The Canadian Revenue Agency has earned everyone’s respect by successfully registering millions of workers who are suddenly unemployed in Canadian emergency response benefits in a matter of days. But what if CERB itself is a mistake?
As the Trudeau government scrambled to include one group that was forgotten from each other in the wage support program, the argument for switching to universal basic income grew more interesting.
Ken Boessenkool is an adviser to former Reformation leader Preston Manning, former leader of the Canadian Alliance, Stockwell Day, and former federal Conservative leader Stephen Harper. He is very conservative.
But Mr. Boessenkool has done it advocacy for what he called the “basic income crisis” to counter the economic downturn created by the COVID-19 pandemic. Under CBI, Ottawa will send direct deposits or checks to all those who file tax returns, taking money back from those who don’t need it through taxes next year.
“For two or three months, covering the country with money makes sense,” he said in an interview.
For most Canadians, COVID-19 is an economic crisis and also a health crisis. Only a small percentage of Canadians are sick or know someone who has suffered. But the brutal unemployment rate reminds us that the country is facing the worst recession since the Great Depression.
CERB is designed to provide income support for people who have lost their jobs due to national quarantine. But as Prime Minister Justin Trudeau admitted in his briefing on Wednesday, many contract workers, part-time workers, students and seniors who needed it were not eligible to join the program.
“We are looking for a solution and we will help you,” he assured them, when he announced new support for creating summer jobs (or possibly falling) for students.
But he avoided the repeated questions from Althia Raj from Huffington Post why the government did not choose to get a guaranteed basic income rather than a program that constantly needs improvement.
Mr Boessenkool believes that the government’s preference for CERB rather than CBI stems from the mindset of bureaucrats in the Ministry of Finance, who prefer to meet economic challenges with targeted solutions, and to later tinker with those solutions as problems arise, rather than to adopt measures universal.
Boessenkool has an unlikely ally in NDP (or maybe vice versa), which also calls for guaranteed basic income to fight the recession.
“Everyone is hit by the COVID-19 crisis,” said NDP financial critic Peter Julian. “Let’s get money to people like other countries do, to make sure everyone is taken care of.”
CBI has its criticisms. British Columbia University economist Kevin Milligan (which I quoted in my last section) column) believes that even though the income guarantee is still easy to launch, it won’t be easy to take money from people who don’t need it from the start.
“‘Send checks to everyone and we will scratch them back later’ people are very minimal in details,” he said in a series of tweets on Tuesday.
Boessenkool agreed that his proposal might overstep the bounds by sending money to those who did not need it. But it’s better to go beyond undershoot, he believes. And if this crisis continues, CBI will provide breathing space while Ottawa works on more targeted substitutes.
Another concern is the possibility that temporary universal basic income can become a permanent universal basic income.
“If the real agenda is to create permanent new rights, how will we pay for it?” Conservative financial critic Pierre Poilievre asked me Wednesday in exchange on Twitter.
As a result of this crisis, the debate about guaranteed basic income can be a major problem in the next election, with Conservatives opposed, NDP in support and Liberals strongly committed to further study.
In any case, as more and more of the unemployed, some are unemployed and it is difficult to say whether they are unemployed eligible for CERB, even as Ottawa offers more generous wage support in the private sector, making the public sector the last place where people have permanent jobs, the government might end up paying almost everyone, one way or another.
What does that mean for the economy and society? Who knows? We are all making this up now.
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