart, the biggest employer, with some of the lowest wages, in the world.
The 1988 Canada-US Free Trade Agreement, now grown into NAFTA, was a model for similar trade pacts around the world.
It launched Canada into the free trade era while helping to kick-start the globalist project.
It’s popular among conservative commentators to say that free trade has been good for Canada.
In 1998, Moncton Times columnist Michael Taube said that free trade “creates an enviable playing field for economic growth by limiting the amount of trade barriers and opening up the free market.
“It allows for greater foreign investment, creates more choice for consumers, and increases the stature of capitalism in society.”
This February, Mark Carney, the new governor of the Bank of Canada, boasted, “The recent period of international integration has coincided with the second-longest expansion in our nation’s history, characterized by rising real incomes, surging employment and low, stable and predictable inflation.”
Canada’s exports to the US have increased since 1988, as have American exports to Canada.
Unemployment has decreased and profits are up.
Overall wealth has increased.
All of these are supposed to mean that Canada is now a better place to live, because of free trade and its sister, globalization.
Then why are only the very richest few doing better?
The answer is quite simple: it’s because that’s who free trade was designed to benefit.
Pushed by millionaires and corporate executives, like Ronald Reagan and Brian Mulroney, free trade agreements maximize profits by limiting the power of government to regulate industry.
They make it easy for companies to “outsource” what were once well-paying unionized jobs in well-regulated Canadian industries to countries where labour laws are weak and often ignored, where environmental standards are lax, and safety regulations nonexistent.
Because globalization helps the rich get much richer — 16.4 per cent of a six-figure income represents a lot of money — the economic figures look good.
Consumer spending is up, average incomes are stable.
All of these rich Canadians have money to spend in stores and coffee shops, so unemployed factory workers have jobs to move into — most of them at minimum wage.
The income gap is not an unhappy side effect of globalization; it is the whole point.
Trade agreements are designed to maximize profits, also known as income for the very wealthy.
They are also designed to destabilize unions and create a more malleable labour force.
It’s not just the ability to buy expensive stuff that separates the rich from the poor.
Poor Canadians have a shorter life expectancy than the rich.
They suffer more from disease and their children get a poorer education.
As a generator of wealth for the already wealthy, globalization has been a roaring success.
What has it done for the rest of us?
Al Pope won the 2002 Ma Murray Award for Best Columnist in BC/Yukon. His novel, Bad Latitudes, is available in bookstores.