The following are some notes drawn from a speech I made at the Tamarack Poverty Reduction Summit in Ottawa, May 6.
John Wilson McConnell, who in 1935 established the Foundation for which I am privileged to work, was born in 1877 to Irish immigrants who had arrived in Canada that same year, illiterate and bankrupt. Like many in those days, and millions more since, his family came hoping to find a better life here.
We now know that the promise of plenty that brought families like the McConnells to Canada – often with the offer of free or low-cost land – had devastating consequences for others. The colonial/settler era resulted in the systematic displacement and marginalization of Indigenous peoples.
Nevertheless, it is striking to consider that, starting out from such humble beginnings, by the time he was 50, McConnell had become, in all likelihood, the wealthiest person in Canada. How did that happen?
The advantages of coming of age in the 20th century
McConnell attended public school, and even in those days, Ontario’s schools were world class. As his biographer notes, “At the Paris Exhibition of 1887, the Ontario Department of Education won awards in six categories – more than Britain and the rest of the empire put together.” When his family moved from their farm in the Muskokas to Toronto – from rural to urban poverty – McConnell found work in the bookkeeping department of a dry goods trading company. He also took night courses at the YMCA. In this way he learned about business, and he soon began trading wood, wheat and other commodities.
The combination of free public education, community organizations’ support for young people’s development and a robust private sector helped move McConnell and millions of others out of poverty. In these concerted efforts we see the shape of a multi-sectoral approach focused on equality of opportunity, echoing the work of what Vibrant Communities is doing today.
But there is more to understanding McConnell’s success than this.
In his bestselling book, Capital in the 21st Century, Thomas Piketty shows how fortunate McConnell was to be living in the 20th century. Several crises, including the Depression and two World Wars, wiped out vast amounts of privately held wealth, and spurred governments to redistribute resources. Calamitous events can create opportunity for those able to take advantage of a newly leveled playing field.
McConnell also lived in a period when, on average, economic growth outpaced return on invested capital. As Piketty’s famous graph shows, in all of recorded history there has never been such an extended period when this was the case. Normally, around the world and under most circumstances over time, societies experience an increasingly unequal distribution of wealth – in other words, rising inequality and extremes of poverty. What the graph shows us is that we are now experiencing a worldwide return to that norm.
Further complicating this picture, we now live in an era when a dominant model of economic growth is threatening the life systems that sustain us all. We simply cannot continue to expand economic activity infinitely.
And so, given what we know about how we got here, and our options for moving forward, the question to ask is how do we build a society that lives within ecological limits and eliminates poverty?
In Canada, we are fortunate to have Paul Born and his colleagues at Tamarack’s Vibrant Communities initiative, and many other collaborators, helping answer this question. I’d like to propose ten reasons — far from exhaustive — of why this work is so important.
10. Poverty sucks
Poverty literally sucks the life out of people and communities. It shortens life spans, by as much as 20 years, if we look at the disparity between Inuit males and the average Canadian. It also reduces peoples’ participation in volunteering and voting – the lifeblood of civic life. However, when we include the poor in collective impact initiatives like Vibrant Communities, and focus on their priorities and aspirations, we elevate their standing and voice; we raise hope and community spirit; and we help change lives for the better.
9. Poverty breaks a promise to children
In 1989, Parliament unanimously passed the Broadbent resolution to eliminate child poverty by the year 2000. We have failed to do so. One in seven of Canadian children lives in poverty today and among Aboriginal children the ratio is four out of ten. Cities and provinces can do a great deal, but we also need the federal government to play its part.
We do have something called the Canada Learning Bond, which provides children of low-income families with a free $2,000 grant for their post-secondary education. The grant consists of a $500 initial payment at birth, and $100 a year for the next 15 years.
Longitudinal research conducted by Dr. William Elliott shows that for children as young as four, just knowing that money has been set aside for their future has a measurable, beneficial effect on self esteem, school attendance, graduation and enrolment in postsecondary education. (See page 33 of this report).
There are 600,000 Canada Learning Bond accounts now active in Canada, but there are another 1.4 million children entitled to them who do not have one. Visit www.smartsaver.org and get involved.
8. Reconciliation demands economic justice
In her seminal 2001 paper on Aboriginal communities Cindy Blackstock cited the 1998 UN Human Development Index that ranked Canada as the best country in the world in which to live. However, she pointed out, if the index was based just on the living conditions of Aboriginal people in Canada, we would rank 62nd.
I have already spoken about the origins and extent of this inequity. Once again, education is key, and let me share some hopeful news: in 1975, there were 1500 Aboriginal people enrolled in post-secondary education in Canada. Today that number is over 70,000.
7. It is time for greater intergenerational equity
According to a recent BMO study, Canadian students are graduating from postsecondary institutions with average debt loads of over $26,000, and are facing an uncertain job market. Youth employment is around 15%; underemployment much higher. Shouldn’t we be doing more to ensure that today’s graduates get the best possible start on building careers and businesses?
6. Piketty is right
Inequality is growing, and it has a corrosive effect on social cohesion. The New York Times recently reported that the bonuses paid to Wall Street workers in 2014 were double the total earnings of the one million Americans who worked full time at the federal minimum wage during the same year. While conditions are not as bad in Canada, there is evidence that the income gap here is growing.
5. Poverty is unhealthy, and it is killing our health care system
As Jeffery Simpson notes in his new book, Chronic Condition, “Poverty is the most consequential social determinant of health.” Meanwhile, the Canadian Medical Association has pointed to the fact that twenty per cent of health care spending goes to treat diseases that can be attributed to low income and poor housing, and recently recommended that all governments give top priority to developing an action plan to eliminate poverty (Laurel Rothman, 2014 & Canadian Medical Association, 2013).
4. Smarter social systems
Manitoba has around 10,000 children in foster care, at an annual cost of about $100,000 per child. The majority are Aboriginal. This is more children than were in residential schools. A similar situation exists in several other provinces.
Research shows that in up to 30% of cases where children are apprehended by the state, housing conditions are the trigger – including such factors as overcrowding, lack of heat, mould and poor repair.
And the cost of a housing subsidy? About $15,000 to $20,000 per year. What exactly are we subsidizing? In the Winnipeg Boldness initiative, the community of Point Douglas and partners in government, business and the community organizations aim to disrupt this pattern by instituting family-centered care – where social agencies collaborate to support families instead of approaching them piecemeal. Parallel systemic failures exist in the justice, public health and education fields.
3. Building the solutions economy
Every problem related to poverty is an opportunity to build and finance a solution. Social innovation and entrepreneurship are opening up a whole field of economic activity that we could call the solutions economy – one that supports healthier, more just, equitable and sustainable communities for all Canadians. There are substantial opportunities to employ more people in such fields as home care, green energy retrofits, and local food production.
2. Let’s measure what matters
It is clear that Gross Domestic Product or GDP is an inadequate measure of community wellbeing. A number of new indices point to a better approach. Examples include Community Foundations of Canada’s Vital Signs, and Ontario Trillium Foundation’s adoption of the Canadian Index of Wellbeing. The Caledon Institute is working on Canada’s Social Report.
1. All solutions are local and systemic
Social innovation is taking place in Canada’s cities, towns and rural communities. Keeping people with lived experience of poverty at the centre of our efforts, we ensure legitimacy and relevance. Drawing on the respective strengths of the private, public and community sectors, Canada will be able to successfully contend with complex issues. Linking local work to a national learning network will enable a new and better social system to emerge in the gaps created by the old.