Proposed $2,000/month Canada Emergency Response Benefit | Page 4 | General financial discussion | Discussion forum

Norman1 said
Not a good idea to give money to everyone.

Some people, like the drug addicts, didn't have a job and had no prospects for a job, before the COVID-19 virus reached Canada. They didn't lose any income from the COVID-19 situation.

Ditto for those who were going take a year off anyways and wander through Europe "to find themselves."

The welfare cheques are still being issued on time. People who had been living solely on welfare should not be getting a "pay raise" because of COVID-19.

I can see why the NDP would want to just give everyone money.  

It's actually not an NDP, or even a socialist, idea. The NDP and socialists would have a government bureaucracy to administer all of this; libertarians, meanwhile, would administer it through the income tax system, bureaucrat-free, based on income. Anyone earning less than a set amount should qualify. Simple enough. I propose the clawback threshold equal the same as the OAS clawback threshold. Anyone, or any couple, of any age, earning more than the combined income limit to no longer qualify for OAS, arguably, does not need the CERB, regardless of any income loss.

Cheers,
Doug

Bill said
It actually IS a socialist concept, to give money from working people to others who are capable of working but choose not to. The method of administration is irrelevant, it's the concept.

The CERB is designed for workers who are unable to work due to covid, predictably some are trying to muddy it with the concept of GIA, etc.

I propose a large temporary tax for a few years on middle to high income pension earners, on a graduated basis, to help pay the private sector young workers who have lost income due to this thing. Maybe on public sector, teachers, etc too, i.e. all those whose money kept flowing in during this time. Just to help pay for CERB, etc. To me it's not fair the burden is borne by workers, and only some of them.  

True, it's a socialist concept in theory, yes, but one which the libertarians would support (i.e., a bureaucracy-free administered program).

+1 to your temporary tax idea. Definitely tax the public sector, possibly with a temporary "pension luxury tax".

Cheers,
Doug

The rationale is I don't want to hit low income seniors. And this economic shutdown plus gov't spending is going to cost taxpayers a lot of money, so who is going to pay is the question? I propose that seniors receiving pension income, totally unaffected by joblessness, help out in paying that bill, sharing in the financial pain, while they're still alive. Especially as the shutdown, etc is mainly for their benefit - check out, for any country, the death rate by demographics and you will see the young are pretty much immune from dying of it, and indeed we are told daily this is mainly for the old folks (it's a very nice thing to do, I must admit it's heartening, the sentiment). Yet workers in the private sector are not only the ones suffering most financially, they (and all young & middle-aged working people) will be stuck with this cost for decades after the saved old folks are long gone. The latter should help out too.

Bill said
I propose a large temporary tax for a few years on middle to high income pension earners, on a graduated basis, to help pay the private sector young workers who have lost income due to this thing.  

Income tax also was a "temporary tax".

There is nothing more permanent than a temporary solution, especially a temporary government program.

Gosh, the details, I'm not sure, I'd let the tax experts draft the appropriate legislation and have the parties debate it and come to a consensus that represents most Canadians, I'm just throwing out the general concept that those who have had their incomes largely unaffected and who aren't lower income could help pay this unexpected bill that otherwise will be borne by those who are going to be around for decades into the future. Yes, it does, among others, target wealthier pensioners (all of whom, it must be said, have gotten their nest egg partly due to the wonderful opportunities & security this country afforded them during their lifetimes) but I certainly ignore critics who do not indicate who else, if not comfy pensioners, will help pay this huge bill. And it's true that pension income is a primary target but in fact I'm targeting anyone who is not low income and whose cheques kept coming in during this time when others were not so fortunate due to the mandated shutdown of large parts of the economy. In general I would expect it's a transfer of wealth from fortunate older folks and other workers to workers who suffered significant losses due to factors beyond their control, i.e. the mandated shutdown of large sectors of the economy.

I'd probably start with total income line on the income tax return. Some adjustments, e.g. remove one-time events that happened to happen in 2020 that distorted one's income such as capital gains on sale of a cottage, etc, or if someone emptied out a retirement plan, and so on. Again, the details are something the Canadians would have to agree on, just throwing out the concept.

Winnie, totally agree but this is just one measure in that Act, you could build a termination date into the legislation. And Alexandre, naturally, if Canadians who suffer no income loss don't want to help pay the bill not much you can do if the concept is not accepted.

I'd be very happy to hear better proposals, mine was just a top of the head reaction, very well may be way better ways to do it. Who will pay this unexpected, unprecedented bill?

Bill said
Kidd, do I have to pick just one?

I'm heartened by the reaction here to my proposal, guess the next step is pass it on to my MP. Thanks all!  

For what it's worth, you have my enthusiastic support, Bill. You and I really only disagree on the millennial worldview now. On literally everything else, we agree. 🙂

Cheers,
Doug

In addition to not being entitled to any of these generous relief programs, people seem to be forgetting that seniors are also getting screwed out of their ability to earn interest income on their savings thanks to the BoC bailing out the debt junkies, both corporate and individual alike

Bill said
For decades now the big banks' dividends have been a gold mine for those (stereotype) little old ladies who hold only blue chippers.  

Buying bank shares certainly worked if we're looking through the rear-view mirror, but a lot of people would prefer not to take the market risk in the current environment. And it's easy to see why, when supposedly civilized pro-business capitalist countries like the UK have already ordered the banks to stop paying dividends to their shareholders and conserve cash as long as they expect to be bailed out with taxpayer money. Not many saw that one coming, but there it is.

The Canadian banks are not yet in that situation (emphasis on the "yet"), but it is becoming clear that investment risks which were almost unthinkable only 10 years ago are now very much on the table. Quite frankly we got off lucky in 2008-09, but this time Canada is in a much worse economic position, and despite all the Pollyanna "we'll get through this together" tripe coming out of Ottawa I think we're in for a world of long term hurt that nobody truly appreciates yet.

Yeah, I've read the same stories as everyone else where the precious BigFive all say that they're just fine, but that's only based on what they think they know at the present time, and I expect things to deteriorate much more than advertised. If it does, now that the precedent in the UK has been set, do not be surprised when measures like the suspension of bank dividends suddenly appear on the table as part of a government rescue. The Canadian bank stocks would obviously crater in response. As of 2020, there is no longer such a thing as "can't happen."

Not a popular view I suspect, but like I said earlier, some people would rather not take the market risk here

Londonguy, totally agree personally, going forward I see free-market capitalism pretty much over in the West, but vast majority disagree so to many of them bank shares might appear suitable vs crappy GIC rates.