Open mic: An occasion for fresh thinking

Why not consider expanding Canada Post into a national deposit only bank?

Mike Shields.

It seems alternating which ‘bums to throw out of office’ every 10 years is democracy enough for most Canadians, and perhaps fair enough.

Whereas the economic pendulum arguably swung too far to the left during the ’70s and ’80s, inferable from October’s election results is that it recently was too far to the right.

But on that premise, a (39 per cent) Liberal ‘landslide’ should allow consideration of ideas which previous allegiance to the market, privatization and free trade made unthinkable.  A favorite of mine is that, rather than lament postal services around the world struggling to adapt to internet and private parcel delivery competition, why not consider expanding Canada Post into a national deposit only bank?

The government already maintains a de facto account for each citizen via Social Insurance Numbers. Combine existing offices in every community with electronically loadable ATM cards (secured by PIN) and the cost savings in delivering social programs alone would be considerable. Further, eliminating account fees would save consumers hundreds of dollars whilst doing the same for transaction fees could save small businesses thousands per year versus credit card processing rates. An automatic overdraft facility would also help the most needy minimize extortionate pay day loans, plus enable an intervention system akin to preventative medicine. And more generally, deposit balances would effectively reduce the national debt, plus benefit savers by paying the same interest as T-bills (higher than commercial bank term deposits).

Another novel concept, though it offends my Scottish heritage work ethic, is establishing a universal basic income for every Canadian. In a future replete with robotics, the 40-hour work week is as relevant as the early bird catching more worms after foreign imports have reduced worm prices below livable domestic wages. Industriousness as a virtue then needs to be rethought – as does legislating minimum wage increases that from an economist’s standpoint yield only a fruitless upward spiral of prices rather than the desired humanistic effect.

It doesn’t require a fortune teller to realize the self-conceit of ‘makers versus takers’ might soon matter less to Canadian values than the loss of self-respect and diminished communal values resulting from under-employing our future middle class.  Thus a minimum income unburdening innovators of the need to survive via sandwich artistry should also incorporate a national business incubator that taps into the wealth of expertise of retiring Baby Boomers. Add in too an online ‘gig’ marketplace to ensure minimum levels of workforce attachment by every Canadian and benefits from international disaster response teams to enhanced elder care are fantastic by-products of relatively insignificant income redistribution.

Obviously, costs for any government initiative will need managing, but the central effect of putting more disposable income in the hands of consumers will undeniably grow the economy and, hence, tax revenues.  Yet it is for detractors who will decry even the thought of investing in our national vitality (rather than in whatever Third World country provides maximum financial gain), I have an even more controversial idea:  cut income taxes on individuals and corporations in half and replace those revenues with a (perhaps less than one per cent) tax on net assets.

In moral terms, approximately 40 per cent of every current tax dollar goes toward interest on government debt, which was incurred during the creation of today’s privately held wealth. On a similar vein, asset ownership by foreign entities would be equalized by a more benefit-based taxation theory.  But most importantly, in economic terms, incentivizing higher incomes and capital spending would both attract the world’s best and brightest and motivate historic levels of corporate cash reserves into research and development.

All of which is not to suggest these admittedly dramatic proposals should be implemented immediately, nor perhaps ever.  Only that democratic change should also be an occasion to explore fresh thinking.

– By Mike Shields, who grew up locally and hosts SFU’s Philosopher’s Café Sessions at the Maple Ridge Act Theater, 7 p.m. on the fourth Thursday of every month.

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