Austerity in Ontario May 2012


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This new OPSEU PowerPoint presentation provides basic facts about Dalton McGuinty’s “austerity” campaign to cut public services, jobs and wages. Complete with speaker’s notes, anyone can deliver it to local meetings, bargaining team caucuses, area councils, or any other group

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Austerity in Ontario May 2012

  1. 1. “The major economic problem facedby Canadians is a very slow recoveryand weak job market, not governmentdeficits or rising debt. But publicspending cuts at the federal andprovincial level will make the realproblem even worse.” -- Andrew Jackson, Chief Economist, Canadian Labour Congress
  2. 2. Attacks on jobs, wages and services in a time of rising profits Summer 2012
  3. 3. People who depend on publicservices – which is everybody – areseeing many of those servicesweakened or wiped out entirelyThe 2012 Ontario Budget will cut$17.7 billion from public servicesover the next three years
  4. 4. Public employees are facing direct attacks ontheir jobs and wagesThe government is cutting jobs and demandinga wage “freeze” (really a wage cut equal to therate of inflation) for all provincial workersPrivate sector wages are not keeping up either.In Ontario, overall wages went up just 0.7 percent from Feb. 2011 to Feb. 2012. But inflationwas 2.9 per cent. In other words, real wages(after inflation) fell by 2.2 per cent
  5. 5. Premier DaltonMcGuinty is makingthese big problemsworseMcGuinty says moredeep cuts to publicservices, wages, andjobs are needed toget the deficit to zeroby 2017-18
  6. 6. The government hasexaggerated how badthe deficit isIn the early 1990sthere were five yearswhen the deficit wasworse than it is nowThe deficit ismanageable
  7. 7. Taking advice frombanker Don Drummond,McGuinty wants cuts thatare deeper and last longerthan those of the 1990sDrummond was happy to ignore optionsfor raising revenues because it helped“keep the screws on” spendingBased on this, you might think the deficitwas caused by public spending. It wasn’t
  8. 8. Ontario’s deficit was caused by therecession, which cut tax revenues togovernments everywhereOntario had balanced budgets forthree years before the recessionOntario has the lowest spending perperson of any province in Canada
  9. 9. Ontario’sprogramspending is 11per cent lowerthan theaverage of theotherprovincesSpendingis not theproblem
  10. 10. Spending cuts will hurt the economy andreduce government revenuesThe Centre for Spatial Economics, amainstream forecasting firm, estimates that the2012 Budget will cost 7,000 jobs in 2012But by 2015, Ontario will have 105,000 fewerjobsIn 2015, the unemployment rate will be 0.9 percent higher as a result of the Budget
  11. 11. Of the105,000 jobsmissing in2015, 65,000will bepublic sectorjobs and40,000 willbe privatesector jobs
  12. 12. Cutting spending on public services hurts the economy more than an equivalent increase in taxes:“Raising taxes rather than cutting spending imposes lower costs on society in terms of reduced jobs and GDP while achieving the government’s objective of reducing the deficit.” - Centre for Spatial Economics, April 2012
  13. 13. Cuts and privatization will cutwages and jobs for workers whilecreating more profit opportunitiesfor investors.They won’t help strugglinghouseholds – in the public sector orthe private sector
  14. 14. Consumers and governments havebeen propping up corporate profitsfor close to three decades – by goinginto debtMeanwhile, corporations in Canadaare sitting on $527 billion in cashthat they are not spending orinvesting
  15. 15. The global economy is like aMonopoly game in which oneplayer has all the money andthe others are brokeIt’s time to start a new game.That can only happen byredistributing money fromcorporations and high-incomeindividuals to workers and governments toget the economy rolling again
  16. 16. Around the world,citizens are fightingback, demandingsolutions that don’tmean lower wagesand higher profits, orfewer public servicesand more privateones
  17. 17. In the last two years, OPSEU has: promoted fair taxation at the G-20 campaigned to reveal the link between theMcGuinty wage freeze and corporate tax cuts launched the satirical “People for Corporate TaxCuts” campaign Supported the Occupy movement and itsopposition to growing inequality sponsored the Commission on Quality PublicServices and Tax Fairness
  18. 18. The 2012 provincial Budget deal that raisedtaxes on those earning more than $500,000 ayear will raise around $500 million a year forpublic servicesMore needs to be done to support jobs, wages,and public servicesIn 2012, we are fighting “austerity” in ourcommunities and at the bargaining tableWorking people did not cause Ontario’sproblems….
  19. 19. Photo: Jackson Chui