We Need to Learn From the Greeks. And Quickly

By Frances Russell | July 31, 2013

The ancient Greeks understood that a flourishing middle class is the bulwark of democracy. 21st Century corporations and governments apparently do not. In fact, they appear hostile to the very notion of a middle class.

Aristotle taught that a large and prospering middle class mediates between rich and poor, creating the structural foundation upon which democratic political processes can operate.

But today's middle class is under assault in almost every First-World democracy. Capital has gone global. It owns and controls governments and politicians, overpowers national boundaries, writes its own labour and tax laws and basically evades its social and economic responsibilities to the countries and societies where it does business.

The disturbing statistics grow.

Last October, Finance Canada prepared a briefing for Finance Minister Jim Flaherty showing that the income growth of middle class Canadian families has lagged behind both the rich and the poor over the past 35 years. The real after-tax income of middle class families -- the middle quintile or middle one-fifth of families - grew by a mere seven per cent between 1976 and 2010. That's just 0.2 per cent per year.

The benefits and accessibility of what was once called Unemployment Insurance (UI) have steadily eroded since the early 1990s. Until two decades ago, people who lost their jobs got 80 per cent of their former wage. Today, they receive 55 per cent.

Currently, only 37.7 per cent of unemployed Canadians get regular benefits from the mockingly-named Employment" (EI) insurance, according to Canadian Centre for Policy Alternatives economist Armine Yalnyzian. That's the lowest rate of protection for jobless Canadians since 1944, the second last year of the Second World War. And it's still falling.

"EI benefits are shrinking far faster than unemployment," reports United Steelworkers economist Erin Weir. The number of unemployed is down by 2.4 per cent compared to May, 2012. But the number of EI beneficiaries is down three times that at 7.4 per cent

Canadian Auto Workers economist Jim Stanford recently took the federal government to task for continuing to boast that Canada's labour market has performed better through the recession than most other member nations of the Organization for Economic Cooperation and Development (OECD) and that the number of Canadians working today is higher than before the recession.

"The decline in Canada's employment rate -- 1.4 points from 2008 to 2012 -- ranks us 20^th out of 34 countries," he says. "We're about equal to the OECD average of minus 1.5 per cent.

Many countries, including Germany, Korea and Austria, have increased their employment rate since 2008, Stanford continues. "Those countries can say they have recovered from the recession, but Canada sure can't."

Unfazed, the Harper Conservatives are now claiming they have created a million new jobs.

"The whole trick is based on ignoring the fact that Canada's population is expanding relatively rapidly," explains Stanford. Since Canada's working-age population has grown by 1.75 million people since 2008 "it's hardly an accomplishment to get back to the same number of absolute jobs or even higher," Stanford says.

"The most outrageous claim about Canada's 'superior' performance is the claim we have the best job-creation record," he continues. "Canada's population grows relatively rapidly, that means we HAVE to create jobs faster just to keep up. Germany, Japan, etc., with stagnant populations, don't need to increase the absolute number of jobs at all."

Stanford says the fair comparison to make is the employment rate, that is, job creation relative to growth of the working age population. "On this score, Canada's performance is not great at all. Germany, Korea, Australia, and others, all did much better."

The OECD itself has some surprisingly critical things to say about Canada's employment record, particularly its protections for the unemployed. In its July, 2013 report the OECD ranks Canada as among the most employer-friendly in the world, pointing out that "the rules for employers implementing individual and collective dismissals in Canada are among the least restrictive in all OECD countries.

"The share of the unemployed who have been jobless for a year or longer has nearly doubled since the beginning of the recession and this group needs additional assistance to be able to benefit from an improving labour market," the OECD continues in its report on Canada.

The OECD also notes that Canada's youth unemployment rate is more than double that of prime-aged workers. It warns Canada that "it is especially important to improve labour market outcomes...in preparation for the retirement of the large baby boom cohort...since this demographic transition could otherwise weaken the economic outlook."

Canada, it continues "should also reduce barriers to geographical and occupational mobility ...by promoting greater cross-provincial recognition of vocational qualifications."

The Conservatives' endless boast that Canada is "leader of the pack" in job creation is made further highly suspect given the Harper government's decision in 2010 to kill the compulsory long-form census. The inevitable drop in data quality on virtually every aspect of Canadian society was deliberate government policy. Now the government can safely bury and ignore the growing social and economic inequality it knows its policies are creating.

Canada's original compulsory long-form census created a baseline retrieved from about 94 per cent of the population. The new voluntary National Household Survey (NHS) -- supposedly created to relieve Canadian families from the "outrageous" obligation to disclose anonymously how many bedrooms and bathrooms they had -- went to just 4.5 million households. It drew a meagre 68.6 per cent response rate from the already-meagre 33 per cent of the population who received it.

As was predicted -- and deliberately designed - this egregious assault on good governance is skewing every other baseline attempting to measure how Canadians are managing their increasingly uncertain social and economic status.

Angella MacEwen, senior economist with the Canadian Centre for Policy Alternatives, has recently warned that killing of the long-form census leaves the validity of all federal statistical predictions less accurate and destined to become ever more inaccurate over time.

"So the NHS Portrait of Canada's labour force is out," she writes, "and I can't help but think of Donald Rumsfeld's 'known unknowns.'"

Even though the Labour Force Survey (LFS) remains mandatory, the government ensured its data, too, is now compromised because, MacEwen continues, "the LFS only samples 56,000 households, excludes persons living on reserves and in Aboriginal communities and full time members of the Canadian Forces, but the NHS does not. So which one gives us better labour market information?"

MacEwen notes that the NHS estimates 900,000 fewer jobs in May 2011 than the seasonally unadjusted data from the compulsory LFS, resulting in a significantly lower unemployment rate.

"Which one is accurate?" she asks. "We know that we don't know anything about those who didn't respond to the NHS survey, or how they might be different from those who did," continues MacEwen. "We also know that there are some discrepancies in terms of labour force data even at the national level when comparing the NHS to the LFS.

"So which gives us better labour market information?" MacEwen asks. " Which survey is more reliable right now isn't even the biggest concern. Whose education level, language, immigrant status isn't being reached? What weighting accuracy should statisticians rely on?

"It's okay to know what we don't know," she concludes. "But I'm worried about thinking that we know something that 'just ain't so.'"

That doesn't worry the Harper Conservatives. In fact, it's what they intended from the start. The less Canadians know about what's really happening in Canada's economy and society, the more they can be manipulated into believing exactly what the government wants them to believe.

Doing away with a knowledgeable public --and public sector -was the real reason the long form census was killed, not saving families from having to declare -- anonymously - the number of bathrooms in their homes.

Such an abridgement of a citizen's right to be informed and engaged is the antithesis of Aristotelian democracy.

Frances Russell was born in Winnipeg and graduated from the University of Manitoba with a Bachelor of Arts degree in history and political science. A journalist since 1962, she has covered and commented on politics in Manitoba, Ontario, B.C. and Ottawa, working for The Winnipeg Tribune, United Press International, The Globe and Mail, The Vancouver Sun and The Winnipeg Free Press as well as freelanced for The Toronto Star, The Edmonton Journal, CBC Radio and TV and Time Magazine.

She is the author of two award-winning books on Manitoba history: Mistehay Sakahegan - The Great Lake: The Beauty and the Treachery of Lake Winnipeg and The Canadian Crucible - Manitoba’s Role in Canada’s Great Divide. Both won the Manitoba Historical Society Award for popular history.

She is married with one son and two grandsons and lives in Winnipeg.