Philip CrossThe Macdonald-Laurier Institute is highlighting its authors’ work on some of the major public policy issues going into this year’s federal election campaign. Today, Philip Cross looks at income inequality and fiscal responsibility

OTTAWA, July 28, 2015 – The middle class. Income inequality. The one per cent.

Debates about the gap between rich and poor are everywhere these days, so it only figures that the issue will play a major role in the upcoming federal election campaign.

The Macdonald-Laurier Institute has published extensively on the subject, starting with a paper from Senior Fellow Philip Cross. “Giving And Taking Away”, released in April 2015, shows how Canada is already more progressive than many people think when it comes to reducing the gap between rich and poor.

To arrange an interview with Philip Cross, please contact Mark Brownlee, communications manager, at 613-482-8327 x105 or email at mark.brownlee@macdonaldlaurier.ca.

The problem, Cross shows, is that many critics focus solely on Canada’s tax system. This leaves out a whole swath of other programs that have a much greater role in reducing income inequality.

These programs – which include old age pension and employment insurance – are dedicated to closing the gap between rich and poor. But because they aren’t part of Canada’s tax system, analyses of income inequality often ignore them.

Cross’ paper, by taking transfer programs into account, is able to show that high earners are already heavily subsidizing the incomes of the middle and lower classes.

Cross1920x1714-04-15Instead, Cross says, governments should focus less on income inequality and more on adopting policies that boost the economy and improve the fortunes of those at the top and bottom of the income scale.

In a June 2015 commentary for MLI, Cross says it’s time to debate policies that encourage more businesses to invest and grow the economy.

“In the debate about the economy, everything seems to be fixated on redistributing income, and I think we've become so wrapped up in that analysis... we forget the number one solution to all these problems is good economic growth”, says Cross.

Cross’ other election-relevant work includes:

Cross has also authored columns on why low interest rates are harmful in the long-term and how the provinces continue to run structural deficits.

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Philip Cross is a Senior Fellow with the Macdonald-Laurier Institute. He previously served as the Chief Economic Analyst for Statistics Canada, part of a 36-year career with the agency.

The Macdonald-Laurier Institute is the only non-partisan, independent national public policy think tank in Ottawa focusing on the full range of issues that fall under the jurisdiction of the federal government. Join us in 2015 as we celebrate our 5th anniversary.

For more information, please contact Mark Brownlee, communications manager, at 613-482-8327 x105 or email at mark.brownlee@macdonaldlaurier.ca.

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