National Post

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Wednesday, October 20, 1999

Apples and oranges
National Post

"What's a million?" is the line attributed to C.D. Howe, former federal minister of trade and commerce, in reply to a critic in the House of Commons. It came to symbolize contempt for debate and common sense and assisted the defeat of the Liberals in 1957.

The Federal Court said essentially the same thing yesterday, though on a much grander scale. "What's five billion?" is the message to Canadians in the court's judgment that the 200,000, mostly female, current and former clerical workers in the federal government deserve a $5-billion windfall based on the concept of pay equity.

Since 1984 the public servants' union has argued that federal clerks, mainly women, were underpaid by comparison with jobs traditionally performed by men. Of course, to make such a comparison, pay equity advocates must rely on the absurd assumption that a bureaucrat with a slide ruler is a better judge of the value of work than the marketplace.

In fact there is scant evidence of gender-based discrimination in wages. Most differences between male and female earnings are explained by the fact that women willingly devote more time than men to child-rearing. If the reason were that employers abused their market power to pay women less, as pay equity advocates argue, why would they not also abuse it to pay men less, too?

Nonetheless, the Federal Court adopted pre-modern economic arguments yesterday and sided with the union. It ordered Ottawa to solve this phantom problem with billions of tax dollars.

Yet it is unfair to single out the Federal Court, the Canadian Human Rights Tribunal (which made the initial ruling in favour of the civil servants), or even the public servants' union as the culprits in this case. They are all playing by Ottawa's rules. And since Ottawa created these mediaeval laws on pay equity, it also has the power to reverse them.

Instead of openly rejecting the concept of pay equity, however, Ottawa merely quibbled over the size of the windfall, offering to ante up $1.3-billion when the civil servants were holding out for $5-billion. Now the federal government says it is considering two further appeals along the same lines.

A far more responsible move would be for the federal government to repeal Canada's flawed pay equity laws altogether and to reject the primitive economics on which they rest.

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