Rich getting richer: It's not a cliche

An op-ed in the October 11, 2007 Saskatoon Star Phoenix suggests studies showing the rich are getting richer make "misleading" claims and are merely "cliche".

The opinion, by the Fraser Institute's Herbert Grubel, is clearly written with the hope that Canadians will overlook the inconvenient truth that the majority of Canadians are not benefiting from economic growth -- growth they are helping create.

The author draws on Canadian and American studies that tell the story going up to the late-1990s to make his point, dismissing more recent findings from Statistics Canada and others.

The newer research converges on disturbing facts: long-term trends in income distribution have changed markedly since the late-1990s.

The rich are indeed getting richer, but what's new is that the vast majority of Canadians' incomes are stagnating despite the fact that they are better educated and working more than their predecessors.

This is occurring in a period of strong sustained economic growth unlike any time in the past 40 years.

Mr. Grubel says the system works just fine, and points to mobility in individual earnings over the life cycle.

He omits the fact that about 80 percent of Canadians have seen no improvement in their wages since 1982, which is astounding, since 1982 was a recession year.

Mr. Grubel thinks the story is about individual pathways to success. The statistics tell a cautionary tale about class polarization.

Though there are more rich people, and those people are increasingly richer, most Canadians are running harder just to stay in place.

Which leads to this question: Why has more than a decade of red-hot economic growth failed to trickle down to the majority of Canadians?

-- Armine Yalnizyan