A Race to the Bottom: Public Sector vs. Private Sector

Ontario’s economy shifting from “stable full-time jobs to shaky part-time jobs”? Toronto Star

“The wage and pension divide between public and private sector is growing.” Globe and Mail.

The latest election trend demonizing public sector workers is disturbing.   Perhaps it’s the ‘Rob Ford’ effect, but it appears that the wages and pensions of public sector workers will be fodder for the upcoming municipal election debate. For it to have any traction, there must be a wedge, a crisis, and demon to hate, so that a candidate can come in and solve it all. The solutions are usually the same old tricks — privatize public services, cut jobs, slash benefits, get tough with unions, open a snitch line to ‘out’ all the abusers and turn full-time jobs into part-time positions.

How does this help our community? Well, it doesn’t.

Public sector workers are our neighbours who live in and contribute to our community. They are the skilled, hard-working citizens who pick up our waste, process our ‘biosolids’, maintain our parks and trees, fix our potholes and plough our streets. They deserve respect. And a living wage.

The gap between a public sector and private sector job used to be the other way around. The recession economy has shifted the paradigm. The result has been to protect corporate prosperity, but has done little for private sectors workers who have seen frozen wages, layoffs, off-shore production, and pension and benefit erosion. The widening gap is not because the public sector is out of control, but because the private sector isn’t keeping pace.

Rather than focusing on the race to the bottom, why don’t we look at it another way…

What if we focus on creating a local economy that attracts and retains employers who offer stable and quality jobs?

What if we create value-added jobs and policies that support local business and economic development?

What if increase the value of public sector investments (capital and labour) so that we lower operating expenses (ie. increased transit ridership)?

It’s time to stop the race to the bottom by blaming the public sector.

LP

“Why Didn’t You Just Say That in the First Place?”

Yesterday, in response to a question from a local resident, I tried to explain that “Tax-Increment-Based Grants” (TIBG) were not giveaways, nor are they paid for by current taxpayers.

TIBGs are the most misunderstood term in the world. We really need to invent a new word for TIBGs. As part of the conversation, I gave an example of a vacant property paying $1000 in taxes per year in its current undeveloped state. Then, after it was fully developed, it would generate $32,000 in taxes per year (32x its current value). Then, after it is built and we get the tax revenue, we give some of it back to the developer for a fixed time (eg. 5 years) to offset their cost of cleaning up the vacant lot. After that, we keep all the revenue and the money goes back to lower tax increases across the whole city.

She responded, “So you’re just giving the developers back their own money?”

“Yes, exactly,” I said.

Well why didn’t you just say that in the first place?” was her response.

It’s that simple.

LP