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Conservative Leader Pierre Poilievre rises during Question Period in the House of Commons on Parliament Hill in Ottawa on June 13.PATRICK DOYLE/The Canadian Press

We would appear, as Woody Allen once said, to stand at a crossroads: One path leads to despair and utter hopelessness; the other to total extinction. (Let us pray that we have the wisdom to choose correctly.)

That, at any rate, is what one would gather from the rhetoric over the governments capital-gains tax proposal. On the one hand, according to the Finance Minister, Chrystia Freeland, the measure an increase in the share of capital gains subject to tax from 50 per cent to 66 per cent, though only (for personal income tax payers) on gains in excess of $250,000 is all that stands between us and, if not total extinction, then certainly despair and utter hopelessness.

What kind of a Canada do you want to live in? she asked opponents of the move, in a speech in Toronto on Sunday, the day before introducing enabling legislation in the House of Commons. Do you want to live in a country where kids go to school hungry? Do you want to live in a country where a teenage girl gets pregnant just because she doesnt have the money to buy birth control?

Do you want to live in a country, she went on, where those at the very top live lives of luxury, but must do so in gated communities behind ever higher fences, using private health care and airplanes because the public sphere is so degraded and the wrath of the vast majority of their less privileged compatriots burns so hot?

The premise, I gather, is that without the additional $19-billion over five years the measure is expected to raise, this is the future to which we are inexorably headed. I know what youre thinking: How on Earth could the Liberals have let things get this bad? Eight years in power, having spent a total of $3.3-trillion in that time, and the country is one paycheque away, as it were, from poverty and revolution?

For his part the Conservative Leader, Pierre Poilievre, was equally convinced of the disaster that awaits us if the capital-gains measure were to be implemented. This job-killing Trudeau tax, he said in a statement released shortly before the bill was introduced, will drive billions of dollars of machines, technology, business and paycheques out of our country. In a video posted online, he raised the stakes even higher. Businesses, jobs, doctors and food production will leave Canada, he predicted.

I know what youre thinking. If this is the kind of carnage the tax would inflict on the country, surely Mr. Poilievre plans to repeal it at the first opportunity. But in fact the Conservative Leader has made no such pledge. The Conservatives will vote against it in the House, but after that all bets are off.

Still, its newsworthy enough that Mr. Poilievre committed his party to oppose it. Since the measure was first unveiled in the April budget, the Conservatives had been conspicuously silent on the matter, seeming to validate Liberal hopes that they had forked the Conservative Leader: Either endorse the tax increase, and infuriate his base, or oppose it, and give up his populist pose as the friend of the working man.

The Liberals even went so far as to hive the capital-gains provision off from the rest of the budget, forcing the Conservatives to vote on it separately. Not until the last minute did the Conservatives declare their position.

You could see the Finance Minister working hard afterward to seize the advantage. The Conservatives are coming out against fairness, she crowed. Canadians are now seeing what side the Conservatives are on. The Conservatives are very clearly saying theyre against fairness, theyre in favour of the wealthy lobbyists who advise them. Liberals everywhere hugged themselves. Now at last they had them.

Have they? Had the Conservatives declared themselves opposed out of the gate, in the government-dominated news cycle that inevitably follows any budget, that might well have been the effect. But the passage of two months has given them some breathing room.

The Liberals contention, that the measure would only apply to the top 0.13 per cent of taxpayers, has been shot full of holes. That may be the share of the population reporting capital gains in excess of $250,000 in a given year, but over their lifetimes a much larger proportion will do so at least once. The increased inclusion rate, moreover, applies to the first dollar of capital gains earned by corporations which would include the 300,000 Canadians who have incorporated themselves.

So the Liberals own position the tax increase is existentially important, but will have no impact on anyone but a handful of the super-rich has looked increasingly untenable. If that were true, why are so many of the non-super-rich doctors, farmers, small businesses so upset by it?

That so many of these groups had already lined up against the tax by the time the Conservative Leader declared his position, then, may not have been as discomfiting as all that. He can vote against the tax increase today, and accept their plaudits, without committing himself to do anything in particular with it should he become prime minister. That gives him time to devise an alternative.

Indeed, the most significant, and fortuitous, outcome of the weeks exchange of fire may prove to be Mr. Poilievres other announcement: that within 60 days of taking office he would appoint a task force to design what sounds suspiciously like comprehensive tax reform one that would lower taxes on work, hiring and making stuff, with the revenues made up, in part, by cutting corporate welfare, presumably including corporate tax breaks.

This is exactly the right response. Leave aside the ludicrous class-war rhetoric and pleas of poverty this, from a government that already spends more and taxes more, in constant dollars per citizen, than any government in the history of the country offered in its defence: Raising the inclusion rate on capital gains, as the Liberals propose, is good policy, on its own.

The reason taxpayers dont pay tax on the whole gain, remember, is to compensate for the tax already paid on the same income at the corporate level. At a 50-per-cent inclusion rate, however, the system overcompensates: The combined rate of tax, corporate and personal (and federal and provincial) works out to about 46 per cent, seven points lower than the 53-per-cent top rate on income generally. Raise the inclusion rate to 66 per cent, and the gap all but disappears.

Thats good, both in terms of fairness (why should people who make their money buying and selling stocks and other assets be taxed less than those who earn it by their labour?) and efficiency: You want people to make economic decisions based on the real costs and benefits of different alternatives, not because of the tax breaks attached to each.

The problem with the Liberal proposal, then, is not that capital gains should not be taxed at the same rate as other income. Its that thats all they did. Raising the tax on capital gains may make the system more efficient in one way, but its still a tax increase, which makes the system less efficient in other ways.

The proper way to oppose such a measure is not to reverse it once it has been implemented, but to embed it in a broader tax reform as the Liberals should have, but failed to do. Mr. Poilievre has talked generally of tax reform in the past, but this is the first time I can recall that he has committed himself to it in such concrete terms, even if the specifics of the reforms are to be left until after the election.

If he is prepared to be bold, however, he has the opportunity to do much good: if not by assuaging the particular complaints of capital-gains earners, then by improving incentives to work, save and invest generally.

The reference to corporate welfare may sound like a throwaway line, but in fact there is a massive amount in that particular kitty. Between explicit subsidies and the various preferences built into the tax system, the economist John Lester after a career with the federal government, latterly as director of research for the Expert Panel Review of Federal Support to Research and Development, he knows where the bodies are buried puts the total at $40-billion. He estimates about 80 per cent of this serves no useful purpose or is actively harmful and should be cut. Lets say 50 per cent of it was: Thats $20-billion that could go to cutting taxes.

There are similar amounts to be found on the personal income tax side: the non-taxation of capital gains on principal residences, worth about $6.5-billion annually; the age tax credit ($5.5-billion); the Canada Employment Credit ($3.2-billion); the non-taxation of employee health and dental benefits ($4-billion); and the charitable donations tax credit ($3.8-billion).

How much could tax rates be slashed with this kind of dough? The Parliamentary Budget Officers Ready Reckoner webpage offers a clue. You could collapse the current five tax brackets (15, 20.5, 26, 29 and 33 per cent) into three (15, 25 and 29), I calculate, at a cost of $22-billion. For another $19-billion, you could cut the general corporate tax rate from its current 15 per cent to 9 per cent (the same as the small-business rate: alternatively, you could make them both 12 per cent for less than half the cost).

Many of these examples might seem politically unfeasible viewed in isolation. But the lesson of past tax reforms, both those that succeeded and those that failed, is that broader, deeper reform is not only better in policy terms: Its more saleable politically. The losers from any reform are always going to hate you, no matter how lightly their ox is gored. The key is to create many more winners than losers.

The Liberal capital-gains tax hike may not prove to be the political winner they had hoped. It may not be to everyones liking as policy. But if it spurs the Conservatives to offer a broader tax reform plan in response, it will have done the country a favour.

The rest is here:
Opinion: Poilievre wriggles out of the Liberal trap, with a commitment to much broader tax reform - The Globe and Mail

Why is it that a substantial body of social science research finds that conservatives are happier than liberals?

A partial answer: Those on the right are less likely to be angered or upset by social and economic inequities, believing that the system rewards those who work hard, that hierarchies are part of the natural order of things and that market outcomes are fundamentally fair.

Those on the left stand in opposition to each of these assessments of the social order, prompting frustration and discontent with the world around them.

The happiness gap has been with us for at least 50 years, and most research seeking to explain it has focused on conservatives. More recently, however, psychologists and other social scientists have begun to dig deeper into the underpinnings of liberal discontent not only unhappiness but also depression and other measures of dissatisfaction.

One of the findings emerging from this research is that the decline in happiness and in a sense of agency is concentrated among those on the left who stress matters of identity, social justice and the oppression of marginalized groups.

There is, in addition, a parallel phenomenon taking place on the right as Donald Trump and his MAGA loyalists angrily complain of oppression by liberals who engage in a relentless vendetta to keep Trump out of the White House.

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Opinion | The Happiness Gap Between Left and Right Isn't Closing - The New York Times

Columbia University president Minouche Shafik is, on paper, a very impressive person. She has been a vice president at the World Bank, a deputy managing director at the International Monetary Fund, deputy governor at the Bank of England, and director of the London School of Economics. She has served on the boards of the British Museum and the Bill and Melinda Gates Foundation, and was named a Peer of Her Majesty Queen Elizabeth the Seconds United Kingdom in 2015.

In 2021 Shafik published What We Owe Each Other: A New Social Contract for a Better Society. True to its hypercredentialed author, the book was celebrated by some of the biggest names in international economics and social policy: European Central Bank President Christine Lagarde, World Trade Organization Director General Ngozi Okonjo-Iweala, European Commission President Ursula von der Leyen, Financial Times columnist Martin Wolf, and the American philosopher Michael Sandel, to name fiveall of whom attested in some way or another that Shafiks little book was indispensable for building a better world.

Few early readers of What We Owe Each Other could have imagined that its author would, within a few years, propel herself to the authoritarian vanguard of U.S. politics. Fewer still would have guessed that the vector for this metamorphosis would be a major American university. But Shafiks disastrous tenure at Columbia has exposed undemocratic currents flowing through the elite milieu that once celebrated her. Read as the memoir-manifesto of a woman who turned riot police on unarmed students, What We Owe Each Other serves as an unwitting guide to the intellectual precarity of the reigning liberal ordera document revealing what can go wrong when liberals treat democratic legitimacy and public consent as merely incidental elements of the liberal political project.

The book would be less harrowing if it were simply devoid of insight. But beneath the Obama-era bank director clichs (Automation! Nudge! Secular stagnation!), Shafik conveys a handful of solid policy proposals, emphasizing that nice-guy humanitarian impulses often turn out to be good for economic growth and productivity. She wants higher taxes on capital and better benefits for labor; longer parental leave and more state support for parents; affordable education and quality health care for all. The world would be a better place if more peers of the realm were on board with the books agenda.

But Shafik bills What We Owe Each Other as a new social contract, invoking the tradition of Thomas Hobbes, John Locke, Jean-Jacques Rousseau, and John Rawls. Social contract theorists are interested in much more than policy wonkery. They try to define the bounds of legitimate government by asking how individuals in an ungoverned state of nature would agree to be governed. For Hobbes, the state of nature was so violent and chaotic that rational individuals would readily consent to the authority of an absolute monarch to establish law and order. For Locke, the state of natures material bounty meant that governments were required to respect the natural rights of individuals, including the right to own private property. Rousseau arrived at democracy by envisioning a state of nature populated by peaceful and compassionate noble savages, while Rawls declared that social inequality could be justified only if inequality improved the living standards of the worst-off. (It might, for example, be OK to pay doctors more than migrant workers because even societys poor residents benefit, ostensibly, from a functioning medical system.)

Although these different thinkers reach very different political conclusions, they are alleven Hobbesoperating within a fundamentally democratic paradigm: Governments are justified by some kind of appeal to the consent of the governed; the state of nature is the key philosophical tool for establishing how people reason through their rights and obligations to each other.

It is striking, then, to see that Shafiks social contract doesnt involve a state of nature at all and isnt actually a deal that individuals reach with other individuals.

When I refer to the social contract, therefore, I mean the partnership between individuals, businesses, civil society and the state to contribute to a system in which there are collective benefits, she writes.

In one blithe sentence, Shafik assumes into legitimacy the major institutions of liberal modernity and declares them partners in a cooperative project, without inquiring into whether or how these institutions might be democratically justified. What we owe each other ends up depending a lot on where we live, what institutions we are affiliated with, and how those institutionssay, for instance, Columbia Universityare governed. How these institutions resolve internal disputes is at most a sideshow; how they might fit into a narrative about free individuals choosing their future together is not even contemplated.

Shafik is, to be clear, calling for institutional reforms. She rejects the state-vs.-market dichotomy. She wants to see institutions bearing more collective risks and individuals receiving more of societys collective output. The successful businesses of the future, she argues, will operate with an eye toward social responsibilities beyond short-term shareholder profits, and ultimately find themselves better regulated and better off.

Enlightened companies will increasingly see environmental sustainability, paying their fair share of taxes and commitment to their employees and communities as central to their strategies, Shafik writes. Investors, meanwhile, will increasingly factor such commitments into their valuations of firms share prices, and financial markets will reward firms that manage these risks intelligently.

All of this sounds very nice and would no doubt be an improvement from the privateering corporate status quo. But which of these various public duties will the successful business prioritize? What should investors do if, say, labor and environmental interests conflict? How might other institutionsColumbia University, perhapssort out competing claims? What can different members of the university community reasonably expect from their schools investment management? What rights do individuals outside the formal management hierarchy have when they want to change the way an institution operates? Where does change come from, and when is it legitimate?

These are not easy questions to answer, and Shafik doesnt do so. Instead, she pivots from talking about the social contract to discussing social contracts of varying generosity that whole countries, rather than individuals, can choose from, depending on the balance of power between people and institutions that happens to prevail. Its an extraordinary philosophical bait and switch in which Shafik substitutes a variant of neoliberal economics for the democratic considerations of social contract theory. Shafik clearly feels real sympathy for the downtrodden, but her narrative is not about self-government, consent, or consensus. What We Owe Each Other is essentially a lengthy meditation on the observation that greater economic productivity will enable more generous social contracts.

I like improved productivity as much as the next Excel dweeb, but this results in some really weird musings on politics. In most countries today the evolution of social contracts depends on the structure of the political system, Shafik writes. Democracies tend to be better at delivering longer lives for their citizens and better economic outcomes, but selectorate countriesShafik cites China as an examplecan also deliver effective outcomes for their citizens. After some hemming and hawing, she concludes, Achieving a better social contract is ultimately about increasing the accountability of our political systems. How this happens will vary between countries. OK!

Shafik mentions free media once, in her final chapter, as part of a description of real-world democracies, and includes the phrase safeguards of freedoms of association and collective action in a graphic on Page 178. Otherwise, there are no discussions of free speech or free press in the book. The word dissent does not appear.

One particularly striking aspect of the state-enforced repression sweeping Americas universities is that so much of it is being ordered by people who are supposed to be the good guys in standard liberal accounts of todays political quagmire. University of Virginia President Jim Ryan was the author of a good book on segregation and education before he tear-gassed his students. Joe Biden has made some genuinely moving speeches on the highest ideals of the American political tradition, and he really has overseen the best U.S. economic performance in at least a generation. But when police started arresting pro-Palestinian students at dozens of campuses nationwide, Biden smeared the protesters and defended the crackdown by declaring that dissent must never lead to disorderan axiom worthy of King George III. Liberal leaders seem to know what to do when democracy is threatened from withoutnothing focuses the mind like a glowering autocrat. But throughout the campus crisis over Gaza, liberal leaders in the United States and Europe have repeatedly failed to maintain liberal values when they are challenged from within.

Over the course of the school year, Shafik steadily escalated student protests over Israel into an intractable institutional conflict. Today Columbias donors and its administration are essentially at war with the schools faculty and student body. Students want Columbia and its endowment to divest from Israel, and they keep appealing to democratic processes and procedures to illustrate the legitimacy of their demand. In addition to establishing encampments, theyve submitted a referendum on divestment to the Columbia College student bodythe universitys undergraduate liberal arts schooland received a vote overwhelmingly in support. Shafik, meanwhile, has invoked her institutional authority to deny that demand, and called on the state to enforce her authority. To win her most recent battles, Shafik has basically had to shut down the school: This years graduation ceremony is canceled, and its hard to imagine Shafik enduring any event where students and faculty would congregate.

Columbia, it seems, could benefit from an updated social contract.

Continue reading here:
Columbia protests: I read the university president's old memoir-manifesto. Yikes. - Slate

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Conservative Leader Pierre Poilievre speaks at the National Prayer Breakfast in Ottawa on May 7.Sean Kilpatrick/The Canadian Press

Ever since the Liberals unveiled their surprise increase in the capital-gains tax in last months budget, the question on everyones lips has been: what will Pierre Poilievre say about it?

Well, maybe not on everyones lips. But certainly on some peoples. Conservatives, for instance. After all, conservatives are supposed to be against taxes and tax hikes, of all kinds. And leaders of the Opposition are supposed to oppose.

Surely the Conservative Leader would have to take the bait. Otherwise he would have to explain to his followers why he had once again failed to oppose the governing Liberals on a major question of economic policy as he had failed to do on subsidies for electric vehicle batteries, for example, or on the ban on replacement workers.

Well, the days have just flown by, and at last we have our answer. Intriguingly, its: What are you asking me for? Only instead of a craven abdication of leadership, the talented Mr. Poilievre has managed to turn it into a boast, even a philosophical credo.

In a striking piece in Fridays National Post, Mr. Poilievre acknowledges that, indeed, investors and business leaders have been pressing him to lead the charge on the capital gains issue. Why, theyve fairly been blowing up my phone.

They yelp: What are you going to do about this?

My answer: No. What are you going to do about it?

Whoa. Who saw that plot twist coming? But theres a point to it. Business, he complains, has been too content to roll over in the face of Liberal attacks on investment and entrepreneurship. Gutless executives prefer to suck up to the Liberals, relying on their useless and overpaid lobbyists rather than taking their case directly to the voters.

Got a beef, then, with the Liberals? Youre on your own. Why should I sell your bleat?

This represents an evolution in the populist, anti-corporate pose Mr. Poilievre has been trying to strike of late. Read quickly, it might even look like Mr. Poilievre is giving business a bit of tough love, urging them to show greater self-reliance, less dependence on government.

And its true: business has been all too willing to cozy up to the Natural Governing Party over the years, accepting destructive and intrusive government regulations as the price of government handouts. Any leader that put a stop to this sordid exchange would earn the thanks of a grateful nation.

But if that was what Mr. Poilievre meant he could have said so. He might have said:

Dont bother coming to a Conservative government for handouts, because we wont give you any.

And dont waste your time lobbying a Conservative government, either. Were going to do whats right for Canada, whether business likes it or not.

So: You mind your business, and Ill mind mine. Ill stay out of business, and you stay out of politics.

But that is not what he says in the piece, is it? He doesnt say he will stop giving handouts to business. And far from telling businesses to stay out of politics, hes effectively demanding they enlist on his side.

On the one hand, he warns that he wont take up any of their policy proposals unless business has already sold the public on it:

[Business] will get nothing from me unless they convince the people first When they start telling me about your ideas on the doorstep in Windsor, St. Johns, Trois-Rivires, and Port Alberni, then Ill think about enacting it.

On the other hand, on those policies he does take up, he wants business to provide him with political cover:

If I do pursue your policy, I expect that you will continue to advocate for it with those same Canadians in those same neighbourhoods until the policy is fully implemented.

As campaign messages go, its pretty nervy: I wont lift a finger for you if it involves the slightest political risk to me. But I expect you to carry water for me, for as long as it takes.

Its not that he wants business to stop sucking up to the Liberals, in other words, so much as that he wants them to start sucking up to the Conservatives: preparing public opinion for policies he can then adopt in safety, and campaigning for them and by implication him until they have been adopted.

Notice the language, too. I, me, my. If I pursue your policy. I expect. Start telling me.

I get it: hes on a roll. He obliterated his rivals in the leadership race. Hes 20 points ahead in the polls. Not only does he not owe business any favours, but hes in a position to start issuing demands.

But I cant be the only one left with the impression that it all seems to have rather gone to his head.

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Opinion: Poilievre to business: stop sucking up to Liberals and start sucking up to me - The Globe and Mail