August 20, 2010

The Canadian Taxpayers Federation: A Myopic Watchdog?

Anti-tax group setting up in Atlantic Canada, critics says it's all rhetoric

by Ben Sichel

The Dominion - http://www.dominionpaper.ca

HALIFAX—A self-described “taxpayer watchdog” group with offices across Canada is poised to open an office in Halifax this fall, according to recent media reports. But critics say the organization is little more than a right-wing media mouthpiece.

The Canadian Taxpayers Federation (CTF) advocates for “lower taxes, less waste, and more accountable government,” according to Kevin Gaudet, the group’s federal director.

CTF’s website highlights the federal long-gun registry, the amount paid to elected officials, and “eco-taxes” as examples of wasted taxpayer money.

But Larry Haiven, a professor in the faculty of management at Saint Mary’s University, says most of CTF’s stances on issues—and particularly their relentless calls to lower taxes—are “the most simplistic garbage.”

“It assumes that nothing that is purchased with our taxes is of any use for us,” said Haiven.

Despite CTF’s anti-tax, spending-is-out-of-control rhetoric, said Haiven, taxes are lower now than they’ve been in decades, leaving governments struggling to provide essential services.

“Provinces and the [federal government] have been cutting taxes frenetically, frantically, for the past 25 years... Governments across Canada are taking in about $250 billion less than they did 15 years ago.

“You have to weigh that against everything the Taxpayers Federation says,” said Haiven.

Erin Weir, an economist with the United Steelworkers’ Union who has publicly debated and frequently published online commentary about CTF, said the organization “represents the right-wing fringe of Canadian politics” and most often chooses which issues to emphasize based on ideology and not their impact on taxpayers.

CTF “uses issues like gun control and politicians’ salaries—which have almost no effect on overall government expenditures or tax rates—to foment distrust of public institutions,” said Weir.

Gaudet said CTF stands up for taxpayers against “special interests,” which he defines as “anybody who’s taking money from government, to a certain extent.”

“We look at all issues, all political issues, all public policy issues through a lens of government spending,” he said.

However, some of the Harper government’s most expensive recent policy decisions barely figure on CTF’s radar.

Gaudet was reluctant to criticize the federal government’s package of "tough on crime" legislation, even though, by the government’s own admission, there is no data to indicate that the new laws will reduce crime in Canada—while the cost of building new prisons and increasing sentences is estimated at $10 billion.

“Legislation ought to have cost impacts put out with it,” stated Gaudet, stopping short of more specific criticism of the legislation.

In comparison, CTF led an extensive campaign against federal prisoners receiving old-age pensions; the group claims the costs associated with inmates’ pensions total $14 million per year.

Gaudet did not question the government’s decision to purchase new F-35 fighter jets from a US multinational, despite a $16-billion price tag; although he did post to his Facebook and Twitter accounts saying the contract should have gone to tender. Several analysts have criticized the purchase on such grounds as the Canadian military's lack of need for such jets.

“I find that type of question [of whether the fighter jets are needed] usually to be the type of refrain from those interests who generally...don’t like Harper, period,” said Gaudet. Opposition comes “from a bunch of people who like to pretend to think they’re experts on the unique service requirements of the Canadian Air Force, as if they had some unique perspective into the minds of the generals that run the show,” he said.

On most issues, CTF indeed camps out on the far right of the Canadian political spectrum. Along with the Fraser Institute and the National Citizens’ Coalition, CTF was one of the few prominent voices in Canada to support the decision to abolish the mandatory long-form census, even though the replacement voluntary household survey may well cost more.

On the issue of climate change, CTF justifies its opposition to all government initiatives to reduce carbon emissions with a straightforward argument: “We don’t believe there’s such thing as man-made climate change,” said Gaudet, adding that initiatives such as “cap-and-tax” are in no way proved to reduce CO₂ emissions.

When it was noted that 97 per cent of scientists support the theory that greenhouse gases emissions are changing the climate, Gaudet challenged the Media Co-op. “I think you’re probably very selective, and this is part of the problem with the movement,” he said. “You get a bunch of Kool-aid suckers who choose not to actually do much work, and mainly focus on that amount of stuff that gets published that suits their own interests. I disagree with the characterization that there’s consensus [among scientists about climate change].”

It is worth noting that some of CTF’s campaigns could be seen to align with the political left. The group’s website denounces “corporate welfare,” and Gaudet listed the aerospace and automobile industries among the “special interests” it accuses of begging at the public trough, noting the millions of dollars doled out in government subsidies.

The group is “fairly consistent” in this respect said Haiven. “They just don’t think government should be spending money on anything.”

The group's website claims 74,000 supporters—a phenomenon Haiven chalked up to the financial situation many Canadians find themselves in.

“Average earnings of Canadians...have not kept up with inflation,” noted Haiven. “[People are] looking for ways to save money, and one of the easy places to look is taxation. That’s part of what’s driving the anti-tax movement... The average person is earning less money...and so the appeal to somehow save some money is very attractive.”

But, he said, anti-tax advocates are barking up the wrong tree. He pointed to a study he co-authored in 2008 with economist Mathieu Dufour that shows that although Nova Scotia’s economy grew by 62 per cent over 20 years—11 percentage points more than the national average—and workers’ productivity increased, their paycheques still shrunk by five per cent.

“The province is getting richer [in terms of GDP]...but working people are not getting richer—they’re poorer. So where is that money going? It’s obviously going into the hands of a few,” said Haiven. His 2008 study noted that across Canada, the incomes of the top five per cent of Canadian families increased sharply between 1982 and 2004 while those of the bottom 70 per cent declined.

“The Taxpayers Federation will tell you that government is getting richer, but that’s not true,” Haiven added. “Government has shrunk...all across the country—the size of government, compared to GDP, has shrunk.

“Their pronouncements tend to be sensationalist, so the media gravitates to it. Media feeds the public perception that we’re somehow overtaxed and government’s too big,” he said.

Christine Saulnier of the Nova Scotia office of the Canadian Centre for Policy Alternatives (CCPA), challenged the notion that CTF’s anti-tax message resonates with very many Canadians.

She pointed to a national poll commissioned by the CCPA in the fall of 2008, in which the overwhelming majority of respondents agreed that government should take concrete action to reduce poverty, raise minimum wages above the poverty line, and provide affordable housing—even if it meant “higher taxes or cuts in spending in other areas.” On nearly every question, Atlantic Canadians polled higher than the Canadian average.

“Yes [lowering taxes] resonates, but not with as many people as they say it does,” said Saulnier. “We’re not talking about the full implications of what it means to lower taxes. If we did, that would be a fairer debate. Then we’d see if it actually does resonate."

Saulnier is lukewarm about CTF’s pending arrival in Atlantic Canada.

“We’re about opening this debate,” she says. “We want to have a discussion about taxation.

“Having said that, I’m not sure it’s the Canadian Taxpayers’ Federation that can have that debate. We can’t have a discussion on taxation without talking about public services,” she said.

Weir noted that unlike think tanks, “the CTF does not produce research or analysis. Instead, most of its employees are essentially full-time media spokespeople.”

Weir remarked that while “the CTF presents itself as a grassroots movement...individual Canadian taxpayers cannot become members of the CTF, vote on its policy positions or elect its leadership.”

Gaudet defended the organization’s structure and grassroots credentials. The CTF functions “the way Greenpeace is run,” said Gaudet. “We don’t take government money. We exist by virtue of cheques from 74,000 people, usually small cheques, in the $50 to $300 range... [from] small businesses, mom-and-pop shops, farmers, for example.”

Saulnier hopes media coverage of CTF’s stance on issues will be fair, and the group’s aims transparent.

“We’re more often than not presented in the media as left-wing,” she said. “We are open about what our mandate is and we’d like the same from the other side.”

“I think we agree with some of [their priorities], like accountable government,” she added. “But we’d like to talk about who’s holding government accountable, and for what.”

Ben Sichel is a member of the Halifax Media Co-op, where this article wasoriginally published originally published.

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