Why is our middle class shrinking? Even ardent capitalists and fiscal conservatives are concerned about figures released at the start of the new year that show middle and lower income earners are losing ground, while top earners are claiming an ever-larger piece of the pie.
The Canadian Centre for Policy Alternatives, self-described as a “centre-left” think tank, reported that stated by noon, Jan. 3, 2012, Canada's top executives had earned just over $44,000 – the average annual wage in this country. Our top 100 executives earn 189 times the average wage. Between 2009 and 2010, the top 100 increased their income by 27 per cent while the average wage stagnated.
A strong and vibrant middle class is one of the things that has made North American-style capitalism and democracy so appealing for those at home and world-wide. The combination spells opportunity.
This continent was not settled by people who were satisfied with the status quo in their land of origin, or struggling to survive. From the first waves of immigrants thousands of years ago, to today's newcomers from Asia, Europe and Africa, North America has attracted people who had few opportunities in their land of birth, but had leadership and drive in their blood.
Until recently, economic and class lines have been reasonably fluid on this side of the Atlantic. The streets of the New World streets were never paved with gold, and there was no guarantee of wealth. But there was the opportunity to better one's prospects. Here, birth did not dictate the full course of one's life, and the lives of one's children. Here, with luck and a lot of work, people have had opportunities to improve themselves. Penniless immigrants have indeed ended up living in mansions.
The likelihood of this happening nowadays is less than it used to be. It appears the guys at the top are in the process of doing what people have done throughout history – building their personal wealth and power to the point they join or become the upper class, and barring the door to keep the upstarts out.
The top 100 earners in this country sit on each other's boards of directors. They not only set each other's salaries, they play a strong role in deciding who gets elected, appointed or hired for any key position in the public or private sector. Ice crystals are rapidly forming in our fluid economic and class system.
The well-paid manufacturing jobs that once provided a good standard of living for many Ontario families are evaporating, replaced by much lower paid jobs. Provincial and federal governments have tried to protect and create jobs through tax breaks and other incentives for big companies, an alarming number of which have accepted the cash and headed south anyway.  
One need look no further than the present situation at the Electro-Motive plant in London to understand what is happening. The plant's 450 or so unionized workers found themselves locked out after rejecting a contract that would slash their wages by over half, from about $34 per hour. Whether the union caves in could well be a moot point - the international corporation Caterpillar that bought the plant in 2010 has another facility in Indiana that also builds locomotives, with the added benefits of Washington's “buy American” policy, plus low wages. This is no struggling company asking for concessions so it can survive, it is a highly profitable, and likely one with a game plan.
Ontarians, Canadians, indeed, North Americans, have always taken great pride in having a political and economic system that goes hand-in-hand with a thriving middle class. The problem is our middle class is not thriving any more. And the reason is no mystery.
If capitalism and democracy are to survive, government might want to reconsider its hands-off-big-business policies and do more to protect our jobs and industries. Someone once said a person will accept all kinds of abuse without complaint, but heaven help you if you take away something he has. People who have never had an expectation of a decent standard of living are easy enough to deal with. Not so for an angry and frustrated – and growing – mob of former members of the middle class. Many are viewing the situation at Electro-Motive as a red flag, a warning, and perhaps a call to arms.