Hon. Jack Layton (Toronto—Danforth, NDP)
|| That, in the opinion of the House, the Conservative government's massive corporate tax cuts are destroying any balance between taxes for large profitable corporations and ordinary Canadians; they are stripping the fiscal capacity of the federal government; they are disproportionately benefiting the financial, oil and gas sectors, while leaving others behind, including manufacturing and forestry; and in so doing have failed to invest in those hard-hit sectors and the needs of everyday working Canadians; therefore, this House has lost confidence in the government.
He said: Mr. Speaker, I will be sharing my time with the member for Outremont.
I am very pleased to speak in favour of this motion. The motion demands a balanced fiscal approach to make life more fair for hard-working Canadian families.
The NDP believes there must be a place where businesses and families can prosper together. That is not what we see today. Over the last 20 years, successive governments have picked the boardroom table over the kitchen table.
They have helped those who are making record profits, like the big polluters and the banks, all the while neglecting the priorities of today's families who are finding it harder and harder to make ends meet.
Over the past 20 years, more than 50% of families have seen their income decrease. The 100 highest-paid CEOs now earn 218 times more than the average Canadian. In 9 hours and 33 minutes, they make the same amount that the average Canadian makes in an entire year.
In the past 20 years, the burden of providing government revenues has fallen increasingly to families as opposed to corporations. According to the last budget, the Conservative government plans to collect 12% more taxes from individuals but 14% less from corporations over the next three years. That is not fair, it is not balanced.
The contributions by corporations to the combined personal and corporate tax revenue of our country will decline to below 25% in the next three years. This new trend is due in large part to the huge corporate tax cuts announced in the 2007 economic statement.
The Conservative corporate tax giveaways are draining the fiscal capacity to build the kind of Canada that our Canadian people want us to build for them and their communities.
The Conservatives have surrendered 12.2%, nearly one-eighth of future federal revenues. The unbalanced, across the board nature of these cuts is stripping Canada's fiscal capacity. It is a great boon to the banks and the oil and gas companies. They are the ones making the profits, enormous profits, often at the same time as picking the pockets of the hard-working consumers across the country, those who are trying to buy some gas, or trying to take their money out of the bank or trying to pay their credit cards, but it does precious little to help out the entrepreneurs who are feeling the tough economic times.
The agenda means that fewer fiscal shock absorbers will be there to protect the middle class when we move into uncertain economic times. Therefore, it is very unwise and will leave more and more people behind as we find ourselves in tough economic problems.
Giving away billions of dollars to big banks and big polluters, while ignoring the key strategic investments in our ailing manufacturing and forestry sectors and in social priorities that Canadians are asking us to address, is creating irreversible damage. It is not something that can be fixed easily.
For the last 20 years, while governments have followed this unbalanced approach, every day families have suffered. Education is now out of reach for more and more families. Infrastructure is crumbling all across the country. The cost of prescription drugs is skyrocketing to the point where many people simply cannot afford the medications their doctors tell them they need to be well. While government hands out deep corporate tax cuts, over four million Canadians do not even have a family doctor.
While the federal government reduces Canada's fiscal capacity to provide the services families need, guess who will fill that void?
There are women in this country who work 24 hours a day trying to track down expensive, hard-to-find daycare centres while taking care of their elderly parents and trying to make ends meet as the cost of groceries climbs ever higher. It is working mothers who suffer under the misguided policies of this government.
It is time to put working families first. It is time for a balanced approach.
Not long ago in this chamber, we saw an earlier government propose a $4.6 billion corporate tax giveaway. The NDP stood up and said it was the wrong approach and recommended that investments be made. Indeed, ultimately, that decision was made and we were able to adopt a budget that was balanced and that met those tests.
The NDP believes Canada must have a competitive tax regime for businesses, but not at the expense of hard-working families and not across the board giveaways to companies that do not need the help. We want Canada to be a great place to invest and for businesses to prosper, but they will not prosper if our communities crumble, our families cannot have their basic needs met on a daily basis and we cannot have the educated workforce that is needed.
Improvements for businesses and families need to move in lockstep together. That is how to keep the balance in shape. We should not be choosing one over the other, as the budget is doing. It is possible to do both. We are a strong, innovative and wealthy country. The problem now is that the few are going to be the beneficiaries of that gift in which Canadians should be sharing in a much more just, sensible and balanced way.
The NDP's motion is a motion of non-confidence. The Conservative government has had 26 months to turn things around and make life more affordable for middle class and everyday ordinary Canadians. However, it chose not to do that. It chose to put the corporations first. The champagne bottles were popping on Bay Street. As a result, the gap between the rich and the rest of Canadians is growing and nobody can prove to the contrary. In fact, all one has to do is spend a little time with Canadians in their homes and at their kitchen tables to know that is the hard reality they are facing.
Conservatives have shown that ordinary Canadians cannot have confidence they will make life more fair and affordable for them and their families. Therefore, it is time to take a more balanced approach. The NDP has worked for that for many decades, and we are not about to stop now.
Mr. Thomas Mulcair (Outremont, NDP):
Mr. Speaker, once again, we will have a chance to see the Liberal Party of Canada's true colours. Once again, during this afternoon's question period, we heard the Liberals get all worked up about all of the appalling ruses they detected in how the Conservatives handled the budget. The Liberals criticized the Conservatives for having included immigration provisions in the budget bill.
If we are meant to take them seriously and to accept their statements at face value, we would expect them to vote against budget bills, just as, from time to time, they have to speak out against the Conservative government's decisions because they are the official opposition.
As usual, the Conservatives know exactly what to expect from the Liberals. They know that they can do whatever they want, including burying objectionable immigration provisions in a budget bill, because the Liberals are much too weak to stand up to them.
This afternoon, we are considering a motion that takes the Conservative government to task for the choices it made in the budget. The Conservatives made a lot of decisions that brought radical change to Canada, and now we are talking about something quite specific. I will give a few examples to illustrate.
Table 5.4 of the budget just tabled by the Conservatives reveals what they really think and betrays their true intentions. Specifically, beginning today—as the new fiscal year begins—and over just two years, revenue collected from personal income tax—from my colleagues, from me, from the people listening to us now, from workers and their families—will increase by 12% in the state's budget, whereas revenue from corporate income tax will drop by 14%. That is the shameful choice the Conservatives really made in the budget. Individuals will be paying 12% more, and corporations will be paying 14% less. People can check table 5.4 of the budget and see for themselves.
We strongly object to this choice. What will the so-called official opposition do? I see that the Liberals are prepping their new star from Toronto Centre, who will undoubtedly rise to try to lecture us, as did his colleague who, yesterday, attempted to mislead the public with false figures on countries such as Sweden, Great Britain, Denmark and Norway. What tales did they tell yesterday? It was nonsense. What did his Liberal colleague say? He said that in the four above-mentioned countries, the corporate tax rate was lower than the Canadian rate. Is that so? Let us look at the facts.
Here, in Canada, with the most recent cut, the corporate tax rate is now 19.5%. It is important that we remember this figure of 19.5%. It will be further reduced by 4.5% to 15% by 2015. What is the current corporate tax rate in the other countries in question? It is 28% in Sweden; 30% in Great Britain; 30% in Denmark; and 28% in Norway. That is the reality, not the nonsense trotted out by the Liberals yesterday to try to justify the unjustifiable, that is their weakness, their softness, their lack of conviction and the fact that, once again, they will support the budget choices of the Conservatives. Conservatives or Liberals, it is all the same.
If the Liberals had the slightest amount of conviction, if they believed in anything, they would be getting up to criticize and challenge the Conservatives' budget.
Later, when the new member for Toronto Centre rises, we will see that they will no longer be content to sit on their hands.
The Minister of Finance dared to reduce corporate taxes that much only because the current and ineffective leader of the Liberal Party of Canada, the so-called official opposition, told him that he could reduce corporate taxes as much as he wanted.
Indeed, the Minister of Finance rose in this House and said that he would never have dared to reduce them so much. He is a Conservative. He would have wanted to, but he did not think he could. It was the current leader of the Liberal Party of Canada who told him he should do so and reduce them so much. This is exactly what he is now doing and it is scandalous.
Now, to try to ease their conscience, instead of simply hiding, ducking the issue, disappearing from the House or sitting on their hands, they are trying to tell us—and I cannot wait to hear it—that the Conservatives' budget choices are completely consistent with their own. And that party has the nerve to talk about social justice, a nation-wide affordable child care system and wait times at hospitals across Canada, which receive federal funding. It can say what it wants but the Liberal Party of Canada does not believe in anything. That is the simple truth, which will be revealed a little later.
On this side of the House, we are not afraid to stand up. We are not afraid to tell Canadians what is really going on here.
We can look at table 5.4 in the new Conservative budget if we want to understand what is going on. In that one table, there is a snapshot of the difference between the New Democratic Party of Canada and the Conservatives, but the Conservatives are being helped in this by the Liberal Party.
In that one table, we see the following: starting from today, when we are at the very beginning of a new fiscal year, over the next two years the part of the budget that comes from corporate income taxes is going to go down by 14%, while individual income taxes, which is what you, Mr. Speaker, and I and the people listening to us pay, are going to go up by 12%.
That is an increase of 12% for individuals and a decrease of 14% for the corporations. That is a scandal. The Conservatives should be ashamed of themselves for proposing it. The only reason they are doing it is because of the weakness of the Liberal Party.
Yesterday one of the minor ministers from the former Liberal government, a former revenue minister, went on the public record with something that was completely contrary to the facts. He named four countries, Sweden, Britain, Denmark and Norway, and said they had a lower rate of corporate taxation than Canada has.
Here are the facts. For somebody who was once in charge of revenue, it is surprising that he cannot count. In Canada with the most recent budget, we are now at 19.5% as our corporate tax rate. It is going to go down a further 4.5% between now and 2015, bringing it to 15%. The tax rate in Sweden is 28%. The tax rate in Britain is 30%. The tax rate in Denmark is 30%. The tax rate in Norway is 28%.
Hon. Bob Rae: Add the provinces, Tom, add them.
Mr. Thomas Mulcair: That is what those birdbrains in the Liberal Party of Canada want to support. They want to support the Conservatives. They are against families. They are against social programs. They are against social justice. They have no vision. They have no convictions. They do not believe in anything.
More and more, the truth is coming out. Canadians are starting to decode the Liberals. I am just waiting to hear the new star from Toronto Centre, someone who once had the guts to come into this House and claim to represent social justice and progressive thought and who has now sold himself out to the bosses.
I can hardly wait to have him stand up and talk against families, against workers, in favour of tax increases for individuals, and against the average working family. That guy wants to give tax breaks to corporations.
Let him have it, I say, and let him know what really is going on out there in Canada. We can hardly wait because we are going to deal with him.
Mr. Ted Menzies (Parliamentary Secretary to the Minister of Finance, CPC):
Mr. Speaker, I will be splitting my time with the member for Oshawa.
First, I completely reject the premise of today's motion. Our Conservative government's historic tax reductions, both personal and corporate, have benefited innovators and entrepreneurs, those individuals who comprise Canadian businesses and the hard-working Canadians whom they employ. Accordingly, lower business taxes are clearly a positive. It appears that the NDP does not realize this, though our competitors in the industrialized world beyond our borders do understand it.
An arena in which Canadians compete for business must be allowed to do so operating in a fair business climate, and in that respect, competitive corporate tax rates are a clear positive. Most observers are universally in agreement with that. As Nancy Hughes Anthony, president and CEO of the Canadian Bankers Association pointed out:
|| Lower corporate taxes will enable Canada to compete successfully with other countries, stimulate sustainable long-term economic growth, and help to improve the standard of living for all Canadians.
|| It means creating quality jobs, attracting investment and talent, encouraging innovation, and building a strong tax base that can support the social programs that we hold dear.
However, the NDP alone in the economic wilderness of a bygone era of high corporate and personal taxes does not understand that. It is still clinging to an old-fashioned regressive and discredited notion, namely, that big government, high taxes and huge government debt are the keys to prosperity. It would be amusing if it were not so sad, because it is clear that it has not learned a thing from the domestic and international examples of the last 50 years.
For everyone who doubts that, just listen to what the member for Toronto Centre had to say about the NDP's economic policies, someone who led the province as the NDP premier and implemented the very economic policy that the NDP advocates here today. He has derided today's motion as a tired and most off-base kind of economic jargon. My friend has assailed the NDP's economic policies as outdated and unrealistic.
The member for Toronto Centre, whom I welcome to the House, has admitted that he showed incredibly poor judgment when he implemented ill-advised policies such as this. We understand that he has learned greatly from his mistakes, namely that regressive and economically devastating high corporate tax policies are not the way this government wants to go, policies that killed investment and jobs in Ontario. After the benefit of hindsight, my colleague now says:
|| Our corporate taxes must be competitive. I know this is anathema to the NDP, but I can tell you that the [NDP leader] and the NDP are wrong about taxes.
We understand that. We understand the long term benefits of tax relief. We cut taxes to attract investment, to create jobs and to help sharpen Canada's competitive edge internationally. This is as straightforward as it is simple. That is what we are doing. We are taking concrete action to spur investment and jobs and to make Canada more competitive.
Tax measures introduced by this government since coming into office have provided tax relief approaching $200 billion. Almost three-quarters of this relief benefits individuals directly, whether it be through personal income tax relief or GST reductions, a tax reduction which benefits all Canadians each and every time they make a purchase, which is millions of times a day across the country, including those Canadians with incomes that are too low to pay income tax.
We are building Canada to remain competitive and create a strong business environment. The reduction of corporate taxes is an important part of the strategy. That is why we are reducing the federal corporate income tax rate to 15% and making it the lowest corporate income tax rate among the major developed economies. This is a positive measure for the economy and for Canadians, and the NDP's assertion otherwise has no basis in reality.
Just listen to the praise from the actual drivers of the Canadian economy with regard to our Conservative government's corporate tax reductions. These are the people who create the jobs for Canadian workers whom the NDP claims to care about, who create the government revenue for the social programs that the NDP also claims to care about.
Listen to the Canadian Council of Chief Executives:
|| The significant corporate income tax cuts...will provide a powerful boost to Canada's ability to compete for investment and jobs in the global economy....[It] will help companies to continue to invest and grow in Canadian communities, despite the rapid rise of the Canadian dollar and intense global competition.
Or listen to the Canadian Manufacturers and Exporters:
|| Canada is going to have a very attractive tax environment to retain and attract business investment....
||...this keeps us in the game of international investment.
Or listen to the Canadian Federation of Independent Business:
|| Tax cuts were our members' number one priority by far, with just the vast majority saying that was the number one issue. So, they have hit that issue.
Even the NDP premier of Manitoba praised them, stating:
|| [The Conservative government's] tax reductions...in all fairness...are positive and we're going to see that through the economy.
The NDP is not listening to them, and it will not listen because it is stuck in the past. Sadly, it has no intention of embracing the realities of today. Again, it would be funny if it were not so sad, as it was sad when the NDP and the then Liberal government teamed up in 2005 and the result was to reverse the relatively minor corporate taxes that the government of the day introduced in its 2005 budget.
The NDP demanded that the corporate tax cuts be stripped from the budget in return for propping up a scandal-ridden Liberal government teetering on collapse due to the sponsorship scandal. The unprincipled Liberals naturally agreed.
We have also seen this type of Liberal approach more recently, when my Liberal friends refused to show up to support their own confidence motion or to vote against the government for fear of having to face the voters. If we consider the manufacturing sector, which the NDP claims to care about, it is suffering immensely as a result of this deal.
As the Canadian Manufacturers and Exporters stated at that time, it is not action that will preserve Canada's industrial base. Manufacturers feel their pleas are not being taken seriously. They worry whether they understand the serious pressures that are facing them.
It is also sad that the NDP has opposed the support we have provided to the manufacturing and forestry sectors, support allowing them to better invest and compete. For example, we provided over $9 billion in tax relief by 2012-13. We are also improving the availability and accessibility of financial support for research and development, and extending the enhanced scientific research and experimental development investment tax credit.
We are also helping Canadians in their communities affected by a slowing global economy. To help vulnerable communities and laid-off workers, we announced a $1 billion community development trust. This will support communities and workers experiencing hardship through no fault of their own, an initiative that was praised across the country by premiers and organizations from across the political spectrum, like the NDP premier of Manitoba, Gary Doer, who stated:
|| I also believe that this is very, very important to the regions and the communities in Canada and the money will be very, very helpful and important.
The Federation of Canadian Municipalities applauded the initiative, saying that the federal government's decision to help Canadian communities hit by economic upheaval is more than welcome.
The initiatives I have focused on today will significantly benefit all Canadians. Our tax cuts will especially help Canadians compete for the jobs and investments of tomorrow. That has been recognized almost universally from Canada's business leaders and economists, and it is recognized of late by even the Liberal Party.
Mr. Colin Carrie (Parliamentary Secretary to the Minister of Industry, CPC):
Mr. Speaker, I am pleased to rise to respond to the motion of the hon. member for Toronto—Danforth.
Let me preface my comments by stating that I am in no way intending to diminish the challenges facing the manufacturing or the forestry sectors. Rather I want to clearly show Canada the hypocrisy of the member's motion and underscore the radical socialist agenda that the NDP is trying to peddle to Canadians.
Let me state at the onset that the government takes the issues facing the manufacturing industry very seriously and we are addressing them head on. We have brought forward billions of dollars in assistance and every time the NDP has voted against these measures.
What is key to the manufacturing sector and the forestry sector is the need to have the right economic fundamentals so our companies and firms can put their full attention and efforts into responding to these world challenges. It is clear that Canadian manufacturers are determined to compete and succeed in the global economy. The NDP does not seem to comprehend that if Canada does not have an internationally competitive economy and tax structure, Canada will not attract new investment, the economy will go into recession and jobs, which rhetorically the NDP members say they would like to defend, will dry up.
When the economic fundamentals are working, businesses have the best opportunity to make their mark and succeed.
Thanks to this Conservative government, the fundamentals of Canadian economy are working and jobs are being created. While other global economies are experiencing uncertainty, we are alone in the G-7 in maintaining ongoing budget surpluses and falling debt burden. Our unemployment is at the lowest in 33 years and our overall employment grew by roughly 360,000 jobs in 2007.
Yes, there are challenges, but also opportunity to ensure that all Canadians share in the benefit from our economic success. Certainly this desire extends to include the manufacturing sector overall. It is not an easy task. While the new jobs generated by our economic gains in thriving sectors offset losses in other sectors, the problem is more complex than that. Otherwise the significant measures the government has introduced to encourage skill development, such as the apprenticeship tax credit and the apprenticeship incentive grants, would represent a sufficient response. However, in a country as large and diverse as Canada, these challenges have a real and profound impact on small communities that have come to rely upon a particular manufacturing plant or mill.
The government took action to respond to these kinds of adjustment pressures. The $1 billion community development trust represents our government's support for provincial and territorial efforts to build a stronger, more prosperous future for communities and workers affected by current economic volatility. The trust allows provinces and territories the flexibility to invest in those projects that best help vulnerable communities and individuals, while respecting Canada's international obligations.
Do not take my word for it. Five provinces, New Brunswick, Saskatchewan, British Columbia, Ontario and Newfoundland and Labrador, have stepped up to leverage the money provided in the trust since it was announced on January 10. We have every confidence this money will be put to good use. By working together, the federal, provincial and territorial governments can best help take the economic challenges we face today and turn them into economic opportunities tomorrow.
The community development trust is one way the government has responded to the needs of workers, businesses and regions affected by economic difficulties.
Despite the NDP's rhetoric, the government has delivered much more. Conservatives delivered the targeted initiative for older workers, which the government seeded with $72.5 million from budget 2006 and has recently expanded with a further $90 million source from budget 2008. Here is another initiative to be delivered at the community level.
Canadian industry needs the skills and knowledge of workers 55 to 64 years of age, especially in the communities that rely upon single industries. While these workers are laid off because of the economic problems in the industry, we need to find some way to keep their knowledge and skills in the labour market.
These are examples of ways in which we have taken tangible action to address the challenges the hon. member mentions in his motion, but we have done much more.
The hon. member refers to tax measures. His motion falsely insinuates that our tax policies do not benefit Canadian companies in all sectors, including those in manufacturing and in forestry. Only the NDP cannot comprehend that cuts to the general corporate tax rate are advantageous to manufacturing and forestry companies. These tax cuts will help manufacturing and forestry companies be more competitive, create wealth and, most important, create jobs for ordinary Canadians.
With the tax measures introduced by the government, manufacturers and processors will receive over $9 billion in tax relief by 2012-13. Our initiatives will give Canada the lowest overall tax rate on new business investment in the G-7 by 2010. Furthermore, we have also extended the accelerated capital cost allowance for investment in machinery and equipment in the manufacturing and processing sector for three additional years.
This was a key recommendation of a unanimous 2007 industry, science and technology report, supported by the NDP member for Windsor West. When it came time to stand up and be counted, the radical socialists voted against their own critic's recommendations. It is unbelievable.
We have allocated $33 billion to the building Canada infrastructure plan, including $2.3 billion for trade related infrastructure and $2.1 billion for gateways and corridors, of which at least $400 million will be in support of a new Windsor-Detroit crossing, an important crossing for manufacturers.
Our 2008 budget also has introduced improvements to the SR and ED tax credit program and provides $34 million more per year for collaborate research for specific industries, including manufacturing, important elements that will contribute to improving innovation so Canadian companies can compete with the best.
For auto manufacturers, we are investing $250 million over five years to support R and D projects that will produce green automotive technologies. Coming from Oshawa, I know how important that is.
We are also helping our manufacturers to extend their business globally. We have improved Export Development Canada's export guarantee program to assist small and medium sized manufacturers in fulfilling export contracts. This is in addition to the $174 million over two years to increase security and minimize delays at our borders. These measures brought forward by this Conservative government will surely benefit our industries, including manufacturing and forestry, attract new investments and will create jobs in Canada.
For the forestry industry, we have resolved the costly and prolonged softwood lumber dispute. The agreement eliminates U.S. countervailing and anti-dumping duties. It brings an end to costly litigation. It protects provincial forest management policies and it has returned over $5 billion to Canadian producers. Again, sadly, the NDP voted against this deal.
We have also provided $127.5 million to strengthen the long term competitiveness of the sector and a further $200 million to facilitate action to combat the mountain pine beetle.
We have provided $25 million for a forest communities program that will assist 11 forest based communities to make informed decisions on the forest land base. Budget 2008 allocated $10 million over two years to promote Canada's forestry industry to international markets as a model of environmental innovation and sustainability.
Over the past two years this Conservative government, led by our Prime Minister, has indeed taken important steps to set the overall business climate so our industries can grow and become more globally competitive.
What today underscores is the hypocrisy of the NDP toward Canada's manufacturing and forestry industry and workers and the radical socialist agenda that it is trying to peddle to Canadians. However, Canadians will not have the wool pulled over their eyes. Canadians know this government is showing leadership and is delivering for manufacturers and forestry workers and industry when it needs it the most. It is the NDP that must stop playing games with the lives of workers and should start supporting the government's endeavours.
Hon. John McCallum (Markham—Unionville, Lib.):
Mr. Speaker, I am very pleased to share my time with my new colleague, the hon. member for Toronto Centre. I am also very pleased to tell you that the Liberals will be voting against this NDP motion.
The simple fact of the matter is that Liberals understand that wealth creation and social justice are both important, whereas the federal NDP, mired in the class wars of the 1960s, does not care about wealth creation and does not understand the first thing about it.
We on this side of the House understand that Canada, in a global economy, is in competition with many countries, not least of which is the United States, to attract capital and jobs to this country and to retain our domestic capital and companies.
We understand that living next door to the world's only superpower we have to create a special Canadian advantage, so that we can be able to level the playing field and compete with the United States.
Until recently, we did have a Canadian advantage. It was called a weak currency. It was cheaper to do business in Canada and business flowed into Canada taking advantage of our cheap currency. We do not have that any more.
Therefore, we need to create a new Canadian advantage to attract capital and jobs to this country and that new Canadian advantage, according to the Liberal Party, and we said this weeks before the government did, is to create a low corporate tax rate, a corporate tax rate substantially lower than the United States, something in the order of 10 percentage points.
That we believe will replace the weak currency as a new Canadian advantage and will serve this country well to improve productivity, competitiveness and attract jobs into this country.
I was a student in England in the late 1960s and the rhetoric of the NDP members is still back in the class war of the 1960s. Their rhetoric sounds just like the rhetoric of the Labour Party under Harold Wilson in the late 1960s.
The NDP members should understand that other social democratic parties around the world in Scandinavia and Britain, and I would include a lot of provincial NDP governments led by fine people like Gary Doer, Ed Schreyer, Allan Blakeney and my new colleague, have evolved too. As governments, they have to understand the realities of the world.
Just to show that NDP members are innumerate, the numbers cited by the member for Outremont, claiming that Canada had lower corporate taxes than Scandinavia or Britain, are totally wrong because we have to include the corporate tax rate for the whole country, not just the federal government.
Therefore, Canada's corporate tax rate in 2007 according to the IMF is 36% versus 25% in Denmark, 26% in Finland, 28% in Norway, 28% in Sweden, and 30% in the U.K. So, the member is out to lunch on the numbers which is typical of the federal NDP.
The true numbers indicate that the reconstructed social democratic movement of the world understands globalization, understands global realities, and those countries have adjusted. They understand that in order to create wealth, jobs and productivity we have to compete with lower corporate tax rates and those countries have done it.
The federal NDP members are in the class war mentality where any corporate tax cut is just seen as a sop to the rich. They do not understand, as their Swedish, Danish, Norwegian, British fellow social democrats learned long ago, that we have to create wealth before we can redistribute it, and that in order to compete in this world and get jobs it makes sense to have lower corporate tax rates.
There is a certain chicken and egg question here. Why are the federal NDP members almost alone in the world in being the Neanderthal version of the global social democratic movement? Are they Neanderthal because they have never formed government and therefore never had the opportunity to learn about realities, or have they never formed government because everyone knows they are Neanderthal?
I suspect it is a little bit of both. They are Neanderthal because they have never been government and they have never been government because they are Neanderthal. I suspect that will go on for some time, but I will leave it to academics to analyze this sociological chicken and egg question.
Before the Conservatives become too enthused with my speech, let me say that if the NDP is clueless on wealth creation, the present Conservative government, and I would not say the same about all Conservatives, is clueless about social justice.
Just as the NDP has never seen a social program it did not like, the Conservatives have never seen a tax cut that they did not think was the panacea for all Canadian problems.
Whereas the reality is that Liberals are in favour of corporate tax cuts. We came to that conclusion before the government did. We do not think that corporate tax cuts alone are sufficient to solve all the problems of the Canadian business world.
That is why we, unlike them, thought that the recent Ontario budget was a good budget because the provincial Liberals addressed business taxes by eliminating the capital tax, but they also understood the importance of investment in infrastructure, investment in training and retraining, and providing jobs for displaced workers and helping communities in distress. The provincial Liberals also understand, as we do, the importance of direct support for the manufacturing sector.
One litmus test to which the finance minister did not have an answer, but we now know that his answer was no, was whether he would match the $17 million offered by the Ontario government to keep the Windsor auto plant open. He said no because he has an ideological aversion to that sort of thing. He thinks that tax cuts alone are sufficient to do the job, when it is perfectly evident that tax cuts alone are not sufficient to do the job.
We on this side of the House are not only going to vote against this silly NDP motion, we are indeed proud to vote against this NDP motion. At the same time, this does not imply support for the extreme laissez-faire ideology put forward by the government.
Hon. Bob Rae (Toronto Centre, Lib.):
Mr. Speaker, I am very grateful to my colleague from Markham—Unionville for giving me the chance to participate in this debate. This is my first intervention in a debate in the House of Commons since 1982, so you will appreciate that in these 10 minutes I am not going to give a long, nostalgic commentary on the last period of time.
I know that is going to disappoint many here, but I want to say it is great to be back in the House and it is great to be welcomed in a very open spirit by my colleagues.
To have been accused by the member for Outremont of having sold out to the bosses and to being a traitor to the working class is a pleasure, if I may say so. I feel honoured to be considered in that particular pantheon by the member for Outremont.
But like me, the member for Outremont has a problem and that is that most of his thoughts are in print. I have this problem and so does he.
I know that members opposite are going to be culling. In fact, when the guy was fired as the Tory candidate in my riding, he had three binders and those binders somehow found their way to my office, so I have the binders the members have and I go to tab three and tab five. So, I know all the quotes the members are bring up.
The member for Outremont in 2002 in the National Assembly of Quebec had this to say about private enterprise. He said:
|| We are already taxed more than anyone else in North America. And that is because the people in our government insist on pretending to be businesspeople, but they do not let the free market determine which companies survive and which ones fail.
On April 16, 2002, the member for Outremont also said:
|| A government exists to create conditions so that private companies, the real ones, can have conditions where they can invest and create something.
That is what the member for Outremont said, although he seems to have forgotten. I do not know exactly what happened. All I know is that, when he was a member of the National Assembly and a minister in Quebec, he knew full well, just as everyone who has been in power knows, that people must be able to create something, to invest, as he said, and to create wealth. Without wealth and prosperity, a government cannot create social justice and help people.
I do not have time at this moment to give a full reflection on what I feel about the motion that has been put forward, except to say that I rise with a certain sense of sadness because I have come through an election campaign that was very interesting. The Green Party put forward positive proposals. I did not agree with all of them but they were there, substantive, thoughtful and creative.
My colleagues from the Conservative Party ran, basically, on a platform of anti-crime, anti the candidate, of course, and anti our leader, and that was the campaign.
The New Democratic Party ran on a threefold campaign. It had three elements. The first element was pure gimmickry. The second element was class warfare, of which we have heard more today. When was the last time someone stood in the House and used the language of saying “another member has sold out to the bosses?” What has happened?
My colleague from Markham—Unionville talks about going back to the class warfare of the 1960s. This is not going back to the class warfare of the 1960s. This is going back to the class warfare of the 1930s. This is going back to the class warfare of the 19th century. This is a truly sad commentary. Then we add the third element of the campaign, which is character assassination.
There is nothing that anybody in the House can say about me that I have not heard 1,000 times. It does not bother me, except that it saddens me when a party, which alleges to be in favour of creating greater prosperity and social justice, has a mentality that says that if we create business conditions, which in fact allow businesses to make money, that is a terrible thing. I do not get it. It is a sad commentary.
Then the member brought forward his devastating facts, presumably from the NDP research, which are all subsidized, which say that we were wrong yesterday when we pointed out that there are a great many social democratic countries that have recognized that they can actually lower business taxes and it helps the overall prosperity of their economies. Then he stood up and said that was not true, that we had the facts wrong. He recited all the information but forgot one simple fact: Canada is a federal country. It is a reality of our country.
Therefore, when we look at the taxes that are businesses are facing, we cannot just compare the federal tax rate to the Swedish unitary tax rate. We need to look at the overall tax rate. My colleague from Markham—Unionville gave those statistics very clearly.
It is quite pathetic to have all the rhetoric, all the overblown stuff, all the language, the gimmicks, the class warfare and the character assassination. That party, which at one time was leading the way on social policy and was setting the mark with respect to where Canada should go, has now been reduced to this really sad state of affairs.
The member for Outremont made a point of saying, in very flowery language, that he was looking forward to seeing how the member for Toronto Centre would possibly escape from this trap, which had been so effectively set by the New Democratic Party, how he would be able to live with himself, wake up in the morning and face the mirror because he sold out to the bosses and has now totally fallen in with a capitalist class.
How would he be able to live with himself? The answer is very easily because, like most social democrats around the world, I recognize that business success is not the enemy of social justice. It is quite simply that.
I had the great honour of leading a province through a very difficult recession. I know my friends opposite have said a lot and will say a lot about that, but I want to say this to my friends. If companies are unsuccessful, it hurts everyone. If companies are unsuccessful, it hurts the poorest of the poor. If companies are unsuccessful, it hurts the weakest of the weak. If companies are unsuccessful, it hurts every Canadian.
I want companies to be successful in this country because I want to create a climate for social justice and I want to create a climate for sustainability. That is the kind of Canada that the Liberal Party and my leader, Stéphane Dion, want to lead and that is the kind of country we want to have.
Mr. Paul Crête (Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, BQ):
Mr. Speaker, I am speaking today on the NDP motion. I think the Bloc Québécois will be in favour of the motion because, in general, it condemns the economic policy of the federal government. The policy is not sufficiently tailored or relevant to the current economic framework, to our economic reality.
The motion states:
|| That, in the opinion of the House, the Conservative government's massive corporate tax cuts are destroying any balance between taxes for large profitable corporations and ordinary Canadians; they are stripping the fiscal capacity of the federal government; they are disproportionately benefiting the financial, oil and gas sectors, while leaving others behind, including manufacturing and forestry;—
Basically the Conservative government has chosen to take a completely and purely ideological approach by saying that it was uniformly cutting corporate taxes in order to stimulate the economy. But we see that many businesses, particularly in the manufacturing and forestry sectors, are not currently making any profit. They will not derive any benefit from the return on investment associated with this policy of general tax cuts. At the same time, the Conservative government has deprived itself of a source of revenue available to boost the economy. Instead it has chosen to put $10 billion of this year's surplus towards the debt.
And this is happening at a time when the very well run companies in the forestry industry are in serious difficulty because of the crisis in that sector. In my riding for example, Maibec, a very solid company, is in trouble, as is Bois Daaquam, where workers are having to reach a compromise with the employer to peg their wages to the price of wood. Companies and workers are making real efforts, but the Conservative government is not showing the same flexibility. It is sad.
As early as last fall, when it released its economic statement, the government should have proposed not only widespread tax cuts, but also an action plan to help the forestry and manufacturing industries and give them the tools to compete and create competitive products.
The Conservatives take a “survival of the fittest” approach: let the strongest survive and if the others disappear, too bad. The government is acting as though it were a company, but it is not. To run the country, the government has to consider the labour situation, the effects on workers, the impact of the economy on the entire population. The Conservative government has abdicated that responsibility.
In that sense, the NDP motion is completely justified. In my opinion, this House should have lost confidence in this Conservative government. We said this when the budget was brought down. If the official opposition had stood firm, if the Liberals had seen things through to their logical conclusion, we would be in an election campaign today and we could pass judgment on the actions of this government, which decided to give priority to big, profitable companies, to multinational corporations, instead of helping the companies in the forestry and manufacturing industries that are in trouble.
The Conservative government has also decided not to help workers aged 55, 56 or 58, with 25 or 30 years' experience. The Conservative approach is to let them find another job. Then, if they cannot find a job, they can apply for social assistance, because, in any event, it is their fault if they no longer have a job.
This practice, this philosophy imported directly from the American right, is unacceptable. It is not in line with the values of Quebeckers and Canadians. It is the government's responsibility to help build prosperity. Prosperity does not happen by itself. It is not created just by market forces, but by the choices the government makes. And the government has abdicated its responsibility to help to create prosperity.
The motion says that quite clearly. We would have perhaps taken a slightly different position than that of the NDP about whether or not tax cuts were necessary for all businesses, but certainly not about the current percentage, or about the non-existent assistance for businesses that are not generating profits. This is unacceptable.
Since last fall, the Bloc Québécois has been making constructive proposals. This week, the House passed a Bloc motion calling for an action plan in the forestry industry. The House approved the motion tabled by the member for Montmorency—Charlevoix—Haute-Côte-Nord, which contained seven measures to help the forestry industry.
Thus, the House sent a message to the government, telling it that such measures were needed. But the government is still not moving.
The purpose of the NDP motion today is simply to ensure that the public will be able to evaluate the situation. We have a minority government. We would have expected the Conservatives to listen in order to find methods that correspond to what most Quebeckers and Canadians want. But they continue to take an approach that pushes us straight into the wall.
The United States is in a recession, and Quebec and Canada are experiencing a major economic slowdown that will, unfortunately, get worse over the next few months. Since 85% of our exports go to the United States, we should consider that if there is a reduction in American buying power, we will be the first victims. The Conservatives' approach, to continue to cut spending, is the same one taken by the Republicans in 1928-29, just before the great depression. And if there had not been changes, if Roosevelt had not become president and implemented the New Deal, the depression never would have ended.
A government has to be pragmatic and implement measures that are in line with the new economic reality. The current economic reality is not the same as it was two or three years ago. It has changed a lot and is still changing. The government did not adapt to this new reality in its economic statement last fall and even less so in this year's budget.
The Standing Committee on Industry, Science and Technology proposed an action plan a year and a half ago with 22 recommendations that were unanimously adopted by all the political parties. The government has adopted just one half-measure out of all those recommendations.
We have pressed on. The Standing Committee on Finance has adopted a motion whereby the fiscal measures adopted by the Standing Committee on Industry, Science and Technology would be implemented by the government, but the government once again is remaining silent. The federal government has shirked its responsibility.
We know that the hon. members in this House are in regular contact with the people in their ridings. We also know that ideology has had greater power than the wishes of the people. I challenge the Conservative members from Quebec to tell us that people would prefer to see $10 billion go toward the debt rather than investing some of that money to help the economy.
I challenge the Conservative members to deny, when it comes to the older workers issue, that Quebec and Canada want to adopt a measure of compassion to provide these people—who have worked for 20, 25 or 30 years—with an income to see them through to their pensions.
We are not saying that all older workers must benefit from an income security program. We believe we should help those who have done everything they can, in other words, tried to find employment, have taken training courses and have joined adjustment committees, but to no avail. They have to be given a tool to bridge the gap to their pension. It is important. It is in society's best interest on a financial and human level to allow this type of thing.
The situation facing the forestry sector will only become completely absurd later on. Younger workers are being laid off, based on seniority. Older workers are keeping their jobs while younger workers are leaving. In a few years, when the older workers have left their employment, there will be no younger workers around to revive the industry.
We should have been able to develop more flexible ways to deal with the inevitable layoffs, such as offering incentives to older workers, for instance, a supplement or possible income support until they receive their pension so they can leave the labour market, thereby allowing younger people to keep their jobs and meet labour needs later on. Yet this Conservative government did not show the necessary flexibility. That is not the Conservative way, which is too bad.
And yet this is not the first time we have talked about it or called for action. For months and months now, the Bloc Québécois and other parties of this House have been calling on the government to do something.
If the official opposition had not run into all those problems with their leadership and esprit de corps, we would currently be in an election campaign and we would know who, according to the public, are the best people to represent them at this time.
I am convinced that Quebeckers do not agree with the Conservatives' current approach to the economy. It is not at all consistent with our way of doing things or with our economic culture.
In the past, having suffered some hard blows, Quebec developed all kinds of tools to deal with such economic downturns.
They were put in place and that allowed us to evolve.
In the current pan-Canadian context, with the Conservatives' approach, we have experienced something that I have not seen for a long time: the Quebec Minister of Finance, a federalist, spoke up and said that the federal budget was unacceptable to Quebec. Imagine. The finance minister is not a member of the PQ or of a sovereigntist party. The day after the budget, the finance minister of the Liberal Party of Quebec told the federal government that, in terms of assistance to the manufacturing and forestry sectors, its budget was not satisfactory.
In Quebec, the initial reflex of citizens is to turn to the Government of Quebec. In fact, it is the only parliament that they have complete control over. They exert pressure on the government so that it will put things in place and it has an obligation to listen. The Government of Quebec took action, although it is not perfect.
Imagine the momentum if a similar effort had been made by the federal government. A decision could have been made to transfer significant amounts enabling Quebec to strengthen programs it established, for example putting in place a comprehensive program for older workers. The current program has a retraining component, which is a good thing for them. However, it does not have a training component for those workers who cannot find a new job.
The same can be said for research and development. Regional companies would have benefited had the federal government re-introduced Technology Partnerships Canada. Premier Tech in Rivière-du-Loup, for example, received significant amounts from this federal program on two occasions. We supported that program; we did not condemn it. It led to the creation of new jobs for young people. In my opinion, the economic prosperity in Rivière-du-Loup is due in part to the success of this company.
Technology partnerships Canada may have been abused in some cases. However, they threw the baby out with the bathwater when they decided not to bring the program back. That kind of program would have been very useful considering the current problems in the forestry and manufacturing sectors. Industry Canada could have maintained partnerships. Partnerships are not subsidies. The government and the company each invested money in developing new products, and if a new product worked out, parts of the royalties flowed back to the government. That worked for Premier Tech. The government should be more open to programs like that and allow for a certain number of failures before achieving success.
With respect to this recommendation, after the 2006 election, there was a transition period during which people thought the Conservatives would take a pragmatic approach to assessing programs. Unfortunately, the ideological approach prevailed, and the program was not renewed, except for the aeronautics sector. As a result, we were deprived of an important tool for development.
Today, the Bloc Québécois supports this motion of non-confidence in the government because of the Conservatives' endless parade of negative answers and their unwillingness to consider certain suggestions.
All one has to do is look at the oil and gas sectors. Take a look. Our society can afford sustainable development. We could have made major investments in renewable energy. Instead, we have to explain to people that the government is giving tax credits to companies to extract oil from the tar sands and create pollution. Moreover, they will be allowed to continue polluting until 2012, because polluters will not be forced to pay the price until then.
That approach is completely unacceptable. That is not the kind of society that Quebeckers and Canadians want. People want their government to take changing realities into account; they want their government to do everything it can to encourage sustainable development; and they want a carbon exchange.
The repercussions for the environment are enormous. For years, people thought of environmentalists as people with high standards that were nonetheless economically unfeasible. Now, we know that economy and environment can work together. Economic development can happen within a sustainable development context. To make it happen, people need the right tools.
The carbon exchange is a remarkable tool, because it relies on market rules. It is the same as a stock exchange, with shares and exchanges. It creates a market and a competitive spirit. It spurs the desire to do something concrete, in my riding for example, to introduce environmentally friendly products.
Representatives from a business came to see me in the spring of 2006 to ask if the carbon exchange was going to be implemented, because they had a project. The carbon exchange would have allowed them to develop such a project and its profitability would have been justified by the carbon exchange return. It was not implemented, however, and their project did not proceed. This is true in a number of sectors. Many businesses in North America would have carried out projects and would have created long term jobs.
In a sustainable development context, we are lagging behind Europe, which has taken the lead in this area and is making progress much faster than we are. There is even now an American law that states that petroleum products produced from oil sands will no longer be accepted in the United States in a few years' time. It is in the American Energy Act. They have already realized that this aspect must be taken into account in order to find a solution to ensure that petroleum products produced from oil sands are produced in a way that is acceptable. We did not take any such action.
The Conservative government is no longer a new government. It is a government with two and a half years of experience. It has had the chance to adjust to the proposals that have been made. Some have been made by the Bloc, and there could have been some from the Liberals, the NDP or the Conservatives. Unanimous proposals have been made by various parliamentarians and have been ignored by the Conservatives. We get the impression that the Conservative government put on rose coloured glasses last year and thinks it will get through the economic downturn without having to do what it takes to help the economy. No one in North America believes that any more.
President Bush, whom we cannot accuse of being left leaning, has taken measures to help his economy. Across Quebec and Canada we have the necessary tools to work together to create and share prosperity. The Conservative government has not done what it takes. If there had been an election, this would have been plain once again. Often the only tool citizens have left to express themselves is democracy.
There is one thing I absolutely do not understand and that is how elected members of this House can say that other members of this House are useless. That shows disrespect for democracy. When a Conservative member tells a Bloc member that he is useless, he is telling all the voters of that riding that the member is useless.
Look at Quebec as a whole, at its economy. We have received the majority of the vote in the past five elections. Take a look at the ridings represented by Bloc members. As far as the Rivière-du-Loup riding is concerned, I am not embarrassed to compare it at any time with any other riding in Quebec. It is a riding that has been represented by a Bloc member for 15 years and by an opposition member in Quebec City. There is full employment in the Rivière-du-Loup area.
The government has to stop blackmailing with power and start taking action. If the federal government continues doing nothing, then we simply must vote in favour of a non-confidence motion. It is all the Conservatives deserve.