Economy Canada's Insane "Equalization" Discussion: Ottawa Quietly Renewed Equalization Formula Until 2024

[Devout Pessimist]

I like when your politicians fight on YouTube

It's funny watching jr read his debate against the speaker, that the best part

Trudeau reads from a sheet of paper and repeats that same response over and over. What is funny is that he will still look down at the paper even after responding in the same manner multiple times.

 

[no fat chicks]

Quebec needs to get its shit together

 

[some random guy]

The solution is for Western Canada to Separate from Eastern Canada. The Eastern provinces decide all of the federal elections and take all of the money. I'm all for a Republic of Western Canada.

But how alike and united are these provinces aside from the issue of equalization payments? Just looking at federal election results BC and Alberta are pretty far apart on the political spectrum. It's mainly Alberta and to some extent Saskatchewan that tend to be much more conservative leaning which may not be reflected by Federal elections. BC (and I guess the territories as well) aligning into a western Canada bloc would likely get less representation on the where it leans on the spectrum.

 

[Grenz]

But how alike and united are these provinces aside from the issue of equalization payments? Just looking at federal election results BC and Alberta are pretty far apart on the political spectrum. It's mainly Alberta and to some extent Saskatchewan that tend to be much more conservative leaning which may not be reflected by Federal elections. BC (and I guess the territories as well) aligning into a western Canada bloc would likely get less representation on the where it leans on the spectrum.

I agree, BC and AB are too far apart ideologically speaking, and most "true" Albertans will tell you that. Let's also not forget that AB is only an economic powerhouse with oil at a certain price. I don't think the confederation has failed, but one of the most contentious issues continues to be Quebec with its massive spending, insistence on special treatment and petulant attitude. It's not fair to offer your citizens the lowest daycare and university tuition (and it's not even close compared to other provinces), when you can't actually do it without having the rest of Canada to float that bill. In fairness though, taxes here are ridiculously high, so at least the collection effort is being made.

 

[SammyPops]

Triggered.

I'm in Toronto, which means my taxes equalizes the rest of Ontario and most of Canada. Fucking ingrates: $2 a day dayccare in Quebec, subsidized rich fisherman in the Atlantic provinces .... and so on.

 

[sangreporsangre]

As regards Quebec, the thought here in Ontario has always been that they get so much in equalization payments as a bribe to keep them from trying to separate again. "Real nice confederation you have there. Be a shame if something happened to it."

 

[Grenz]

As regards Quebec, the thought here in Ontario has always been that they get so much in equalization payments as a bribe to keep them from trying to separate again. "Real nice confederation you have there. Be a shame if something happened to it."

Two referendums, both voted no. Separation still exists as a dream here for some (mainly the older generation that lived through the quiet revolution), but it's pretty much widely acknowledged now that it'll never happen (especially after the last embarrassing run the PQ had as provincial government). The old guard may try to position the transfer payments as a guarantee QC won't leave the confederation, but it's an empty threat. Montreal, immigrants and Anglo population basically ensure that QC will stay part of the confederation.

The problem is that Quebec is addicted to the luxuries these transfer payments provide and not surprisingly, they don't want to give them up. Take the student protests 5 years ago for example. There was a very modest and reasonable proposal to raise tuition, which is by far the lowest in the country, probably the lowest in N. America, all tax payer subsidized. IIRC it was something like a $350 annual hike for the next 7 years which would still only barely bring it in line with the rest of Canada. Students were having none of it, so they protested and got what they wanted. Interesting to add that the only university in Quebec that didn't participate was McGill, which is also the only notable school here (Concordia being the distant second). So we can rest assured that all the Arts majors at the provincial shit schools still get to discover themselves through education, provided at basement budget rates, sponsored by the rest of Canada.

The same thing happened with the cops who were protesting budget cuts for years by wearing non-uniform cargo pants. To put that into perspective, it's very common here in Montreal to see a cop work the traffic lights. They are not directing traffic, they are literally pressing a button to change the traffic lights. All. Day. Long. I see it several times on my way to work, and I only have a 20 minute commute. I bring this up because it demonstrates the inefficiency and petulance of government workers here: Why in the fuck are we using someone who makes 70K/year to change fucking traffic lights? That's a $20 an hour job maximum. Better yet, why don't these fucking traffic lights just do what they're supposed to do? How hard is it to get that fixed???

Or take a look at where government offices are located. Why in the living fuck would you put a government office in the old port, right next to the canal, one of Montreal's most expensive areas? You're a government worker, put that shit in an industrial park somewhere. It's good enough for private businesses, it's good enough for public administrations.

I already brought up other deficiencies, like the complete lack of government services streamlining. Lost your health card? No problem, you can get a new one on-line. There'll be approximately 38 steps to follow, one of which will involve your old health care card. Yep, the one you need to replace...because you lost it. Makes sense? No lol, ofc not, but this is Quebec. Did you move here from another provinces and need to transfer your driver's license? Yea, you're gonna have to make an appointment at one of the two offices in Montreal (pop. 3.5 million) that are actually equipped to do this. It'll take 6 weeks to get the appointment, and you will need to bring a mountain of paperwork, for example, 6 months of original bills to prove that you lived in the very province your current driver's license is from. You do online billing? Don't think you can simply print out the bills, you need originals. The whole process literally takes at least 8 hours of running around, and most people don't even make it on the first try because they failed to satisfy one of the ridiculous bureaucratic requirements.

The rest of Canada needs to call the bluff, Quebec isn't going anywhere, and the provincial government structure needs a complete overhaul and needs to integrate with the federal government like the rest of the provinces (fun fact: During tax season I get to spend twice as much time doing taxes, because on top of my T4 I also have a Releve 1, Quebec's own version of the T4. Why? Because fuck me, that's why).

 

[MikeMcMann]

As an Albertan born and raised, bitching about equalization payments is more than just a topic of conversation, it’s a way of life.

As it should be.

As a Canadian I am all for sharing the wealth across the country and uplifting struggling Provinces but this just makes no sense...

...The province of Quebec has received the lion's share of the country's equalization payments, about 50% since the program began in 1957. The province received $10 billion this year, which the government put towards balancing its budget. Quebec has received almost $300 billion in equalization payments since 1957 and has never been a net contributor to the fund. The province's significant revenues from the sale of hydroelectric power are excluded from the equalization formula...

Especially the bolded orange part. That could not be a cleared attempt to ensure a main revenue generator for Quebec is excluded so they can always show lower revenue than other provinces and thus never pay out any money and only collect money from others.

Quebec has been the biggest benefactor of the Oil price plummeting in 2015 in terms of their economy improving and going into surpluses and Alberta the hardest hit as it spun into recession and the increase in debt. And yet here still struggling Alberta must send Billions to surging Quebec because the Federal government uses rigged accounting to make sure Quebec always looks like the poor cousin.

 

[MikeMcMann]

As regards Quebec, the thought here in Ontario has always been that they get so much in equalization payments as a bribe to keep them from trying to separate again. "Real nice confederation you have there. Be a shame if something happened to it."

Of course that is a big part of it. The squeaky wheel gets the grease. Quebec would never separate truly as they could not afford to finance themselves. They would quickly become Greece with their over burdened public sector. The elite in Quebec know that but whip up the ignorant masses to yell Separation to wring out more gov't dollars.

Also Quebec is the heart of crony politics in Canada. Much of the money sent to Quebec has always been divvied out to Quebec elite as hush money.

 

[MikeMcMann]

Two referendums, both voted no. Separation still exists as a dream here for some (mainly the older generation that lived through the quiet revolution), but it's pretty much widely acknowledged now that it'll never happen (especially after the last embarrassing run the PQ had as provincial government). The old guard may try to position the transfer payments as a guarantee QC won't leave the confederation, but it's an empty threat. Montreal, immigrants and Anglo population basically ensure that QC will stay part of the confederation.

The problem is that Quebec is addicted to the luxuries these transfer payments provide and not surprisingly, they don't want to give them up. Take the student protests 5 years ago for example. There was a very modest and reasonable proposal to raise tuition, which is by far the lowest in the country, probably the lowest in N. America, all tax payer subsidized. IIRC it was something like a $350 annual hike for the next 7 years which would still only barely bring it in line with the rest of Canada. Students were having none of it, so they protested and got what they wanted. Interesting to add that the only university in Quebec that didn't participate was McGill, which is also the only notable school here (Concordia being the distant second). So we can rest assured that all the Arts majors at the provincial shit schools still get to discover themselves through education, provided at basement budget rates, sponsored by the rest of Canada.

The same thing happened with the cops who were protesting budget cuts for years by wearing non-uniform cargo pants. To put that into perspective, it's very common here in Montreal to see a cop work the traffic lights. They are not directing traffic, they are literally pressing a button to change the traffic lights. All. Day. Long. I see it several times on my way to work, and I only have a 20 minute commute. I bring this up because it demonstrates the inefficiency and petulance of government workers here: Why in the fuck are we using someone who makes 70K/year to change fucking traffic lights? That's a $20 an hour job maximum. Better yet, why don't these fucking traffic lights just do what they're supposed to do? How hard is it to get that fixed???

Or take a look at where government offices are located. Why in the living fuck would you put a government office in the old port, right next to the canal, one of Montreal's most expensive areas? You're a government worker, put that shit in an industrial park somewhere. It's good enough for private businesses, it's good enough for public administrations.

I already brought up other deficiencies, like the complete lack of government services streamlining. Lost your health card? No problem, you can get a new one on-line. There'll be approximately 38 steps to follow, one of which will involve your old health care card. Yep, the one you need to replace...because you lost it. Makes sense? No lol, ofc not, but this is Quebec. Did you move here from another provinces and need to transfer your driver's license? Yea, you're gonna have to make an appointment at one of the two offices in Montreal (pop. 3.5 million) that are actually equipped to do this. It'll take 6 weeks to get the appointment, and you will need to bring a mountain of paperwork, for example, 6 months of original bills to prove that you lived in the very province your current driver's license is from. You do online billing? Don't think you can simply print out the bills, you need originals. The whole process literally takes at least 8 hours of running around, and most people don't even make it on the first try because they failed to satisfy one of the ridiculous bureaucratic requirements.

The rest of Canada needs to call the bluff, Quebec isn't going anywhere, and the provincial government structure needs a complete overhaul and needs to integrate with the federal government like the rest of the provinces (fun fact: During tax season I get to spend twice as much time doing taxes, because on top of my T4 I also have a Releve 1, Quebec's own version of the T4. Why? Because fuck me, that's why).

Excellent post and very true.

Quebec is basically Greece but with a big brother to pay their over spending ways off for them. Bloated bureaucracy, Unions and demands run rampant, expectations that life's nice things (education, etc) should be subsidized by others without any regard for the tax payers on the other side who are paying for it while not getting the same benefit. You try to tell Quebecers they need to pay their fair share of the costs and they scream bloody murder about you taking away their entitlement.

Quebec is not the threat to leave Canada. Alberta is. And it would be very warranted. Alberta could be very rich and self sufficient with a sovereign fund somewhat like Norway based on all the good years of Oil Revenue they have had. Money that could have tied them through this bad time. But instead the Federal gov't takes mass amounts of money from Alberta in good and bad times and uses it to bribe Quebec and provide for Quebecers a life style that Alberta's do not have.

 

[senri]

Excellent post and very true.

Quebec is basically Greece but with a big brother to pay their over spending ways off for them. Bloated bureaucracy, Unions and demands run rampant, expectations that life's nice things (education, etc) should be subsidized by others without any regard for the tax payers on the other side who are paying for it while not getting the same benefit. You try to tell Quebecers they need to pay their fair share of the costs and they scream bloody murder about you taking away their entitlement.

Quebec is not the threat to leave Canada. Alberta is. And it would be very warranted. Alberta could be very rich and self sufficient with a sovereign fund somewhat like Norway based on all the good years of Oil Revenue they have had. Money that could have tied them through this bad time. But instead the Federal gov't takes mass amounts of money from Alberta in good and bad times and uses it to bribe Quebec and provide for Quebecers a life style that Alberta's do not have.

Didnt they spend all the oil fund money they had years ago?

 

[MikeMcMann]

Didnt they spend all the oil fund money they had years ago?

Ya it became abused and a political slush fund for politician pet projects and after citizen revolt it was allowed to diminish and languish.

It is what happens when you allow politicians to administer a good idea.

...In their August 2015 contrast forThe Globe and Mail between the AHSTF and the Norwegian Government Pension Fund Global, Brian Milner and Jeff Lewis wrote that Norway parks 100 per cent of its non-renewable resource (NRR) revenue from royalties and dividends in a fund that is barred from investing a krone in the domestic economy.[9]

Reports by the Canadian Centre for Policy Alternatives and the Fraser Institute concluded that Alberta should be saving more of its non-renewable resource revenues. Since 1980, the NRR in Alberta has generated almost $190 billion, but the value of the Heritage Fund was only $17.3 billion in 2014. After 1987, NRR was no longer added to the Heritage Fund. The Fraser Institute report compared the Alberta Heritage Fund to Norway and Alaska's NRR funds and argued that Alberta's was significantly "smaller than others because of its relative under-funding and chronic withdrawals of most income from the fund."[16]:9Alaska for example continued to deposit 25 percent of its NRR from 1982- 2011 and Norway contributed 100 percent. If Alberta had followed the Alaskan formula, by 2011 the Heritage Fund would have had $42.4 billion instead of $9.1 billion. By the Norway rules, Alberta would have had $121.9 billion by 2011...

cite

And even more if Alberta was not providing the welfare payments to Quebec.

 

[Arkain2K]

Two referendums, both voted no. Separation still exists as a dream here for some (mainly the older generation that lived through the quiet revolution), but it's pretty much widely acknowledged now that it'll never happen (especially after the last embarrassing run the PQ had as provincial government). The old guard may try to position the transfer payments as a guarantee QC won't leave the confederation, but it's an empty threat. Montreal, immigrants and Anglo population basically ensure that QC will stay part of the confederation.

The problem is that Quebec is addicted to the luxuries these transfer payments provide and not surprisingly, they don't want to give them up. Take the student protests 5 years ago for example. There was a very modest and reasonable proposal to raise tuition, which is by far the lowest in the country, probably the lowest in N. America, all tax payer subsidized. IIRC it was something like a $350 annual hike for the next 7 years which would still only barely bring it in line with the rest of Canada. Students were having none of it, so they protested and got what they wanted. Interesting to add that the only university in Quebec that didn't participate was McGill, which is also the only notable school here (Concordia being the distant second). So we can rest assured that all the Arts majors at the provincial shit schools still get to discover themselves through education, provided at basement budget rates, sponsored by the rest of Canada.

The same thing happened with the cops who were protesting budget cuts for years by wearing non-uniform cargo pants. To put that into perspective, it's very common here in Montreal to see a cop work the traffic lights. They are not directing traffic, they are literally pressing a button to change the traffic lights. All. Day. Long. I see it several times on my way to work, and I only have a 20 minute commute. I bring this up because it demonstrates the inefficiency and petulance of government workers here: Why in the fuck are we using someone who makes 70K/year to change fucking traffic lights? That's a $20 an hour job maximum. Better yet, why don't these fucking traffic lights just do what they're supposed to do? How hard is it to get that fixed???

Or take a look at where government offices are located. Why in the living fuck would you put a government office in the old port, right next to the canal, one of Montreal's most expensive areas? You're a government worker, put that shit in an industrial park somewhere. It's good enough for private businesses, it's good enough for public administrations.

I already brought up other deficiencies, like the complete lack of government services streamlining. Lost your health card? No problem, you can get a new one on-line. There'll be approximately 38 steps to follow, one of which will involve your old health care card. Yep, the one you need to replace...because you lost it. Makes sense? No lol, ofc not, but this is Quebec. Did you move here from another provinces and need to transfer your driver's license? Yea, you're gonna have to make an appointment at one of the two offices in Montreal (pop. 3.5 million) that are actually equipped to do this. It'll take 6 weeks to get the appointment, and you will need to bring a mountain of paperwork, for example, 6 months of original bills to prove that you lived in the very province your current driver's license is from. You do online billing? Don't think you can simply print out the bills, you need originals. The whole process literally takes at least 8 hours of running around, and most people don't even make it on the first try because they failed to satisfy one of the ridiculous bureaucratic requirements.

The rest of Canada needs to call the bluff, Quebec isn't going anywhere, and the provincial government structure needs a complete overhaul and needs to integrate with the federal government like the rest of the provinces (fun fact: During tax season I get to spend twice as much time doing taxes, because on top of my T4 I also have a Releve 1, Quebec's own version of the T4. Why? Because fuck me, that's why).

Good Lord! With ridiculous issues like these across the provinces, why do the Canadian national elections seems so tamed?! Those in the West being robbed blind in broad day light should tell the Quebec secessionists to just scram!

Logic dictates that the benefactors who have been consistently footing the bill oughta have more political clout and representation than the bureaucratic, wasteful, chronic free-loaders.

 

[gatchaman]

Good Lord! With ridiculous issues like these across the provinces, why do the Canadian national elections seems so tamed?! Those in the West being robbed blind in broad day light should be the ones demanding to secede, not Quebec!

Logic dictates that the benefactors who have been consistently footing the bill oughta have more political clout and representation than the bureaucratic, wasteful, chronic free-loaders.

Excuse my interjection, but you could make the same argument about Barcelona and Bavaria.

But when separation is seriously considered by the haves you, Arkain2K, will want unity.

 

[Grenz]

Good Lord! With ridiculous issues like these across the provinces, why do the Canadian national elections seems so tamed?! Logic dictates that the benefactors who are footing the bill oughta have more political clout and representation than the bureaucratic and wasteful charity receipients.

That's just the thing: Quebec is the second most populous province in Canada which means that it's extremely difficult to win a national election without major wins in Quebec. That obviously means that there's constant pandering in an effort to get votes. Alberta - even though it contributes significantly to overall GDP (although that's not the full story either, AB oil is only profitable when oil is above a certain price per barrel, which hasn't been the case for the last 2-3 years - thank OPEC for that).

ON: 13 million
QC: 8 mil
AB: 4 mil

You can see why from a population standpoint, the Eastern provinces tend to dominate Canadian politics, a fact that is obviously (and in some ways rightfully) protested by Western Canada, namely AB.

Also note that from a GDP standpoint, even though AB has one of the highest GDPs per capita, ON still contributes moire than twice as much as AB overall, and QC contributes more, even though only slightly more.

http://www.worldatlas.com/articles/canadian-provinces-and-territories-by-per-capita-gdp.html

 

[Arkain2K]

Excuse my interjection, but you could make the same argument about Barcelona and Bavaria.

But when separation is seriously considered by the haves you, Arkain2K, will want unity.

A big reason for rich and selfish Catalonia to want to secede is because they don't want to help out the poorer Spanish provinces. This is known.

On the other hand, Quebec is the "have-not" province who have been happily receiving in excess of $300,000,000,000 in free money paid for by other Canadian provinces since Equalization were introduced, and THEY threatened to secede over and over again from the people who foot their bills? What kind of ass-backward logic is that?? Who would actually believe that ridiculous bluff?!?

 

[gatchaman]

That's the thing: A big reason for rich Catalonia to want to secede because they don't want to help out the poorer Spanish provinces.

Quebec is the one who have been receiving $300,000,000,000 in free money from thr federal government, and THEY want to secede?? Sounds like a ridiculous bluff to me.

Some Quebekers want to secede for the same reason that some natives do, to preserve culture. Both groups get a lot of handouts, but neither Quebec nor the reserves are the most desirable places to live in Canada. A government that can give you everything you think you want can also take everything you have.

 

[MikeMcMann]

Good Lord! With ridiculous issues like these across the provinces, why do the Canadian national elections seems so tamed?! Those in the West being robbed blind in broad day light should tell the Quebec secessionists to just scram!

Logic dictates that the benefactors who have been consistently footing the bill oughta have more political clout and representation than the bureaucratic, wasteful, chronic free-loaders.

Its the exact opposite.

The freeloaders have all the time in the world to focus on politics and have made it a true profession. It is very hard to lead a National Party in Canada with any long term success with a strong Quebec contingent if not a leader from that Province. Quebecois dominate all levels of politics both on the front line (elected officials) and behind the scenes in the bureaucracy and they fight tooth and nail to ensure that cash cow is not changed. Voting in Canada tends to be dominated by the socialists, gov't workers and Unions as they are literally buying their paycheques with their votes.

Most in the West are busy with their businesses and lives and don't want to focus on politics. And Canadians as a whole believe in a more socialist model where wealth is spread around. Only a few hardcore are against it. It is just the abuse and waste coming to light every few years that finally rallies conservatives to mass their votes and get some change. And then they go back to their daily lives and businesses and the Socialist/Leftists start doing it all again.

 

[MikeMcMann]

Some Quebekers want to secede for the same reason that some natives do, to preserve culture. Both groups get a lot of handouts, but neither Quebec nor the reserves are the most desirable places to live in Canada. A government that can give you everything you think you want can also take everything you have.

A big reason for rich and selfish Catalonia to want to secede is because they don't want to help out the poorer Spanish provinces. This is known.

On the other hand, Quebec is the "have-not" province who have been happily receiving in excess of $300,000,000,000 in free money paid for by other Canadian provinces since Equalization were introduced, and THEY threatened to secede over and over again from the people who foot their bills? What kind of ass-backward logic is that?? Who would actually believe that ridiculous bluff?!?

Most Quebecers are in denial as to the financial position of the Province. We can all see the numbers and Quebec is a welfare province but in Quebec they actually tell the citizens the opposite. They tell them that Quebec contributes more than it takes and if they separate they would be better off. They also tell the citizens that it is the rest of Canada that is responsible for the massive debt and if Quebec leaves they would not take their proportional part of the debt.

That is why after the last referendum the Federal Gov't created the Clarity Act which ensures if another Separation vote ever called that the truthful facts must be put to the citizen and not just political spin. so for instance it would have to be established what percentage of the debt the separating Province would be taking with them.

 

[GhostZ06]

So can we invade that area?