Counterpoint: The power of positive spending
by Laurel Rothman in response to National Post editorial board: Money can't end poverty published Nov. 26, 2009
Posted: Dec. 01, 2009
The recent editorial in the National Post ( "Money can't end poverty," Nov. 26) takes a number of shots at Campaign 2000's proposals to end child and family poverty, claiming "that throwing money at the problem is never going to be the solution." Campaign 2000 disagrees, and the weight of the evidence supports our perspective. Analysis of strategic spending of public funds in many jurisdictions has demonstrated the power that smart social policies have to improve the lives of low-income children and their families.
Take the case of other wealthy OECD countries that have much lower child and family poverty rates than Canada's 9.5%. Most of them, including Sweden and Finland, have also experienced sea changes in work and family life that the editorial cites as reasons for poverty over the past decades: higher rates of lone-parent-led families, fewer good job options for young adults and rising rates of immigration. In contrast to Canada, however, these countries have well-developed programs of affordable, secure housing and universal early childhood education and care (ECEC) as well as more generous child benefits and more supportive labour policies. As a result, their poverty rates are roughly half of Canada's and children and families enjoy a high quality of life.
The editorial perpetuates the myth that all low-income families are unemployed. In fact, in the 2000s, four out of 10 (40%) low-income children had at least one parent who worked full time throughout the year but could not rise out of poverty; that is up from less than one in three children during the 1990s. While the editorial claimed that the slight reduction in child and family poverty to 9.5% in 2007 from 11.9% in 1989 is the "result of expansion of the private sector economy," this data demonstrates otherwise. The small change in the child poverty rate over 20 years is striking in light of an unprecedented period of economic growth since 1998.
Thursday's editorial seemed to imply that supporting the poor is done to the detriment of the rich. Poverty has an impact on us all. A recent study by economist Nate Laurie found that poverty costs Canada at least $30-billion a year. The measures called for by Campaign 2000 are grounded in sound economic thinking. Many economists have demonstrated the cost benefits of public investment in child care, for example, which we strongly endorse. Gordon Cleveland and Michael Krashinsky at the University of Toronto determined that an investment of $1 in a universal, high quality, accessible system of ECEC services for children two to five years of age would yield $2 derived from a combination of benefits for children, parents and society.
There is solid evidence that children who arrive at elementary school with the tools and capacity to learn the cognitive and social skills needed to thrive are way ahead of those children who are not well prepared. It's important also to note the public benefit we would receive from increased workforce participation by lone mothers and two-parent families and lower costs of social assistance. In Quebec, where a high proportion of young children have access to affordable ECEC, labour force participation rates among mothers went up. Tax revenues from their employment also increased and now cover 40% of the cost of the ECEC program. That's a good example of how public spending that improves the early learning of all children helps to reduce poverty and benefits all of us.
Campaign 2000 firmly believes that parents who work full time should not be living in poverty. We also recognize that the labour market is not going to pay parents differently than other workers. Minimum wages need to enable adults to lift themselves out of poverty, and public policies like the National Child Benefit will provide a supplement to assist in paying for the cost of raising children. Campaign 2000 calculates that a pathway out of poverty for a lone parent with one child begins with full-time work at $11 per hour plus a full child benefit of $5,400. Clearly, affordable, available ECEC services and secure housing are also essential parts of the solution.
Campaign 2000 has always maintained that money that is well spent, not "thrown at problems," is part of what's needed to end poverty. Families themselves know this; that's why they toil at part-time, seasonal work that may or may not add up to full time hours; that's why they struggle to go back to school and improve their skills and ability to earn; that's why well-educated immigrant parents drive taxis and deliver pizzas to put a roof over their heads while seeking to have their foreign work experience and credentials recognized. There is good evidence that as a society, we either share the collective responsibility to prevent child and family poverty or we face rising costs in health care services, criminal justice and education; the way societies do this collectively is through well-designed social policy.
In these times of economic uncertainty, smart public spending to prevent and reduce poverty makes good economic sense. Our choice is clear -- as Canadians, we can pay now or pay much more later.
