15 March 2010
For some years the city of Mississauga, Ontario, has been held up as an example of how efficiently a city can be run, inferring that it is the incompetence of other jurisdictions that prevent them being run prosperously. While its next-door neighbour, Toronto, has had its financial woes for twenty years, Mississauga went without a single tax increase between 1991 and 2001 and, in fact, Mississauga has not borrowed money since 1978.
A low business tax encouraged companies to relocate from Toronto, and new developments were constantly being built, bringing in more revenue. Now, however, things are not so rosy. The city is proposing a 2.3% increase on the city's portion of the property tax bill. The cash reserves that have kept Greater Toronto's second largest city debt-free are almost gone. The gloomy prognosis is that by 2012 Mississauga will have to borrow again. The main factor behind the city's changing fortunes is that it is now built out and, therefore, charges on new development are no longer coming on stream. Also, repair costs are rising with $1.5 billion needed over the next twenty years to repair or replace the city's roads, bridges, water lines, and sewers. To pay for all that, mayor Hazel McCallion (once voted the world's second best mayor) proposed adding a five per cent 'infrastructure levy' to the property tax in order to raise the needed money. This was later cut to one per cent and then abolished by the budget committee. This could well be because 2010 is an election year. Whoever wins will be aware that Mississauga needs cash. Some argue that infrastructure from the federal and provincial governments will make a levy unnecessary while others say it's not enough. There are two things of which we may be sure. The first is that no politician in Mississauga, whether councilor or mayor, can be certain of being constantly re-elected on the basis of no increases in the city portion of the property tax bill, as Hazel McCallion was, time after time. The second is that there is no such thing as continued prosperity in any city, town, or village under capitalism.
Many cities have had their financial woes over the last few decades. Mississauga was able to postpone the problem because it grew at a furious pace and had the land available that enabled it to offer low fees and taxes to the developers. Other councils were not so fortunate and were not able to compete. This is a function of the competitive nature of capitalism. Not only are workers in competition with each other for jobs, but also enterprises are in competition with each other for sales, and nations are in competition with each other for land, natural resources, and markets. Thus cities have to vie with one another for development and tourist dollars. As in all economic competitions, it is a race to the bottom and for every winner, there has to be a loser.
In addition, the squeeze on even necessary spending on vital services such as healthcare, education, roads, water, sewers, etc. applies equally to all municipal budgets and is a further extension of the same problem, scarce tax dollars and the struggle to provide those services. Why, in the light of our ever-increasing productivity and wealth production, is this so? The answer is that these services, vital to the efficient running of our economic machine, are paid for by taxes that come out of profits. That's right, your taxes are paid by the capitalist class! Your wages reflect the amount of necessaries (food, shelter, clothing, etc) that you need to enable you to continue to show up for work and bring up a family, the next generation of workers. The only amount that counts for this is your 'net' or take-home pay. The taxes that you supposedly pay are added to that amount and then deducted without you touching them in an accounting sleight of hand. If you really paid the taxes, then you would not have enough money to sustain yourself and your family adequately. It is in the capitalists' interests to make you think that taxes come from your wages so that they, through their media campaigns and corporate-driven think tanks can get you on side in reducing taxes, even though we are all quite aware that lower taxes means a lower quality of services for us, not the capitalist, who can easily afford the best of everything on offer. So, the capitalist class as a whole provides the services necessary to keep the system running, but individual capitalists do not like giving up profit and thus strive to lower these losses by conducting campaigns to starve governments of the dollars needed. Most governments of all stripes, Tories, Liberals, NDP, and others, are cowed into pursuing policies of reducing taxes and balancing budgets, usually at the expense of programs for our most needy citizens, by the owning class and their media, such that any increase in taxes by any government is seen as a failure. Socialism means an end to this minority control that perpetuates vast inequalities, and its replacement by the control of all through elected councils to provide high quality services accessible to all. After all, who would vote for poorer hospital, educational, or social services? That's exactly what you do when you vote for any party on the ballot sheet today because they simply want to continue the present system. Think about it!
