Child Poverty and Guaranteed Income in Canada - Research Paper Example

Child Poverty and Guaranteed Income in Canada Introduction In this paper, I will examine key issues around Child Poverty in Canada and will argue for a guaranteed annual wage to be implemented for all Canadians, as a way to address the problem of Child Poverty and its effects. This is not a new issue for Canadian consideration. There has been a lot of discussion on all sides. The disagreements around child poverty in Canada seem to focus primarily on how poverty, and especially child poverty, should be measured, without being in the service of a specific political agenda. The disagreements around a guaranteed income seem to focus around the concepts of charity vs entitlement. These disagreements, rest upon differing perspectives of child poverty and guaranteed income. For the purposes of this paper, we will agree on a definition of poverty that has been cited by 111 books, from 1962 to 2008, according to the Google search listing of citations, for search phrase, “child poverty”. The poor shall be taken to mean persons, families and groups of persons whose resources (material, cultural and social) are so limited as to exclude them from the minimum acceptable way of life in the Member State in which they live (Vieminclox and Smeeding, p. 34). This is a fair definition when speaking about poverty in general, or world poverty, because it assumes differing living standards in all countries, differing national priorities, and the multiple aspects of resources rather than limiting the concept to money. Countries, of course, generally state a specific monetary level, below which is poverty, and above which is not poverty. This legalistic definition is less pragmatic, however, because people’s circumstances differ greatly and resources vary with a range of circumstances beyond income. For example, a healthy family living with three homeschooled children in a rural intentional community will require fewer resources, per capita, than a young executive couple with a staggeringly high mortgage, a parent with Alzheimer’s, maintained in a nearby facility, three family members in psychoanalysis, a high-interest credit card balance and two children in private school. The needs of each family are quite different. Highlighting the quoted definition for poverty, and adjusting it to focus on child poverty, is a suitable definition by Canadian standards also, because Canada does not specify an official poverty line but uses a lower income cut-off (LIC), relative to situational factors, below which the standard of living would be challenged, but not necessarily fitting the definition of poverty (Segal). The National Council of Welfare and most social policy researchers use the LIC as their preferred measure of poverty, even though it was never intended to be used that way and even though doing so gives a greatly inflated picture of people’s discretionary income (Goldberg). Considering this idea of poverty relativity, it is intriguing to note that Canada is one of the richest nations in the world, yet is ranked extremely low, by comparison with other developed nations, for child well-being. This is in spite of the Canadian government’s ratification of the 1991 United Nations Convention on the Rights of the Child (Free the Children; Howe and Covell), in which the elimination of child poverty was articulated as a foremost priority. Of course, ratification is not legally binding or enforceable, but it does indicate public and formal political agreement and obligation to cooperate with other nations to eliminate child poverty, and focus attention and action on this issue. It has meaning. I will address questions of why Canada is still ranked low for child well-being; whether poverty is income based and what the key variables are in urban and rural poverty in Canada; which groups are most affected; and what are the outcomes of child poverty. I will discuss evidence of social and political motivation to end child poverty in Canada and will raise social change scenarios to direct attention to positive outcomes of implementing a guaranteed annual income for all Canadians, alleviating child poverty in Canada. The guiding question of this research requires a definition of guaranteed income, in order to present any arguments about its relationship or potential relationship to child poverty. There are two primary approaches to proposed GAI (guaranteed annual income): the NIT and the UD. The NIT is a negative income tax which the government pays to people below a designated income level. The UD is a universal demogrant, paid to all adult citizens, regardless of income. The NIT is usually preferred by people who favor work incentives, while the UD is usually preferred by people who believe in citizen entitlement to economic adjustment in society, and who want to end poverty by some redistribution of income (Government of Canada). These two approaches, and some later modifications of them, were pioneered by American economists, the first of them in 1946 (Government of Canada) . However, in exploring guaranteed annual income in Canada, it is advisable to focus on a Canadian definition of guaranteed income, since Canada, and not the international community, is where modification, implementation and enforcement will need to occur. In fact, Canada’s approach to the GAI puts differing emphasis on the objectives (work incentives, citizen entitlement, anti-poverty, and income redistribution), because of rising unemployment, more generous government assistance programs, increasing population of marginalized groups, a rising base income marker determining financial family adequacy, and increasing government debt (Government of Canada). The Canadians specifically want and need a responsive GAI, that will keep pace with changes in family income and family structure, and replace social assistance programs, making the UD a more appropriate GAI definition than the NIT approach (Government of Canada). It is inarguable that there is an indirect correlation between income and poverty, if money is where we put our attention in defining poverty. Merely implementing a basic GAI for all citizens, however, while providing a subsistence income, eliminating the worst excesses of child poverty (hunger, and third world conditions), the stigma of welfare, will not necessarily eliminate the marginalization and stigma of being low income relative to one’s neighbors, or relative to one’s schoolmates (Segal). Realistically, the government cannot afford to provide a guaranteed annual income that makes everyone infinitely rich, or even be sufficiently generous so that no family or child is marginalized. Furthermore, marginalization associated with poverty involves more factors than money. For the purposes of this paper, we are stating a thesis that is intended to be understood within the context of relative definitions. Child poverty and Guaranteed Annual Income must, of necessity, be understood as relative in their definitions, and therefore the correlation between them is not absolute and precise, but also relative. With that in mind, this paper takes as its thesis the statement that the federal government should implement a guaranteed annual income for all Canadians to alleviate child poverty. 2. Discussion In one of the richest countries, Canada, 1,400,000 children live in poverty (Free the Children). Canada ranks 12th out of 17 peer countries, and one in seven children in Canada lives in poverty (Martell). These precise figures can be argued, of course, by debating whether to use the Canadian Lower Income Cut-Off (LICO), established by Statistics Canada (IMFC) and typically used, or some adjustment of it or an arbitrary number chosen to represent the absolute lowest income within which children have their basic physiological needs met. But in common is the understanding that we are designating some income level from which children can access resources for basic needs. Some people feel that basic needs are food and water and shelter. In other words, they feel that the basic components required to sustain life are sufficient to allay poverty. Developmental Psychology, however, leads us to understand that children have developmental needs that go beyond subsistence only. Piaget, for example, says that children’s cognitive and affective development comes about through acting on the environment and then organizing experience into schemas which provide the foundation for all future experience (Oakley). Acting on the environment requires resources. Without a range of resources, there will not be a range of experience, no range of schema organization, and therefore a limited foundation for the organization of all future experience. In Piaget’s model of cognitive development, the highest level of perceptual organization is abstract thinking (Oakley). It refers to the ability to apply logic even to situations and elements that are not concrete and are removed from the present context. Without abstract thought, a world of potential opportunities and achievements are unavailable to the individual. Children who have clothing with which to cover, and bread and margarine in their school lunches, and who live in a tenement building where heroin addicts lounge and prostitutes solicit, might be seen to have the basic necessities of clothing, food and shelter. On the other hand, do these children have access to what they need to develop in a healthy way? Children who have clothing that does not fit in to the peer group’s preference will be teased and bullied and excluded (Crossley and Curtis). Children who pack only bread and butter for lunch cannot share in the widespread practice of trading lunch items with friends, because no one will choose to trade with them. Children living at subsistence level will probably not have a computer and will not be exposed to a range of art and music and resource-enriched social events, stimulating ideas and conversation. Children who attend school in at-risk environments will form a worldview that is different from children who attend the best schools. These are critical distinctions, in understanding that poverty is marginalizing, whether one chooses a subsistence level cut-off or something slightly less or more generous. If we look at the groups most affected by child poverty, we find they include single mother families, immigrants, Aboriginals, rural farmers, and those who live in urban neighborhoods. Research indicates that the rate of child poverty is 5 times greater in single parent households, and the proportion of lone-parent households is rising rapidly (Crossley and Curtis). Nearly 50% of children living in woman-headed households live in poverty (Williams). Not only are children of lone-parent households more likely to be poor, but they are also more likely to be severely poor (Dooley). Citizenship rights are denied to women when caring labor (such as child care) is undervalued and uncompensated, and when, on the other hand, there is a vastly inadequate child care system across Canada (except in Quebec), precluding single parents (usually women) from a reasonable breadwinner role (Adkin and Abu-Laban). Their children are in poverty, due to low income and also due to inadequate resource exposure. A guaranteed annual income would go a long way toward relieving this segment of child poverty. Complementarily, a more extensive child care system would also help to alleviate child poverty. Another group particularly affected by child poverty is immigrants. Research indicates that 47% of immigrant families live in poverty (Williams). The spatial concentration of poverty in Canada reveals that immigrants bear the brunt of rising poverty levels and the escalating misery of an inegalitarian society, and due to ethnic isolation in poverty-stricken neighborhoods, are trapped in a perpetual cycle of poverty (Kazemipur and Halli). Child poverty is most common in foreign-born children of immigrant families, less common in native-born children of immigrant families, and even less common in children of non-immigrant families (Human Resources and Skills Development Canada). What is intriguing about child poverty among immigrant families, however, is that foreign-born children of immigrant families tend to be the healthiest, mentally, developmentally and physically, with native-born children of immigrant families less so, and children of non-immigrant families even less so (Human Resources and Skills Development Canada). It would seem, then, that a guaranteed annual income, in rectifying spatial concentration of poverty, social isolation, and inadequate income, would end child poverty in this category. First Nation (Aboriginal) people are disproportionately affected by poverty, their housing below adequate Canadian standards and very overcrowded (Williams). Rates of poverty for Aboriginal women are double that of non-Aboriginal women in Canada, and Aboriginal people are four times more likely to experience hunger (Closing the Gap Campaign). Young Aboriginal women and teenage girls, due to decades of impoverishing government policies, police indifference, and racism, are more vulnerable to exploitation and violent attack, and five times more likely to be violently attacked (Cardinal; Saskatchewan Human Rights Commission). Among First Nation children, 25% live in dire poverty (Closing the Gap Campaign). Assistance programs and services have not had funding to keep up and have been capped for ten years (Williams). A guaranteed annual income may not correct ethnic discrimination, cultural damage and treaty violations, but will certainly go a long way toward eliminating hunger, housing issues, poor mothers, and inadequate resources that lead to profound child poverty. Rural children are another category of poor, in Canada. In 2000, 14% of rural households were poor. Newfoundland and Labrador, Saskatchewan and New Brunswick are the provinces with the highest rural poverty rates for children (Rural Poverty Portal). Hajnal researched concentrated urban poverty in Canada and found that it is extensive and that race and ethnicity are contributing factors to urban poverty (Hajnal). However, he found that race and ethnicity do not entirely explain concentrated urban poverty since most of the urban poor are white (Hajnal). He also found that immigrants, Blacks and Aboriginals were heavily represented in concentrated urban poverty (Hajnal). For them, ideas that justify inequality, indifference, and inadequate government intervention are responsible variables, while for the 86.3% of urban poor who are white, rapid immigration, manufacturing decline, and central city depopulation have been the major contributors to their poverty (Hajnal). As opposed to the average 10% welfare dependency in other neighborhoods, 24% of urban poverty neighborhood income was welfare (Hajnal). Children in these urban neighborhoods have deficient educational opportunities, social isolation, and social dislocation, yet there is almost no discussion of this aspect of child poverty in Canada (Hajnal). Their situation is officially invisible. A guaranteed annual income would replace the stigmatizing welfare they are raised on and greatly increase their social and educational opportunities. Child poverty is positively correlated with low verbal ability (Kohen, Jeanne Brooks-Gunn and Hertzman), low school success, health and behavior problems and developmental delays (Martell; Dooley), stress and lack of safety (Human Resources and Skills Development Canada) . Every Canadian citizen has an ethical responsibility to see that the children, who constitute the future of Canada, are provided with maximal support. The Canadian Charter of Rights and Freedoms, part of the Constitution, guarantees personal security (Free the Children). Children living in poverty are being denied that constitutional right. A guaranteed annual income would help to restore that right and be a strong step in meeting the government’s obligation incurred with the ratification of the UN Convention for The Rights of the Child. Social and political motivation for ending child poverty through a guaranteed annual income are demonstrated by advocacy programs and Child Tax Benefit and assistance programs already in place, as well as by a GAI (GAINS) for Ontario seniors (Ontario Ministry of Revenue), various reforms proposed for the disabled (disabilitypolicy.ca), and the lengthy historical dialogue about implementing a GAI in Canada. Admittedly, Canada is a Welfare State, and as such has defined its priorities as including security, social solidarity, protection, the elimination of destitution, and forging stable and cohesive communities (Esping-Andersen). Yet contrary to its priorities and best intentions, a UN Human Rights Committee criticized Canada for policies that inadvertently escalated child poverty and homelessness, even during a time of economic growth and prosperity in the country (Free the Children). A good example is the Goods and Services Tax (GST) which, in spite of a goal to help low and middle income households, actually worsened the economic situation of one third of low income households and low income households with children, and two thirds of middle income households with and without children (Curtis and Kingston-Riechers). When a GAI is considered, questions arise as to what is the cost and how would the government come up with the money needed to fund it? The government of Canada reports that much of the money to run such a program would come from the GAI’s replacement of all other assistance programs (social assistance payments, unemployment insurance, child tax benefits, etc) (Government of Canada). A lot of money is wasted presently on all the bureaucratic red tape to determine eligibility for those programs, money that would be saved with the program simplicity of a UD GAI (Segal). Total transfer payments from the federal and provincial governments in Canada, to those requiring assistance, amounted to $130 billion in 2004 and that figure does not include another approximately $64 billion in employment insurance, child benefits, old age benefits, etc (Segal). So by 2004 figures, that is a funding source of about $190 billion, not including money spent on the administration of these programs. The 2011 figures are expectedly much higher. Significant funding would also come from taxation on income beyond the non-taxed GAI under the UD approach (Government of Canada). For example, if the GAI were $25,000, for an individual, then any other income earned becomes taxable. If it were taxed at 50%, for example, and the individual earned $40,000, then the government collects $20,000 in personal income tax and the individual has a combined net income of $45,000. Adding these funding sources together would surely provide enough money to end child poverty in Canada, through the provision of an adequate GAI. A counter argument against the GAI, I encountered, is that the poor underclass is basically an American invention, caused by giving welfare to people who do not work, which mistake Canada should not emulate (Frum). The listed arguments were that giving welfare payments to families with young mothers, emasculates the male by competing with his capacity to provide, encourages girls to get pregnant and head their own households, giving rise to fatherlessness, another American import (Frum). Evidence is postulated that families broke up after a GAI experiment in the US, under the Nixon Administration and so the same thing can be expected to occur in Canada (Frum). No mention is made of an experiment in Canada in which incomes were topped off and the consequences were found to be quite positive (teens stayed in school longer, arrests went down, hospitalizations and car accidents went down) for the 4 year duration (Hyslop). Further arguments are presented that a GAI would raise taxes in an already overburdened country, and that Aboriginals are miserable with the amount of “handouts” they currently receive and so they will likely be more miserable with more government handouts since there is already too much government influence in their lives (Frum). A further argument was introduced that instead of the GAI, the government should consider supplements for working people only, but not until the government is richer (Frum). Another source argued that a GAI takes away any incentive to work and that if people are poor, it is because they do not work hard, and that is their own fault (Sarge927). Because I have presented evidence and logical argument that clearly answers these ideas, I will not take more space to repeat the material here except to point out that for every dollar a country invests in children starting out good in life, seven dollars is saved in costs for health and other problems that come when basic needs are not met. Assisting children to escape poverty is morally, socially and economically productive (Free the Children). The GAI provides a way. Imagine if Canadian children all had enough to eat and a developmentally-appropriate, low-stress lifestyle in which to progress through life. This would go a long way toward neurological equity by providing the building blocks for physical and mental health and a brain undistorted by chronic stress prenatally and through childhood and adolescence. Equity in opportunity for wellbeing would increase. Reaching individual potential could become a reality for all Canadian children. Abraham Maslow’s Hierarchy of Needs pyramid shows that an individual’s needs extend beyond the basic to safety, social, esteem, and self-actualization (Boeree). An individual is motivated to satisfy a particular category of needs only when the lower category or categories are satisfied (Boeree). Applying this theoretical model to child poverty, it can be seen that a subsistence level income will likely be spent on basic physiological needs, and a slightly more generous income will result in children’s safety needs being a priority. Only when these categories are satisfied, will money likely be prioritized for the satisfaction of social needs and, with all these met only will money be prioritized for esteem considerations. Only with all of these lower category needs satisfied, will the child and family be motivated to reach for higher things, for becoming the best that they can become and extending their reach outward. Table 1 A subsistence level assessment does not take into account more than the lowest category of needs. A guaranteed annual income, in order to address the developmental needs of children, must look beyond the subsistence level that designates the boundary of poverty, and must be generous enough to consider the satisfaction of a child’s physiological, safety, social and esteem needs if Canada’s young citizens are intended to develop in a healthy and holistic manner, to be motivated to reach out and become their own best and to want and achieve the best for society. 3. Conclusion In this paper, we have explored the extensive problem and incidence of child poverty in Canada, the groups most affected (lone-parent households, immigrants, Aboriginals, rural and urban poor) and the nature of those effects (social isolation, marginalization, entrapment in poverty, developmental damage, stress, behaviour difficulties, lack of safety and stability), with a view toward how a GAI might impact the situation (removing stigma, redistributing resources, replacing all current assistance programs cost-effectively, protecting at-risk children and restoring opportunities). We have considered the cost of implementing a GAI, as well as the costs of not implementing one, and realize it is both affordable and cost-effective. We explored ethical, social and political motivations for relieving poverty through a GAI, and find it morally obligatory, socially supportive and politically timely. We speculated on some social change scenarios that might result if child poverty were eliminated, culminating in the opportunity for children to reach their full potential. My conclusion, therefore, is that the federal government should implement a guaranteed annual income for all Canadians to alleviate child poverty. Works Cited Adkin, Laurie and Yasmeen Abu-Laban. "The Challenge of Care: Early Childhood Education and Care in Canada and Quebec." Studies in Political Economy (Spring 2008): 81: 50-76. Print. Boeree, C. George. "Abraham Maslow." 2006. Personality Theories. Web. 20 July 2011 Cardinal, Tantoo. "Stolen Sisters: Discrimination and Violence Against Indigenous Women in Canada." 4 October 2006. Amnesty International. Web. 20 July 2011 Closing the Gap Campaign. "Canada: First Nations Want Poverty Addressed During Election." 12 April 2011. Indigenous Peoples Issues & Resources. Web. 20 July 2011 Crossley, Thomas F. and Lori J. Curtis. "Child Poverty in Canada." 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