Equalization math 2: net benefits of the Equalization Programme

As I mentioned in my first post on equalization (here), equalization is a federal programme that is funded by federal taxes. The 'share' of the cost that falls to each province is roughly equivalent to share of the country's total taxation that that province pays.

Roughly 13% of federal taxes are collected from Albertans. Therefore, 13% of the cost of equalization is born by Albertans. Quebecers pay about 20% of federal taxes, and therefore fund 20% of the equalization. The difference, of course, is that the Quebec government gets an equalization cheque and Alberta doesn't. (This isn't accidental--that's the way the program was set up to run.)

This table attempt to sketch out in a rough way where the net benefits are. Each province's share of the tax burden is assumed to be their share of the cost of equalization.

	% of tax burden*	Program cost (mil.)	Benefit (mil.) 2003/4	Net benefit (mil.)	pop. (2001)	net benefit per capita
Nfld	1.05%	$113.00	$766	$653.00	512,930	$1,273.08
PEI	0.28%	$30.60	$232	$201.40	135,294	$1,488.61
NS	2.27%	$247.20	$1130	$882.80	908,007	$972.24
NB	1.68%	$183.10	$1142	$958.90	729,498	$1,314.47
Que	20.70%	$2,256.00	$3764	$1,508.00	7,237,470	$208.36
ON	44.24%	$4,822.50	0	$(4,822.50)	11,410,046	$(422.65)
MN	2.85%	$310.80	$1336	$1,025.20	1,119,583	$915.70
SK	2.42%	$263.00	0	$(263.00)	978,933	$(268.66)
AB	12.33%	$1,343.00	0	$(1,343.00)	2,974,807	$(451.46)
BC	11.75%	$1,280.90	$590	$(690.90)	3,907,738	$(176.80)
Yuk	0.08%	$8.80	0	$(8.80)	29,900	$(294.31)
NWT	0.14%	$15.60	0	$(15.60)	40,000	$(390.00)
Nun	0.06%	$6.60	0	$(6.60)	27,400	$(240.88)

The pattern is one that is fairly well-known. Ontario makes the largest contribution to equalization, which is perfectly appropriate given that it is almost half the country's economy; Alberta makes a large contribution given its size (13% of the cost, though having only 10% of the country's population); BC and Saskatchewan pay in more than they get out. Quebec receives the largest cheque, but on a per capita net basis the sums are quite modest.

*Note: the share of taxes is an old number and reflects only federal income taxes. So this table is useful only for illustrative purposes. If you know more recent or exact figures, by all means mention them and I'll update the table.

Update. Andrew Spicer conducted a similar exercise here and got roughly similar results. (I suspect that his numbers are better than mine.)

Welcome to Bouquets of Gray

This is my second blog. The first, which was dedicated to discussing the Gurmant Grewal tapes, was more successful than I'd expected, and, given the amount of information that became available about the Grewal Affair, it became clear that if I continued to post on other questions, my work on Grewal would soon disappear into the mysts of time. Instead, I've decided to leave Buckets more or less as it is, and create a new blog. Here it is.

Down in the archives you'll find some old posts that I've moved from the Buckets site that were not related to the Grewal affair.

Equalization math

Several bloggers have already noted the new call for Alberta to separate made by Leon Craig, an emeritus professor of political science from the University of Alberta. (See especially the discussion of Muck Shoveller, a former student of Craig, here and, especially, here.) Prof. Craig has published an essay with the folksy title, 'Let's get while the gettin's good', which begins with this paragraph

To be sure, the $250 million of graft involved in the Adscam racket is but a small portion of Alberta’s annual donation to keeping Quebec tenuously tethered to the rest of Canada, barely a week’s contribution of the $12 billion Ottawa sucks out of Alberta every year in “equalization” payments (which the Liberal party then uses to buy votes east of Cornwall), a mere $60 of the almost $3,000 that every man, woman and child in Alberta pays per year for the privilege of remaining in a federation governed for the benefit of Ontario, Quebec and cronies of the Liberal Party of Canada.

The prose is, frankly, pretty sloppy, and its invective cliché, but let's leave that aside. Instead let's concentrate on the math behind his characterization of what equalization costs Alberta. Prof. Craig asserts two things here: (1) that equalization costs Alberta $12 billion per year, and (2) that this is 'sucked out' of Alberta in '"equalization" payments. (I'm not sure why he uses quotes here; perhaps someone can explain.) On the Buckets Truth Index, both statements sit somewhere between highly misleading and rank nonsense.

First, Craig mischaracterizes equalization payments. Alberta does not make any equalization payments--check its annual budget and public accounts if you don't believe me. Equalization is a program in which the Federal Government makes payments to some, but not all, of the provinces. At the moment there are eight provinces that qualify--all but Ontario and Alberta. (If you need to review the facts about this program, see here.) It cost $8.7 billion per year in 2003-4 (here), which is about 4.6% of the federal budget of $189 billion. Where do the Feds find this money? Out of the federal budget, which comes from federal taxation, which Canadians from all provinces pay.

Second, Craig is obviously wrong to imply that Alberta's share of equalization comes to $12 billion--which would be truly remarkable for a program that costs $8.7 billion. What is Alberta's share? Strictly speaking, of course, Alberta doesn't have a share, since it makes no payments. The money for the program comes from the federal taxes paid by individual and corporate Albertans. Now, we could roughly calculate what Albertans collectively pay towards equalization, since figures are available for share of federal taxation by province. The ones I have to hand are out of date (2000, I think) and are only federal income taxes, but they should give us a rough idea:

• Nfld 1.05%
• PEI 0.28%
• NS 2.27%
• NB 1.68%
• Que 20.70%
• ON 44.24%
• MN 2.85%
• SK 2.42%
• AB 12.33%
• BC 11.75%
• Yuk 0.08%
• NWT 0.14%
• Nun 0.06%
• foreign 0.15%

So, Prof. Craig raises the question of how much Alberta is paying towards equalization. Albertan's share will be equal to its share of total federal taxation, or 13% (rounding up). The total budget for the equalization program in 2003/4 was $8.7 billion. 13% of that is $1.1 billion. Not a trifle, but only a small fraction of Prof. Craig's $12 billion.

What went wrong with Craig's math? Did he slip a decimal point? I will try to return to this in a future post*, only pointing out here that it's a good thing that Prof. Craig taught Political Science in university rather than math in high-school.

*For this post, see here

Satorial snarkiness

If you haven't seen it yet, go check out My Blahg'ssartorial attacks (complete with pictures). Especially praiseworthy is that Robert is an equal opportunity drive-by shooter. Ah, the things that bring us Canadians together.

Right 'Ho' sells himself for traffic!

Over at Right Ho!, we see just how far a once respectable blogger will stoop in order to increase his 'traffic'. First, he joins the Blogging Tories (see here); now he works a gratuitous Harry Potter reference into a title to generate hits. These surely are the blogging equivalents, respectively, of putting on the fishnets and heels and leaning into car windows. Now at last we know what the 'Ho' part means! (For a more innocent explanation, see here.)

(Of course, in broadcasting his, um, 'services', I could be accused of pimping … nah ... couldn't happen.)

How typical are Blogging Tories?

Over at Progressive Bloggers, Scott Tribe has a diary entry asking how much influence Blogging Tories have within the Conservative Party and concludes that their influence is minor.

There is, however, another side to this question that Scott mentions tangentially, but doesn't explore. Are the views espoused at BT typical of the Conservative party?

I dont think we should be getting into the same pattern over calling all the Conservatives xenophobes or whatever just because we see a few of their bloggers state what we consider to be idiotic remarks.

Now, if Monte Solberg starts saying stupid stuff like that, and/or high ranking Conservative Party members, then we need to get concerned. But not til then.

Fair enough. But what are we supposed to do with, say, Vitor Marciano? He is on the National Council of the CPC. How different are his views from those of the Blogging Tories generally? If you were to judge him by the BT posts he recommends to his readers, you'd have to assume that he approves of many of BT's least attractive posts. And if a member of National Council approves, should we not conclude that this is (sadly) reflective of something in the party and its activists?

Fake separatism will not work

There is a recent column of Link Byfield in the Calgary Sun advocating Alberta separatism. The article has gotten a mixed reaction. An interesting one is offered by M.K. Braaaten, who decides against separatism but recognizes its potential advantages:

However, I guess there could be some benefits of having a separatist party - and it’s precisely not to separate but to use it as leverage against the federal government. I mean, look at Quebec, they have done it for years and they have yet to separate. Quebec has used the threat to extract huge sums of money and power from Ottawa. If Alberta had a credible separatist party I’m sure Alberta wouldn’t leave because it would be given enough clout in confederation that it wouldn’t want to leave (similar to Quebec). If only we could find a separatist party leader that promised to never actually separate but to only use for power, then Alberta would be set.

And here, of course, is the problem with the whole endeavor. Alberta Separatists cannot seem to make up their mind whether they are really separatists or whether they are only pretending to be separatists in order to get leverage in Ottawa. But in saying that their goal is leverage, they give away the fact that they don't want to separate and destroy any leverage that they ever could have had.

Let's indeed look at Quebec, which has had some leverage. Whatever leverage they get out of separatism is due to the fact that their separatists seem to be sincerely interested in separation. They don't muse aloud about the fact that all they want is leverage in Ottawa.

Arguments I hate, pt. 1: hypothetical hypocrisy

One of the exasperating things about reading political blogs is the low level of argumentation that we find. There is too much name-calling and cheap-shots, and not enough thinking of high quality. This is a point that I suspect most bloggers agree with, although most of us find it easier to identify posts that offend against this when they are made by the other side. Such is human nature.

It struck me thta it would be helpful to create a taxonomy of false arguments that we all (left, right, and center) might try to avoid.

With this in mind, I offer the first 'argument I hate', which I dub 'hypothetical hypocrisy'. This argument begins with a political or moral position of its target; a hypothetical situation is concocted into wihch the target is placed; the target is imagined to act against their original position and is condemned for hypocrisy.

A classic example of this came a couple weeks ago when Laurie Hawn, conservative candidate in Edmonton-Centre, wrote a post with the title 'A conflict hypocrisies', which included this swipe at Jack Layton:

Okay everyone, hands up all who think that Canada's federal socialist leader, Jack Layton, would put himself at the back of the queue if he (or his wife) needed an MRI. I didn't think so.

The original post was worded slightly differently, causing a controversy about name-calling, but let's leave that aside, and whether it is true (which it probably isn't: Layton's wife is undergoing cancer treatment and apparently gets no special consideration). What is noteworthy is the unfairness of the argument. Layton is placed in a hypothetical situation, imagined to have acted hypocritically, then condemned for hypothetical hyprocrisy. In essence, it is as if I said 'X says theft is wrong; but if his family were starving, surely he would steal; therefore x is a hypocrite'.

This argument comes in various forms, and I invite people to include examples (left, right, and center) in the comments.

What to do about terrorism?

There are many blogs from left, right, and center condemning today's bombing in London. This is surely something that everyone in the Canadian blogosphere joins in condemning.

There are differing ideas about what should be done in response. There will inevitably be calls for military action--though the inevitable question is how to pick the target and the unfortunate possibility that some military actions will only become a recruiting tool for the enemy. So, too, police actions. Some will call for action to remove 'the causes of terrorism'. But what are those? Supposing that the ideology behind this recent outrage was caused by a lack of freedom, democracy, or any other good strikes me as extraordinarily naive. The one course we can agree on is to denounce it. But words are insufficient, and since part of the terrorist strategy is to seek publicity, terrorists are likely to believe that the harsher the condemnation, the better.

The sad fact of terrorism is that, like being in quicksand, almost anything that we do will make it worse. Yes, let us improve internal security. Yes, let us strengthen our intelligence and arrest those whom we can catch. And, yes, destroy the infrastructure where we can. But the best revenge, as they say, is living well.

More on our flag

The last few days have seen several discussions about Canada's flag and its origins, largely in response to recent Conservative complaints that our current flag has an especially Liberal heritage.

When we're having this discussion, it is worth looking at an important influence, the flag of the Royal Military College.


This places the college's coat of arms on a white background between red bars. From the Royal Military College site:

The design of the RMC flag proved to be instrumental to the final selection of the Canadian flag in 1965. In fact, the former RMC Dean of Arts, Deputy Director of the Army Historical Section and author of the book The Story of Canada's Flag (Ryerson, 1965), the late George F.G. Stanley, writes that during the great flag debate in 1965, he suggested that the design of the RMC flag be used as the new National flag, substituting the College crest for the styled red maple leaf. From his idea came the flag we know today.

Church clamp down a two-edged sword

The Catholic church, as has been fairly widely reported (see, e.g., here), has begun to punish MPs who had voted for same-sex marriage and against Catholic doctrine.

Many bloggers have commented on this. Those who supported ssm were appalled; those who were opposed, enthused. My view is that the RCs (and other churches) are free to use the whip on their members if they like. But I think they would be wiser not to. There is a potential back-lash here that I think they should be wary of. It was not long ago that JFK had an uphill argument to make in trying to convince protestant America that although a Catholic he did not take marching orders from the pope. Now, the church seems to be saying that all Catholic politicians should do precisely this. But does this mean that we have to begin scrutinizing Catholic politicians more closely than others in order to find out whether they are going to impose church doctrine concerning abortion, divorce, birth control, etc., on the rest of the country? If that process begins, I can only assume that it will work to the detriment of the Church.

Canada-haters, honest critics, and separatists

Over at BlogsCanada, Jim Elve calls on the right to quash Canada-haters, pointing to the collection of comments collected by Peace, Order, and Good Government. The discussion continues, and several commentators point out that many of the anti-Canada posts are not anti-Canada per se, but critical of various aspects of our character and polity, an act that need not be interpreted as anti-patriotic.

The 'smoking (shot)-gun' for the charges of Canada-haters come from comments to several entries in the Western Standard's blog (here and here). I choose several examples that I think illustrate different attitudes. First,

"In short, a Canadian Liberal is a liar, a thief, a bigot, and narcissist, but accuse others of the same. A Canadian conservative is an honest, hardworking person who just wants to make a living and provide for their family."

This post gives us no grounds to complain about anti-Canadianism. This is merely a piece of partisan polemic asserting the virtue of its political soul-mates and the vices of its opponents. This is not anti-Canada, but anti-Liberal. Compare this to

"I'm ashamed to be Canadian. Ashamed of our refusal to assist others, whether it be in the fight against terrorism or our fake committments to the tsunami relief. Our refusal to reform the UN but to instead be an intimate part of its corruption. I'm ashamed of our consistent smug superiority, our condescension to others and our utter ignorance of the hard realities of the world."

Again, I don't think this is necessarily the post of a Canada-hater. Instead, it is someone who is disappointed in a series of political decisions that Canada's government has made over the last decade or so. My third case, however, is something different.

"No one can detest Canada more than I. It's racism, fascism and apartheid are all too obvious. The sooner Alberta leaves this putrid dictatorship, the better off our people will be."

Here, of course, is a Canada-hater: he self-identifies. Nothing could be clearer.

The calls made by Jim Elve, POGGE, and (I'm sure) others that conservative bloggers to quash anti-Canadianism misses the mark. The problem is not so much anti-Canadianism but separatism, and a tendency of conservative commentators to try to use the rise of separatism for their own political ends.

[Edited and revised]

The new flag debate

Over at BlogsCanada, Scott Tribe points out the recent anti-flag stance being increasingly taken by some Conservatives. Ezra Levant, for example, has denounced our current flag as 'Liberal':

Canada Day replaced Dominion Day the way the Liberal-red Pearson Pennant replaced the Red Ensign

Scott quite correctly points out the weird a-historicity of this. The Maple Leaf had been a symbol of Canada long before it was made our flag. Look at the accompanying picture of the war medal awarded to participants in repelling the Fenian raids in 1866. There is nothing very remarkable about the medal--with Queen Victoria on the obverse, a flag of victory on the reverse. But look at the field. What's that? Maple leaves. Indeed, this is the only thing about this medal that iconigraphically identifies it as 'Canadian'.

The same point could be made from the cap badge from World War I to the left. What is Canadian here? Again, it is the maple leaf. And here the maple leaf has taken over the whole medal. Clearly, then, the maple leaf was regarded as a national symbol long before it became our flag in 1965.

Where, then, did Ezra and his kind get the idea that Canada's maple leaf is a Liberal flag? 

It presumably comes from the image to the right: the Liberal Party logo, which has been made to look like the Canadian flag.

In doing this, the Liberals have wrapped themselves in the flag, so to speak. But they are hardly alone in this. To the right is the logo of the Liberal Party in Australia.  There is a flag buried there.

Or Bush-Cheney in the last American election.  Again, note the flag theme.



There is nothing exceptional, then, in a political party associating themselves with national symbols, including the flag. What is exceptional is the petulant rejection of those symbols out of a misguided partisan pique.

Tipping points

I've been trying to broaden my blog reading recently, seeking out worthwhile Conservative and Libertarian posters to include in my blogroll.

Today I found quite an interesting post by N=1 on his/her tipping-point, a highly eloquent discussion of the choices that face socially liberal Conservatives. Do, please, go read the whole thing, a particularly quotable bit is this:

Harper and the CPC appear to be opposing SSM with a tenacity, a ferocity, that they reserve for absolutely nothing else. Not health care, property rights, war, trade, separatism, terrorism... nothing. It is easy to conclude that fighting an inevitably losing battle against allowing gay Canadians to wed one another must be the single most important thing in the CPC platform. We hear from the CPC nothing but compromise on the issues that will actually affect my personal life: compromise on taxes, compromise on medicare, compromise on fatty foods for Heaven's sake. But on a matter which will not directly affect me at all, the CPC is ready (aye, ready!) to Fight To The Death. It has become readily apparent to me that the CPC doesn't actually care about my issues at all. They evidently care about the issues of those who don't much like gay people, and who don't think homosexuality is normal. But I like gay people--at least, I like them as much as straight people, which is to say I like them as much as I like any individual. And I think homosexuality is normal--at least, it's as "normal" as any type of human predilection in which no-one is injured and in which all participants engage willingly. I accept that for millions of Canadian Christians, Jews, and Muslims, homosexuality is considered evil. They're wrong, and I no longer wish to associate with a party that acts as if it agrees with these Canadians.

The question that comes to mind, however, is why does this tipping point for N=1 come now? I hesitate to offer an explanation for someone I don't know. But it strikes me that the passage of C-38 may be the important fact. That the leader of a Conservative party might oppose changing the definition of marriage should not cause us much surprise--even if we disagree with him. But now that the law is passed, ssm is the new status quo, and Harper's promise to repeal it becomes not a conservative gesture but a radical one. The leverage has changed, and many Canadians who were neutral or tepid about ssm will very soon discover that they have tipped over into accepting it.

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