Paths to prosperity for all?

Kristina Craig Special to the News Poverty doesn't exist in the theory of free-market capitalism. If it did, it would be a temporary problem. Poverty might be a flaw that comes from government interference into the markets.

Poverty doesn’t exist in the theory of free-market capitalism. If it did, it would be a temporary problem. Poverty might be a flaw that comes from government interference into the markets. Or, poverty might be a consequence of individual decision making or of cultural traits.

In theory, poverty within our dominant economic system is a self-eliminating state. Through economic growth and the trickle-down effect, everybody will benefit from the accumulation of wealth and will automatically experience prosperity – for as long as an individual is fully participating economically and for as long as governments do not restrict or regulate the free market.

“Yukon is clearly on the path to prosperity and, I believe, the best place to live in Canada,” Premier Fentie said recently. “We are leading the country in economic growth.”

In contrast to market theory, Fentie makes it sound as if government is in charge and control of economic forces. He is not mentioning the ongoing reality, in which up to 20 per cent of Yukon’s population lives in poverty, which means many Yukoners can’t meet their basic needs with the income they earn.

Anecdotal evidence from the nongovernment sector speaks clearly about the conditions of one in every five Yukoners who are not yet on the proclaimed path to prosperity.

Despite Fentie’s assertion “we are seeing success through the lowest unemployment rate in the country; a growing population; a positive financial position and a robust private sector,” increasing numbers of people are seeking contributions from the food bank in recent months.

How can it be, in a prosperous society, that people can have jobs and need to ask for support from the food bank to feed themselves and their families?

There have been 3025 food bank recipients in less than two years: This means almost one in 10 Yukoners, or one in eight people from Whitehorse has experienced food insecurity in the last two years. That does not sound like the best place to live in Canada.

If feeding the family is difficult, consider the housing situation: the bureau of statistics reports the average house price in Whitehorse increased by $191,000, or 101.6 per cent, from 2004 to 2010. Inflation over the same time period was 11.4 per cent. This is a ‘real’ increase in average house price of 90.2 per cent over the past six years.

What about the average incomes?

From 2004 until the recession in 2008, the average income has increased from $36,665 to $46,666, a 27.3 per cent increase. Not bad, but with such a growth disparity between income and real estate it becomes clear why there is a very low vacancy rate in Whitehorse. Many working people cannot afford to own a house; they are forced to rent. And the rental prices in Whitehorse increased by 17.7 per cent, faster than the rate of inflation, between 2004 and 2010.

Thus, a bigger share of income is spent on housing costs – which leaves even less money for food and other necessities.

The current government has recognized that low-wage workers need a guard against exploitation and inflation. Since 2007, the minimum wage has been indexed to the Consumer Price Index.

In 2010, a

full time minimum wage worker in Yukon would have earned $18,574.40 per year (based on eight-hour days, a 260-day work year, and the 2010 wage level of $8.93 per hour). After taxes, that would leave the individual with disposable income of about $15,802.

For 2009, the unofficial poverty line in Canada, the Low-income Cut Off (LICO) was $15,384. Even with an adjustment for the rate of inflation, a full time minimum wage worker would not have been able to rise above the poverty line in 2010.

If this person was also a provider for other people in a household, it would be worse. Obviously, low-income earners need more protection than an indexed minimum wage.

These are not conditions for a path to prosperity for all. It is important to create the right conditions for a healthy economy. Our government should also create the conditions for all of its citizens to have a livelihood, and not just jobs.

It would be a lot more dignifying to make a living from full-time work, instead of becoming eligible for social assistance, various benefit programs, and food bank contributions. Or, do low-income earners need to wait until the wealth of the few, who can afford to speculate with investments and to turn over real estate at solid profits, has finally trickled down to them?

Provided by the Yukon Anti-poverty Coalition.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Maria Metzen off the start line of the Yukon Dog Mushers Association’s sled dog race on Jan. 9. (Gabrielle Plonka/Yukon News)
Mushers race in preparation for FirstMate Babe Southwick

The annual race is set for Feb. 12 and 13.

The Yukon government is making changes to the medical travel system, including doubling the per diem and making destinations for medical services more flexible. (Joel Krahn/Yukon News file)
Subsidy for medical travel doubled with more supports coming

The change was recommended in the Putting People First report endorsed by the government

Chloe Sergerie, who was fined $500 under the <em>Civil Emergency Measures Act</em> on Jan. 12, says she made the safest choice available to her when she entered the territory. (Mike Thomas/Yukon News file)
Woman fined $500 under CEMA says she made ‘safest decision’ available

Filling out a declaration at the airport was contrary to self-isolation, says accused

The Yukon Department of Education building in Whitehorse on Dec. 22, 2020. Advocates are calling on the Department of Education to reverse their redefinition of Individualized Education Plans (IEPs) that led to 138 students losing the program this year. (John Hopkins-Hill/Yukon News file)
Advocates call redefinition of IEPs “hugely concerning,” call for reversal

At least 138 students were moved off the learning plans this year

Yukonomist Keith Halliday
Yukonomist: Your Northern regulatory adventure awaits!

“Your Northern adventure awaits!” blared the headline on a recent YESAB assessment… Continue reading

Yukoner Shirley Chua-Tan is taking on the role of vice-chair of the social inclusion working group with the Canadian Academy of Health Sciences’ oversight panel and working groups for the autism assessment. (Submitted)
Canadian Academy of Health Sciences names Yukoner to panel

Shirley Chua-Tan is well-known for a number of roles she plays in… Continue reading

The Fish Lake area viewed from the top of Haeckel Hill on Sept. 11, 2018. The Yukon government and Kwanlin Dün First Nation (KDFN) announced they are in the beginning stages of a local area planning process for the area. (Crystal Schick/Yukon News file)
Local area planning for Fish Lake announced

The Government of Yukon and Kwanlin Dün First Nation (KDFN) announced in… Continue reading

Whitehorse City Hall. (Joel Krahn/Yukon News file)
City hall, briefly

A look at decisions made by Whitehorse city council this week

Fire damage, photographed on Jan. 11, to a downtown apartment building which occurred late in the evening on Jan. 8. Zander Firth, 20, from Inuvik, was charged with the arson and is facing several other charges following his Jan. 12 court appearance. (Gabrielle Plonka/Yukon News)
More charges for arson suspect

The Inuvik man charged in relation to the fire at Ryder Apartments… Continue reading

The grace period for the new Yukon lobbyist registry has come to an end and those who seek to influence politicians will now need to report their efforts to a public database. (Mike Thomas/Yukon News file)
Grace period for new lobbyist registry ends

So far nine lobbyists have registered their activities with politicians in the territory

The Government of Yukon Main Administration Building in Whitehorse on Aug. 21, 2020. Some Yukon tourism and culture non-profit organizations may be eligible to receive up to $20,000 to help recover from losses due to the COVID-19 pandemic. (Crystal Schick/Yukon News file)
Details released on relief funding for tourism and culture non-profits

Some Yukon tourism and culture non-profit organizations may be eligible to receive… Continue reading

Most Read