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July 13, 2019 - Freedomain Radio - Stefan Molyneux
47:12
The Decline and Fall of Canada. Prepare Yourself Accordingly.
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Hello everybody, it's Stefan Mollen from Freedom Aid Radio.
I hope you're doing well.
This is The Decline of Canada, aka There Will Be No Economic Recovery, the Frozen North Tundra edition from Freedom Aid Radio.
The only freedom, remember, is freedom from illusion.
So people are generally told that the Canadian economy has a lot of positive attributes, that the Canadian banking sector weathered the recent financial storms, and that there's a sound, stable and relatively free economy with low government debt to GDP.
We will be examining this in a little bit more detail and it's true that there are some strengths Canada tackled a lot of its truly tumorous excessive government spending in the 90s and Canada did not have a massive stimulus package which is one of the reasons why the economy has been strong and so on.
But let's look historically.
So from the 1970s, where Canada and the U.S.
started off with similar unemployment rates, Canada's unemployment rate has continually trended higher up until the recent financial crash has continually trended higher by a percentage point or sometimes even two percentage points above the U.S.
And this, of course, creates significant costs in terms of social programs and significant loss of productivity gains because people, of course, are not working and rather consuming.
This is significant.
This is the result of Canada's increased socialist commitments to its population, or at its population.
So there's one way in which the Canadian economy has remained relatively weak relative to the U.S.
And one of the reasons for this, and the true degree of it is masked as well, the public sector is enormous in the Canadian economy.
Now in the private sector over the last thirty years the The unionization rate has dropped by almost 50 percent.
And this is because unions tend to push for more and more demands for their workers, which tends to make businesses uncompetitive, which tends to put those workers out of a job.
And so, certainly over the last five years, unions in Canada, in the private sector at least, have become quite reasonable, because they look at the company's finances, they recognize that they can't afford more wages, and then they back down on their demands.
This doesn't happen in the public sector.
I mean, the public sector shouldn't actually theoretically have any
unions at all according to even left-wing theories right because unions are there to supposedly according to left-wing theory unions there to counteract the desire to crush workers wages so that the you know fat evil monopoly monocle capitalists can get more profits and have more baths of gold but of course in the public sector there's no profit motive to drive down union wages so there should be no public there should be no need for unionization but this is where unions have gone because they have continually made businesses uncompetitive in the
In the private sector and therefore they have retreated to the public sector which is where they tend to gather most of their gold.
So if you look at in Canada the public sector percentage of employees covered by registered pensions in 2011, it's almost 90% in the public sector and less than 25% in the private sector and average retirement age in Canada is 62 and a half for private sectors and 60 for public sector.
employees and I hope everybody understands that because it's 60 in the public sector it has to be higher in the private sector to pay for because you have less money and higher taxes and so on.
Job loss by class of workers for Canada in the thousands so this is over the last little while 22.1 for public sector employees 423.4 for private sector employees this is in the not even close category as a percentage of employment 0.6 percent for public sector employees 3.8% for private sector employees.
So this is one of the problems.
The public sector is what's called upwardly sticky.
In other words, it grows as a result of unions, as a result of inefficiencies, as the result of people wanting to give patronage jobs in order to buy votes to get in power, the politicians and so on.
But it almost never shrinks.
Right?
So this is sort of a continual growth problem.
It's like a coral reef or something.
It just keeps growing and growing.
So the result of this has been something very interesting, and this is something which you can see all around the Western world, which is this hollowing out of the middle class.
So this is from 1971 to 2011.
You can see that the lower income percentage distribution has risen from 25 to 29 percent.
The upper income has risen from 14 to 20 percent.
And the middle class has dropped, or the middle income has dropped from 61 to 51 percent.
This is typical in late statism, right, as the government grows and as the government particularly borrows to spend and so on.
What happens is the poor get trapped in this sort of sticky welfare subsidy underclass and the rich start to manipulate the state to get more and more benefits and both of these are paid for by the middle class.
So the middle class is the great ballast of society.
When the middle class goes As it did in the 1920s in the Weimar Republic in Germany, bad things tend to happen.
The middle class is the great stabilizer within society and as the government grows, so does the poor and so do the rich, at the expense generally of the middle class.
And if you are in the middle class, you will know what I'm talking about.
So, as I said, in the late 90s, the government in Canada, the federal government, was paying 40 cents on the dollar, just on interest payments, and so they savaged a fair amount of spending.
But these dips are nothing compared to what's grown.
I mean, this would be called savage austerity, because if you look at 1960, this is gross Canadian federal government debt, 1867 to 2008.
I mean, there's massive escalation that has occurred from the 1960s from the rise of the welfare state.
And Canada has almost no warfare state.
I mean, it's a very small military.
And this is almost all transfer payments, also known as vote buying, also known as paying people to not change the system.
You know, one of the great problems with things like welfare and unemployment Is it tends to drug people's sense of outrage about a system that doesn't work for them, because they can kind of get by, and so it's like taking cocaine for a toothache.
I guess you feel a little better in the short run, but the rot only gets worse.
So the demand and a desire for social changes is really kept at bay through this fire hose of fiat imaginary monopoly money that keeps getting fired at the poor, which prevents them from wanting to change the system, and also keeps getting fired at the rich, which also prevents them from wanting to use their more considerable muscle to attempt to reform a system that doesn't really work very well.
So, debt.
Household debt is one of the great unspoken or underspoken of trends in modern western economies.
As real income has declined, as taxes have increased, what people do to sort of wallpaper over these cracks is they just continue to borrow.
And of course, as the government prints money, as it tends to do, prints a lot of money, the money washes out into the economy and the inflation hits.
But the government keeps interest rates low because it doesn't want to pay a lot of interest on its own debt.
And this combination really does provoke consumer spending, which is a massive waste of a lot of resources and so on.
But people are just borrowing and spending in order to make up for diminished income and also to take advantage of the artificially low interest rates kept in place by Western government.
So so they don't have to pay money on their own debts.
And so here in Canada you can see this massive rise from 1980 where the debt to personal income ratio was 80% or so, now heading northwards to 160% and so on.
Exceedingly unsustainable.
You can see this trend through Canada, the US, the Euro area and the United Kingdom.
This is a continual trend.
This is unsustainable.
And debt, of course, is simply deferred.
It's deferred losses.
And what happens, of course, with a lot of debt is you are crowding out investment, right?
So as you borrow to consume a whole bunch of stuff, which is generally where this goes, you are crowding out investments in capital improvement and worker productivity growth, as we'll see down the road in this presentation, tends to lag.
It's a huge problem.
I mean, productivity growth is about the only thing that matters when it comes to having a sustainable and growing economy.
And when you borrow to buy a plasma TV, that's fine, but you're not investing in creating better ways of producing things.
Household debt to income ratio in G7 countries 1960 to 2011.
As you can see here, this is Canada, France, Germany, Italy, Japan, UK and US.
All trending upwards from 0.5 to 1.5, 1 and so on.
And this is significant.
This is extremely important.
This is an addiction, right?
And all addictions come with the highs and the crashes, and we're just starting to enter into the crashes now.
Of course, a lot of this is driven, as well, by the belief that somehow a consumer good, like a house, is somehow an investment good, like a factory, and therefore it rises in value.
This is, of course, not true, and the lie of this is becoming revealed through the various housing crashes around the world.
You can't get rich by investing in consumption goods.
You can't get rich by buying a bunch of cars and driving them around.
They lose value over time.
Same thing with houses.
But this idea that your house is an ATM that's going to continue to rise in value is what has fooled people into over-leveraging themselves by borrowing a whole bunch of stuff, by buying a whole bunch of stuff, and when the housing crash comes, this is all revealed as nonsense.
So, again, these trends are very, very important and indicate deferred poverty.
So, when you have debt, I mean, almost by definition, you're not going to have a whole lot of savings.
So, saving rates in Canada have declined.
Retired debt has declined.
Household debt to income ratio, you know, 144, 146.9%.
Debt to personal disposable income is just lunatic.
And so you can sort of have a look at the two pauses if you want to look at these graphs.
In more detail.
So this is very very important.
Household debt in trillions has risen from 1.4 to 1.6 just over a couple of years and this is average household debt for a family with two children $176,461.
children, $176,461.
So low savings means low investment, which means low productivity growth in the future.
House prices in Canada.
Oh my goodness, what an exciting rollercoaster this is.
Going to be.
This is from 1980 to 2011.
You see that they've gone from about $50,000, constant dollars, from $50,000 to over $350,000.
This is remarkable.
I mean, many years ago I was chatting with a guy who was a teacher and he said, oh yeah, when I was a teacher I made $9,000 a year and I could buy a house for $12,000.
That would be the equivalent of buying a house on average for about $70,000 to $80,000 or maybe $90,000 here now.
As opposed to, and this was in Toronto, where the average house price is northwards of about half a million dollars, so it's been completely mad.
But this is what happens when you have, of course, a lot of immigration.
This is what happens when you have very low interest rates.
Interest rates really should be set by the free market, not by government fiat, in order for there to be any kind of free market.
It's pretty brutal stuff.
The government, of course, loves getting people into houses because they pay a lot of property taxes.
And when you get people in houses and you get them into multi-decade debt, they tend not to agitate for social change.
It's another sort of secondary gain from getting young people into a lot of debt to go to school, is that once they come out and they're tens of thousands of dollars in debt, they tend not to agitate for a lot of social change because they're on the hamster wheel of paying interest.
So, lots of benefits for the powers that be.
Now Canada's job market is just not recovering.
The Canadian economy has lost 26,000 jobs so far in 2013 as a whole.
That's net.
But if you just look on the losses side, it shed 85,000 private sector positions, all of them full-time, in March.
And of course a lot of the losses come from those in the core working age group, those between 25 and 54.
So job growth has lagged population growth, making the recovery, to put it mildly, incomplete.
There are 1.4 million Unemployed Canadians competing for jobs compared to 1.1 million prior to the 2008 crisis.
This added population to a little over 30 million.
So, it's huge.
It's huge.
And again, unemployment insurance and so on, I mean, I understand people need to eat, but it does keep people from really protesting, you know, change.
When you're in an addiction, as government spending, government debt, and so on, when you're in an addiction, panic is often the only course correction that you have, and when people don't panic, nothing changes.
This is a way of keeping people not panicking, as they should be.
So, Canadian public sector workers are paid 12% more than their private sector counterparts, said a 2013 study by the Fraser Institute.
Now, this is a vast understatement.
If you just remember a couple of slides back, we looked at the fact that they just don't lose their jobs when there's a problem in the economy.
How much is that worth?
Better pensions, non-wage benefits, shorter work weeks, earlier retirements, greater job security, and so on.
That's hugely important.
I mean, this changed a couple of decades ago in Canada, as it did throughout most of the West, where before you worked for the public sector, you had job security and, you know, you'd often want to take a gun to your own head because of the useless futility of your days, but you'd get job security and better benefits, but you wouldn't get paid as much.
That has completely changed to the point where now, in America, public sector workers are earning a third or more when you count in benefits and so on than private sector workers and the deferred pension payouts are just staggering.
They eat the entire economy up.
88% of the public sector has a registered pension versus 24% of the private sector.
And those who have a pension in the public sector, 94% are defined benefits.
In other words, no matter what you pay in, this is what you're going to get out.
Only 53% are defined benefits in the private sector.
So that's another significant benefit.
The number of Toronto City employees who earn more than $100,000 has jumped about 30% from 2012 to 2011.
Taxpayers are on the hook for more than $1.5 billion in regular and voluntary severance to over 100,000 public sector servants.
Never have servants seemed so much like masters.
In 2011 to 2012, It will spend at least another 850 million in 2012 to 2013 on accumulated severance payouts.
Yeah, of course, the staggering and outrageous... You bribe people to go away.
I mean, you literally bribe.
It's like having a psycho stalker ex-girlfriend and you pay her a million dollars to move to Mali.
This is why it's so hard for governments to cut their spending because when you fire a bunch of government workers, your costs actually go through the roof in the short run and it looks a lot worse.
900 million to cover workplace adjustment payments owed to thousands of employees who would be let off due to federal budget cuts.
In the good old days you'd just get fired but now you have to pay people to go away and it's just brutal and this is why so many politicians don't want to take on this stuff.
Population of the Federal Public Service 278,000 and change between 50 and 60,000.
278,000 and change between 50 and 60,000 federal public sector jobs or private sector jobs funded by the government will be eliminated by 2014.
If we take 55,000 to be the future federal job cut number, the average 900 million results in over $16,000 payout per person.
Now, to be fair, the people who've spent a lot of time in the public sector, I would have a very tough time, when I was an entrepreneur and hiring people, I had a very tough time taking people from the public sector, unless I was like a Welfare whore, and wanted to gain access to their government contacts.
But, I mean, who wants to hire people from the public sector?
So, it is kind of rough.
They're going to have to change their attitude just a tad.
So in Canada, of course, this is typical in the West, more and more seniors are working longer.
A percentage of those aged 60 to 64 who are employed rose from 34% in 1989 to 47% in 2011.
That's a new record.
in 1989 to 47% in 2011.
That's a new record.
Those who are 65 to 69 who are still working from 11% to 23% same time period.
The percentage of the 70 and over increased to 6% in 2011 are once more a record high.
Bye.
The labor force aged 45 to 54 more than doubled, while those aged 55 to 64 also more than doubled, while those aged 65 and older grew even faster by 180%.
So, these are not exactly the golden years, they are the Put your back back to the ore years.
So, wage stagnation and decline in manufacturing.
This is very important stuff.
The median income of full-time Canadian workers increased by just $53 annually between 1980 and 2005.
And this is a time when inflation was very high.
This is a time when government debt, which is simply deferred loss of income for taxpayers, was very high.
And so this is really important.
So when they say, well, it's just going up 50 bucks a year, well, taxes are going higher, inflation is going higher, national debt goes higher.
Whenever national debt goes higher, you're looking at a deferred loss of income in the future, right?
Because the government's either going to have to default on the debt, which is going to Mash up people's savings or it is good because the dollar will be worth almost nothing if the government defaults on its debt and also it or it's going to raise taxes to pay for the debt.
So in real terms the money is going up by 53 bucks but in sort of nominal terms but in real terms it's going declining enormously.
After eight years of decline, the Canadian manufacturer sector created only 15,900 jobs in 2011.
Employment in 2011 was about where it was in 1993, down by 532,200 jobs since the peak in 2004.
So, looked up one example, a 50-year-old man laid off last year from his job of 22 years at a bus assembly plant, has since applied for 130 jobs.
His best offer was a job at 12 bucks an hour, half his previous wage and not enough to pay his bills.
Factory sales plunged 3.1% to $48 billion, marking the deepest one-month decline in 43 months or since the midst of the Great Recession.
Auto plant shutdowns in Ontario occurred, but even excluding that sector, Canadian factory shipments fell almost 2%.
And the fell, as a whole, in the last month of 2012, 2.8%.
Of course, the U.S.
is still struggling in its own quagmire, its mastodon pileover of debt and dysfunction.
Asia, of course, experiencing a slowdown.
Europe continuing to muddle through its debt crisis.
There's not going to be much of a pickup for Canadian exports, which, you know, for a resource- and manufacturer-based economy is quite a big deal.
Canadian companies' business investment plans are at their lowest non-recession point since 1995.
This is an alarm bell for the economy.
Investment is so important to the creation of new jobs and future profits.
Almost all businesses in the West are facing regime uncertainty, which really used to be a third-world problem in that they don't know what's going on in the economy, they don't know what steps the government is going to take to remedy or get out of the way, and so they're hiding money in a war fund.
Business investment remains slow.
Outgoing Bank of Canada Governor Mark Carney wants the private sector to unleash some of what he has called the dead money to stimulate the economy.
But companies need to put cash in a war fund until better times, says Betty Lou Pacey, founder and chief executive officer of BL Innovative Lighting, a small Vancouver-based business that exports optical fiber for lighting.
She cites a massive U.S.
fiscal deficit as the biggest external threat for exporters whose sales growth depend on healthy U.S.
demand.
Her own company has a couple of costly projects percolating that would be easier to commit to if circumstances were better.
And this paralysis is also occurring, of course, in the U.S.
where some companies are experiencing record profits and just not spending.
Not spending.
There's too much regime uncertainty.
20,000 pages of Obamacare regulations that are not even complete are coming down the pipeline and people just don't want to spend right now.
So, the flip side of Canadians' explosive debt burden is consumer spending, which is showing weakness as debt loads continue to grow.
Retail sales over the crucial holiday season posted an unexpected 2.1% decline this past December, signaling that the Canadian consumer may be running out of steam and finally reining in those debts.
Canadian household debt has reached an all-time high, but in 2012 Canadians still took on more.
Consumer debt jumped 6% last year.
Analysts are growing concerned that Canadian consumers are over-leveraged, really, and will eventually have to make steep cuts to their spending.
And this is the last desperate throws of this debt-based lifestyle that really started in the 1960s, particularly, of course, in America in 71, when Nixon finally severed the last connection with the gold standard.
It's all been toilet paper monopoly money ever since, which drives a lot of consumer spending.
Austerity measures will shave 0.9% off government spending, which in turn will translate into a 0.2% drag on Canada's GDP.
And again, one of the problems with democracy is it's very, very short-term economic.
There's an election cycle every two years, usually, so it's very, very short-term economic thinking, whereas in other kinds of systems, and hopefully a system with no government, there's a much longer-term view of the economy.
But why is it that politicians won't want to take on this stuff?
Because they'll be in the trough, right?
They'll be the big dip of cutting spending, usually in the next election cycle, which means they'll lose power.
Experts say nervous consumers won't spend enough to provide a significant boost to the economy, especially as households have a record $1.65 of debt for every dollar earned.
Madness.
There is this weird fetish that says that if you just buy a bunch of stuff, that's good for the economy.
I mean, GDP measures are ridiculous.
People who get sick add to the GDP.
I mean, it's nonsense.
But this idea that just get consumers to buy a bunch of stuff and that's really good for the economy is It's just nonsense.
I mean, imagine giving everyone a million-dollar winning lottery ticket and they'll buy a whole bunch of stuff, but the economy would be completely insane as a result.
The economy does not grow because people buy stuff.
The economy grows because there's capital investment in improving efficiency in various things.
It's all B2B stuff that causes the economy to grow.
The consumer stuff is just an effect of that.
But it's, of course, what's easier to measure.
But it's just nonsense.
This is the whole lie behind stimulus packages, right?
Just get consumers to buy stuff, or get people to buy stuff, and suddenly that's good for the economy.
Well, no.
I mean, because every time you buy stuff to consume, you're not investing in improvements.
Canada Mortgage and Housing Corporation predicts construction of new homes will fall 11% this year.
Bad news for the economy as Canada has come to be, as the US was, more reliant on real estate and construction related activity than it has been in recorded history.
The fire industries, finance, insurance and real estate amount to 27% of the economy, up from a long-term average of 24%.
Construction slowdown could translate into big job losses.
House prices in Canada suffered six straight months of declines before leveling off in April, according to Terranet.
But sales volumes have dropped sharply over the past year, down 15.3% from a year earlier, according to the latest numbers.
And the supply of homes available on the market is growing relative to the number of buyers, which is a bad sign for future prices.
Capital markets predict a 25% drop in house prices.
The Economist indicates Canada has one of the most overvalued housing markets in the world.
And we all know what happens.
Look at the US.
What happens when Housing prices begin to decline.
Well, the lie that your house is your ATM is revealed and the economy just goes through an unbelievable, stomach-churning, retching kind of monkey in a barrel rolling down a hill off a cliff series of events.
So of course what happens here in the housing price index from 2007 to 2010 you can see this decline and a massive decline in the net worth of families to the point where in the US families now have a lower net worth than they did in 1989.
So, all of these increases in housing prices, which makes people feel wealthier, which makes people feel... The other thing, too, is if you believe that your house is continually growing in value, that becomes what you invest in, which is really just setting fire to your money in a slow, house-shaped form.
And the lie of that, and everything that's not done... Opportunity costs are everything when you look at economics.
So, the fact is that people are investing in their house.
They say, oh, I'm going to build a deck.
It's like, well, a deck is a consumption good.
It's not going to make you money after that.
It's like buying a gaming computer rather than a productivity computer.
It's fun, but it just doesn't add anything to your wealth in the long run.
It consumes and destroys it.
Which is not to say that's bad, it's just that's the natural economic outcome of it.
And so when people think that their houses are continually increasing in value, they don't do other things which they could do that will actually increase in value.
And so this is why it's such a calamity when it all falls apart.
So let's look at the international view of the Canadian economy.
Forget about people who, and this includes me, but forget about people who have opinions about the economy.
What you want to do is look at the people who are betting on various economies, because that's usually their own money, or at least money that they're responsible for, and they do a heck of a lot more work than generalized pundits.
And global investors are turning against Canada's economy and they're placing some of the largest bets on record that Canada's housing market, financial sector and currency are in for a rough ride.
A report Monday in the Financial Post indicates that a near record amount of money is being placed against Canada's major banks.
In other words, people are shorting.
They're going to make money if the bank stocks go down.
The length of time it would take for investors who are shorting Canadian banks to cover their debts if the stock went up is now at 10.3 days compared to just 1.3 days for US banks.
So you're going to make money if the stock price goes down.
If the stock price goes up, you have to pay money in.
And the amount of time it will take for them to pay money in is over 10 days.
Anything over a five suggests investors are pessimistic.
Follows the report last week, the Canadian dollar has become the second most shorted major global currency after the Japanese yen.
I think Japan is what, over 250 percent of debt to GDP ratio?
Suggesting investors widely expect the Canadian dollar to keep sliding, several trends appear to be behind the negative sentiment, including a weakening housing market and falling prices for commodities such as oil and gold.
Both of these trends could impact the country's economy, given Canada's well-known reliance on commodities and given that housing now supports a greater percentage of Canadian jobs than it has in recent history.
Also, of course, when the housing market crashes, all the people who were trained in that housing market have to go retrain, which is a huge drain on the economy.
San Francisco-based Hyphen Partners LP is putting 95% of its clients' assets into bets against Canada's housing market and banks.
Canada faces two risks, says this dude.
Housing and banks.
Very few people are looking at those risks simultaneously.
That collectively presents a lot of opportunity for those who wish to make money off the Canadian economy's expected decline.
In terms of the market, Canada is a rather exciting place to do business, as I did for about 15 years.
Most Canadian small businesses pay much more than their US counterparts to comply with regulatory requirements.
Smallest businesses in Canada, fewer than 5 employees, pay 45% more per employee, almost $6,000 to comply with government regs, than their US counterparts, $4,000.
Total cost of regulation to Canadian businesses is $31 billion a year, In addition, Canadians spend more hours a year to comply with regulations, 171 hours versus 130 hours in the US.
Productivity growth in Canada was 0.7 percent between 2001 and 2011, well below the US with 1.8 percent and OECD average of 1.4 percent.
The productivity growth, as I said, is everything, but it has to be productivity growth in investment goods ideally rather than consumer goods.
So Housing being a consumer good, something which you use up in value and does not create additional value itself.
If you count all of the growth in the housing sector and housing market, then it's probably even lower if you discount all of that stuff, which is not going to add to our growth in the long run.
run. 2012, a record 882,000 Canadians use food banks, highest level ever, which is 26% above 2008 levels.
Number of Ontario residents on welfare jumped by more than 63,000 last year or Social assistance caseload increased by about 20% between November 2008 and November 2009.
British Columbia, also known as the Left Coast, it's also risen significantly.
Its clumping economy takes its toll.
Latest numbers from Ministry of Housing and Social Development show the number of people on social assistance who were able and expected to work has increased almost 50% in the last six months.
And here's some more details.
As you can see the vast majority of the welfare cases are single moms.
I mean basically the welfare state is deliver money from single people and people with two parents and families to single moms.
This is a huge giant sucking sound of the need for single moms to have resources.
The number of people on welfare rose 26.2 percent People defined as unable to work because of persistent multiple barriers fell nearly 4%.
So, not good as a whole.
There's a 21-year difference in life expectancy between the poorest neighborhood and the wealthiest neighborhood in Hamilton, Ontario.
Again, this is a huge cost to the economy as a whole.
For the richest 1%, the share of all Canadian incomes almost doubled between the late 1970s and 2007.
For the richest 0.1% of tax filers, their total share almost tripled.
And for the creme de la creme, the richest 0.01%, making more than $640,000 a year, the share of the total income is more than quintupled.
Because the government in the 1960s began a process of attempting to narrow inequality, to narrow the gaps between rich and poor, as a result, since violence always achieves the opposite of what you want, this gap is only increased.
Between 1980 and 2005, median earnings among Canada's top earners rose more than 16%, while those in the bottom fifth saw their wages dip by 20%.
The report from the OECD said the top 1% of Canadians saw their share of the country's total income increased from 13.3% in 2007 from only 8.1% in 1980.
19.3% in 2007 from only 8.1% in 1980.
The share of income, the top 0.1%, show the share of income more than double to 5.3% from 2%.
Top 10% of Canadians in 2008 earned 103,000 on average, 10 times higher than the bottom 10% who made an average of 10,000.
This is up from 8 to 1 in the early 1990s, higher than the overall OECD average.
Out of 25 developed countries, Canada ties for last place for failing to attain 9 of UNICEF's 10 benchmark indicators of quality and access to early childhood education and care.
Canada is brutal on the environment, Canada is brutal on children, Canada is brutal on the poor, and Canada is particularly brutal on the native population.
So let's just take a few minutes to talk about this.
And the reason I want to talk about this is to show something very very important.
As government power grows over a community, that community tends to do worse, unless that community is very rich.
But over the poor, as government power grows over the poor communities, those communities tend to do worse.
And there's no place in the West where the government has more power over a community than it does over the native population.
So let's really recognize that this is where the poor are heading to if the government continues to gain more and more power.
If you look at the sort of ghetto in Canada or in the US or even in Europe.
Government controls the roads, government controls the housing, government controls the education, government controls the sewage, government controls the electricity, government controls almost the entire environment.
It's a government zoo that these people are living in and it really tends to be pretty wretched.
I mean they bulldoze these public sector housing projects all the time because they just become so completely ruined and wrecked.
So it's really important if you want to look at the future of the poor, look at areas where the government has more power over the poor and this would be the native population.
The First Nations is what they're called in Canada.
Children are suffering the greatest levels of poverty of all children in the country.
One aboriginal child in aid is disabled, double the rate of all children in Canada.
43% of First Nations children lack basic dental care.
Overcrowding is double the rate of general for Canadian families.
Mold contaminates almost half of their households.
Almost half the aboriginal children under 15 live with a single parent in urban areas.
A hundred First Nations communities have to boil their water.
Of all off-reserve Aboriginal children, 40% live in poverty.
The biggest revenue source for them, of course, is transfers from the federal government, which is really not exactly true.
It's transfers from Canadian taxpayers and mostly the unborn in terms of debt.
Aboriginal children in Canada die from unintentional injuries at rates three or four times higher than the national average.
While injuries are the leading cause of death for all Canadian children, they affect Aboriginal kids disproportionately.
In some areas of Manitoba, Saskatchewan, and British Columbia, the injury-related death rate for First Nations children is 6.5 times that of the general population.
For certain injuries, it's 22 times higher.
Unintentional injuries cause 6% of deaths in Canada, but 26% of all Aboriginal deaths.
This is sort of young and old.
It's brutal.
I spent... After high school, I wanted some money to go to college.
And I was just dead broke so I took a job panning for gold and prospecting up north and I was driving back from a town where I went for a couple of drinks one night and I found this aboriginal woman staggering along the side of the road.
Uh, brought her in and, uh, asked her what happened, and she said she was in the back of a pickup truck with a bunch of other guys.
They wanted blowjobs.
She wouldn't give them blowjobs.
They threw her out of the car while it was still working.
So, of course, they took her to the hospital, made sure she was okay.
But, man, it's brutal.
You see the aboriginal kids in town wandering around in their underwear, like, two o'clock in the morning.
Uh, no clothes.
It's cold.
I mean, it's just a brutal, decimated community.
This is what happens when Government power moves in.
Human beings are like muscles that respond to resistance.
When government moves in, resistance goes, the muscle goes, and atrophy sets in.
In Canada, being aboriginal means being poor, generally, even very poor.
3.8% of the country's population identified as aboriginal, and almost 22% had incomes below the low-income cutoff after tax.
So it's almost double compared to the non-aboriginal population.
Employment rate of Aboriginal peoples being almost 10 percentage points below that of the non-Aboriginal population.
Basic education, only 43.7% of Aboriginal Canadians have less than a secondary education compared to 23% for the non-Aboriginal population.
Again, education is like training for a race.
If there's not going to be any race, why would you train?
Over 50% of all Aboriginal children were poor, the highest rate Of all the three equity groups previously mentioned, disability rate more than twice the national average, more than four times likely to be hungry for aboriginal children.
So in 1988, amendments to the Indian Act empowered First Nations with their own tax authority and today, according to this guy Wilson, about one-sixth of bands collect taxes.
This will all be available at fdrurl.com forward slash Canada, all the sources for this.
So, the personal property of an Indian or Band situated on a reserve is tax exempt.
This is Métis and Inuit, or what used to be called Eskimos, not eligible for this exemption.
A status Indian working on a reserve is exempt from income taxes and status Indians do not generally pay the federal goods and service tax or provincial sales tax if they buy something on reserve or if it's destined for a reserve.
Off reserve we all get stuck with it.
Well, so do we.
Okay, so every time someone leaves a reserve, the cost and obligation of the federal government for each of those individuals is reduced by about 80%.
So, this is one of the reasons why the federal government has no economic interest, in fact, every economic interest, to keep things really crappy on the reservation, because they're trying to drive people off, to reduce the cost of ownership for these wretched souls.
This is sort of important.
For every $8 spent on reserves, only $1 is spent on services to those 60% of the band members that lives off-reserve.
So again, the crappier it is, the more people they hope to leave, the less their cost is going to be.
Crazy economic incentives.
So, you're grinding poverty, tainted water, not suitable for drinking or bathing, major housing crises, loss of language, extreme crime rates, rampant health epidemics, youth suicide rates eight times the national average.
For Inuit youth living in the Arctic, the suicide rate is 40 times the national average.
I mean, these are the people who are drinking photocopy fluid just to get high.
It's wretched.
Now, this has been the result of pretty significant and savage government intervention.
So for more than a century, education for on-reserve Aboriginal children was primarily provided through government-funded residential schools.
They were designed really to assimilate Aboriginal children in Caucasian culture and the churches.
The children were forbidden to speak their own languages, practice their own spiritual traditions or maintain their cultural traditions.
Schools were usually too far from reserves to enable contact with parents.
Siblings were separated in residence.
Sexual and physical abuse and death from disease were rampant in these institutions.
Children in these residential schools did not encounter healthy parental role models, to say the least, and they had diminished capacity compared to care for their own children.
The last residential school closed in Saskatchewan in 1996.
The results have been parent functioning concerns and so for alcohol abuse 63% for aboriginals 21% and change for Caucasian strike abuse 27 to 12% criminal activity 17 to 8% cognitive impairment 8% to 5.3% mental health concerns about equal physical health concerns about equal and so on.
So, an 80.9% increase in the number of days that a First Nations Children's Spending Group or Institutional Care during this period.
This increase is dramatic when compared to the corresponding figure for the number of days spent in foster care.
37.4% increase.
So, government basically came in, as governments tend to do, is they decimate the family, they decimate the community.
Families and communities, one of the primary purposes is to shield people from the natural hardships and rigors and challenges and problems of life.
When the government comes in and takes over these, it weakens community bonds completely.
Having the government around is like putting all of your limbs in a cast or going into space.
All that happens is your muscles and your bones atrophy.
You don't solve the problems.
All you do is make people permanently dependent upon this kind of economic and legal shield.
Fewer Aboriginal children aged 14 and under lived with two parents than did non-Aboriginal children.
32% of Aboriginal children and 46% of those on a reserve and 46% of those in metropolitan areas lived with a lone single parent.
Only 17% of non-Aboriginal children lived with a lone parent.
I mean, the more welfare, the weaker the family.
This is terrifying how easily the family unit was destroyed by the cultural Marxism of the left and this constant desire to intervene and muck about with ancient institutions.
5% of Aboriginals living in large urban areas live with a relative other than their parents or live with a non-relative.
12% of Aboriginal families are headed by parents under the age of 25.
27% are headed by single mothers.
40% of single Aboriginal mothers earn less than $12,000 per year.
So, I'll just blow past this fairly quickly.
The aboriginals have lower rates of two-parent biological families, which is by far the best environment for children statistically.
And if you look at source of income, full-time employment for aboriginals 15.8%, whereas Caucasians 42.9%.
Benefits, aboriginals are almost 60% of their income comes from benefits.
Caucasians, it's still a pretty wretched 37.7%.
Average number of aboriginal welfare recipients risen from 40 to 41 percent over a 10-year period beginning 88-89.
45 percent of Canada's First Nations social assistance is their only source of income.
34.8 percent of Indians on reserve received social assistance compared to 5.5 percent for the country's general population.
This rate for on-reserve Indians was 43.9 percent in Manitoba.
This is very significant because it means that They are now wedded to the government, and the government is a dangerous and terrifying entity to be wedded to.
Welfare becomes a family's tradition, like Sunday dinners.
Instead of the children adopting the role of community hunter or healer or fisher or weaver, the occupation becomes welfare.
A new family tradition is formed.
Children learn from their parents.
Social assistance has become an acceptable way of life for too many people in their families.
While for centuries children have been encouraged to adopt the occupation of their parents, children of social assistance parents are too And now following in the footsteps of their parents creating intergenerational welfare families, fewer capacities to negotiate in the free market and so on, it's just wretched.
It's a death spiral.
So a lot of the elders say, welfare isn't a part of First Nations culture.
They can recall the first person in their community to get welfare.
Our community has never been the same, they say, and add, we used to help each other out, support ourselves, not anymore, not after welfare.
Of course.
Okay, so to commemorate the 20th anniversary of Parliament's resolution to end child poverty in Canada, Campaign 2000 released its annual report card on child and family poverty in Canada.
Today in 2009, or then in 2009, an Aboriginal child is 12.3 times more likely to be in foster care than a non-Aboriginal child.
While comprising only 3.8% of the Canadian population, poverty has resulted in Aboriginal children accounting for a staggering 30% of children in foster care.
The situation is so grave that the number of Aboriginal children in the child welfare system today is three times the number of those enrolled in residential schools at the height of their operation.
Horrendous.
Okay, so, obviously, thank you so much for your patience in watching and listening to this presentation.
This is really important.
This plague of state growth, of debt, of fiat currency, of inflation, of vote buying, this clusterfrack of an ancient curse that was well understood in the ancient world.
I mean, there was an old saying that, as far back as you can really remember, that one of the problems with Giving people the right to vote away other people's property is a poor outnumber the rich and the poor will vote to take away the richest property until everybody becomes poor.
That's only partly true.
Of course the rich are very politically connected and the rich, of course, because the rich pay a higher proportion and a greater amount of taxes, the government really wants to Listen to the rich, because the rich are the cash cows that allow them to pay off a lot of the poor.
So this is particularly terrifying.
My question to people who are skeptical of this process is, where does it end?
Where does it end?
Where does government debt end?
Where does government inflation end?
Where does intergenerational debt end?
Where do unfunded liabilities end?
Where does this end?
How does this get resolved?
There's no indication that this momentum is getting slower.
In fact, it's getting faster.
At this point, we must, we must, we must question the system as a whole.
This is not the first time, nor the last time this will occur in human history.
Systems such as slavery, unlimited democracy, fascism, totalitarianism of various flavors, communism, various forms of extreme socialism, communitarianism, The sort of city-hating, agriculture-worshipping of the Khmer Rouge and so on.
All systems need to be open to question at their fundamentals.
Not tweaks, not adjustments, but at their fundamentals.
Do we want to have a system where we have a centralized monopoly of violence that has the power, the right, the obligation to use weapons against citizens to get them to pay taxes, to use weapons against citizens to get them to not compete in government monopolies like interest rates, like currency creation and manipulation and so on.
Do we want to give These people, a monopoly of power in society, do we think that a monopoly of violence is going to lead to anything good?
In the long run, the evidence seems to say no.
And there's great moral reasons for that.
The initiation of violence, which is the essence of the state, is not moral or acceptable in practice.
Creating a magic of the universe called the public sector doesn't change moral rules.
Government workers don't get to fly, they don't get to reverse time, they're not subject to opposing laws of physics, neither are they subject to opposing laws of morality.
That which is immoral for you and me is immoral for the state.
The initiation of force, the counterfeiting of money, the enslavement of others unwillingly and sometimes even unborn through intergenerational debt is immoral for us, it's immoral for the state.
Having one Universal moral rule is the only way forward for mankind that must lead us to at least question the existing configuration of a society dominated by a small minority with the right to use all the weapons in the world to get their way and to gain allegiance from people through bribery.
This fundamentally is a Stone Age system and we have inherited it through the inertia of history.
It must be open to question just as slavery was.
It was a system that was inherited through the inertia of history that was universal across mankind.
Those who questioned the essence, the basic morality of slavery were really the saviors of mankind.
I invite you to look at our system, which has just got all of the momentum of history behind it, which makes it feel true.
As Nietzsche said, whatever lives long is so gradually saturated with rationality that irrational origins become improbable.
We must be skeptical of the systems we have inherited.
So thank you so much for watching and listening.
I'm the host of Free Domain Radio, which is the largest and most popular philosophy show on the web.
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