The Current - Does money pit generations against each other? Listeners react

Episode Date: October 10, 2024

Last week’s conversation about pension hikes and generational fairness sparked an avalanche of mail from listeners. We hear your thoughts, and reconvene our panel to discuss how to create policies that benefit all Canadians, without pitting generations against each other.  

In 2017, it felt like drugs were everywhere in the news, so I started a podcast called On Drugs. We covered a lot of ground over two seasons, but there are still so many more stories to tell. I'm Jeff Turner, and I'm back with Season 3 of On Drugs. And this time, it's going to get personal. I don't know who Sober Jeff is. I don't even know if I like that guy.

On Drugs is available now wherever you get your podcasts. This is a CBC Podcast. Hello, I'm Matt Galloway and this is The Current Podcast. So last week on this program, we had a conversation about something sparking a national debate in Canada. This is this idea of generational fairness. And the conversation was prompted by the demand by the Bloc Québécois for an increase in old age security payments to seniors under the age of 75. This discussion moved many, many, many of you to write in. People like Kate Ashman, who's 58 and lives on a farm in Chase, British Columbia. I'm looking more of it at this idea of pitting generations against one another. You know,

with that OAS thing, there's a lot of wealthy seniors. There's a lot of really poor seniors. There's people who really, really struggle. And I guess I just think we need to have a more intergenerational perspective, like looking back at my life and the struggles I had when I had young children. And now looking at the struggles that my parents are having in their elder years, I think, wow,

we have to be kinder to one another. I said that this is sparking a national debate. Don't take my word for it. We got dozens of pages of mail on this subject, and we have several more of your letters in hand. And in light of the response, we thought we would invite our guests back to delve into some of the issues you've raised and some of the solutions that might be out there. Rudy Boutignal is president of the Canadian Association of Retired Persons, or CARP.

Paul Kershaw is professor of population health at University of British Columbia, founder of the think tank generation squeeze. And Vas Bednar is executive director of the master of public policy program at McMaster university and the author of a book coming out next week called the big fix, how companies capture markets and harm Canadians. Good morning, everybody. Good morning. Good morning.

Thank you all for coming back. It's nice. I mean, in short amount of time to come back to a subject that clearly got a response from people. Vasu, are you surprised at the fact that this really touched a nerve? I mean, I'm surprised that you had me back after my poor behavior interrupting you and interrupting Rudy. So, yeah, yeah, I am a little bit surprised. I was surprised by even my response and sort of how I how I felt at times during, during our discussion, because what what

felt like something that was polarizing was actually something that was becoming really productive, right. And we were talking about how we could remake and better kind of target and tailor a major policy. But I'm happy to hear that it resonated with your listeners. That's really cool. Paul, are you surprised by that? The fact that Canadians coast to coast to coast leaned into this subject? No, I'm not surprised at all. I mean, I've had the privilege of working on these issues now for almost 15 years. And I'm always marveling at how in our families, there's so much intergenerational love that parents and grandparents want to get it right for their kids and grandchildren and the latter want to protect their parents and grandparents as they age. And I think what's vexing is we don't see that same intergenerational love to drive our public policy in the world of politics.

And that's what was on offer from Mr. Blanchet and then all the opposition parties piled on. from Mr. Blanchet and then all the opposition parties piled on. And, you know, I felt really, really appreciative that Rudy, the president of CARP, the lobby for retirees was showing the kind of intergenerational solidarity that's missing in parliament. So, Rudy, I want to start with you and go back to something that you brought up the last time we spoke. This is about the idea of re-examining the income threshold for people collecting old age security. What is that threshold now, Rudy? Well, the floor is $90,000, I think it is, or $91,000 for an individual. And the ceiling is about $140,000, I think.

I might have those numbers a bit wrong. But that's pretty close. That's above her. Yeah, $150,000. And so that's pretty close. Yeah, 150, 148. When you floated the idea, Rudy, of reconsidering that threshold, what did you have in mind? Where did that come from and what were you thinking? Well, what I said was that we're open to a discussion because there's a broad range here. And so, you know, going back to your opening line about the surprise number of people that called in, we did a poll, a quick poll of our members. And within 24 hours, we had 6,600 people responding to about 30 questions. So we put the threshold idea to our members. And, you know, it seems that the floor at 90,000 was what most of our members said

should remain the same. And some said, well, maybe it should be raised, you know, at 90,000. However, there was more openness to looking at the ceiling of 148,000 and perhaps looking at bringing that down. So what I was proposing was a discussion. This is a big issue. This is about children and grandchildren looking after their elders, and we should have a discussion to see how we can let our elders live with dignity. What do they actually require? In the spirit of that discussion, let me read a letter from Elaine Tindall, who's in Vancouver. I'm an accountant who works with people all across the income ranges. There are seniors who have household incomes of $180,000 who are still entitled to OAS payments of over $700 a month or $1,400 per couple.

Then there are seniors who live on $36,000 a year as a household and barely qualify for any additional supports. I agree with Rudy, income thresholds should be studied because it's clearly inequitable. Paul, what do you make of Rudy's proposal, or at the very least a suggestion, to think about reconsidering that threshold? Well, I think it's a real game changer because what's at issue is Rudy's asking more affluent retirees, more affluent baby boomers, those with six-figure incomes in retirement to say, might you be able to contribute a little more to those who are economically vulnerable in your generation so that we don't have to entirely ask your kids and grandchildren's generation to pick up that extra work? And for a range of reasons

I can describe later, the work they're already performing is heavier than has been in the past. And what's at stake is really vital. And this is, at first I was like, wow, it's so noble and intergenerationally just what Rudy's doing. It's also very practical if his concern is seniors in need, because the Bloc Québécois proposal would effectively add about $870 to retirees, rich and poor alike. But with Rudy's proposal, we can better target the spending we're already doing on old age security so that we don't just add $870 to a retiree that's struggling near the poverty line. We could add thousands of dollars and thereby eradicate poverty for retirees once and for all. And I just think that that is like, it's making me tingle and shiver with enthusiasm that we could actually do that

because Rudy's putting this idea on the table. Vass, are you tingling and shivering with enthusiasm here? I mean, what would that do to go toward addressing the inequities that we just heard about in that letter among seniors in particular? Well, I think there's a vocabulary that we're starting to shift with that's very productive, right? Rudy, you had used the word fair and fairness when we were chatting last time. And, you know, this discrepancy between seniors 75 and older and seniors who are a little younger has been framed by the bloc as something, as a form of discrimination, right? Instead, recalibrating and kind of looking at it not based on age, but on income thresholds, lets us be more targeted, right? More precise, more appropriate.

But back to framing and some of those dangers, Mr. Blanchet said something the other day that sort of stuck with me, I thought was really striking. He said that seniors deserve, this is a quote, a significant increase to their purchasing power because they literally built Quebec and the prosperity we all have and enjoy today. more of a loopback instead of something that is targeted to support and supplement seniors' income doesn't really help anyone, doesn't help us have the right conversation. Rudy, if you're looking at targeted support, what would be a fair retirement income for someone to be eligible for OAS, do you think? Well, we asked our members, by the way, just to, you know, our members' average household income, the majority is between $50,000 and $75,000 a year. That's the majority of our members and represents a lot of seniors. When we asked our members what they thought about the threshold. The majority thought it was fine where it was,

and a significant amount wanted it raised, in fact. So $90,000 sounds like a lot for an individual, but that's pre-tax, right? So what you actually take home after a provincial and federal income tax is much less. home after a provincial and federal income tax is much less. When my interpretation of the Baca-Becau's reference to purchasing power was going to the grocery store, you know, not going out and blowing it on, you know, luxuries, but just the basics. So $90,000 pre-tax is actually not a lot of money. And that's where our members, OK, we heard we heard CARP and we heard Generation Squeeze talking about the threshold to be. We should really put, you know, support those two groups to come together and do the kind of outreach that Rudy has been doing with his CARP methods. And we could add in some Gen Squeeze members and we could come up with a conversation and then a recommendation about what the threshold would be. Because as I listen to Rudy right now, one of the things I'd want to say back is, I wonder what his members would say if it was pointed out to them that

when the Canada Child Benefit, this really important benefit given to families with kids, is clawed back, it doesn't happen at an individual income of $90,000. It happens at a household income of $79,000. And so I wonder whether or not CARP members would say that we ought to be trying to better align the thresholds for the Canada Child Benefit and the thresholds for old age security. And I think that could be a really productive conversation because it does worry me a little that we are talking about allocating old age security to those with six figure salaries in ways that then disrupt our ability to actually address Rudy's primary goal, which is like we don't want seniors in need. And we could fix that with the funds that we're spending in old age security and then money to do other things, in fact. And so I want to really focus on that particular need.

In 2017, it felt like drugs were everywhere in the news. So I started a podcast called On Drugs. We covered a lot of ground over two seasons, but there are still so many more stories to tell. I'm Jeff Turner, and I'm back with season three of On Drugs. And this time, it's going to get personal. I don't know who Sober Jeff is. I don't even know if I like that guy. On Drugs is available now wherever you get your podcasts. So I want to get to a couple of other comments from our listeners. One of the things that this

and we heard it in the program last week, but it did draw out some tensions between generations. Take a listen to Laurie and Reed Williston, 75 and 73 years old in Williams Lake, British Columbia. It is pretty selfish to begrudge seniors struggling to exist a small wage increase, pretty shameful and disrespectful. We had to work hard for everything we got. I did not have the opportunity to have a post-secondary education other than one year of secretarial training. There were times when there was a can of soup and a box of crackers in the cupboard, and that was all until payday in a few days. We had just bought our first home with the assistance of a relative. Then interest

rates went through the roof to 21% plus, accompanied by massive unemployment. Maternity leave was 17 to 18 weeks and spousal leave? Are you kidding? Everyone thinks that everything was peachy. It wasn't. They weren't the good old days. And these aren't the good new days. The younger generation feels that, oh, well, we're putting all this money into this and we're not getting any of the benefits. Well, they will get them. But they will get the benefits. And they'd be a sorry lot if they came to our age. And these things are put into place for them as well. I really, really feel, and my husband does too,

that nothing is being focused on seniors. I mean, it's like, oh, I wish they'd die. That's the attitude that I feel. You know, then we wouldn't have to worry about them. Rudy, that attitude, I wish they would just die. I mean, what do you make of that? Well, it reflects this ageist society that we're in. You know, I was in Williams Lake last summer during the forest fires and I was driving through and stayed overnight on the way up and on the way down. And you realize what life is like in smaller centers where there's a lot less services. And, you know, I totally empathize with these folks, because that's been the attitude. We are still in a very youth-oriented society. And, you know,

old people tend to be a nuisance for some people. And what happens, comparing the child benefit credit to old age security doesn't make, you know, it's not comparable. First of all, when you're a senior, you're more prone to health issues. And again, if any kind of health intervention, like having somebody come into your home every day, even for a couple of hours, and all of a sudden, it's very, very expensive right away, you know, thousands of dollars a month, possibly. And so that's the health outcomes that seniors are really worried about. They're worried about outliving their savings. They want a little bit of a safety net.

But mostly they want to live in dignity. You know, like the folks from Williams Lake, they, you know, they sacrifice. They deferred vacations. They live modestly. They built up their wealth over generations. And we should be looking after our elders, again, with dignity and respect. And we shouldn't be pitting one generation against the next. If there's an issue with child benefit, then absolutely, let's look at that.

But it's a separate issue. That's not the intention of this conversation. But, Vas, is it selfish? I mean, you listen to that. Is it selfish of young people not to want pensions to go up? Well, again, is it selfish of young people? You know, that frame, the frame of ageism can be used across generations as well, right? So the idea that people are begrudging a modest increase, by the way, $70 a month, like you can spend that by accident at Shoppers Drug Mart. I don't know how fast. I don't know how much this is really going to help.

I think the state is always listening to people when they say that they're feeling stretched and they're in need. And I want to quote Dr. Jennifer Robson for a second, just because she did this amazing public service for everyone on Twitter with charts and kind of data. this amazing public service for everyone on Twitter with charts and kind of data. And she was kind of reminding us that when we designed these policies, you know, these elements of our tax and transfer systems for seniors came at a time when seniors were a much smaller share of the population, had much higher rates of poverty, and didn't live as long. Okay, so when we look at the growth and the extension of these policies, I do think it invites a potential redesign. And the redesign, I don't think anyone wants it to be punitive or that it's about taking money out of a better phrase, but this is not a payout from the state just because you hit a certain age in life, right? It is money from the state recognizing that your income is lower and constrained, and so are your earning abilities when you're of a certain age. And that's the frame we need to use. Paul, will young people be a sorry lot, as we heard in that letter,

and have regrets when they retire if their pensions are really... If OAS is not perhaps as robust as the times demand? Well, of course we want income security for retirees now and into the future. That's a big goal for CARP and that's a big goal for Generation Squeeze. If you'll let me put my professorial hat on for a moment and to reach out with empathy to Lori and Reid, I would say a few little fact checks. First, the data really are

clear today that hard work doesn't pay off for younger folks as it did some decades ago. And I think one of the most clear telling stats about that is back in the early 70s, mid 70s, it would have taken five years of full time work to save a 20% down payment on an average home in this country. Now it takes 17 years in Canada and 22 in Ontario and BC. And then I heard Laurie and, and Reid rightly point out to the period of time in the early 80s, it sounds like they bought their home. And then in the early 80s, they had that home and interest rates spiked. And it was a really difficult time for boomers at that moment. People felt such financial strain. And it might surprise them, though, that in today's housing market, the challenge of paying for a home is even greater with today's

very, very high costs and lower interest rates than it was in those few years of particular difficulty in the 1980s. And so I would ask them to acknowledge that with empathy. And my last point, just picking up on something that Vass reminded us about. We are asking a younger demographic now to contribute more to retirees than boomers were asked to contribute to seniors in their day. Because when boomers were in, we called them a baby boom for a reason. They were a big group. There were seven working-age people for every retiree. And with many hands makes lighter work.

But now that boomers have retired, the number of people following in their footsteps is just three working-age Canadians for every retiree. And that means that every younger person now is so far already contributing 20% to 40% more towards today's retirees than boomers did. And I think that it's just important in this conversation as we think about where the next increase in federal spending should go. We are already asking a younger demographic that's contributing more to maybe do even more on top of the fact that they're struggling more in the economy than younger people did in the past. So I have the stack of letters here that I have to get through, and I want to read a couple of them. One is from, those are really important points that will be picked up in the

conversation. Pamela Delaney is from Woolfield, Nova Scotia, who writes, when my parents got old, they became physically and mentally ill. That lasted eight years for my mother, 10 for my father. As their only child, they were my responsibility. They ran out of their retirement savings, so I had to pay out of pocket for their living expenses and retirement and nursing homes. Cost me all of my savings to see them to their deaths. I'm now 69. I get only government pensions, not enough to live on,

and so I have to work part-time to make ends meet. I don't see that as equitable. From Julie Koster, I'm Gen X, the forgotten generation. My husband and I bring in about $170,000 per year together. Back in the day, this would be an amazing family income. We have a mortgage. Our three children live with us. The two eldest in their 20s work and contribute to rent, but neither can afford to move out. My mom lives with us because she couldn't afford a bachelor suite anymore, and she spends most of her pension on groceries for us. If my mom didn't live with us, we would not be able to support this family.

Is this the new standard of making it? As I get to know my generation through the eyes of my children, I'm realizing that Gen X is barely making it through life. And finally, this comment from Vlod Matejka, 32, lives in Birch River in Manitoba. I was dismayed that startling figures such as the time until homeownership, among other things, between generations, was so easily ignored by the guest on the show who sounds like they've made it to the other side. But I also couldn't help but notice in their voice the need to be heard. We all do. When the government showered my wife and I with extra benefits as we were having children and growing as a family, I couldn't help but think there were families who could use the money more. This lack of effectively targeted government spending is an

issue we can all agree on, but some of us don't seem to be able to keep ourselves from generalizing our own blessed lives onto others. Until that happens, there will be no fairness and no loving dialogue. We just have a few minutes left. Rudy, I think he was referring to you, and in some ways you need to be heard in that comment. What do you want to say to people who are listening, who are invested in this, but there are competing priorities. They don't want to have people pit it against each other, but they also understand that there are competing priorities. What would you say to them? pit it against each other, but they also understand that they're competing priorities.

What would you say to them? I think having a discussion about how we look after our seniors, particularly those in need, is really important. There are the lower income seniors that really need the help. There's the higher income seniors that probably don't. We should have, you know, a nonpartisan discussion. Our politicians should have a nonpartisan discussion of what are those things, you know, how do we fairly or equitably distribute the wealth of the nation. One thing I want to go back to that Paul said is like, look, in a nation of homeowners, this younger generation is going to inherit the wealth of their parents. So they'll have, and many young people depend on the bank

of mom and dad to help them out, not on the state. But the bottom line is, this is about family discussion. The younger generation and the older generation, it's the same family. It's the grandparents, the parents, and the grandchildren and great-grandchildren. And we're talking about how do we help each other through the various generations. That's where we should be having the discussion. Bas, is there a better way to have this conversation than through the idea of division? If we're talking about equality or class, for example, is there a better way to frame this? Yeah, I mean, I think even when we use class, you know, when we think about the love across families, that actually ends up putting us more

in a class conversation than a generational one, right? Because of different people's standards and contexts. I think it comes back to this idea of, you know, what does it mean to live in a society and have some of that give and take and make those investments across other age group, people mentioned, you know, benefits for newer families or younger families. I had brief but very ugly experience kind of engaging with people online about childcare. And it was fascinating and really eye opening for me. And there is really also a feeling of unrest and resentment from a generation or generations, I don't mean to generalize, but people who did not have these benefits or these opportunities feeling like if they didn't have it, others shouldn't and

they don't want to invest in it, right? So how do we get away from a highly individualistic kind of pay-as-you-go society and also make people feel that the money is being spent in the best way possible? Paul, very briefly, last word to you. I mean, is this about, not this idea of fairness, but somebody was thinking about this idea of solidarity between generations. Is that how we have to think about this? between generations. Is that how we have to think about this? Yes. And we can build on this theme of love. It's not that often I get to come on radio programs and talk with others about love, but the love between generations is actually the source of the solution here. And it does exist around family tables regularly, young sacrificing for older, older sacrificing for young. What we need to do is to bring that love into the world of politics, as Rudy has in many regards modeled in this conversation. And so let's do that. Let's have this conversation. Let's make let's demand that our political parties, opposition and the incumbent governor alike, task us to have this conversation.

Ask Rudy's question, when is a retiree's income sufficient? is a retiree's income sufficient? And then we can ask ourselves, how do we ask some of the more affluent members of the baby boom generation to contribute in ways so that those who are more economically marginalized, like Pamela, can live in the dignity that Rudy's talking about with thousands of dollars of more support, not just what the bloc is proposing, like 870. Now that, what a lovely thing to do, because it would also then lighten the load on their kids and grandchildren. And we could make this country work even better for young and old alike. I'm glad you all agreed to come back. And I'm glad that the response that we got prompted in some ways this discussion. It will continue. But in the meantime, thank you very

much for being here this morning. Thank you. It's a pleasure. Have a great day. Rudy Boutignal is president of the Canadian Association of Retired Persons, or CARP. Paul Kershaw is a professor of population health at UBC, founder of the think tank Generation Squeeze. Vas Bednar is executive director of the Master of Public Policy program at McMaster University. Her new book comes out next week. It's called The Big Fix, How Companies Capture Markets and Harm Canadians. That conversation happened because you wrote in and were responding to the earlier discussion that we had. If there's anything that you hear on the program that you want to comment on, get in touch.

The email address is thecurrent at cbc.ca. For more CBC podcasts, go to cbc.ca slash podcasts.