The Ontario government claims that it's shortchanged because Ontarians send more federal tax dollars to Ottawa than what the federal government directly spends in Ontario. But does this prove that Ontario's government deserves more money from the federal government?
Instead of demanding more money from the federal government, Ontario could a) cut provincial spending or b) reform everything from labour laws to regulation to tax policy and electricity policy, to unleash the economy and thus produce more at-home tax revenue or c) both. Ontario should not expect continued billions in annual equalization payments. While the exact decline in equalization is unknown -- it depends on how badly the resource economies and their provincial treasuries are hit -- Ontario should face reality and act accordingly.
Ontario Finance Minister Charles Sousa complained on Thursday that the federal government underfunds Ontario. The complaint is part of a political effort by some Ontario politicians and others to distract Ontarians from the real issue: made-in-Ontario policy that is killing investment and jobs in that province and creating massive provincial deficits.
Asking for more money is common among municipal officials. Despite soaring transfers from higher level governments, municipalities repeatedly claim they need more because their revenue sources lack growth potential. So how has municipal revenue actually performed over the last 10 years in Metro Vancouver?