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Middle class for sale

November 12, 2013

3-minute read

A leaked Ontario Progressive Conservative document reveals a deep disconnect between ideologically driven wedge politics and the realpolitik of Ontario’s struggling middle class.

The document lays out a provincial election plan for the party that is premised on an explicit attack on workers and a promise to bring in American-style low-wage policies.

In other words, the middle class could soon be up for sale in Ontario – at bargain basement rates.

It’s a path Ontario would be wise to avoid.

In the U.S., where the Progressive Conservative party is getting its policy ideas these days, there has been a concerted effort to drive down workers’ wages.

As the Economic Policy Institute has documented, between 2011 and 2013, nine American states passed laws that prohibit government from implementing paid sick leave rights. More than 40 million Americans don’t even have the legal right to take a single paid sick day.

In 2011 and 2012, four American states passed laws lifting child labour restrictions. Several states stripped workers of overtime rights. And several states made it harder for workers to recover unpaid wages.

Fifteen states passed laws restricting public employees' right to bargain collectively and to collect fair share dues from members.

Essentially, all these laws make it harder for households to stay in the ranks of the middle class in America.

In Ontario, Progressive Conservative leader Tim Hudak seems committed to campaigning in the next election on similar attacks on workers, unions, and the middle class. At the centrepiece of this strategy, copied directly from the U.S., is his pledge to prohibit the Rand Formula.

The Rand Formula was introduced by Supreme Court of Canada Justice Ivan Rand in 1946. It ensures that once a democratic decision has been taken by workers to form a bargaining unit, then everyone who benefits from the resulting contract will pay their fair share toward maintaining that contract and the union that negotiated it. It’s a democratic majority choice – but Mr. Hudak’s party wants to prevent workers from being able to come together in that way.

They would prohibit the Rand Formula, and replace it with provisions of the U.S. Taft-Hartley Act – passed in 1947 in a climate dominated by Cold War McCarthyism and racism. Incredibly, Mr. Hudak calls this “modernizing” Ontario’s labour laws.

In America, there are now 24 states that have passed laws that prohibit any form of dues check-off. It's certainly not a gift to workers. In those states, workers make less money: median household incomes are $6,437 less than in other states. And 26.7 per cent of jobs in states which banned union dues check-off are low paying, compared to 19.5 per cent of jobs in other states. Poverty rates are higher in these states. And the number of workplace deaths is 36 per cent higher.

And this downward pressure on wages doesn’t simply stop at the border. A recent CIBC report by Avery Shenfeld and Emanuella Enanjor say U.S. practices may already be reducing Canadian workers’ bargaining power, in turn suppressing wage growth.

This is simply part of a long-term, concerted political agenda to weaken workers’ right to bargain for a fair and decent wage as well as to reduce government’s power to protect workers’ health and safety on the job.

And as a political agenda, its promise rings hollow: numerous independent research reports have shown that restrictions on union rights have not, in fact, helped these U.S. states to retain manufacturing jobs.

These attacks on workers and their unions are not the answer to Ontario’s economic woes. In fact, the political agenda Mr. Hudak is espousing would drive down workers’ wages and family incomes.

It would foster a divisive narrative that pits workers against workers in a mad scramble to fight for crumbs from a shrinking income pie.

It would condemn the next generation of workers to a future of low wages.

And it would strip workers of rights long ago secured through the courts.

Ontario has come too far to turn back the clock to pre-1950s working conditions.

Before the 1950s, Ontario didn’t have a strong middle class. Income inequality was higher. The quality of life was not what it is today.

With the rise of the middle class came the ability for people to collectively pool their tax contribution to pay for public services that benefit everyone: universal health care and education, to name just two.

Those public services would become another casualty of American-style low-wage laws in Ontario – partly because public sector workers would be among those forced into the race to the bottom, and partly because government tax revenues (essential to paying for those services) would also shrink in line with workers’ incomes.

That’s the thing about low-wage policies: the lowest paid workers suffer the most, but it affects all of society. It diminishes our sense of fairness, it eats away at hope for the future, and it guarantees a spiral of economic decline.

None of this is inevitable. There is no reason to put Ontario’s middle class on fire sale. They’re worth more than this political agenda is offering.

Trish Hennessy is director of the Canadian Centre for Policy Alternatives’ Ontario office. See our website: Follow us on Twitter: CCPA_Ont.

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