In the next five years, as the nose of the baby boom starts turning 65, the politics of money will become a lot more complicated for Canadian politicians. Many voters who dreamt of a comfortable life after work will be facing a reality they didn’t expect, or plan for.
This was true before the market meltdowns, and is only made worse by reduced portfolio values, low rates on fixed income products and high deficits. The options are fewer and uglier.
In the last several days, we’ve seen hints of how these concerns start to manifest themselves in our politics.
Finance Minister Jim Flaherty’s announcement about mortgages is just one of many we can expect from Ottawa in years to come about the need for people to make prudent choices in their financial affairs. Warning shots about federal pensions are meant to let people in the private sector know that the government empathizes with those who envy the defined benefit plans that public servants enjoy. For his part, Michael Ignatieff has put the question of pensions high up on his priority list.
Absent a good long streak of great economic performance, the sound of crashing lifestyle expectations will reverberate in coming election campaigns. The personal and policy choices will be pretty unappealing: borrow more from our kids to finance more income support for retirees, live on less than we wanted to, or keep nose to the grindstone for years to come.
This would normally be great fare for opposition parties, and tough sledding for incumbents, who will have to try to bridge potential schisms between young and older voters, affluent and less affluent, and public and private sectors. The reason these schisms haven’t materialized just yet is time, and time is not standing still.
<snip> Money talk will become deeply divisive - The Globe and Mail