It is ironic, though, that this OECD report (emanating from the employment and social policy side of the organization, DELSA) flags as the underlying causes of inequality precisely those policies which the economic side (ECO) advocated for so strenuously through at least the 1990s and much of the past decade as well.
...[The] first OECD Jobs Study of the early 1990s are prepared by ECO and advocated “flexible” labour markets to generate jobs. The key argument was that employment growth required labour market de-regulation, and that we should not be too concerned if the jobs being created were insecure and poorly paid. Relatedly, reports advocated major cuts to unemployment insurance and welfare programs which were seen as needed to make wages flexible and to reduce taxes. ... [Now] they tell us that the Canadian tax/transfer system offsets only 40% of any increase in market income inequality – one of the lowest proportions in the OECD – compared to 70% in the mid 1990s when Canada’s redistributive effort was at near Nordic levels!
Andrew Jackson, Mind the OECD Credibility Gap
You can read this in the CBC Business story, Wealth gap widens to 30-year high:
"Our report clearly indicates that upskilling of the workforce is by far the most powerful instrument to counter rising income inequality," [OECD Secretary General Angel] Gurría said. "The investment in people must begin in early childhood and be followed through into formal education and work."It led some literacy people (who ought to have known better) to repeat the mischief that people are poor or struggling because they are under-educated. Tweeted one in-cautious soul:
As the rich-poor gap widens, Workplace Education is the most powerful instrument to counter rising income inequality. cbc.ca/news/business/…But that's not what the report says; not in whole, and not in specific reference to Canada. What it says is, "Employment is the most promising way of tackling inequality. The biggest challenge is creating more and better jobs that offer good career prospects and a real chance to people to escape poverty," and "Reforming tax and benefit policies is the most direct instrument for increasing redistributive effects."
Most promising way? More and better jobs.
Most direct instrument? Reforming (a.k.a., "raising") taxes.
Certainly, education and/or workplace retraining are important. But we need to be very careful with statements like "Investing in human capital is key." Citizens are not "human capital." They are human beings: human beings who live here and raise families here and die here. If you really see them as "capital", as part of the cash, goods, property and other assets owned by a business, then fuck you.
Too, the statement "there must be sufficient incentives for workers and employers to invest in skills throughout the working life" fits very nicely with the ideas like subsidizing on-the-job training (to the benefit of the wealthy) while reducing or ending employment insurance or social assistance payments (to the determent of the poor). "The provision of freely accessible and high-quality public services, such as education, health, and family care, is important," they write. Yes it is. But only if "freely accessible" is not limited to employment-related programs and services, or schemes for convincing HDRCanada to pay for provincial programs.
I'm not very interested in anything the OECD says, by the way. I think we've allowed an awful lot of damage to be done to our nation by people who were happy to use shallow, jargon-laced OECS reports for cover. We don't gain anything by continuing to pay attention to what is in essence a lobby group for international banking and business interests.
But if you're interested, here's the "Key policy recommendations for OECD countries from Divided We Stand" section of the two-page COUNTRY NOTE: CANADA
- Employment is the most promising way of tackling inequality. The biggest challenge is creating more and better jobs that offer good career prospects and a real chance to people to escape poverty.
- Investing in human capital is key. This must begin from early childhood and be sustained through compulsory education. Once the transition from school to work has been accomplished, there must be sufficient incentives for workers and employers to invest in skills throughout the working life.
- Reforming tax and benefit policies is the most direct instrument for increasing redistributive effects. Large and persistent losses in low-income groups following recessions underline the importance of government transfers and well-conceived income-support policies.
- The growing share of income going to top earners means that this group now has a greater capacity to pay taxes. In this context governments may re-examine the redistributive role of taxation to ensure that wealthier individuals contribute their fair share of the tax burden.
- The provision of freely accessible and high-quality public services, such as education, health, and family care, is important.
OECD (2011), Divided We Stand: Why Inequality Keeps Rising