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Here is a short essay on how Employment Insurance was gutted in the 1990s, with special discussion on how it impacted Social Assistance and welfare-bashing in Ontario at the same time.
In the 1990s, Canada's federal Unemployment Insurance program went from being a foundation of the welfare state to becoming a weapon against workersunion power and a tool to create the "flexible" labour markets required to compete globally at the End of History.
In 1990, Mulroney cancelled federal government contributions to UI, leaving employers and workers to finance it alone. In 1993, workers were banned from collecting UI after quitting their job, even though this practice had stiff penalties in wage replacements and weeks eligible.
In 1996, the Liberals renamed it Employment Insurance. Payouts were weakened, and penalties ramped up for people who had used the program in the previous five years. From 1990 to 1996, eligibility was cut from 83% to 46% - the lowest rate since UI's first decade in the 1940s
There is a lot more to say about how these changes had major knock-on effects through the provinces, but let's look at Ontario (because that's what I know best). From 1990 to 1993, Ontario suffered a devastating recession driving unemployment up in to the double digits.
As EI access become more difficult and payments ran out during the drawn-out recession, people turned to the province's social assistance programs in huge numbers. In 1993 and 1994, 1 in 10 Ontarians were on welfare - about 1.3 or 1.4 million people.
With Ontario's NDP government capitulating to austerity economic, welfare rates were frozen for the first time in memory. Until 1993, they were increased each year (as was minimum wage) as a means of covering inflation.
In addition to freezing the rates, the Ontario NDP hired dozens of new "welfare cops" to launch a crackdown on welfare recipients. A public campaign against welfare "cheats" and fraud was waged openly by the NDP. Welfare-bashing was now being practiced by every party in Ontario.
Mike Harris, leader of the third-place PCs argued Rae wasn't tough enough, and declared he would break the "cycle of dependency" and deliver "tough love" for Ontarians who had grown accustomed to big "socialist" government.
Harris was elected Premier in June 1995, his "Common Sense Revolution" promising massive welfare cuts and the introduction of mandatory workfare. On October 1 1995, rates were cut 21.6 percent (mandatory workfare was defeated by anti-poverty and CUPE activists in late 1996).
Mulroney, Chretien, Rae, Harris: Shredding the social safety net was an all-party project forged in the early 1990s. Its brutal human cost has never been truly understood. But if you want to know more about what these monsters did, read about the fate of Kimberly Rogers.
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