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What happens when it’s over?

April 22, 2021

That is an intriguing question, what will happen when it’s over?  The CERB has been running for a year and a half – projected to end in September 2021, but what will happen then?  Will the $2,000 per month benefit be replaced with UBI (Universal Basic Income)?  Really that is just shifting the name of the benefit.

How will UBI work?  Will everyone in the country get $2,000 per month, or will that only be payable to people who do not work?  The after-tax value is about $1,700 per month, a person working in Ontario for minimum wage ($14.25 p/h) will net about $2,056 each month.  In other words, the worker could stay home and get paid $1,700 or go to work for 173 hours to earn an additional $356 or $2.05 per hour “I wouldn’t get out of bed for two bucks an hour“.

People are being commoditized and opportunity for personal growth and financial development is being taken away.  It is the old story of the “rich getting richer while the poor are getting poorer” on steroids.  By the government throwing money at the, growing number of poor people, they are ensuring that money is in the system to facilitate purchasing from big box stores and online giants such as Amazon.  At the same time, the impact on small business is unprecedented. 

Colleges and Universities are also feeling the financial strains of lockdowns with some turning to insolvency professionals for solutions.  The government has been alluding to the full implementation of MMT (Modern Monetary Theory). While I do not profess to be an economist, there are many economics theories around, including the now infamous, and opportunistic, Klaus Schwab’s Great Reset, none have proven to be accurate, useful or implementable in a way that is beneficial to society – they all seem to favour the rich at the expense of the poor and middle classes.

Some 774,000 small businesses have taken on debt from the government’s CEBA programme. Those that got in at the beginning may have thought they were getting a short term loan for a two week lockdown.  None would have realized that a year and a half later the lockdown would still be ongoing.  Many of these small businesses have probably ceased to operate, while many more will be forced out of business – then what?

Dealing with debt is one thing, any LIT can provide a variety of solutions to resolve debt problems, but how do you rebuild?  According to Statistics Canada, in 2016, the median income in Canada was about $35,000 (slightly more than minimum wage in Ontario) – meaning that 50% of income earners in the country earned less than that value. While incomes have increased very slightly, since 2016, they have not kept pace with inflation.  For example, house prices on average have increased by about 20% per year for the last two years.  The cost of food has increased at a much faster rate (about 7% per year) than incomes.

What will you do when it’s all over?  What will your life look like?  Will your business resume?  Will your family be O.K.?  Will your income increase, decrease or return to pre-lockdown levels? 

Give us a call, tell us your thoughts, get a free consultation to discuss debt resolution – 519-646-2222