The Fraser Institute’s long march from right-wing hysteria sheet to respectable and highly influential think-tank has been interesting to watch (and might be the subject of another post someday). But institutional memory is a powerful thing, and it still routinely tosses out stunt releases like “tax freedom day” (the Buy Nothing Day of the right) and this weird one today, lamenting the fact that “The average Canadian family spends nearly half its total income on taxes, more than it spends on food, clothing, and shelter.”.
The heart of the study is an invidious contrast between the amount of their total income Canadians spend on food, clothing, and housing versus taxes today, compared with similar measures from 1961. And if you hate taxes, it doesn’t look good:
– In 2008, the average Canadian family earned an income of $71,764 and paid total taxes equaling $31,535-43.9 per cent of its income.
– In 1961, the average Canadian family earned an income of $5,000 and paid $1,675 in total taxes-33.5 per cent of its income.
And here’s what they have to offer in the way of analysis of these Shocking Figures:
“Canadian families have seen their total tax bill increase by an astounding 1,783 per cent over the past 47 years,” said Niels Veldhuis, the study’s co-author and the Institute’s director of fiscal studies.
“The tax burden faced by Canadians extends well beyond income tax. When you add up all the taxes Canadians pay to all levels of government, the typical family is sending more of its income to government than it spends on basic necessities such as food, clothing, and housing.”
Get it? Food and clothing and housing are “necessities”. But taxes? That’s a “burden.”
Let’s look at it another way: Since 1961, the amount that Canadians spend collectively providing themselves with defence and other forms of security, health insurance, unemployment insurance, pensions, clean air and water, consumer protection, infrastructure, research and education, and other public goods has increased by 1,783 percent per family. Astounding? I’ll say! Burden? Hardly.
Despite what the Fraser Institute wants you to think, this is an entirely good thing. Only in the bizarro-world fantasies of anti-tax conservatives could a world where families spend over half their income on private necessities be considered preferable to the one we have today. If it’s invidious contrasts the Fraser folks are after, why look to 1961? Today, the average North American spends about 10 percent of disposable income on food alone. In 1933 it was more like 25 percent.
Ahh, but the tax “burden” was so much lower then.