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Budget serves top 1 per cent

Despite the Mulroney govern-
ment’s talk of ‘‘deficit-cutting’’,
the major effect of Michael Wil-
son’s budget is to redistribute in-
come from poor wage-earners to

wealthy investors and cor-
porations. The budget is essen-
tially a trojan horse for the old
‘*trickle-down’’ economics which

“sees government’s main duty as

Universality attacked

When Finance Minister
Michael Wilson sat down after his
50-minute budget delivery May
23, Canadians released a small
Collective sigh: universal social
programs, threatened. since- the
Tories took office last September,
seemed to have been spared. But
the relief may be premature, as
economic analysts are pointing
out this budget is no short-term
deal — its shock waves will be felt
well into the next decade.

Their first 10 months in office
demonstrated to the Tories that
universality isn’t an issue to be
confronted head on. Instead
they've embarked on a course
which will leave these programs
economically impotent and ripe
for disposal.

In addition to de-indexing the
Old Age Security pension, the
Cost-of-living increase on family
allowances will also be reduced to
the inflation rate minus three per
Cent. Its immediate effect will be
to cut $11 per year, per child:

Wilson has said low income
families will be compensated
through an increase in the child
tax credit. A family earning
$20,000 with two children will re-
ceive an additional $70 in 1986
and $35 in each of the following
two years. However, the same
Cost-of-living limit will apply to
the credit Starting in 1989, so even
Baer families will begin falling be-

nd. :

Families with incomes over
$25,000 will feel the bite this year
as the child tax credit threshold
(the income at which it starts to
diminish) is reduced from $26,330
to $23,500.

When the government first
Started tinkering with the federal
family benefit package in a con-
Sultation paper tabled in the
House in late January, it main-
tained that any monies taken from
Middle income earners would be
Used to benefit low-income fami-
lies, Although there is substantial
€vidence to suggest that even
Modestly well-off families require

help. in raising their children,
rather than helping the needy, the
net effect of the budget will rob
$635-million from children’s
benefits by 1990, according to a
report released by the National
Action Committee on the Status
of Women.

Likewise, the de-indexing of
pensions will hit the elderly poor
hardest, despite government pro-
testations that these seniors will
be cushioned by leaving the
Guaranteed Income Supplement
program intact.

“This is misleading,’’ says
NAC president Chaviva Hosek,
‘‘since half of the income the poor
elderly receive comes from the
old age pension.’’ And indeed, as
the NAC report projects, the
poorest pensioners — most of
whom are women — will lose
$100 in 1986, $203 in 1987, $305 in
1988 and so on.

Since the previous Liberal
government froze the OAS and
family allowance back in 1973,
cost-of-living indexation has pre-
served recipients’ buying power.
These are extremely popular
programs and understandably so;
they are depended upon each
month as a major or integral part
of the majority of household
budgets, and Canadians are pre-
pared to vigorously defend them.

But out of the corporate think
tanks who ghost wrote Wilson’s
budget the startegy is advanced:
As inflation steadily reduces the
purchasing power of social bene-
fits, how anxious will people be to
maintain a monthly cheque which
won’t even buy a roll of toilet
paper? :

Indications are the Tories
won’t have to wait until 1990 for
an answer. They were huddled in
an emergency cabinet meeting on
the weekend trying to figure out
how to handle the backlash to
their de-indexing plans. An im-
mediate call to the PM’s office
should suggest they stay there
until they’re ready to withdraw
this proposal from the budget.

helping the rich get richer so they
can then ‘‘spread some of the
benefits to the poor.”’
Specifically, the new $500,000
exemption on capital gains will
make Canada’s wealthy the most
lightly taxed group of people in
the developed world. It is esti-
mated that this provision of the

budget alone will save upper-class ~

investors an extra $1.25-billion
annually by 1990.

A report prepared by the Fi-
nance Department under the last
Liberal government warned that,
“exemption of capital gains
would leave Canada as the only
industrialized country that per-
mitted large amounts of wealth to
be accumulated and to be passed
between generations without any
tax liability.”’

In fact, taxpayers with incomes
above $50,000 — who account for
less than | per cent of the popula-
tion — make more than 40 per
cent of the total net capital gains.
These people will be able to
dramatically reduce their taxes
under the terms of the new
budget, even while the overall tax
burden on individuals will grow
enormously. Most of the increase
will be absorbed by low-and-mid-

-dle-income working people.

Corporations have also re-
ceived some major breaks under
the new Tory ‘budget, even
though some 60 per cent of them
already pay no taxes at all. Big
conglomerates will now be able to
evade federal profit taxes by
transferring losses incurred by
one company to another more
profitable one.

There will be no reduction in
the $30-billion annual special tax
exemptions currently being
enjoyed by large corporations,
nor will any effort be made to col-
lect the-$40-billion they owe in
back taxes.

The government’s own figures
show that by the end of the de-
cade the tax load on corporations
will decrease by $2-billion, while
personal income taxes will rise by
$4-billion and sales taxes will in-
crease by $3-billion.

PEOPLE

BEFORE

PROFITS

Halifax peace
meet advances
alternatives to
armed conflict

By NAN McDONALD

HALIFAX — Over 350 women from 33 countries meeting
here, June 5-9, condemned militarism as a source of poverty, -
repression, torture and death.

The conference — Women’s Alternatives for Negotiating
Peace — organized by a coalition of 118 Canadian women’s
groups drew representatives from socialist, capitalist and
developing countries and adopted a statement demanding as a
first step toward peace: a comprehensive test ban treaty; an end
to the militarization of space; an end to the research, testing,
development and deployment of all weapons of mass destruction
and an end to all forms of violence.

The statement supported the rights and efforts of all peoples to
self-determination, and to freedom from military and economic
intervention. It cited Nicaragua as a new kind of society, a
symbol of hope which must be allowed to live.’

Star Wars Capability

The U.S. Star Wars program dominated much of the delibera-
tions. Canadian scientist Dr. Rosalie Bertell described its deadly
capabilities: ‘‘it is well advanced, one space station can monitor
half of the earth,’ and the United States and its NATO allies
intend to put ‘‘60 of these stations in space. It has the ability to
take pictures to such a degree that they can read a licence plate
number on.the earth from a space station. They have the capabil-
ity of picking up sun rays and laser capability which is like an
incendary weapon. It can set fire to an oil deposit underground. It
can set fire to a big brush area, and to homes.

‘They can also use two space stations to microwave, some-
thing like your oven, to kill people and save buildings. It can wipe
out communications systems, wipe out whole communities with
all kinds of electrifying devises. It can zap people with radiation
and drive them insane. It can cause riots anywhere. If the military
locates anywhere in the world, a beam can be diverted and make
them become an unlimited electrical power. This thing (Star
Wars) is insane, it is something we don’t have, we don’t need and
won't have.”

Citing an “‘overwhelming need and desperate urgency for
peace,’ the final document also’ called for a more equitable
distribution of world resources. The official statement was pre-
sented to Quebec Conservative MP Monique Landry. She is to
take it to the Mulroney government and to the special session of
the United Nations in Nairobi, Kenya next month, marking the
end of the UN Decade for Women, under the slogan ‘‘Equality,
Development and Peace.”’

At the opening session MP Barbara Sparrow, representing the
federal government, attempted to defend the Tory’s support for
Star Wars and the U.S. inspired arms race. She reminded those
present that the Canadian government provided $237,000 to fund
the conference. However, the proceedings were guided from the

‘floor and resolutions on peace were brought from the 24 work-

shops that convened each day.
_ The resolution on Star Wars demanded that ‘‘the Canadian
government clearly and ambiguously express its opposition to
the arms race by. refusing to participate in the U.S. Pentagon
Strategic Defence Initiative (Star Wars) and any other similar
undertaking.”

It also demanded a cut in Canada’s military budget by 50 per
cent; annulment of the Cruise testing agreements with the U.S.;
that Canada be declared a nuclear weapons free zone, and that

Canada pressure the U.S. to pledge never to be first to use nuclear

weapons.
Peace Initiatives

Numerous initiatives were brought forward to strengthen the
women’s peace movement in Canada and internationally by
building women’s peace coalitions and for an international wom-
en’s peace network.

The conference clearly showed that women, irrespective of
outlook on other questions, want to be free from the threat of
nuclear war. The debate isolated the military industrial complex,
represented by the Reagan administration and its NATO allies, as
the root cause of the nuclear war threat.

The U.S. was also named as the main supporter of dictator-
ships in Central and Latin America, the Philippines and the
powder keg in the Middle East. The tragedy of Grenada was
considered and the demand for all U.S. troops out of Grenada
was unopposed. :

The conference demanded laws to end Canadian investment in
South Africa; it called for an end to the U.S. economic blockade
of Nicaragua, an end to the Iran-Iraq conflict by peaceful solution
through negotiations; for support to the Portuguese people’s
effort to remove U.S. bases and for U.S. ships to refrain from
exposing the port of Lisbon to nuclear danger.

Many delegates from the Halifax conference will also be at-
tending the United Nation’s world conference in Nairobi, Kenya.
Armed with the results from this meeting and joined by other
progressive women they will no doubt be able to ward off any
attempt by Reagan’s handpicked delegation to win support for the
U.S. administration’s nuclear war strategy.

PACIFIC TRIBUNE, JUNE 19, 1985 e 7