Don Mills, Ontario. The Economic Council of Canada announced recently that on a scale measuring per capita income Canada ranks eighth out of 17. The list was compiled from figures available in 1970. In 1965 Canada ranked number two. What has happened?
In the last three months the average Canadian wage settlement worked out to an 18.8 percent increase or $4.49 per hour. In the United States the average increase was 8.3 percent or $4.40 per hour. Yet the American worker proved to be 27 percent more productive.
The reason for this apparent paradox is something with which libertarians are well acquainted—government interference. It has been shown over and over again that government interference in society can lead only to more interference until the saturation point of socialism is reached. Canada is now on the brink of that saturation point. It is one of the reasons why Canadian standard of living has dropped so drastically in the past 10 years.
It would be quite safe to assume that Canada will be in the next 8 to 10 years where Britain is now. The parallels between the two countries are quite startling. Since the end of the Second World War, Britain has become almost completely socialized. All of the great socialist ideals have been legislated into existence in Britain: subsidized medical care, subsidized housing, food, redistribution of income, social planning. The failure of each and every one of these plans combined with towering balance of payments deficits have left the country on the verge of social disintegration and economic collapse.
In Canada there is a $52 billion federal debt with a $2.9 billion annual interest charge. Thirteen cents of every Canadian tax dollar goes to pay off that interest charge. There is an average 16.4 percent tariff charged against imports to "protect" domestic producers. The federal government continues inflationary monetary policy and deficit financing.
It is on the provincial level that we find the most graphic examples of the socialization of Canada. Three of Canada's 10 provinces have an N.D.P. or avowed socialist government: British Columbia, Saskatchewan, and Manitoba.
The forest industry upon which B.C. most depends has completely shut down because of province-wide strikes by all of the major forestry unions. Antibusiness legislation in B.C. helped to bring about such great union power.
The mining industry in B.C. cannot expand or even make a profit because of the huge income and mining taxes, and royalties demanded by the B.C. government. For example royalties and taxes converted a six-month profit by Gibraltar Mines of $584,000 to a net loss of $396,000.
The B.C. government run auto insurance monopoly is on the verge of collapse because of striking civil servants and lack of funds.
In the prairies the horror story of government meddling continues to escalate. Exploration in the oil sands of the north has all but disappeared by the constant haggling by governments over royalties, taxes, rights, profits, foreigners, and all of the other straw men set up by governments in order to seize power. The resulting exodus by major oil exploration companies has left no money, no jobs, and no oil. All that remains is the government exploration consortium with nothing resulting from its exploration except long, sticky strands of a red, tape-like substance.
Ontario does not have an avowed socialist government. It has a covert one masquerading under the unlikely name of the Progressive Conservatives. Their most shining achievement is the medicare system. In 1974 medicare costs rose 7.2 percent. This year they will rise 16.6 percent. Next year 23 percent. Medicare has mushroomed in the usual bureaucratic way.
Now the government is seeking solutions to the problems it created in the first place. Of course, the solutions are more horrifying than the original problems. The one solution which stands above the others in its blatant idiocy is to place a limit on the number of doctors. As of July 2 of this year no doctor may locate in Ontario without government approval of his location. The next step, inevitably, will be the limiting of the number of medical students. As usual, the government will do the opposite of what is necessary. The medical profession in Ontario is already fighting government standardized fee scales and the possibility of a strike cannot be ignored. The result of government meddling will lead not to a reduction of costs but to a reduction of quality as it has done in Britain.
In 1969 Ontario's former premier, John Robarts, termed the medicare scheme a "fraud" designed to change the Canadian constitution. He was right about the medicare but wrong about the constitution. Canada's constitution is the B.N.A. (British North America Act) which is nothing more than a carte blanche for the federal government to enact any legislation it desires. Robarts should have known that it was because of the B.N.A. Act, not in spite of it, that Ontario was drawn into the monster of medicare.
Further socializations of Ontario can be found in the minimum wage-unemployment insurance frauds. The minimum wage in Ontario is $2.40 per hour. As if a minimum wage law were not enough to distort the free economy, the federal government offers at least $3.40 per hour unemployment insurance whose costs have soared to $3.75 billion this year. The hopeless bungling of the various departments of Health and Welfare account for roughly 50 percent of the tax dollar or 10 percent of the gross national product.
The economic and social ills which plague Britain are beginning to make themselves evident in Canada. Government induced lack of incentive in the various social programs has led to dissatisfaction in work and enterprise. Endless strikes, inflationary monetary policy, and deficit financing all produce calls for more government intervention. The government is more than willing to oblige!
In 10 years such a course will lead Canada, as it did Britain, into social and economic upheaval which will result in the saturation point of government intervention and the achievement of totalitarianism. By then, the standard of living in Canada will no longer merit consideration.
This article originally appeared in print under the headline "Foreign Correspondent: The Socialization of Canada".