Not One Of The Fraser Institute's "24 Facts for Voters" in Canada Stands Up to Scrutiny.

While Canadians Fret About Foreign Interference, the Political Misinformation is Coming from Inside the Building

For decades, the Fraser Institute - as well as various other think tanks - have issuing misleading reports with the purpose of manipulating public opinion. It’s what George Orwell called political writing - crafted to provide “the appearance of solidity to pure wind”

The function of these “think tanks” is to crank out misleading propaganda using cherry-picked data, deceptively presented, which are then presented as fact - as their latest “24 facts for 2024” was, in a column, by Conrad Black, originally published in the National Post.

Information only has meaning in context, and the Fraser Institute is selective about what they present. If their arguments were being presented in an academic setting or a legal setting, they would be torn apart. Given the blatant misrepresentation it presents of the lives of Canadians, it needs to be challenged.

As I explained in another post, of the many techniques used to manipulate and give a false impression, one of the most important is “paltering” - which carefully combines a string of technically true statements to convey a completely false impression.

Breaking Down The Fraser Institute’s Two-Four of BS

“With a better understanding of the impact of government policies, Canadians will be better able to hold politicians accountable and make informed decisions at the ballot box. With the calendar now turned to 2024, here are 24 facts for Canadians to consider.

Canada’s Economic Crisis

1. Average per-person incomes in Canada have stagnated from 2016 ($54,154) to 2022 ($55,863). Meanwhile, the United States has seen an increase from $65,792 to $73,565. The average Canadian now earns $17,700 less annually than the average American.”

The Fraser Institute starts with three deceptions here - 1) cherry-picking data; 2) taking an average of people with massively different income concentrations for a meaningless average, and 3) ignoring global events that drove crises.

• In 2014, Canada’s economy and especially its oil sector were thrown into turmoil when Saudi Arabia launched a deliberate and sustained price war. The collapse in the price of oil was historic, and it was not random market forces or some kind of technology shock. It was an act of financial and economic warfare by Saudi Arabia on the North American oil industry. Oil went from hovering at $120 USD a barrel for years, before collapsing in 2014, to actually being negative at the beginning of the pandemic.

• The second data point is from 2022 - a year when Canada was still in the middle of the pandemic.

• The pandemic was a global event - a widely predicted natural disaster, of the kind that has been occurring for millons of years. Waves of disease and death running through a species. No one with any credibility on the issue thinks the pandemic was anything but naturally caused. The fact that Donald Trump is promoting the idea tells you everything - the idea that China is “to blame” for an event that is a natural biological disaster.

• In 2011, an economist determined that adjusted for inflation 99% of people living in Calgary and in Edmonton are no better off than they were in 1984. That was in the middle of the most recent energy boom, in a province that had one political party running it for over 40 years.

It is completely insane that these two historic disruptions to Canada’s economy are being glossed over, but it is far from the only omission.

The word “average” is one of the most commonly abused words when it comes to deceiving voters.

For a reader, the idea being communicated by the word “average” is “someone who has a lot in common with me,” which is not the case, at all. It’s not a casual sense of the word “average,” it is the specific, mathemathical meaning, which involves splitting the entire pot perfectly equally, when real-world distribution is based on a power law. Trying to find an “average” of a power law distribution is so inaccurate that it should be considered professional malpractice to use it.

The Fraser institute is labouring under the mathematical delusion that in Canada, and in the other countries Canada is being compared to, all income, taxes, and property ownership are perfectly equally divided among the population.

It is odd, to say the least, that a libertarian think tank would hallucinate that every country in the world is some kind of communist fantasy, but part of the point here is to conceal the distribution.

It’s Billionaire-in-a-bar logic: If you and your friends are out at small bar, and Bill Gates walks in, on average, everyone in the bar is a multi-billionaire. When he walks out again, that ends. The same thing is true of income: lumping you in with someone who makes more money doesn’t make you richer.

The U.S. is home to more billionaires than any other country in the world. This really does “pull up the average”.

If the Fraser Institute wanted to describe the situation that most people live in, the accurate word is “typical” which means “people with common circumstances”.

2. Canada ranks just below Louisiana ($57,954) in average per-person income and slightly ahead Kentucky ($54,671). This is not exactly the bar Canadians should be aiming for.

This is a meaningless comparison, for the reasons above: it is based on averages, and the data is being cherry-picked. Louisiana has five billionaires, and so does Kentucky.

3. According to the Organisation for Economic Co-operation and Development, Canada will be the worst-performing advanced economy from 2020 to 2030 and from 2030 to 2060.

No one should take an economic projection for more than 30 years from now seriously, and as Christine Lagarde noted, “economists are a tribal clique” and warned against their models as being useless.

Let’s look at 4, 5 and 6 together.

4. Canada’s economic growth crisis is due in large part to the decline in business investment. Business investment per worker in Canada declined by 20 per cent since 2014, from $18,363 to $14,687.

5. In 2014, Canada invested about 79 cents per worker for every dollar invested in the United States—in 2021, investment was 55 cents for every U.S. dollar.

6. We’ve witnessed a massive flight of capital from Canada since 2014, to the tune of more than $285 billion.

This is what the chart for investment in Canada looks like, and it’s all about one thing: the price of oil.

In 2014, the price of oil had been at or above $120 a barrel for half a decade. In June, 2014 the price of oil hit $135.61 and started to plunge - while Conservative Prime Minister Stephen Harper was still Prime Minister. That’s why all the capital flowed into Canada - and why it all flowed out again. It is all about the global price of oil.

2021 was mid-pandemic, before the price of oil soared again due to OPEC collusion.

Source: https://www.macrotrends.net/1369/crude-oil-price-history-chart

7 . From the onset of the COVID recession in February 2020 to June 2023, the number of government jobs across the country increased by 11.8 per cent compared to only 3.3 per cent in the private sector (including the self-employed).

This is a perfect example of the ways in which the Fraser Institute is completely divorced from reality. The crisis of the pandemic was the single largest public health crisis in a century, and massive disruptions that occurred in order to prevent the complete collapse of the health care system, which nearly happened in several provinces.

Fiscal Crisis: Imprudent Spending and Massive Deficits

8 The Trudeau government has increased annual spending (not including interest payments on its debt) by nearly 75 per cent since 2014, from $256 billion in 2014-15 to a projected $453 billion in 2023-24.

During the pandemic, the Government of Canada’s interventions prevented a total collapse of the Canadian economy, and it was the federal government that did the heavy lifting. Over 80 cents on the dollar in relief was from the federal government.

After the 2008-09 financial crisis, the Harper Conservatives engaged in austerity budgets, cutting federal direct spending as well as transfers to provinces. The province of Manitoba had no increase in federal transfers in 6 years.

The Harper Conservatives shrank the Federal Government to its smallest size as a share of GDP since the Depression. As a percentage of GDP, Military spending under Harper was half what it was when Pierre Trudeau was Prime Minister in the 1970s.

9. With federal spending at nearly $11,500 per Canadian, the Trudeau government is on track to record the five highest levels of per-person spending in Canadian history.

This is meaningless hyperbole, and ignores inflation. Even if a Canadian government committed to maintaining stable per-person spending, it would still go up.

10. A large portion of government spending in Canada goes to pay for the 4.1 million federal, provincial and local government employees. Government employees across Canada—including federal, provincial and municipal workers—are paid 31.3 per cent higher wages (on average) than workers in the private sector. Even after adjusting for differences (education, tenure, type of work, occupation, etc.) government employees are still paid 8.5 per cent higher wages.

This is colossally misleading.

The people who make really astronomical pay in Canada are in the private sector, not the public sector. The private sector in Canada generally pays people at the bottom less than public sector does - and there are still thousands of people who work in Canada’s public sector who are not making a living wage.

This aims at making the person making $50,000 a year to resent the people making $54,250 and not the CEO who makes $150-million, which is 299,900% more.

There is no apples-to-apples comparison between the private sector and the public sector, which the statement half-concedes. The people being paid for are the justice system, health system, most of the education system, police, fire paramedic, emergency and safety inspectors, engineers, clean water experts. They need to be independent, and not political.

11. The Trudeau government has used large increases in borrowing and tax increases to finance this spending. Federal debt has ballooned to $1.9 trillion (2022-23) will reach a projected $2.4 trillion by 2027/28.

Even this phrasing is deeply deceptive. By saying “large increases in borrowing and tax increases” a reader might reasonably think that the both the increases in borrowing and the tax increases were “large,” which is false.

Borrowing has been significant in response to the 2014 oil price crash and the pandemic, to name just two massively disruptive events. For taxes, however, the federal government cut income taxes and modestly raised others - which is part of being fiscally responsible.

Canada was left in a structural deficit that was the result of Harper Government policies, made acute by the plummetting price of oil.

Instead of using high oil tax revenues to save for a rainy day, the Conservatives cut taxes in good times. When bad times hit because the price of oil had collapsed, there was nothing left in the coffers.

After 2015, the Federal Government did the fiscally responsible thing, which was to increase tax revenues on the people with the highest incomes. The Canada Child Benefit, which lifted hundreds of thousands of children out of poverty.

12. Combined federal and provincial debt in Canada has nearly doubled from $1.18 trillion in 2007/08 (the year before the last recession) to a projected $2.18 trillion this year.

This chart is deceptive, notably because it combines all federal and provincial debt, and therefore conceals the colossal surge in federal debt added by the Conservatives under Stephen Harper, after the Global Financial Crisis.

What it also doesn’t show was an unexpected effect of the federal spending under Trudeau: provinces started to balance their books or run surpluses.

Conservative Premiers used this revenue windfall as an opportunity to once again engage cut taxes, instead of using the money to invest in services.

A major part of the reason for debt and deficits is that tax rates are lower than they once were. Premiers who were on the way to a balanced budget or surplus chose to keep cutting taxes and keep borrowing. This is true in most provinces, including NDP-governed provinces.

Has it delivered better or more equitable growth? No, it absolutely has not.

I’ll answer 13 and 14 together.

Tax Increases and Canada’s Affordability Crisis

13. To pay for all this spending, the total tax bill for the average Canadian family was $48,199 or 45.3 per cent per cent of its income—more than what the average family spends on housing, food and clothing combined.

    

14. Housing and grocery costs dominated the news last year but in 2022 the average family spent $1,452 more on housing and $996 more on food while governments extracted an extra $4,566 from the average family in taxes.

This bogus claim about taxes is one of the Fraser Institute’s most shameful and oft-repeated lies.

It’s based on the same fallacy of “average” again.

To calculate taxes, the Fraser Institute is taking all of the money paid in tax, including by billionaires and the biggest corporations in Canada, and pretending that they are being paid for by Canadian families.

This is blatantly false. This is not just junk economics, it is junk scholarship.

”they attribute all taxes paid in Canada to individual families — including those paid by employers, corporations, and taxes paid on capital gains — their calculations treat families as having paid a good deal of their taxes out of income they are not treated as having received.”

The claim that “you’re really paying these other taxes” just isn’t true. It ignores all the real, specific and separate transactions taking place. It is not true politically, economically or legally.

There are many important reason why corporations are considered persons under the law: one is so that they can be taxed and held liable for their actions. This false idea is used to suggest that corporate tax cuts for someone else will benefit you - because they’ll pass on the savings, and not pocket them. One major reason this is a blatant swindle is that the people with the most income and wealth avoid taxes and run their income through entire constellations of corporations. Many corporate tax breaks directly benefit the very wealthiest people in society because they can afford to turn themselves into corporations.

The Fraser Institute is also looking at what the “sticker price” of a tax is, but not the effective tax rate - what people actually paid. This is what a study of what Canadians actually paid in taxes showed.

Note, that they emphasize the typical Canadian family, not the average.

15. While the federal government has claimed it “cut taxes for middle-class Canadians everywhere,” in reality 86 per cent of middle-class families in Canada are paying higher income taxes under the government’s personal income tax changes. And that doesn’t account for carbon taxes, etc.

16. More than 60 per cent of lower-income families (those in the bottom 20 per cent of earners) in Canada now pay higher federal income taxes because of the federal government’s tax changes.
    
    At this point, I’m certainly not going to take their word for it. There are two points here - first - when the Fraser Institute says 86% of middle class families - how do they define middle class? Where do they get the 86% number? Are they only looking at one side of the ledger? Expenses only or revenue and net as well?
    

17. Seventy-four per cent of Canadians surveyed believe the average family is being overtaxed by the federal, provincial and local governments.
    

    An opinion is not a fact, and there is no average family.

Damaging Energy and Environment Policy

18. In the federal government, there’s a common belief that the Canadian economy is undergoing a fundamental and rapid transition towards “clean/green” industries. Yet despite massive regulations and subsidies, Statistics Canada data shows that Canada’s “green” economy amounts to only about 3 per cent of gross domestic product (GDP) and directly employs roughly 1.6 per cent of all jobs.

    
    This is copy-pasted from oil industry lobbyists, which is kind of funny: it’s an incredibly partisan political and ideological series of accusations that aren’t based in fact or evidence.

    Instead of recognizing the reality of low oil prices, the Fraser Institute hallucinates Canadian-made obstacles.

    Under the Harper Conservatives, environmental regulations dating back to confederation in 1867 were removed. It didn’t help development.

    Canada’s oil industry has received enormous support from government over decades, from the TransMountain Pipeline to the research that helped make mining the Alberta oilsands possible, which was provided by the Liberal Federal Government of Pierre Trudeau.
    When it comes to jobs and growth, the oil industry is pumping a lot more oil with a lot fewer people. Automation - self-driving trucks - have replaced six-figure driver jobs. The trajectory of the “green” economy is for growth, and there are good strategic reasons to do so.
    Energy security is critical, and overreliance on a single energy source - oil - is a vulnerablilty. It exposes the entire Canadian economy to greater shocks and volatility because of something global and international having a profound effect on our economy. This is about having a backup power supply.
    There are real costs that come with the damage of burning trillions of tonnes of coal and oil for decades to the point that the atmosphere starts holding in more heat. The science is proven and has existed for more than a century. We have been talking about climate change for a long time.
    

19. The recent United Nations climate change conference pushed for a "transition away from fossil fuels." Despite significant spending on “clean energy”, from 1995 to 2022, the amount of fossil fuels (oil, gas and coal) consumed worldwide actually increased by nearly 59 per cent.

    These are unconnected statements that make as much sense as complaining “I keep eating, but I still keep getting hungry.” The reality is that every efforts to reduce emissions and develop alternatives have been stymied by the global oil industry as well as NDP and Conservatives, in and out of government.
    

20. Canada has an opportunity to serve the world with its energy and resources and, in doing so, benefit our allies and improve both world energy security and the environment. But the federal government doesn’t see it that way. How else could one explain the latest singling out of Canada’s oil and gas sector through an arbitrary cap on greenhouse gas emissions, even though the sector only represents 26 per cent of Canada’s total GHG emissions? Even if Canada eliminated all greenhouse gas emissions expected from the oil and gas sector in 2030, the reduction would equal only 0.004 per cent of global emissions while imposing huge costs.

    

    “How else can one explain… ” is just making things up and putting words in people’s mouths, based on imaginary scenarios. “Even if Canada eliminated all greenhouse gas emissions?” No one is talking about doing that.

21. As a result of new federal energy efficiency regulations, the cost of a newly constructed home in Canada will increase by $55,000, on average, by 2030 because of the federal government’s stricter energy efficiency regulations for buildings. Rather than increasing the costs of new homes, governments should help close the gap between supply and demand.
    
    It’s would be worthwhile to know where this claim comes from. It reads as if a consortium of corporate lobbyists came together to craft it.
    
    Any evidence for this claim - a link tracking back to an industry website would be appreciated.
    
    However, opposing energy efficiency on the basis of cost is a classic “false economy,” the short term savings in having a house that’s not well insulated is that it will cost you much more in energy bills. Building all new houses to that standard means that over time, we’ll be able to run houses at much lower cost.
    
    Why is the Fraser Institute pro-waste?

Our Failing Health-Care System

22. How good is our health-care system? Canada’s average health-care wait times hit 27.7 weeks in 2023—the longest ever recorded and nearly 200 per cent longer than the 9.3 weeks in 1993 when the Fraser Institute began tracking wait times.
    

23. Among a group of 30 high-income countries that have universally accessible health care, Canada spends the most money on health care as a percentage of GDP.
    

24. Despite this high spending, we are a poor performer. Among this group, Canada had the longest wait lists and ranked:

    • 28th (out of 30) for the number of doctors

    • 23rd (out of 29) for the number of hospital beds available

    • 23rd (out of 29) for the number of psychiatric beds available

    • 25th (out of 29) for the number of MRI machines

    • 26th (out of 30) for CT scanners
      
      Not one of these is a federal decision. Every single one of these is entirely provincial jurisdiction.
      
      On doctors: Provinces are constitutionally responsible for health care, including professional certification as well as funding for universities for the number of seats available in medical schools, for nursing, etc.
      In the 1980s, it was determined Canada had too many doctors, so universities scaled back class sizes, and left them there.

    • Around 2000, people warned that a shortage was coming and that they needed to expand training again, but it was ignored by provincial governments, who did not fund the needed expansion of post-secondary medical training - and still haven’t.

    • The same criticism applies for hospital beds, psychiatric beds, MRI machines and CT scanners. These are all provincial jurisdiction, and as mentioned above, in the last years. provincial governments chose to borrow to pay for tax cuts - sometimes major tax cuts. Since 2016, BC, Alberta, Saskatchewan, Manitoba, Ontario and Quebec were all asking for more money for health care while they were running deficits and cutting taxes. They did so all while the current federal government restored equalization payments and introduced side health accords to increase health funding.

      
      At the federal level, the Harper Conservatives unilaterally slashed provincial health transfers from 6% a year to 3%, and froze Manitoba’s total transfers for six years straight. They also introduced a new funding formula that took $1-billion away from every other province and used it to increase Alberta’s transfers instead.

      
      There’s another factor which comes with cost: without even seeing the list of 30 countries, I can tell you exactly what makes Canada unique. We are the only country on that list that shares a language and a border with the United States, which has the highest expenditures on health care in the world.

      All of the other countries are separated from each other either by language or geography. When you train in something that is as focused and specific as nursing or medicine, you generally do it in one language. That means language barriers in Europe. Other countries, are islands - the UK, Australia, New Zealand.
      

      That has real consequences when it comes to health professionals being able to move back and forth - so they can may pay them less. In Canada, we have a border where nurses and doctors can generally move back and forth, so we have to pay more to compete.

That’s it.

If you’re keeping score, every single one of these 24 “facts” weren’t facts at all.

That should not happen. Taken as a whole, these statements present of profoundly, provably false, and distorted picture of Canada, all while claiming to inform voters.

“Think tanks” were created in the 1970s to give a veneer of academic or intellectual credibility to far-right ideas, pushed by zealots, which aim to dismantle decades of economic and social progress, and undermine democracy and elected governments. The fact that Fraser Institute routinely picked Hong Kong - which is not a democracy - as the freest jurisdiction in the world - should tell you a lot about its priorities.

If the Fraser Institute really has a case to make for its policies, why can’t it be straight about it? Because they don’t appear to be operating in the public interest,

Rather, as John Kenneth Galbraith said, “The modern conservative is engaged in one of man's oldest exercises in moral philosophy; that is, the search for a superior moral justification for selfishness.”

• DFL