Gen Squeeze thinks it’s really important for governments to budget fairly for older and younger generations alike.
That’s why we analyzed the election platforms of the Conservatives, Greens, Liberals and NDP to understand which ones were doing this the best. We even gave the parties scores on how well their election promises will deliver, which you can find in our fedElxn'19 Voter's Guide.
Like with other platform analyses Gen Squeeze has done this election, the idea wasn't simply to break down what each party has committed to (though we do that), it was to assess how far the party platforms go towards meeting our budgeting goal.
Unfortunately, most party commitments fail to promote this kind of intergenerational equity in public finance, although one party has made more meaningful commitments than the others.
Three of four parties promise a free lunch on young people’s (and future generations’) dime
The Greens are the only party of the four analyzed that have committed to balance the federal books by the end of the next federal term of office (2023/24).
That means the Conservatives, Liberals and NDP will pass on today’s bills (the largest of which are incurred by our aging population for medical care and retirement income support) to their kids, grandchildren and future generations.
It’s worth noting that the Green party currently does not include a clear cost estimate for the guaranteed livable income it promises, which is bound to have a big price tag. So while the party deserves credit for at least committing not to run a deficit that would pass unpaid bills on to younger Canadians and future generations, the fiscal plan it presents is not yet rock-solid.
Parties aren’t committed to raising revenue fairly between generations
Parties are struggling to balance the books in part because they haven’t committed to raising revenue fairly between generations. Many who bought homes some decades ago have gained a great deal of wealth thanks to skyrocketing home prices. This has happened while wages for younger Canadians have stagnated.
No parties have committed to reducing income taxes on middle and lower earnings by increasing housing wealth taxes (of some kind) to acknowledge this massive increase in wealth that has been accumulated by many home owners, often older generations. Designing our tax systems to account for these wealth disparities could help balance the books and pay for new programs – like Pharmacare.
Multiple parties are talking about bringing pharmaceuticals into our public health care system, especially the Greens and NDP who are promising to spend $10 billion+ more per year to make this happen. This investment is needed by and will benefit retirees and older Canadians perhaps the most. However the revenue system to pay for Pharmacare must be designed in a way that explicitly addresses the fact that today’s retirees haven’t pre-paid into a Pharmacare plan in the way they have the Canada Public Pension plan. If this isn’t considered, Pharmacare risks passing large bills on to younger Canadians and future generations. So far no party has grappled with this potential challenge. This is especially problematic for the Greens and NDP, which have committed more new money to Pharmacare than (nearly) any other commitment in their platforms.
Three of four parties aren’t promising to invest fairly between generations
At Generation Squeeze, we propose that spending on child care, parental leave, income supports for families with kids, and postsecondary should grow at least half as fast as spending on income supports and medical care for retirees. (To be honest, one could argue that spending on younger Canadians should grow as fast as spending on priorities for the aging population. But we are open to incremental improvements).
So far, the Liberal, Conservative and NDP platforms won’t come close to meeting this benchmark. The Green party does.
Most parties agree pollution shouldn’t be free
The platforms reveal that most major parties commit to the principle that pollution shouldn’t be free, except one. This is important because when polluters don’t pay, they pollute more, which puts in jeopardy the health of those who still need a stable climate – younger Canadians and future generations!
So far, the Green platform makes the strongest commitments to lead Canada to a better, greener economy by 2030 as recommended by the Intergovernmental Panel on Climate Change. This includes setting a broad-based, revenue-neutral carbon fee on all sources of carbon dioxide pollution that is sufficient to incentivize citizenry and industrial adaptations at levels that will meet recommended scientific targets for decarbonization by 2030. Revenue from its carbon fee will be returned to Canadians as a dividend.
Building on the federal backstop price on pollution that it launched this year, the Liberals currently plan for carbon pollution to be priced eventually at $50/tonne, and to use this revenue to reduce income taxes so that the majority of people save more income taxes than they pay in carbon prices. It’s not clear, though whether the Liberals would do this at a rate that will be sufficient to achieve enough decarbonization of our economy by the timelines established by scientific experts.
The NDP will stick with the Liberal plan, and address some concerns that larger industrial polluters are being left off the hook by comparison with regular Canadians.
The Conservative party says it will eliminate the federal price on pollution, a position that cost them points as it’s out of alignment with scientific consensus on how to deal with climate change.