Political Discussion - "on-topic & unmoderated"Rated PG13, unmoderated but threads must stay on topic - that means you can flame each other all you want as long as it's legal
Without that 20 billion Ontario's defecit would be maybe 30-40 billion dollars
At the same time if Alberta was not paying anything, they would not be in deficit right now.
This is not how it works.
'Alberta' isn't paying anything. The funds transferred to the provinces come from income taxes, or other sources of revenues that are directly taxed on all citizens of the country.
Additionally, Alberta also gets billions of dollars of transfer payments from the federal government, all of the provinces do.
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Think of the Federal government revenues as a giant cookie jar. Each citizens puts in a penny, and those pennies are first divided up and given to the provinces, and then a portion of them are spent on institutions and government programs that the Federal government has jurisdiction over (national defense, federal law-making, foreign relations ect). All those pennies that get transferred to the provinces are just being redistributed, nothing more, nothing less. But those pennies are essential to the decentralized state because most of the most expensive services the government provides, are administered by the provinces.
It really baffles me how many people don't even understand how the system works.
Why? Then there is a burden on the provinces...
I mean, the provinces are responsible for health, justice, education, social services ect...
Distributing money from the Federal government that has little jurisdiction over these main pillar institutions is essential for the distribution of proper services.
I think people are conflating transfer payments and equalization payments.
It really baffles me how many people don't even understand how the system works.
Unfortunately some people's realities are constructed by their political views, while it should be the other way around.
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Originally Posted by The Moose
There is no such thing as "transfer payments from Alberta to Quebec".
THANK YOU. It makes me SO happy to see someone from Edmonton writing this.
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Originally Posted by DeathFromAbove
The right course of action is to cut taxes if there's a surplus of revenues, not hand a cheque to the provinces.
Thats certainly one of many possible ways to deal with a surplus. Canadian voters however have made it resoundingly clear in recent decades that they disagree with you.
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Originally Posted by DeathFromAbove
Why should tax dollars collected in Ontario be spent on social programs in Quebec?
Thank you for demonstrating so clearly for us one of the common misconceptions about equalization payments. We must clarify that tax dollars collected by the Ontario government NEVER LEAVE ONTARIO, ditto for Alberta, B.C, PEI, et al. Its only FEDERAL taxes that get transferred around.
Its important to understand how the different levels of government operate. You pay taxes to a province, and to the federal government. The province has jurisdictions that it is responsible for, as does the federal government. Each of those bodies spends the tax dollars they collect to facilitate those particular responsibilities.
Why should it be a surprise that a country as large and diverse as Canada has different needs in different places? If the federal government spent tax revenue collected from Ontario only in Ontario, whats the point in having a federal government?
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If the government in Quebec wants to provide cheap tuition and free daycare they should have to deal with the economic consequences.
Quebec has, by a long shot, the highest taxes in Canada, something politicians in Alberta often fail to mention when bashing its spending. By your logic, any province could offer free education, and all the others would have to pay for it. That ain't how it works. Equalization payments are based off "minimum national standards": The qualitative service requirements for a number of citizens within a province, and not on the arbitrary fiscal figures of that government. Further, those minimum standards are in place because as Canadians we are entitled to move around and obtain social services in any province, it's quite reasonable that the federal government take a role in making sure those services have a minimum level of quality across the board.
Without transfer payments, you might as well dissolve into 10 autonomous regions.
Last edited by jgravessimcoe: 04-09-2012 at 04:55 PM.
'Alberta' isn't paying anything. The funds transferred to the provinces come from income taxes, or other sources of revenues that are directly taxed on all citizens of the country.
Additionally, Alberta also gets billions of dollars of transfer payments from the federal government, all of the provinces do.
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Think of the Federal government revenues as a giant cookie jar. Each citizens puts in a penny, and those pennies are first divided up and given to the provinces, and then a portion of them are spent on institutions and government programs that the Federal government has jurisdiction over (national defense, federal law-making, foreign relations ect). All those pennies that get transferred to the provinces are just being redistributed, nothing more, nothing less. But those pennies are essential to the decentralized state because most of the most expensive services the government provides, are administered by the provinces.
As it should be...there's nothing wrong with a province feeling the pinch because they're spending too much money.
Are you aware of the disconnect between jurisdictions and funding that exists between the federal and provincial governments as set out by our constitution?
That could be why you are missing the point on how essential federal transfer payments are to the functioning of this country. This is NOT a left vs right debate on low or high taxes, theres actually a built in discrepancy between who is responsible for x, and who has the ability to generate the revenue to pay for x.
Dont take this is confrontational or condescending, its a genuine question.
Last edited by jgravessimcoe: 04-09-2012 at 04:21 PM.
edit: Transfer or equalization? You used both in your post
They can be the same thing. All equalization payments are transfer payments, but not visa versa,
I was addressing a grievance specifically with the equalization payments, so I addressed that. The OP asked about transfer payments, so my final statement pertained to that.
If we are talking about equalization payments, they shouldn't stop. However, i wouldn't mind if the formula changed to make it more fair for all parties.
If we are talking about transfer payments, then its a federal -provincial thing not a province to province thing as mentioned previously above.
edit: Transfer or equalization? You used both in your post
I'd say 3, maybe 4. Depends on whether the Maritimes would rather unite with Quebec or go their own way. Probably the latter -- Quebec would just about swallow them.
Equalization is entrenched in the constitution, ending equalization would require a constitutional amendment and we all know what that isn’t a door we want to open.
As for federal transfer programs, we would have an unworkable union if the provinces continue to pay for the brunt of expenditures and receive little assistance from the federal government.
Fun fact. Equalization payments don't have to go to the province. Alberta for example could just cut a cheque for whatever amount they needed to contribute to every person in the "have not" provinces.
It would never happen, but interesting to think about.
If we are talking about transfer payments, then its a federal -provincial thing not a province to province thing as mentioned previously above.
Equalization payments are also federal-provincial.
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Originally Posted by devils4cup
Fun fact. Equalization payments don't have to go to the province. Alberta for example could just cut a cheque for whatever amount they needed to contribute to every person in the "have not" provinces.
It would never happen, but interesting to think about.
Is this sarcastic? Nothing about that fact is correct.
Throne speech points out high cost of public services in small provinces
CHARLOTTETOWN — Premier Robert Ghiz of Prince Edward Island is calling for changes to the equalization program, saying a cap on the federal wealth-sharing formula should be removed.
In a throne speech Wednesday, the first since Ghiz was re-elected last fall, the Liberal premier says equalization does not recognize the higher cost of delivering public services in small provinces.
"We recognize that the federal government is taking its own measures to deal with its fiscal concerns," said the speech, read by Lt.-Gov. Frank Lewis.
"Nonetheless, there is a constitutional obligation to ensure Islanders can enjoy comparable levels of services at a comparable level of taxation.
"The equalization program — which should serve to offset fiscal inequities — has been adjusted with the result that the program does not, in fact, equalize."
The province is objecting to the federal cap on the overall pool of equalization funds brought in as Ontario became a recipient of equalization payments along with five other provinces.
Ghiz said in an interview that by creating the cap, the result was less money for the social services his province needs.
"It’s cost our province about $63 million," he said.
Coming from Newfoundland and Labrador where we depended on federal payments for a long time I see the value of these payments. Still the system should be made to be fairer to all provinces in that if 1 province gets something the other 9 should as well.
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Kudos to the Ottawa Senators for the great season despite injuries to their 3 best players.
Coming from Newfoundland and Labrador where we depended on federal payments for a long time I see the value of these payments. Still the system should be made to be fairer to all provinces in that if 1 province gets something the other 9 should as well.
But equalization payments are a small, a very small, portion of transfer payments to the provinces of which they all receive. The equalization payments are a component of the transfer system to give them a "fairness" you are advocating for.
Coming from Newfoundland and Labrador where we depended on federal payments for a long time I see the value of these payments. Still the system should be made to be fairer to all provinces in that if 1 province gets something the other 9 should as well.
Our constitution ensures that Canadians receive equal levels of service wherever they happen to reside. Is that not the epitome of fairness??
You tell me what's more unfair:
i) The federal government spends its own money(NOT ANY PROVINCE'S MONEY) according the rules that govern this country.
ii) Canadians give up a fundamental and constitutional right because uninformed people dislike how the feds spend their dimes.
What's 'fair' about the wealth of one province trumping the rights of every Canadian citizen? As Canadians we have the right to an acceptable level of social services, wherever we choose(or don't choose) to live in this country. We should give this up because certain provinces disagree with how another level of government spends its own money?
I'm not calling you uninformed, but am just pointing out that I find a rather direct correlation in people opposing equalization and not knowing how it actually functions. Just read some of the posts in this thread. And, IT IS rather complicated, which makes it very easy to exploit as a political issue. The very fact that this thread is entertaining the notion of canceling transfer payments wholesale indicates that some people have NO IDEA what our constitution requires of federal-provincial cooperation.(and that ain't a shot at you melrose munch, just making a broader point)
A constitution completely rewritten today would likely eliminate this discrepancy between administering social programs and having the fiscal capacity to pay for them. However, a constitution written today would be different is SO MANY WAYS. It would know how much oil is worth, and would NOT grant jurisdiction of natural resources to the provinces. We're all Canadians, and no person or province should be above anyone else when it comes to Canadian rights.
Every 'have' province will eventually be a 'have not' province again, and vice versa. Transfer payments make good political talking points but they are a necessity to keep the country strong as a whole. What gets done with the money on the other hand is another question.
Exactly. No province will stay in the same position forever, if one is on the upswing (Like we are in Alberta), it's only logical to use some of the wealth for the betterment of the nation as a whole. When the economic situation changes and Alberta is on the recieving end of payments it will be no different, this is how a country should operate. Those Albertans who wish to think of their province as some sort of "Independent Republic of Alberta" will no doubt be singing a different tune when the debate becomes "Should Ontario(insert any province here) end transfer payments to Alberta."
