Letter To Dalton McGuinty re Harmonized Sales Tax

Beginning in 2010, Dalton McGuinty's government is instituting a new tax system in Ontario which involves expanding the Provincial Sales Tax to encompass thousands of new goods and services. The program is disingenuously entitled the "Harmonized Sales Tax." To express my dissent and outrage, I sent Mr. McGuinty the following letter and I encourage everyone of a like mind on this matter to send a message as well. Please feel free to borrow my letter, either in part or in whole, while making your opinion known.

Dear Mr. Dalton McGuinty,

As a politically engaged citizen of Ontario, I am pleased to offer my support for any government initiative that aims at lessening the tax and paperwork burden on the people of our province. I find it interesting that the achievement of this rational tax reform is the guise under which Ontarians are being offered the "Harmonized Sales Tax" (HST). Regrettably, the HST plan will, in reality, distend the 8% provincial tax to include innumerable products and services that are presently – and mercifully – beyond the provincial government’s reach. As a result, it is clear that the valid objective of reforming the tax system for the benefit of Ontario’s over-taxed individuals, families, and businesses is no more than a convenient pretext that has been employed by your administration to obscure the true nature of your proposed tax plan.

Like many of your government’s policies, the HST has been initiated under a smoke screen of beneficence while truly aiming at arrogating to the state an even larger portion of the wealth of Ontario’s citizens. In essence, the “harmonization” that your government has advanced is nothing more than a massive tax hike, one that will be keenly felt by Ontarians in their purchase of basic goods and services such as hydro, gasoline, and home heating fuel, as well as in important areas like legal fees, real estate charges, and the sale of used cars. Given our province’s already inordinately high tax burden, this drastic and underhanded cash grab by your government will represent a major financial challenge to Ontario’s producers and consumers alike, especially those in the middle class. Your constituents will not tolerate this state of affairs.

Mr. McGuinty, I implore you to strike down the proposed Harmonized Sales Tax. Furthermore, as the leader of Ontario’s government, I ask that you focus your efforts on what common sense, sound economics, and the lessons of history have demonstrated time and again is most conducive to the real welfare of Canadian citizens: freedom in the economic realm. I assure you that your failure to take positive action on this matter will be reflected in the results of the next provincial election.

Please follow the link to send your own message.

McGuinty Wrong To Force CUPE 3903 Back To Work

In a recent article published at The Gods of the Copybook Headings, Publius provides Canadian conservatives with a timely reminder that our principled rejection of compulsory unionism does not, in fact, oblige us to support Dalton McGuinty's plan to force the members of CUPE 3903 back to work at York University. In reality, McGuinty's plan to end the 'deadlock' would set a dangerous precedent in terms of the government's ability to impose itself upon strikes in industries deemed to be 'essential' (a constantly shifting standard, invented and defined by the politicians citing it for their causes).

The following is a rather lengthy excerpt from Publius's article:

In an ideal society the right to strike - an extension of the right of voluntary association - would not need to be curtailed. Even, if by some strange happenstance, a private company were able to obtain a monopoly over public transit in Toronto - something which never happened before the creation of the TTC nearly ninety years ago - they would risk having their market position undercut by competitors. While no one can throw up a parallel subway system overnight, the city's rail lines (currently used for freight and commuter rail) might be put into use in a matter of months. Bus service could probably be established even more quickly. The mere threat of a competitor can make both management and labour think twice about the costs of a strike, a reality private companies must confront daily. The TTC doesn't have to worry about a drop in fares as does a private company, for thousands of commuters there is really no alternative and much of any potential shortfall is covered by the City of Toronto or Provincial Government. Union workers cannot be laid off, and their employer is not in the business of turning a profit.

How then has Dalton McGuinty extended the logic of "essential services" to a university? There are no private universities in Ontario, all receive some degree of government funding, but all collect tuition from students. There are some 22 in the province, three in Toronto alone (with another two with campus in the city). Southern Ontario has one of the most dense concentrations of post-secondary institutions in North America. There are plenty of alternatives to a York University degree. Nor does York provide any type of specialized training not available elsewhere, as say does the University of Toronto. There is nothing life or death about getting a university degree. Many students may lose their year because of this strike. This is no doubt a great inconvenience but it is also a hazard of everyday life. It would be legally doubtful that the students could sue York for the financial loss incurred by the strike. In the marketplace, such as it exists, for post-secondary education a student, seeing that York is an unreliable service provider, can switch to a different institution going forward. If a year is lost, having not provided the service as promised, York should be compelled to refund tuition, at the very least.

The danger of the Dalt's unwarranted extension of government power, fully supported by the political zombie that is John Tory, is the precedent being established. Before an essential service was a government monopoly in a life or death industry, or essential to living in an urban environment. Now it is anything deemed important enough by the provincial government. As provincial funds flow freely into the coffers of GM and Chrysler, watch for the first attempt by the UAW or CAW at a strike, or even a minor job action. How long before the automotive industry is declared an essential service? The logic of "essential service" is driven by a related concept, "public service." Government monopolies deny first the right of competitors to challenge their market position, they then deny their workers' right to strike. The contagion, as we are seeing with the case of York University, soon spreads to other sectors of the economy. This is a bleak precedent that deserves to be condemned.

I whole-heartedly approve of the author's reasoning on this question. Although I am certainly no friend of CUPE 3903 or the thuggish practice of compulsory unionism, it is not the government's role to force a resolution in disputes between employees and employers.

This situation at York University, however, is an object lesson demonstrating the price of making deals with the devil or the government. CUPE 3903 is a perfectly despicable collection of thugs and bureaucrats and their tactic of using the state as leverage against the evil overlords of the administration at York University has back-fired here. By allowing the government a role in unionization, they have invited the state to impose itself upon both sides of the arrangement: employees and employers.

So, although I cannot say that I feel sorry for CUPE 3903, I do agree that Dalton McGuinty's proposed actions are unacceptable. Yesterday, Publius cross-posted his article at Dust My Broom and I made the point another way in the comments section:

It's a dangerous precedent to set to permit the provincial government to deem a university an 'essential service' and force the strikers back to work. However, I see two factors that complicate the issue: (1) the union is itself coercive (CUPE 3903 is a prime example of compulsory unionism, which is to say that contract faculty, tenured professors, and teaching assistants are given no option but to join CUPE 3903 upon accepting a position with the university - evidently, this is a violation of the freedom of association's corollary, to wit, the freedom not to associate which is encompassed by the practice of voluntary unionization), and (2) York accepts government money, blurring the line between public and private. As a consequence of these issues, the relationship between CUPE 3903 and the government of Ontario is not as clear-cut as it would be were the union private and voluntary.

Although I stand by this assessment, I concede that there can be no benefit to the cause of freedom in allowing Premier McGuinty to arrogate to himself the power to end a strike of a non-governmental and evidently non-essential service.

It behooves Canadian conservatives to think on these points before advocating for a knee-jerk reactionary anti-union position and, in so doing, allowing Dalton McGuinty to violate the rights of Canadian citizens.


ALSO: For more information about the evils of coercive unionism, please follow the link below:

The Myth of Voluntary Unions

Harper Announces Auto Bailout, Sheds A Single Tear For Lost Principles

Gasp. Can it be? Are the rumours true? Has Prime Minister Stephen Harper betrayed his free market convictions for simple political expediency?

CTV:

Prime Minister Stephen Harper and Ontario Premier Dalton McGuinty have announced a $4-billion aid package for Canada's struggling auto industry.

Shock. Betrayal. Surprise. I feel ... none of these emotions. Harper has made his willingness to cater to whomever demands it of him perfectly clear so long as it prolongs his time in power.

For one, I disagree unreservedly with the popular wisdom that a man must either be principled or practical, the point being that the two spheres are mutually exclusive. In my mind, there is nobody more practical than the person who acts on principle. Evidently, Mr. Harper begs to differ.

I've made my thoughts regarding the auto industry bailout rather clear so I won't beat a dead horse in this post. I will, however, recruit Publius to summarize the bailout decision as well as my own opinion on the matter to provide a little bit of closure:

This is, we belabour the point because it is not made enough, the economic equivalent of putting four billion dollars on a huge raft, lighting it on fire and then letting it drift to the middle of Lake Ontario to sink.

So for now, the Canadian auto industry will avoid bankruptcy. Financial bankruptcy, that is. They've been bankrupt of integrity for years.


ALSO: The cold hard facts about auto profits and sales (or lack thereof) in the United States. Again, linked by Publius.

How To Solve Ontario's Economic Crisis

CTV:

Newfoundland and Labrador Premier Danny Williams says the federal government should do more to help Ontario and Quebec's struggling manufacturing sectors.

"The broad shoulders of Ontario have carried this country for a long, long time," Williams told CTV's Question Period on Sunday.

Well, gee. That's a really sweet sentiment, Mr. Williams. But how do you want the federal government to help? Perhaps you note the great injustice of the present equalization scheme which sees Ontario tax-payers sending $20 billion more to Ottawa than they receive back in transfers or services. So is the answer a greater chunk of the equalization pie?

Absolutely not. The difference would just be made up again through cuts to transfer payments. The only real option is the simplest one: decontrol. The suggestion has been put forward by John Tory but has predictably fallen on deaf ears. The moratorium on the minds of businessmen and women in Ontario is - as it has been for years - strangling the province's economy. What sets the present situation apart from the past is that, given our current economic circumstances, business is no longer fully capable of shouldering the weight of governmental interference.

The government's proper role is the protection of its citizens. If the provincial Liberal government is truly interested in protecting the people of Ontario they will cut taxes and, in Tory's own words, immediately ease the regulatory burden on business.

UPDATE: An article by Lorrie Goldstein in today's Ottawa Sun regarding the Ontario recession. Goldstein emphasizes restraint and responsibility in the McGuinty government's actions moving forward. Absent from the article are any tangible policy solutions whatsoever but it still provides a decent contextualization of the present situation.