Protecting Manitoba's Middle Class

There is a lot of talk of “income inequality”, and how it has steadily been getting worse over the years. “The rich get richer, and the poor get the picture.”

It is difficult to visualize how income varies and is spread across society. There is also a big difference between differences in income - what we make - and differences in wealth - which is what people own.


This graph is from 2016 Statistics Canada data, based on people who filed an income tax return.

Whenever anyone talks about “averages” or “average incomes” it should be red flag, because it doesn’t describe anything like reality.


“Average income” means taking all the money made by billionaires, or NHL stars and people working part-time on contracts or minimum wage, pooling all their income, and pretending everyone gets an equal share.


“Median income” means half of the population makes more, half makes less.

When we talk about inequality, we’re really talking how income or wealth is concentrated.

The “1%,” in Canada starts at $200,000 in income. This is certainly very good pay, but the 1% goes much higher than that.


There is a much bigger difference in income *within* the 1% than within the other 99%.

The person with the lowest income in the top 1% makes $200,000, while the person with the highest income in the top 1% makes tens of millions of dollars.


Over the last 40 years, Canada has become more unequal.


Between 1945 and 1975, in Canada and elsewhere, as the economy grew, it grew for everyone - and the rate of growth was better. Between 1975 and 1980, countries began adopted “trickle-down” economics.


The basic idea is that if governments and companies alike followed policies that returns to owners (like shareholders), companies would be more profitable and could grow and hire more, and the economy would grow faster too.


Instead, growth has been slower (and is projected to slow next year), and about 20% of Canadians haven’t had a raise since 1976. About 70% have lost their share of total income.


What we need to do is think about PRE-distribution - good jobs with better pay, and creating an economy that grows for everyone, not just a few. #OurNewWay

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