What’s Wrong with Equalization?

So it comes out now that Ontario is a “have-not” province under the government’s equalization scheme. The opposition freaked out, the government downplayed it, but what does it mean? One of the things it means is that Ontario is actually paying itself back under equalization.

To me, what this means is that equalization is seriously messed up. As the Grope and Flail points out, you can play the system to get a bigger payout. While the goal of ensuring that there is some parity among the provinces, these attempts to beat the system combined with the intense politicization of this topic makes for a real mess. This is how you get the absurdity of Ontario paying into equalization and yet qualifying for a payout as well.

It’s time to streamline and, if possible, depoliticize equalization.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s