Ontario’s plan is hardly working
Today, the Wynne government released its fall statement—essentially an update on the state of Ontario’s economy and finances. The document’s second paragraph contains a shockingly out-of-touch sentence. It reads: “Our plan is working.”
It’s difficult to know where to begin pointing out the problems with this claim, but looking at the broad macroeconomic numbers is as good a place as any.
The government’s rosy rhetoric notes that the provincial economy is now growing and that relatively strong growth is expected in the years to come. But it’s important to recognize just how severe and prolonged Ontario’s economic slump has been before popping the champagne to celebrate a brief uptick in growth.
Consider the fact that from 2003 to 2015, per person economic growth (adjusting for inflation) in Ontario increased at an average annual rate of 0.5 per cent. That’s anemic growth over a long period of time, and is approximately half the growth rate in the rest of the country.
Weak economic growth is not just a matter of economic concern—it has hit regular Ontarians hard in the pocketbook. Consider that in 2000, average disposable household income in Ontario was 10 per cent higher than in the rest of the country. Prolonged poor economic performance has meant that Ontario’s average income (since 2012) is now below the rest of the country. Ontarians having income below the national average is historically unthinkable and probably quite difficult for most to comprehend.
Put simply, the average Ontarian is now poorer than the average Canadian.
A potent symbol of Ontario’s economic slide came in 2009 when the province became eligible for equalization payments, becoming a “have-not” province for the first time in its history. It’s a situation that would have been almost unimaginable a generation ago. Seven years later, however, the receipt of equalization payments has simply become business-as-usual in Ontario.
It’ll take more than a few quarters—or even a few years—of strong economic growth to undo all of this damage and restore Ontario as an economic engine in Canada.
If this is what economic success and a “working” plan looks like, it’s hard to imagine what might constitute failure in the government’s eyes.
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