Are Ontarians Hopelessly Addicted to “Free” Stuff and Money From their Government?

Ontario Liberal Premier Kathleen Wynne reads a story to kindergarten students during a campaign stop at a school in Cambridge, Ont., on Monday, June 9, 2014. (Colin Perkel/CP)

Premier Kathleen Wynne rang in the New Year by popping corks and splashing more money onto an electorate and province already drunk on spending.  Her decrees that Ontario businesses have to pay at least $14 an hour to their employees and everyone under 25 get “free” prescriptions (both of which took effect on January 1) are clearly two more ploys in her bag of goodies to buy desperately needed votes for the upcoming election in early June.

But what is not being asked enough is why these rushed in, makeshift policies are realistic in a province that is the most indebted sub-sovereign jurisdiction in the developed world.  Do Ontarians not realize the province has been running an unsustainable budget for most of the last decade and a half that this Liberal government has been in office?

The last few elections and polls — all be them wildly unreliable — would tell us they don’t.  Yes, the polls largely say Wynne’s personal popularity stinks, but the party as whole still seems to be in contention despite the scandal-plagued government being well past its best before date.  Easier to have a scapegoat than face the cold hard facts.  Even more importantly than those polls though, in telling us where the province is headed long-term, are other polls suggesting many of Wynne’s socialist policies are widely popular with the majority of Ontarians.

When it came to the so-called Fair Hydro Plan unveiled last year, most Ontarians supported the plan.  Never mind that the auditor general blasted the plan and found that the government could’ve reduced the amount spent on interest payments by $4 billion (yes, BILLION) if they hadn’t serviced the debt in an “unprecedented” way in order to keep the cost off the books this year — all so the Liberals can falsely claim they’ve balanced the books.  No, short-sighted Ontarians rejoiced in screwing themselves over in the long run in order to get quick and slight relief now.  Ultimately this was the government’s choice, but they wouldn’t have done the wrong thing if it wasn’t popular with the electorate.

The same goes for the latest two socialist policies.

Although there has been uproar over the implementation of the minimum wage hike, it was not over TD Bank and the Bank of Canada projecting job losses of  90,000 and 60,000 jobs respectively over the hike, but instead from the Tim Hortons heirs cutting paid breaks and benefits to help offset the huge additional cost of paying an additional $2.40 an hour to every employee making minimum wage.  Reading the top comments from the initial CBC report and the nearly 100,000 shares of the article suggests the vast majority of the proletariat seem to think business people are evil for trying to keep a restaurant profitable.  The overwhelming sentiment of Ontarians was that business owners are greedy fat cats and that they should fork over more money to their workers, no matter how low-skilled the job.  No one seemed to take into consideration that these owners had given their employees additional benefits and paid breaks, things they weren’t required to do, without the government intervening and demanding they do so.   

Now, none of us know how much the aforementioned Tim Hortons location is making as its net profit annually, but if we do some simple math using the increase in the minimum wage we can see how disruptive and costly this can be to a small business owner.  Let’s say this location had 10 full-time employees making the former minimum wage and two supervisors making around the new minimum wage of $14 an hour last year.  If each employee works on average 2,000 hours in a year that means those 10 employees at minimum wage will need to be paid an additional $4,800 each or a total of $48,000 extra spent on wages.  But then the owners would also need to spend additional money giving the supervisors a raise as well so they’re still making more than the other rank and file workers. (And this doesn’t factor in the new three weeks of paid vacation for employees with an employer for over five years.)  And then there will be another rise next year of an additional dollar an hour which will add tens of thousands more in additional wage expenses for this type of employer.  To think a business, especially a small family business (the wealth of the Tim Horton heirs is irrelevant to whether or not this particular restaurant is still in itself profitable after the wage hike), should just eat the tens of thousands in additional costs, and only be given half a year’s notice, should be seen as absurd and unrealistic by the electorate.

Yet the average Ontarian and Liberal MPPs like Ann Hoggarth have no sympathy for small businesses, the lifeblood of any healthy economy.  No, instead they think all these business owners are fabulously rich and should be able to afford high taxes, a steep minimum wage hike and out of control hydro rates.

Although the Ontario Progressive Conservatives have pushed back a bit on this suicidal anti-business mentality, they too sense a restless proletariat that have an insatiable hunger for more and more from their government.  How else can one explain PC Leader Patrick Brown’s used-car-salesman pitch of the People’s Guarantee, a socialist manifesto that promises more and more stuff and tax cuts without any concrete counter proposals to pick up the province’s pants and tighten the belt?

But back to another one of Wynne’s socialist programs, “free” drugs for everyone under 25.  Wynne and the Liberals have been selling this hard in the past few days, with the Premier making a big show of it at pharmacies and the government pumping out heart-warming stories of Ontarians grateful for free prescriptions for themselves or their children.  What’s missing in this picture is that many hospitals have bed shortages at the moment and many parts of the healthcare system are in disrepair.  So completely subsidizing prescription drugs for Ontarians under 24 probably shouldn’t be the top priority for the government right now, especially when subsidization almost always increases the thing being subsidized, which in this case means more young Ontarians becoming dependent or addicted to drugs instead of finding cheaper and/or preventative measures to address their health problems.  But apparently Ontarians want a magic pill to fix everything.

The government projects the free prescriptions for everyone under 25 will cost the province $465 million per year.  But knowing this government’s less than stellar track record in predicting the overall cost of their programs, expect the bill to run much higher.  Fellow Loonie Politics columnist and Ontario pharmacist Josh Lieblein has been interested to see how this new drug plan would play out.  At the end of last year, Lieblein studied the government’s database that allowed Ontarians to search what would, woudn’t and “may be” covered under the new drug plan.  When Lieblein told me there were quite a few drugs in the “may be” category I suspected the Liberals were just trying to keep some suspense, at the inconvenience of pharmacists, before they declared they were giving away the whole shebang.  Sure enough this seems to be more or less the case, as Lieblein hasn’t had to disappoint anyone under 25 yet, whether it be requests for birth control pills, Adderall, or anti-anxiety medication; the drug companies must be thrilled.  (Of course I could get behind a drug plan like this if it was just for life or death medication, but to give away so many drugs for free to youth doesn’t seem like what the doctor ordered for our health care system.)

With all of the above in mind I’m reminded of a quote from a much more venerable female politician than Wynne will ever be and who would be appalled by Ontarians demanding more and more from their government: “The problem with socialism is that you eventually run out of other people’s money.”  Wynne and the other parties seem content to continue to drive the province off the cliff, unless Brown intends to get serious about making cuts if he gets elected.  But ultimately it comes down to whether or not Ontarians and the press stop daydreaming and tell our politicians to change course.  Otherwise they’ll wake up to an irreversible nightmare.

More from Graeme C. Gordon   @GraemeCGordon

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