7/7/10

The Mop and Pail instructs

Toronto's national newspaper, the Globe and Mail, yesterday called on Canadian governments to take inspiration from the pending (savage) cuts to the public sector in Britain. Budgets will be cut (outside of health care and ‘foreign aid’) by an average of 25%. A leaked British Treasury document estimated that 600,000 public sector jobs will be eliminated. The Mirror reported on July 4th that the cuts may be increased to 40%, with even more job loss (http://by.ly/3yrx).

From the 'no surprise here' category --  A new study from the British Fabian Society  (Don't Forget the Spending Cuts!) indicates that the bulk of the British cuts will fall on working people: the average annual cut in public spending on the poorest tenth of households is £1,344,equivalent to 20.5% of their household income.  That percentage of income remains quite high, until you get to the top. The annual cut in public spending on the richest tenth of households is £1,135, equivalent to just 1.6% of their household income.   The Guardian provides commentary on the study here.

Of course, these are just the latest in public sector cuts that are sweeping across many developed capitalist countries (and US states) in recent weeks.


While these sorts of cuts have not come to Ontario yet, I have to suspect that many in corporate Canada will see this emerging trend as a golden opportunity to further undermine public services (and, with that, the security of working people).

While some economists see the cuts to the public sector as slowing economic growth, this idea has not yet become a major issue in either Ontario or Canada.  Indeed, the public has been pushed (but not yet stampeded) in the opposite direction recently through the efforts of our own Prime Minister Harper at the G20.  This despite the uncertainty over the economic utility of the cuts that is found even among mainstream economists (see http://by.ly/u7zyei ).

As usual, business is planning ahead on this issue, not just the overall grab o' swag, but right down to the itty-bitty details. One major corporate consulting firm has even released a report alerting governments to the ‘threat’ of increased fraud in the public sector as the cuts proceed!

Will labour develop an effective counter to this growing threat?  Time will tell.  -- Doug

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