Tax cuts for large corporations are simply making them richer and depriving young people of a chance to get established when they finish their education.
Marvyn Novick, professor emeritus at Ryerson University, made that claim while addressing a recent meeting of Poverty Free Burlington.
“Mark Carney, former Governor of the Bank of Canada and now Governor of the Bank of England, has said $626 billion was created for corporations through tax cuts,” Novick told the meeting.
“The price for that is fewer jobs and student debt that is unbelievably alarming.”
Novick said the capital that makes it possible for large multi-national corporations to be successful actually comes from public sources.
Brody Huk, a graduate of M.M. Robinson high school in Burlington, had to drop out of the Sheridan College photography program after just two semesters because of financial difficulties in his family.
After working for four years, he went back to school at the Centre for Skilled Trades to learn to be a machinist.
Between the two schools he racked up a debt of $17,000, one which he says will take him three of four years to pay off.
“The government needs to take a real look at subsidizing education a little bit better,” he said. “At McMaster a lot of professors make a huge chunk of change.”
On the positive side, Huk acknowledges that he could be a lot deeper in debt if he had chosen to go to university and he now has a full-time job as an apprentice at Burloak Tool and Die.
Novick said we should be talking about how we’re going to retire the debts students have accumulated.
“It’s our tax cuts that put them into debt,” he said. “I really think we owe them something.”
He said an idea put forward that people should borrow from an unemployment fund and repay the money when they get a job is stupid.
Novick said we have the most educated group of unemployed people in history.
He said there’s always enough money to go around.
“Governments always have fiscal options,” he said. “It’s never the case that we can’t afford it. The problem is our generation has accepted the notion that we can’t afford it.
“We’ve been sold a bill of goods over the last 35 years.”
However, Burlington MP Mike Wallace said the Harper government has good reason to cut taxes.
“Governments don’t create jobs, it’s the business sector,” he said. “We tried to stop the tide of companies leaving Canada and also to attract and retain businesses in this country.
“We now have the same or better corporate tax rates than any jurisdiction in the U.S.
Wallace said EcoSynthetix moved its head office and research centre to Burlington from Michigan.
“There’s nothing wrong with making a profit. Companies are always interested in making profits so they can grow and create jobs.
“We believe the best way to break the poverty cycle is to have good quality secure jobs that help people support their families.”
The minimum wage in Ontario has risen from $11 to $11.25 per hour, making Ontario the second highest in Canada.
Novick said a decade ago some forecast disaster if it went that high, but it hasn’t happened.
South of the border, the city of Seattle recently raised its minimum wage to $15 per hour.
Corporate profits in Canada hit a 27-year high in 2014, to a large degree as a result of a flatlining of labor costs.
Last year several large Canadian businesses sitting on massive cash reserves were criticized for using temporary foreign workers or unpaid interns and failing to invest in employee training.
A report by the International Monetary Fund said Canadian companies were collecting idle cash reserves faster than any country in the G7.
In 2014, 116 employees of the City of Burlington made more than $100,000.
Former mayor Rob MacIsaac hauled in $757,583 in his new job as President and CEO of Hamilton Health Sciences.
Novick said positive steps must be taken to change the system.
“We have to vote for politicians who set proper employment standards and make it easier for employees to unionize,” he said. “Boycotts don’t work.”