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November 8, 2011 - No. 12
Ontario GDP Declines in Q2 2011
Step Up the Work for a New Direction
for the Economy
Ontario GDP Declines in Q2 2011
• Step Up the Work for a New Direction for
the
Economy - Steve Rutchinski
Commission for Public Sector Reform
• Health Care Is a Right! No to Privatization
and Americanization of Health Care! - Jim Nugent
Toronto
• One Year of Resistance to Mayor Ford's
Anti-Social Offensive - David Greig
York Region
• Support Striking Transit Workers!
• Monopoly Groups Involved in York Region
Transit
Coming Events
• Ontario Federation of Labour Biennial
Convention
Ontario GDP Declines in Q2 2011
Step Up the Work for a New Direction for the Economy!
- Steve Rutchinski -
 Immediately
following the Ontario election, the province's 2nd Quarter 2011
economic results
were published, showing a 0.3 per cent decline in the Gross
Domestic Product (GDP) compared to the previous quarter. The financial
oligarchy and the Ontario government in its service are now
using these results
to escalate their attacks on public services and public sector workers.
They are
setting the stage to go beyond the anti-social measures taken in the
last provincial budget, such as the three year wage freeze. All
indications are that the Fall 2011 Economic Statement currently being
prepared by the Minister of Finance Dwight Duncan,
and the Commission to Reform Ontario's Public Services, which is
chaired by former TD Bank Senior Vice President Don Drummond, are going
to be used for the same purposes.
For the McGuinty Liberals and Finance Minister Duncan,
the decline
in GDP is not seen as a problem to be taken up for
solution by addressing issues such as the destruction of manufacturing
and forestry by the monopolies. It is used as a justification for more
of the same
neoliberal, anti-social assaults on the wages and living conditions of
workers and on society itself. Speaking through
the media at the Toronto Board of Trade last week, Duncan said that
despite the 2nd Quarter decline in GDP and consequent decreased
revenue, the provincial government must stick to the Liberal deficit
reduction schedule -- even if it means cuts to social programs. This is
what the rich and their media and think-tanks said throughout the
recent election. The day after
the election, October 7, even before the 2nd Quarter results became
public, the TD Bank gave the Ontario government its marching orders. It
wrote: "With the difficult job of winning re-election now complete, the
government now faces the even
tougher job of addressing its sizeable deficit and steeply rising debt
burden, in a challenging economic environment."
Duncan insists all parties in the legislature must get
behind the
Liberal agenda or the province risks a lowered credit rating by
financial institutions like Standard and Poor's and will have to pay
even more debt servicing costs. The Finance Minister's threats
are not really aimed at getting the other parties
in the legislature on board. They are already on board. They will beat
the drum that the Liberals aren't going hard or fast enough. Or, there
will be liberal conciliation with the neoliberal offensive by arguing
the aim can be achieved without program cuts but simply by increasing
revenues.
The target of the threats of the financial oligarchs and
their
government is the working class. It is intended to disinform and
paralyze the workers' movement and its allies. Fifteen years ago during
the Harris regime, pressure was exerted on the people to swallow the
dictate of the financial oligarchy that the greatest
problem they faced was that of deficits and debt. Today the same public
relations job continues. Its purpose is to prevent the working class
and people from coming to the conclusion that the deficit and debts are
merely symptoms of the crisis of the capitalist system.
It is scandalous that the Finance Minister is raising
the prospect
of a downgrade of Ontario's credit rating unless everyone is on board
with the Liberal deficit reduction schedule. It suggests that the
McGuinty government is heading down the same path as the Harper
dictatorship, depriving workers of their rights
and criminalizing resistance because it is "harmful" to the economy.
The real criminals here are the likes of Standard and Poor's, Moody's
and other agencies of the rich who certified the creditworthiness of
the useless paper-backed assets American banks were flogging, which
precipitated the 2008 financial crisis
in the first place. In 1993 Standard and Poor's downgraded Ontario's
AAA rating to AA to force the Bob Rae government to get with the
program of the anti-social offensive, which he did to his everlasting
infamy. Creditors have been reaping the rewards of that downgrade ever
since. Throughout the Mike Harris
and McGuinty years the financiers never restored Ontario's AAA credit
rating. Why isn't the Minister responsible for Ontario's finances
demanding compensation or even jail sentences for Standard and Poor's
and their ilk for their crimes against society!
The decline in GDP and the way it is
being used
to set the stage for attacking public sector workers and the public
service underscores the necessity to organize for a new direction for
the Ontario economy. The Ontario Legislature is about to reconvene on
November 21 and the government
is going to step up its anti-social offensive. Ontario Political
Forum calls on everyone not to
permit this. Stay informed. Read and contribute to Ontario
Political
Forum. Step up the work for a new direction for the Ontario
economy.
Commission for Public Sector Reform
Health Care Is a Right! No to Privatization and
Americanization of Ontario's Health Care Sector
- Jim Nugent -
 During the Ontario
election, Don Drummond, Chair of the
Commission for the Reform of Ontario's Public Sector made statements to
prepare public opinion for what he called the "forceful" and "painful"
cuts to social spending which he said were needed to reduce the
provincial budget deficit. He also indicated that Ontario's health
budget will be central to his public sector reform recommendations,
claiming that 25 per cent of the health budget is "waste."
Dalton McGuinty had
promised that the public services review he had set up would not touch
education and health. The media created a
drama about Drummond "marching to his own drummer" because he seemed to
be contradicting McGuinty. However, Drummond is just doing the
job he was hired to do -- helping create hysteria about the budget
deficit
so the rich can use it to push forward their anti-social
offensive.
McGuinty knew exactly what recommendations to expect
when he appointed Drummond to the public sector review. These were all
laid out
in a report Drummond worked on during his last year as a Senior VP at
the TD Bank. The 2010 report, "Charting a Path to Sustainable
Health Care in Ontario" is TD's blueprint for the elimination of the
remaining public elements in the health care system so it more
closely resembles the privately financed and largely privately operated
American health system. The report says that the current
deficit crisis is the perfect window of opportunity to push this
through. This is the job for which Drummond was hired.
Workers fighting against privatization can find
information about the schemes being worked out behind the scenes at
Queen's Park by
looking at the work Drummond did on the privatization/Americanization
of Ontario's health care system for TD Bank. Information about
TD's health plan is presented below to develop discussion in order
to oppose the Drummond Commission's mission of wrecking
Ontario's health care.
Managed Care
Drummond cites the insurance and hospital conglomerate
Kaiser Permanente, the largest U.S. health management organization
(HMO), as a
model for changes in Ontario's health care system. He proposes changing
the way doctors, clinics and hospitals are compensated in order
to move the system towards the American system of health care
rationing. Drummond calls this rationing "increased efficiencies." The
Ontario Health Insurance Plan (OHIP) would in effect become an HMO
setting flat rates for each "episode of care" with additional
incentives for patient volumes and per capita payments based on the
"catchment area population." Doctors, clinics and hospitals would
no longer be able to bill OHIP based on services provided to each
patient. Experience in the U.S. shows that compensation by insurers
(in this case OHIP) based on volume "throughput," not on services
provided, degrades patient care.
This change is an important element in the entire scheme
for using the health care system to pay the rich, in both the short and
long term. In the short term, this system would enable more funds to be
handed over to the privatized elements of the system as patient
care is degraded. It would also result in degradation of the working
conditions of hospital workers. Drummond calls this
degradation "finding efficiencies." In the long term, these
"efficiencies" will make the eventual takeover of the health care
system by
the private sector more profitable. Degrading patient care will also
result in those who can afford quality care pressuring the
government to create a two-tier system of medical treatment, with the
higher, more profitable tier provided by the private sector. This
two-tier system would in turn create conditions for expansion of
private health insurance.
Drug Benefit Claw-Back
Amongst the biggest expenses in the health care budget
are pharmaceuticals and payments to the drug monopolies. To create more
possibilities for the drug companies to fleece the system and increase
their profits, the report recommends phasing out universal
subsidies for seniors through a means-based claw-back of high-income
seniors' drug benefits and eventually a sliding scale of
deductibles based on income. Previous experience shows that clawing
back high-income earners in universal programs is a "bait and
switch" tactic. Once universality is out the window, the claw-backs
soon grab benefits from everyone but the very poor. As in the case
of degrading patient care through managed care, in the long term this
measure would open up opportunities for private insurers.
Pre-Payment of Medical
Expenses
Currently, the government pays for seniors' drug needs
and a minimum level of long-term care is guaranteed regardless of
ability to
pay. One of the recommendations would enable government funds presently
devoted to drugs and long term care to be "freed up" for
growing the private sector claims on the health budget through a scheme
called "pre-payment" plans. The report says this would work
like CPP with life-long compulsory contributions, except without the
employer contribution as with CPP. Without the employer
contribution to these compulsory plans, they would just be disguised
user fees paid in advance. Costs currently carried by the
government would be transferred entirely to workers with no
contribution by the monopolies either through payroll tax or corporate
income tax.
An added benefit for the government and the monopolies
is that these user fees would be paid in advance throughout a person's
working life for the drugs and long term care required by most people
when they become the oldest 10 per cent of the population. A vast
pool of funds will be extracted from workers, accumulated by the
government and made available for pay-the-rich schemes, which is the
aim of the exercise in the first place.
Health Benefit Tax
Like the recommendations for "pre-payment" of drug and
long-term care benefits, the recommendation to impose a health
benefit tax on
workers is another disguised user fee that will create a pool of funds
for paying the rich as the health sector is privatized. The
health benefit tax will also result in a degradation of patient care.
This user-fee has an ideological aim, namely
breaking the conviction of Canadians that medical services should be
delivered to
patients free of charge as a matter of right, with the aim of further
expansion of the American-style user-pay system.
It is worth looking at the logic Drummond uses to argue for user fees,
a logic based on the idea that there is a problem of
"excessive use" of the system by patients:
"Shifting to a benefit-tax system would help to improve
public awareness of the cost of health care services and, along with
complementary supply-side measures [managed care -- Ed. Note.],
would
assist
in
reducing
'excessive'
utilization...
Research
is
clear
in
showing
that benefits taxes do not have to be large in order
to induce individuals to alter their behaviour."
Drummond proposes the health benefit tax work this way:
at tax time a person would receive a T-4 listing the medical services
paid
by OHIP during the year; 40 per cent of the total services used would
be paid as a benefit tax; three per cent of family income would be
set as the maximum payment. At these proposed levels a family at the
median Ontario income would pay a health benefit tax of up to
$2,100. Of course, once user fees have been introduced, there would be
nothing stopping the government from raising
the percentage recovered or raising the maximum payment. Patient fees
will have become a matter of government policy.
According to Drummond's estimates, these user
fees would take $7 billion out of workers' pockets and put it into the
health care
system, with a proportionally greater impact on low-income earners.
There would be another $6 billion in "efficiencies" as people avoid
or postpone medical care. And there is no doubt where these funds will
end up. With an 18-hospital construction plan under way, most
being built under sweetheart
deals for public-private partnership
consortiums and with many other privatization deals in the works,
these funds will find their way into the vaults of the banks and other
monopolies. As in the American system, these user fees would be
a financial burden on anyone who has the bad luck to get a serious
illness or injury.
 Besides imposing burdens on people to feed the
increasing monopoly claims on the health system, this back-door user
fee would
exclude many people from medical treatment and be an incentive for
people to postpone or avoid medical treatment. Drummond admits that
this will be especially true for people in families with lower incomes.
These kinds of user fees result in the rationing of health care
and represents a major degradation of patient care, especially for more
vulnerable people.
The report's recommendation for large scale health
promotion and illness prevention campaigns also play into this
money-grabbing
scheme. These seemingly benign campaigns would have the effect of
disinforming the public by imposing a regime according to which
illness and injuries are self-inflicted and people "deserve to pay for
their bad choices." The campaigns would present a logic that
says, for example, a steel mill worker who spent a lifetime working in
coke ovens and has high medical needs later in life deserves to
be punished with high health benefit taxes because of this "bad
lifestyle choice."
Private Insurance
Drummond recommends Ontario experiment with a limited
private insurance system, but it is clear that this is intended to be
just a
stepping stone towards the complete Americanization of the system, a
system founded on the interests of insurance monopolies. He
recognizes that there will be political resistance to this measure and
proposes a gradual approach. Drummond recommends the government
grind down political resistance through "public engagement" strategies,
while exploiting the opportunities presented by the deficit
crisis to put in place measures like managed care and increased user
fees. After patient care and workers conditions of work have been
sufficiently degraded and the stage is set for the monopolies to
realize profits from these "efficiencies," then, unwrap the rest of
the Americanization package.
"There is so much public and political resistance to
private financing that the controversy could throw off track any
potential for
other changes that would improve the efficiency of the system,"
Drummond writes. "It makes more sense, in our view, to first put in
place the proper incentives to achieve cost efficiencies. Once the
incentive structure has been changed, other, potentially more
sweeping reforms, could be considered. In the meantime, the province
could experiment in a limited way with private financing."
The report of the Drummond Commission for the Reform of
Ontario's Public Sector is expected to be released by the end of the
year.
It will attack not only the health sector but workers and services in
education and other sections of the public sector. As workers in
the public sector step up the defence of their livelihoods from these
attacks, this will also be a fight to defend health, education
and other public services they deliver. The workers' fight is central
to the defence of the right of all people to health, education
and other services. Broad discussion is necessary among the workers to
set an agenda that opposes the wrecking of public services, an
agenda to stop paying the rich and for increased social spending to
ensure the rights of all to public services.
Toronto
One Year of Resistance to Mayor Ford's
Anti-Social Offensive
- David Greig -
  
On October 25, 2010, multi-millionaire conservative and
previous city councillor Rob Ford, was elected Mayor of Toronto and
emerged as the city's number one face of neoliberal retrogression. At
the same time his like-minded brother Doug and a gang of like-minded
cronies occupied an important part of the City Council and will also be
in
office until 2014.
This result came about in the wake of a dishonest
campaign of disinformation and manipulation by both the Ford camp and
monopoly media, and the workings of an archaic political and electoral
process that gives considerable play to the role of private wealth and
the political elite and their political
parties while marginalizing much of the population. Multi-millionaire
Ford was presented as the common man, champion of the generic taxpayer
and scourge of municipal waste and corruption. Legitimate concerns
about the taxation system, corruption, municipal finance, and
socio-economic inequality and insecurity
were harnessed and manipulated. The infamous strategy of "divide and
rule" by promoting the most backward consciousness was applied to set
some workers and people against others and harvest sufficient votes to
bring the Ford regime to power. Even so, the Ford victory on October 25
was rather less resounding
than reported by the monopoly media: he won with just the votes of
24 per cent of Toronto's electors.
After taking power on December 1 and in the months that
followed, the new regime began to implement its pumped up version of
the anti-social agenda underway across Canada being led by Ford's close
associates, the Harper federal government. The regime proclaimed its
aim to eliminate, privatize or sell off
"anything that's not nailed down." It began its work to exacerbate and
exaggerate the city's budget deficit as the main pretext for its agenda
of cuts, moved to degrade the city's public transportation
infrastructure, initiated its ongoing attack on public housing and
garbage collection, put in motion its reviews of
services and user fees and declared a 10 per cent reduction to the
budgets of all departments (from which to date the police department
alone has been exempted). In the context of threatening and degrading
the public library system, the Ford brothers even made a point of
expressing their disdain for culture.
In spite of the past electoral rhetoric, the regime did
not focus on real waste and corruption, and instead pursued its attack
on the thousands of city workers, their jobs, remuneration and
security, and the programs and services they provide, presenting this
as the "gravy." Custodial staff at the Toronto
Community Housing Corporation and police stations are already losing
their jobs. Temporary employees displaced due to the privatization of
garbage collection, confirmed on October 24, are to follow. At the Ford
regime's request, the McGuinty government revoked the right to strike
for Toronto Transit Commission
workers at the end of March. Another 700 employees pressured by the
prospect of what may lie ahead are being forced to take "separation
packages."
Normal attrition and the measures mentioned above will
be insufficient to fulfil the regime's considerable job and service
elimination targets. The existing collective agreements provide for
redeployment rather than layoff of permanent employees displaced by
privatization. These expire on December
31 and it is no secret that the regime intends to destroy job security
provisions in order to proceed more rapidly with further service cuts
and job elimination. To do so, the regime relies on the monopoly media
crescendo of recent years that anything better than
utter job insecurity allegedly constitutes "jobs for life," to incite
attacks on the public sector
worker.
As the reality of degradation and city-wrecking behind
last year's taxpayers, gravy and deficits electoral spin has unfolded,
the Toronto people's resistance to the Ford agenda has grown steadily.
Thousands have demonstrated and spoken out at many forums and
events. Ford and his cronies have been
obliged to babble in the style of Richard Nixon about a silent majority
of support, about their supposedly favourable private communications,
what they overheard at Tim Horton's, or just asserting their right to
rule because of a self-declared mandate. The people's resistance has
slowed the regime's impetus in some
cases, avoiding some cuts for the moment, to library branches for
example. However, the anti-social objective remains, to be pursued by
other means or at other opportunities. The hope of halting and
reversing the Ford agenda lies with the resistance of the
people of Toronto to defend and improve social
programs and services, to defend the workers who provide them and
uphold the rights of all, and to demand that Ford and City Council
ensure a dignified life and future for every Torontonian.
York Region
Support the Striking Transit Workers!
Transit workers in York
Region are waging a fight for
a decent livelihood against the international monopolies and local
millionaires who operate the privatized municipal transit system in the
region. They are also opposing the politicians who give the
transit monopolies the right to run roughshod
over transit users and the workers who provide transit services.
 Five hundred and sixty
transit workers have been on
strike since October 24 against transit operators Miller Transit, First
Canada and Veolia Transport. First Canada and Veolia are among the
world's largest corporate conglomerates. Miller is a consortium of
local millionaires with good political connections
who have hooked up with international finance capital to exploit the
workers. The workers on strike are members of Local 1587 and Local 113
of the Amalgamated Transit Union. Local 1587 members include 250 bus
drivers and maintenance workers at Miller Transit and 90 bus drivers at
First Canada. Local 113
represents 220 bus drivers on the York Bus Rapid Transit Services
(BRT)/Viva express service operated by Veolia Transport.
Workers are demanding wages and benefits commensurate
with the work they do and consistent with the high cost of living in
the Greater Toronto Area (GTA). Workers want a collective agreement
that reduces the big gap in their wages and benefits compared to the
going rates for other transit workers
in the GTA. The monopolies operating York Region Transit pay wages
$7 below the going rate and do not provide pensions or other benefits.
Workers were also forced to strike in 2008 over similar issues.
The strike has resulted in the suspension of 60 per
cent of the
transit services in York Region. The Toronto Transit Commission,
Brampton Transit and
Metrolinx (Go Transit) also provide some services in the region's
transit system but are not affected by the strike. Local 1587 also
represents 1,500 Metrolinx drivers and maintenance workers in York
Region and other localities in the GTA. These workers
were also set to strike on October 24 but a tentative agreement was
worked out just before the deadline.
One of the issues being raised by the transit workers
is the way that the politicians in the regional municipality have
abandoned their responsibility for the operation of the transit system.
The Regional Municipality of York is a two-tier confederation of nine
municipalities, including the cities of Vaughn,
Markham and Richmond Hill and has a combined population of over
1,000,000 people. The transit system has 44,000 daily users but the
politicians have allowed the system to develop as a hodge-podge of
stitched together pieces and allowed it to be operated in a way that
serves the interests of the transit monopolies
but disregards the needs of workers and transit users. All of the
mayors and regional councillors say that how transit workers are
treated and how people get to work or school are none of their business
since the transit service is contracted out.
On October 27, hundreds of York transit workers held a
demonstration at the York Region administrative offices. Workers and
their union representative denounced the mayors and councillors for
their detachment from the issues affecting the workers and the transit
users. They demanded that the municipality
take responsibility for ensuring that its transit operators make a
contract offer that will end the strike.
At the rally, speakers pointed out that fares and
subsidies for York Regional Transit are the highest of any municipality
in the GTA, but that the wages and benefits paid to workers are the
lowest. The three monopolies suck $120 million a year from user fees
and government subsidies. Union leaders
denounced the chaotic, patchwork privatized system. They demanded that
York Region Transit eliminate the international monopolies that suck
funds out of the system so that it can be reorganized in a rational way
as a public service that better meets the needs of users and respects
the workers who provide the services.
Monopoly Groups Involved in York Region Transit
The Ontario government, which has the final say on all
municipal matters, is planning to hand over billions of dollars to
monopolies involved in the financing, construction and operation of
transit facilities in the next few years. The expansion of transit
services, coupled with the privatization of transit are important
elements in the plans of the Ontario government for paying the rich.
Privatization of services opens up space for profits for international
monopolies by eroding levels of service, increased user fees and
undermining the livelihoods of workers providing services. The fight of
transit workers for their livelihoods
is central to resisting the plans for paying the rich.
The fight of the York Region Transit (YRT) workers is
part of this resistance. YRT workers are confronting the
aggressive monopoly groups closely connected to the anti-social trend
of privatization of public services, locally and internationally.
Miller Transit
Miller Transit is a wholly owned subsidiary of the
Miller Group, a construction monopoly that specializes in the
construction and maintenance of public infrastructure projects. The
Miller Group head office is in Markham but it operates throughout
Canada, in the U.S. South East and
in other international markets. The Miller Group branched out from its
core construction business into the operation of privatized public
services, starting with waste services for Markham in the 1960s. The
Miller Group is currently one of the monopolies aggressively expanding
in the GTA as the anti-social offensive
opens up space for monopolies through privatization of public services.
Other subsidiaries in the group include Miller Waste which operates
waste collection and other waste services in York Region, Durham
Region, Peel Region, Markham, Richmond Hill, Ajax, Pickering and other
locations in the GTA. Miller also
operates some waste services in the City of Toronto. Miller began
contracting transit services with municipalities in the GTA in 1984.
Miller Transit operates and maintains 145 buses owned by York Region
under a long-term contract to provide transit service to Markham,
Richmond Hill and Stouffville.
First Canada
First Canada Transit is a subsidiary of the huge
international transit monopoly First Group, based in Britain. First
Group was formed in 1995 through a series of corporate mergers
following the privatization of national and municipal bus authorities
in Britain during the anti-social
offensive of Margaret Thatcher who deregulated bus service in 1986. At
the time it was formed, First Group had accumulated
contracts for operating 5,600 buses. It went on to acquire bus
services in several large British metropolitan areas, including
London and now operates 9,000 buses
in 40 British cities and towns. First Group also expanded into rail
service as Britain's national rail service was privatized and now
operates passenger and freight trains throughout Britain.
With its vaults bulging with profits from the British
bus and rail privatizations, in February 2007 First Group bought out
the U.S.-based monopoly Laidlaw for $3.7 billion. This gave First Group
control of Greyhound, Greyhound Canada and other inter-city bus lines.
First Group also received Laidlaw's contracts
to operate school bus services and contracts for municipal transit and
transit maintenance across North America.
York BRT Services (Viva)
The York Bus Rapid Transit Services (Viva) is operated
by Veolia
Transport, the transport services division of the French-based
corporation Veolia Environment, one of the world's largest monopolies.
Veolia Transport has 72,000 employees in transit and rail working in 72
countries and annual revenues of $7.84 billion. Veolia Environment also
has extensive contracts in water supply, waste management, energy and
other privatized public services. It is the world's largest private
water supply company. Worldwide Veolia Environment employs 300,000
people and has revenue of $48.4
billion. Among its transit contracts are several for transit services
in the Montreal area.
Coming Events
Ontario Federation of Labour Biennial Convention
The Ontario Federation of Labour (OFL) which represents
about one million organized workers in the province of Ontario, has
issued its
call for delegates to register for its 11th Biennial Convention,
November 21 to 25 in Toronto. The main theme of the Convention is
"Defending the Next Generation" and the main demands
put forward in the call are good jobs, secure pensions, public services
and strong communities.
Ontario Political Forum considers this
convention important not just for Ontario workers but Canadian
workers as a whole. The destruction of the manufacturing sector in
Ontario has carried on since the last OFL Convention in November 2009.
The election of a Harper majority has
emboldened the rich and this government in their attempt to criminalize
the right to resist. This has been seen in the criminalization of the
Air Canada and Canada Post workers. The monopolies and the
newly-elected Ontario government have openly declared that they are
going all
out to wreck and privatize the public
services and smash the public sector unions under the hoax of reducing
the debt and the deficit of the province. The holding of the OFL
Convention is a unique opportunity to mobilize the Ontario workers to
restrict monopoly right to wreck society's assets and to defeat
this retrogressive drive to criminalize the workers for their just
demands. Restricting monopoly
right today and advancing the fight to provide the rights of all with a
guarantee will
go a long way to ensuring that the coming generations are mobilized
and defended.
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