Canada - Land of Plenty?

Canada - Land of Plenty?
by Lutz Scheler
published Dec 1972

Canadians are materially well off. They live in nice homes and apartments, enjoy such things as fridges, televisions, stereos, cars and a host of other conveniences. Food is no problem, and vacations abroad are commonplace. Canada is a land of plenty.

Or is it?

Not for five to seven million Canadians. The poor.

This article is an attempt to touch upon some aspects of the daily life of those unfortunate fellow citizens, to state their cause, and to tell something about the few organizations they have formed in an effort to be better heard.

That poverty exists amidst plenty is absurd, but it’s also true. Poverty reduces the performance of the whole economy by decreasing national income one to two billion dollars annually. It increases costs for health-care, administration of justice and welfare services. To quote the Special Senate Committee on Poverty in Canada: “On economic grounds, there is a powerful case for enabling the poor to stand on their own feet. On humanitarian grounds, the case for action is compelling.”

Most of us have come to believe, enlightened, as we are, that social institutions are not God-given. Theodoret of Cyrrhus, Bishop of Antioch, said some 1600 years ago: “One must really admire God for having organized things so wisely by giving wealth to some and industriousness to others.”

Am I My Brother’s Keeper?

Few people today would admit adhering to such a philosophy of life. Yet they talk about equality of opportunity, which, on closer scrutiny, does not seem to exist. Or they mention competitive markets, which do not exist either - at least not in the economist’s sense. In essence, they are saying the same thing as the eminent Bishop, mainly because they are complacent, or indoctrinated with what John Kenneth Galbraith calls an “economic theology”. Or it could simply mean they are afraid of losing some of their material comfort. Man has an infinite capacity to rationalize his conduct.

Let’s talk about responsibility, more specifically, social responsibility. Am I my brother’s keeper? Yes, because we live in a complex social economic environment in which there is a great amount of interdependence for survival. Nobody in Canada produces all he needs to live; he has to rely on the market mechanism and government.

In order to understand the situation more fully, let’s take a brief look at just what economics is. Although the study of economics is classed as a social science, it operates under many of the same laws and with the help of the same mechanisms found in the natural sciences. Some of these mechanisms are known as models, which are based on certain assumptions. Basically, four of these models have been developed, although agreement as to their relevancy and the validity of their conclusion varies.

One of them is called perfect competition, and its value is substantial if not total. This model has only one fault: it doesn’t correspond sufficiently to reality, either past, present, and probably future. Nevertheless, government policies are, to a great extent, based on this model. The other three models have similar limitations.

Therefore, it makes little sense to put the problem of poverty off by shrugging our shoulders and making vague references to the almost sacrosanct mechanism of the market. Many of us benefit by the existence of poverty. If it became widely known that in most cases the just and efficient competitive apparatus for determining prices and wages is simply not present, our economic theology might collapse. The reason for this is that people would become aware of their responsibility, and hence be confronted with the question of guilt. So, to protect ourselves, we prefer not to talk too much about such matters and instead blindly adhere to the faith of our religion which substitutes competition, the market, and private property for the Holy Trinity. No matter how hard we try, we cannot escape the conclusion that our social responsibility goes beyond just marking an X on the ballot every four years so.

The increased interdependence among human beings, brought about by economic progress, coupled with the unjust mechanisms of income distribution, would, if people really became aware of them, lead to a marriage of guilt and a sense of powerlessness an individual experiences in a mass society. Needless to say, the result is anything but connubial bliss.

How, then, does a concerned individual cope with this situation? There should be more than self-interest in a society that pretends to be Christian. In a civilized society, people in privation should be helped if their condition is a result of competitive forces in the market. Poverty is a shame to all Canadians, and, in the words of the Senate Committee on Poverty, “as a whole (Canadians) cannot escape their share of responsibility for the situation in which this nation finds itself. The economic system in which most Canadians prosper is the same system, which creates poverty. The fault (does not) lie in the poor themselves; for the most part, they are neither morally flawed nor physically idle by nature, as many today still seem to believe.”

Honourable senators are not usually suspect of being left wing radicals and, therefore, their report couldn’t possibly be a Communist plot. Hence, we are forced to face grim reality and accept the report at face value. We might even wonder if it is not an understatement. The latter contention was made by four people who had served on the committee and resigned. They subsequently published The Real Poverty Report because they were dissatisfied with the recommendations of the official committee, among other things.

In order to gain some insight into what conditions are like on a local, rather than a national level, and discover what is being done by the poor themselves, I recently interviewed Mr. Juergen Dankwart of the Welfare and Low Income Group. This organization is one of the many local groups that constitute the Greater Montreal Anti-poverty Coordinating Committee (GMAP).

Protests and Actions

GMAP was founded in 1970. Prior to this date protests in various parts of Greater Montreal were largely uncoordinated. To be sure, there were various local movements such as the Point Equal Rights Movement, or Citizens’ Association of Pointe St. Charles as it was previously called. Because this association was probably the first of the local groups, the driving force for GMAP also came from this area.

The first drive for organization on a local level resulted from the movement for social justice in 1967. This movement was a milestone, since it marked the first time that people on welfare organized and voiced their complaints collectively. In 1967, 500 people marched to the head office of the Montreal Welfare Administration with a demand for emergency welfare. People actively engaged in organizing the movement included Peter Katadotis, Brian Knight and Mike Keith.

Mr. Dankwart says he was not in Montreal at the time and relies heavily on secondary reports, mostly from people who participated directly. He stresses that the protest was spontaneous, not the work of professional organizers. Katadotis, Knight and Keith were simply the catalysts. Pointe St. Charles was chosen as the starting point by the organization, simply because they felt that this was the easiest area to organize. It is a relatively small area with many welfare recipients who are, as a minority group, easier to organize. Dankwart maintains that there is also a greater acceptance of demonstrating and protesting among the English as compared to the French working-class, possibly because of a greater repression of the latter. The poor among an ethnic group in a more favorable economic position then another group, will tend to acquire a greater awareness of their miserable lot, because their position relative to their own group is worse.

The organizers of poverty protests have been criticized for their failure to unite English and French underprivileged people on a common platform. Dankwart thinks that the desire to keep the unpalatable issue of French separatism out, was an instrumental cause for this failure. No alliance was sought with the Parti Quebecois, the F. L. Q. or any other political party. Strictly speaking, at the time there were no French welfare rights groups. Several Committees d’Action Politique (CAP), however, had been formed, but they had a more global view than their English counterparts. They were predominantly concerned with general issues, such as the quality of schools, public health, housing, clinics, etc..

The welfare rights groups are based on democratic principles. In the local groups, people get together, discuss issues and decide what action they want to take. GMAP meets once a week for discussion, and much work is done in committees, such as the Advocates Committee, or the Action Committee. The problems involved are usually presented in a precise form, rather than in a vague, global one, such as “the welfare system is no good.” At times, GMAP is able to enlist the support of other agencies like the Red Feather Agency or the Catholic School Commission.

Methods used distinguish between a protests and action. A protest is simply a statement of grievance at the welfare office. An action requires somewhat more elaborate planning, and, above all, a strategy. After the appropriate strategy has been adopted, press releases are prepared and the action can take place. This may involve a march to the welfare office or a sit-in. These actions are usually well organized, and special care is taken that the participants are truly representative of the protest group. It wouldn’t do much good, to use Dankwart’s words, “if this was just a bunch of radicals running around.”

When asked if they had ever been evicted by the police, Dankwart said this had never occurred at the provincial office on St. Denis Street. Confrontation with the police is avoided at all costs. Their aim is simply to state the case peacefully with a minimum of trouble. At the municipal welfare office on Atwater Street, however, protesters were arrested and Dankwart was among them. They were kept in jail for eight hours, then released. At other times the protestors were simply evicted, but more often than not, they knew about it beforehand.

With a smile Dankwart recalled a particular incident at the Atwater welfare offices. While some members of GMAP were inside the office equipped with a portable bridge table and a walkie-talkie, others were posted outside with similar equipment. When the police arrived, the “flying squad” outside informed the people inside of their presence. The protesters in the office then rapidly packed up the table and left just in time to meet the policemen, who even held the door open for them as they made their way out.

Common Sense, Not Militancy

Most gains, Dankwart stresses, were made through common sense arguments rather than militant methods. An example of a successful action was the occupation of the provincial welfare office, which acts as a sort of “overseer” for the regional welfare offices under provincial jurisdiction. Although all the funds come from the provincial government, the City of Montreal administrates them within its boundaries. In municipalities such as Verdun and Longueuil the province has instituted its own offices.

The successful action revolved around a needy mothers’ provincial allowance, which was provided to some mothers who could not get anything from the city. The problem involved was that the rates were lower; no provision for emergency funds existed; and because of a great amount of centralization, regional offices could not make independent decisions. Long delays in receiving checks were often the result. Another problem arose when a welfare recipient moved from an area under municipal jurisdiction to one under provincial jurisdiction. Because the city issues checks on the third of the month and the provincial office on the 20th, there was usually a 20-day delay in assistance, and what this means, most of us cannot imagine.

In this action, GMAP won decentralization; that is, it won the right of district offices to make their own decisions, and reached “ parity” with Montreal for needy mothers. This “parity” was not achieved by raising the rates but by transferring the mothers involved to a municipal office.
Another successful action won welfare recipients the right to have a third party present when they were being interviewed by a social worker. This privilege is important for two reasons. The first is that the welfare recipient is given a greater guarantee that the rules are being applied properly. The second is that individuals are given the chance to help one another. Not only does this knit closer ties, but it also gives these people a little bit of dignity resulting out of a worthwhile activity. Welfare officials initially refused to allow the presence of an advocate on the grounds that the issues and problems involved were confidential between the social worker and the person seeking assistance. GMAP argued that the confidentiality of the matter was supposed to protect the client, not the social worker, and that the logic of the welfare department was therefore faulty. The officials gave in, and now anybody who wishes to have a third party present during a welfare interview, may bring one along.

But for each hard-won victory, there is a lost battle. Like the fight for the Special Diet Allowance. A person was entitled to a $10 per month allowance if a doctor signed a certificate that the party in question suffered malnutrition, diabetes, or, in the case of a woman, was pregnant. Dankwart said that many doctors were quite liberal in signing such certificates because of the inadequacy of the basic welfare rates. The department of social affairs decided to discontinue the special allowance, and GMAP was unsuccessful in stopping them.

When asked what factors give rise to the need for social assistance, Dankwart explained that about 60 to 70 per cent of all welfare recipients are children below 17 years of age. As far as adults are concerned, only 13 per cent across Canada, and 13 to 15 per cent in Montreal (according to the director of Welfare Services) are able to work. In Dankwart’s opinion, “it would seem that most adults might remain on welfare all their lives.” His figures are supported by the Senate Committee (15.7 per cent) if we include single parents with dependent children. The children of poor families pose a special problem because of what could be called a poverty culture, which tends to be self-perpetuating.

The Poverty Line

The myth that the poor are poor because they are lazy has a very powerful grip on Canadians. The Senate Committee called it a cruel myth and said, “the notion that the poor do not want to work can be quickly dispelled. The plain fact is that the vast majority of the ‘working poor’ continue to work at jobs that pay no more than they would receive on welfare.” Analyses of those on welfare show that less than two percent beat the game.

Of the 832,000 families that fell below the poverty line in 1967 (as defined by the Economic Council of Canada), 525,000 heads of families were in the labor force, working for what have been called “poverty wages”. It has been estimated that among the poor are at least 180,000 disabled persons (60,000 of them mentally retarded), 800,000 persons over 65 (some two-thirds of all people over 65 have incomes below the poverty line), and 150,000 mothers with their 330,000 fatherless children. One-quarter of the 3.5 million families with children under 18 were below the (official) poverty level.

Let us have a look at the definitions of the poverty line as explained by the Economic Council of Canada. They’re shocking in themselves because, as the Senate Committee concluded, they tend to understate the prevalence of poverty in Canada. They depend entirely on family size up to a family of five, when they stop increasing. Thus a family is considered poor if it consists of 5 persons with an income of $5050 annually. But a family of eight whose income is $5052 annually, is not poor.


Family Unit Size Economic Council of Canada
Poverty Lines

1 $ 1,894.00
2 $ 3,157.00
3 $ 3,788.00
4 $ 4,420.00
5 $ 5,051.00


Figures supplied by Statistics Canada with respect to the distribution of total income in the economy reveal some interesting facts.

The Canadian population is grouped in five sections, each 20 percent being called a quintile. In 1951, the lowest quintile received 3.2 percent of the total income of the Canadian economy, and the top quintile, 45 percent. In 1965, the figures shifted significantly - the lowest quintile received 2.6 percent and the top quintile 46.8 percent. It is difficult to say whether this constitutes a trend, but it is sad, nevertheless, that these two groups are moving in opposite directions.

The implications of this economic inequality are enormous. To quote Senator Chester W. Carter:
“If every working man and woman knew and understood what that inequality means and the economic implications it has for them and their children, there would be a revolution in this country.”

We cannot ignore the necessity of social consciousness. One of the preconditions for this consciousness is the availability of information, in general, and education, in particular. Information is largely provided by the media and we all know, if we reflect just one moment, what interests democratic institutions like the Gazette, CTV, the Montreal Star etc. represent. Just ask yourself who provides their income and this will lead you in the right direction. As far as post high school education is concerned, John Porter, author of The Vertical Mosaic, has shown that it is only open to a small segment of society.

We could go on and examine statistics about levels of education, regional differences, differences according to ethnic origin and how they relate to poverty. We could talk about housing, life expectancy, child mortality of Indians and Eskimos (to pick the most miserable). But no one would believe it. Try this one on for size: Average age at death in Canada is 59.7 years for males and 63.1 years for females. In the Northwest Territories, where many Eskimos and Indians live, it is 26.0 years for males and 21.5 years for females.

But what are numbers? They don’t convey the immense human suffering involved. Even words are painfully inadequate - only the experience itself would give us a total picture. We can only imagine what it means to live as one of these statistics.

Generally speaking, welfare payments are based on a complicated formula, the exception being the case of a single unemployed, but employable person who cannot get more than $75 a month. In other cases, payments are partly calculated according to “need”. There is a basic rate for food, clothing, personal care, and household items, which according to GMAP, is 30 percent below the absolute minimum. Other agencies such as the Red Feather, Montreal Diet Dispensary and Montreal Council for Social Development agree on this. The basic rate for a married coupled without children is $78 per month, excluding rent and certain other needs.

“A Hopeless Failure”

We don’t have to look much further to see that the system is outdated, inefficient and in the words of the Senate Committee “a hopeless failure”. According to this committee the bureaucrats who administer the system, the poor who experience it, and the social scientists who study it, are all against it. It costs “Canadians more than six billion dollars a year, yet it has not significantly alleviated poverty let alone eliminated it... The reasons for the system’s failure are many.”

These reasons include a lack of determination and commitment by society as a whole, compounded by a lack of understanding of the causes of poverty and its destructive effects on the whole community.

Significantly enough, both GMAP and the Senate Committee suggest, in principle, the same remedy. They both recommend a guaranteed annual income (GAI) but at different levels.
The Senate Committee suggests that a GAI be given initially to those people living 70 percent below the poverty line. This is clearly inadequate. GMAP demands a GAI of $5200 a year, per family, subject to adjustments for children and cost of living increases.

The average for Canadian families and unattached individuals was $7900 in 1970. The fact is on the political scene that none of the parties (with the exception of Social Credit which proposed a GAI below the present welfare rate) has pledged an amount. In fact, the majority have rejected the idea. In any case we don’t have and probably won’t get it for long time to come. It is true that many people become irritated when a guaranteed income is mentioned. They’re not aware that a guaranteed income does in fact exist. Since welfare was changed from a privilege to a right for persons in need, there exists a line below which income cannot fall. Emphasis should therefore be placed on an adequate guaranteed income rather than on all sorts of emotional outbursts when the topic comes under discussion.

GMAP and other agencies propose to finance such a scheme mainly through more equitable taxation. Some industries pay extremely low tax rates, and profits are usually high in these cases. Some examples from 1968 taken from Information Canada publications will illustrate this point. The amounts are in millions of dollars:

Industry Tax Rates

[Blogger messed up the table, or I simply don't know how to enter a table here. Please click on the above link.]

GMAP, however, puts much more emphasis on finding suitable jobs for those who can work, rather than handing out welfare. The local initiatives program (LIP) is a good example of a successful way of providing the underprivileged with worthwhile jobs usually within some community project. Within this program citizens choose their own areas of job concentration, and Canada Manpower provides the money. The program provides jobs and incomes to the poor, but more important, it gives them a sense of dignity and the feeling that they have contributed something to society. Furthermore, LIP-created jobs require much less money than jobs created by industry with government funding.

Poor Need Bread, Get Cake

Mr. Dankwart doubts the situation will change. He said: “As far as GMAP is concerned, there has to be a realization that, in order to function in a meaningful way in Québec, the committee has to get together with the French people because it depends on people power. In order to create such power, there has to be communication with the people. This implies that it is not up to the people of Québec to assimilate with the English, but the other way around. Now that has to happen first in order to have more success.”

There is indeed little hope for change through legislation. Examine this excerpt from the United Nations Universal Declaration of Human Rights, signed by Canada, and compare the ideal with the reality:

“1) Everyone has the right to a standard of living adequate for the health and well-being of himself and of his family, including food, clothing, housing and medical care and necessary social services, and the right to security in the event of unemployment, sickness, disability, widowhood, old age or other lack of livelihood and circumstances beyond his control.
2) Motherhood and childhood are entitled to special care and assistance. All children, whether born in or out of wedlock, shall enjoy the same social protection.”

The poor in Montreal need housing at low-cost and what do they get? The extension of the Trans Canada Highway, which has forced the demolition of over 12,000 housing units. Oh yes, they build new houses, but can the poor afford the rent? Rarely.

The pour need bread, but Mayor Drapeau gives cake in the form of Expo and its infirm child, Man and his World and soon the Olympics. Drapeau claims that such projects create jobs. Aside from the fact that the money could be used for more worthwhile projects, let’s look at them a little more closely. This circus on the St. Lawrence is taking a substantial loss, which is paid for by the province out of our tax money. The fair does create some employment, but mainly summer employment to which students traditionally flock, and they are not generally the very poor. Let’s keep in mind too, that a large part of provincial revenue is derived from sales taxes. The poor pay as much per dollar as the rich - 8 percent. But if we examined this relationship more closely, we see that the people in the lower income classes pay even more than the rich in proportion, since the former spend all their income on consumption, and the latter save and invest a substantial part of theirs.

The Poor Man’s Pimp

What then, can be done? The problem has become so complex, that direct action is nearly impossible - except on a personal level. This is the crux of the matter. If you’re concerned about poverty become actively involved. Find out which group is working in your district by phoning the GMAP offices. Write letters to your MP, keep discussion alive. For those of you who can’t or won’t become involved, at least don’t live off the poor. Don’t, in the words of Mr. Dankwart, become the poor man’s pimp.

Time Magazine reported in June 1971 how the job market for penologists, criminologists, public health workers, politicians, crusading journalists and, last but not least, social workers serves to maintain poverty. To this Dankwart added that many people who are presumably fighting poverty actually profit from it because they serve the very system, which ensures the existence of poverty. Poor people prolong the economic usefulness of day-old bread, secondhand clothes and cars and substandard dwellings, while directly or indirectly providing income for some incompetent lawyers, doctors, and slum landlords who might otherwise be an economic drain on society.

If we realize what we are in effect doing to promote the current state of affairs, then a vital step will have been taking in helping Canada’s poor.