Canada

Business tax breaks pushing deficit up

When big business demands cuts in
spending on social programs to reduce the
$28-billion federal deficit, what it doesn’t
say is that its share of federal funding has
grown, while its share of the tax burden
has shrunk. In other words, business is
responsible for a growing chunk of that
debt.

A new Library of Parliament study
shows that as a percentage of the Gross
Domestic Product (GDP) — the value of
all goods and services produced in the
country — spending on business through

subsidies and other assistance increased to
a peak of 2.5 per cent in the mid-1980s
from less than one per cent in 1970.

In dollar terms, the amount spent on
so-called transfer payments to business
totalled $8.9 billion in 1987. And based on
the first half of last year, these rose to $9.3
billion in 1988.

Spending on persons has declined stead-
ily from a peak of seven per cent of the
GDP to about six per cent. Since 1970, the
growth of federal transfer programs to

persons has been well below the growth in
transfers to business.

Finance department figures show busi-
ness has done equally well, if not better, on
the tax side.

Corporate income taxes, as a portion of
total federal tax revenues — personal and
corporate income tax plus sales tax —
peaked at 26.2 per cent in the mid-1970s
but have since fallen steadily to a low of
15.6 per cent in the fiscal year ending
March 31, 1988.

And Finance Minister Michael Wil-
son’s tax “reforms” let business further off
the hook. Figures for the first seven
months of this fiscal year show that the
share of the tax burden carried by big
business slipped to a record low of 11.4 per
cent.

Even if the reforms do what Wilson says
they will, corporate income taxes will only
amount to 17.2 percent of total taxes after
five years — far smaller than in the 1970s
and early 1980s.

By PAUL OGRESKO

Second of two parts

he roar of super-
sonic jet fighters in
the Arctic skies and
the silent movement
of nuclear subma-
rines under the Arc-
tic ice may irrevoc-
ably destroy one of
the last societies in
which people live in peace with the land and
with each other. For the 26,000 Inuit of
Canada’s Arctic it is a time of change — a
time in which the very future of the Arctic is
being decided, not in the traditional com-
munal ways, but in the corridors of power
in such far-away cities as Ottawa and
Washington.

The cultural destruction associated with -

the colonization of so many aboriginal cul-
tures in southern Canada is having an
increasing impact on the Inuit, according to
Mary Simon, president of the Inuit Cir-
cumpolar Conference (ICC).

“It’s already taking place in the Arctic,
maybe not to the degree where it’s totally
destroying everything, but there is reason
for concern,” said Simon, “We have to do
everything we can to try to make sure we
stop these adverse effects from increasing.”

In a report commissioned last year by
Health and Welfare Canada, Dalhousie
University professor Colin Irwin forecast a
bleak future for Canada’s Inuit, in which an
independent and resourceful society 1s
transformed into a people dependent on
welfare and marginalized into “Arctic ghet-
toes.” The report, entitled Lords of the Arc-
tic: Wards of the State, predicted a
particularly stark future for the Inuit
youth — a world of no hope, characterized
by crime, unemployment and drugs.

It is precisely that nightmare of social
disintegration that Inuit leaders such as
Simon and John Amagoalik of the Inuit
Tapirisat of Canada (ITC), the main Inuit.
political body in Canada, are working to.
avoid. The prerequisite to survival for the
Inuit is the right to land and self-
government — and while negotiations over
land rights and self-government continue
with the federal government, one of the
rising concerns for the Inuit is the rapidly
accelerating militarization of the Arctic.

The integration of the Arctic into the
U.S.-Canadian military agenda goes far
beyond the well-documented $10-12-billion
Tory plan to purchase nuclear submarines
to patrol Arctic waters. The whole agenda,
first outlined in the defence white paper in
1987, includes, as part of a North American
Aerospace Defence Command, a $247-
million program to upgrade air strips in the
North to extend the range of jet fighters.

That will mean the building of a new air
strip at Rankin Inlet, in the Northwest Ter-
ritories, as well as expanding other NWT

6 « Pacific Tribune, January 23, 1989

Inuit ata summer camp near Igloolik, Canada in 1987. (Photo: from Living Arctic by

Hugh Brody.)

airfields at Yellowknife, Inuvik, Iqaluit and
at Kuujjuaq, Quebec. Incorporated into the
NORAD plan is the construction of a
North Warning Radar System above the
Arctic circle at the cost of more than $1
billion, with Canada paying 40 per cent of
the bill. Critics charge the radar system will
play an integral part in the Strategic
Defence (Star Wars) Initiative.

Also on the agenda is the building of a
military training facility at Nanasivik,
NWT. ss

“It concerns us that the government is
prepared to spend an awful lot of money on
military hardware in the Arctic,” ITC pres-
ident John Amagoalik told the Tribune.
“Submarines, CF-18 bases, a possible mil-
itary training centre at Nanasivik ... All
these things run contrary to decisions taken
at the Inuit Circumpolar Conference which
has always had a policy of no military build-
up in the Arctic and trying to keep the
Arctic nuclear-free.

The Mulroney government’s claim that
the nuclear submarines will be an assertion
of Canadian sovereignty over the Arctic is a

cance

proposition that Amagoalik does not buy.
He argued that the interests of Canada
would be far better served by the federal
government recognizing the rights of self-
government for the Inuit and Northern
peoples, and an end to the current colonial
relationship between the North and the rest
of Canada.

“The government seems to have its prior-
ities wrong in terms of asserting sovereignty
in the Canadian Arctic,” Amagoalik
charged. “Sovereignty would be better
served by giving the people living in the
Arctic the rights of citizenship which they
currently don’t have — especially with
Meech Lake coming into play.

“The settlement of land claims and self-
government agreements with the Inuit will
do more to assert Canadian sovereignty in
the Arctic than any nuclear submarine
could ever do.”

“We are Canadians and we are part of
Canada,” Simon added. “We want to be
able to have our own governing powers, but
within the framework of Canada, not as a
separate nation.”

The policies of the Mulroney government —

are in stark contrast with the positions
adopted by the ICC at its last assembly in
Greenland in 1986. The international non-
governmental body, representing 100,000
Inuit in Canada, Alaska and Greenland,
calls not only for the peaceful development
of the Arctic, but also demands that
governments should not impose policies to
the detriment of the Arctic and its peoples.
The level of consultation between the Can-
adian Inuit and the Mulroney government
over such vital issues to the Arctic as the
nuclear submarine program has been nil.

In trying to sensitize world governments
to the rights of indigenous people in the
Arctic and the importance of protecting the
fragile Arctic eco-system, the ICC is
emphasizing the importanc eof building
solidarity among northern peoples. One of
the draft principles from the 1986 ICC gen-
eral assembly outlines this goal:

Co-operation, information sharing and
solidarity among northern peoples are
increasingly vital, whether such peoples are
aboriginal or indigenous like the Inuit, Sami
and Dene, or ancient European socieities
like the Icelanders. In this way, northern
peoples can better deal with the many prob-
ems and phenomena of social and political
change. Currently, there is insufficient
recognition and respect for indigenous
societies and rights, inadequate protection
of the Arctic environment, and too often the
imposition of centralized state policies
unsuited to Arctic conditions and needs.

One of the principal goals of the Circum-
polar Conference, to bring together all the
Inuit of the Arctic region into the annual
assemblies, is coming close to a full realiza-
tion.

Last summer, Simon and an ICC delega-
tion travelled to the Soviet Union to meet
with the Native people of Siberia and with
Soviet government officials. And while past
attempts to bring the Soviet Native peoples
into the ICC had failed — this time, in the
era of glasnost and new thinking in world
affairs, agreement was achieved on having
Soviet Native participation, for the first
time, in the upcoming ICC general assem-
bly in Greenland in July, 1989.

For the Circumpolar Conference, it will
be animportant event — one that not only
strengthens the voice of the assembly on the
global stage, but also reunites peoples long
separated but still sharing similar cultures
and languages and a vision of the Arctic far
removed from the reality offered by CF-18
fighters and nuclear submarines.

“T think the ICC has been quite success-
ful in building bridges between northern
people in Canada and the Soviet Union,”
Amagoalik said. “There have been numer-
ous contacts now, and things are really
opening up with more and more exchange

programs occurring — this is what we

want to encourage.”

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