Thank you for inviting me.
I had prepared what I thought were some elegant empirical slides and then your committee decided to double the presentation, to double the time. Fair enough, and I think many other witnesses will likely present some excellent empirical data, so I completely rewrote my presentation. I have the slides there as background.
I have a deeply personal interest in the subject of inequality, social hierarchies, and barriers because at the age of 18, in 1971, I dropped out of grade 12 high school. However, for those who blame society, I think I would like to suggest are wrong. I dropped out of high school, and society couldn't attend my classes and do my homework when I stopped going. The real reason was that at 18 I thought life was a big party, and I wanted to party as much as possible. I did not drop out because I experienced low income or income inequality. That has causality running backwards. Dropping out of high school caused my subsequent low income that placed me in the bottom quintile, because I was not qualified for higher-paying jobs.
However, after two years of partying, I became dissatisfied with this life. Being left behind and being at the bottom motivated and drove me to do something completely different. I applied to many different companies and, after many rejections, I was hired at the very bottom by a large American company called Avco. They proceeded to train me, and I want to emphasize that word “train”. They trained the dickens out of me. I eventually became branch manager at the age of 24.
But far more importantly for this committee, they offered to reimburse me for university courses successfully completed if I agreed to enrol part time as a mature student, which I did. I started at 20 and graduated 10 years later—completely part-time—at the age of 30. Then, partly because of the training and the education, I was recruited by the Bank of Montreal, where I became a mortgage manager.
The point of this narrative is that education is the most radical liberating force in the world, for it involves the development and education of the most valuable asset in the entire world: the human mind. Education enables high school dropouts to be come mortgage managers in large banks, and it enables high school dropouts to become professors who appear before the Canadian House of Commons finance committee to discuss inequality from first-hand experience.
Now, let's talk about inequality. As the philosopher Hannah Arendt taught us, equality is the absence of difference—ten equals ten—while inequality is the presence of difference—five is not equal to ten. Restated, we live in a world characterized by plurality, diversity, and heterogeneity. Each is a synonym for inequality or difference.
The academy is an excellent example of contemporary societal inequalities. There are full professors, such as some people here today, who earn much larger salaries than associate professors, who in turn earn much larger salaries than assistant professors. Moreover, full professors often have no teaching load at all, while associates and assistants teach four, five, or six courses.
However, I am not suggesting that the university system is unfair or exploitative or that full professors should not possess the pronounced advantageous privileges and benefits of being a full professor. In vigorous defence of this, they earn and deserve the significantly higher salaries, status, and radically reduced teaching loads that accrue to them. Although the university creates significant inequalities, it is not unfair and it is not illegitimate. The university is a microcosm of the larger society of corporations, NGOs, the public sector, politics, sports, and entertainment, each with its own hierarchies and inequalities.
However, as Professor Deirdre McCloskey—formerly Donald McCloskey, prior to her gender transformation—an economist and historian at the University of Illinois, has argued in over 400 peer-reviewed articles and 18 books, the market economy has generated far greater benefits than any other system in history. She notes what she calls “the Great Fact”. After thousands of years of humans around the world living on a dollar a day, after 1800, almost overnight, we went to $150 a day in today's dollars, an increase of between sixteen- and a hundredfold.
The outcome of this great fact, she argued, is that the poor have benefited the very most from the market economy. This suggests that we should be facilitating and fostering innovation, creative destruction and growth, which she characterized as Schumpeterian growth, instead of protectionism that produces inequalities by benefiting crony capitalists—think of the pernicious supply management.
In conclusion, I do not question the statistics that will be presented today showing the correlations between social pathologies or—in much more accurate English—bad decisions or bad behaviour on the one hand, and low income and income inequality on the other. However, I profoundly disagree with those who claim income inequality causes bad decisions or bad behaviour. Bad decisions and bad behaviour cause income inequality by dropping out of school....
In my slides, I have one critical slide which shows that the people in the two bottom quintiles in Canada and the U.S. have the lowest levels of education. This is why governments must much more aggressively encourage the 45% of adult Canadians who do not have post-secondary education to return to school—“levelling up”, as it's characterized by the Public Policy Forum, the Canadian literacy network, and the Canadian Association of Manufacturers & Exporters—and I would argue, by tying EI, welfare, and other government assistance programs to re-enrollment and retraining. It may be argued that some are not capable, but I think this is an inaccurate assumption.
If we really want to address inequality in this country, we must attack these inequalities through a levelling-up program, because post-secondary education is the most radical and the most effective policy of all in addressing inequality. I know it, because I did it.