Key Points on Canada's Income Inequality

  • Concentration of Wealth: The richest 1% of Canadians now claim a larger share of the economic growth than ever before, rivaling levels seen in the Roaring Twenties.
  • Income Statistics:
    • Average income of the richest 1% in 2007: 405,000405,000.
    • They took 32 ext{%} of all income growth between 1997−20071997-2007.
  • Historical Comparisons:
    • In the 1950s and 60s, the richest 1% took only 8 ext{%} of income growth during similar economic growth.
    • From 19461946 to 19771977, the income share of the richest 1% decreased from 14 ext{%} to 7.7 ext{%}.
  • Current Trends:
    • Income growth is sharply concentrated; the richest 1% has doubled their share since the late 1970s.
    • Nearly 67.6 ext{%} of the wealth of the richest 1% now comes from wages, a change from previous reliance on investments.
  • Taxation Changes:
    • The top marginal tax rates have fallen from 80 ext{%} in 1948 to around 42.9 ext{%} in 2009, allowing the rich to keep more of their income.
  • Wealth Distribution:
    • As of 2005, the top 10% controlled about 60 ext{%} of all wealth in Canada.
  • Public Policy Implications:
    • The current concentration of wealth may lead to similar public policy responses as seen post-Great Depression, focused on wealth redistribution through taxation and wage fairness.