The aftermath of last year’s severe global recession is far from over, with a rippling debt crisis in Europe, continuing turmoil in world financial markets, a record government deficit, a four-percent drop in Canadian living standards, and an interest rate hike on the horizon.
A recent report found that Canadians have an average debt of $41,740 each – which is the worst among the world’s top 20 most advanced nations. That means higher interest rates will only put more pressure on Canadian families, making it harder for millions of average households to afford child care, pay tuition bills, care for elderly parents, and save for retirement – while many still worry about job security in a changing economy.
The result is that Canadian families are left with little room to manoeuvre – and with a record $54 billion deficit, the Canadian government is squeezed as well.
Given these mounting pressures, what is the Harper government’s top priority? Borrowing more money from future generations to give further tax cuts to large, profitable corporations – when according to KPMG they already benefit from the lowest business taxes in the G7?
This is the wrong economic approach – and it ignores the economic pressures on Canadian families and it ignores that investing in child care, higher education, elder care, and strong retirement security can also be good for the economy.
That’s why Michael Ignatieff and the Liberal Party will freeze corporate taxes and use part of the savings to cut the Conservative deficit. And we’ll ease the burden on families who are saving for their children’s education, caring for aging parents, paying for retirement, and looking for a job in the new clean energy economy.
Liberals believe in cutting corporate taxes – when the time is right. Just look at the record – it was the Liberal governments of Jean Chretien and Paul Martin that made Canada’s corporations more competitive in the first place, while slaying the deficit and making crucial investments in healthcare and education.
What’s Stephen Harper’s economic record? Flying around the world and taking credit for the Liberal economic record and putting Canada in a precarious position by squandering all of that financial strength in four years.
Just consider how it was Stephen Harper who, in 2002, lambasted Jean Chrétien in the National Post for “the failure to adapt bank regulation to the needs and challenges of a financial sector that is less and less national, and more and more global” – in other words, opposing the very same banking regulations that protected Canadian families and businesses during the 2008 financial crisis.
What has Mr. Harper done since? He promised not to raise taxes, but then he taxed income trusts, robbing $35 billion of savings from Canadians. He’s raising payroll taxes by $13 billion. The Canadian Federation of Independent Business has estimated this will kill 200,000 jobs and cause an average worker’s wage to drop 1.5 percent.
Mr. Harper promised not to run a deficit. After inheriting the Liberal $13-billion surplus, he put us into deficit even before the recession began in 2008, but he can now boast of running up the biggest deficit in Canadian history and adding more than $150 billion to the national debt by 2015.
Mr. Harper promised smaller government, but in four years he increased federal spending by 25 percent.
Where does that leave Canada now? With the nation’s finances and our families squeezed by record debt levels.
Yet instead of relieving pressure on middle-class families who will be squeezed by higher interest rates and paying down the Conservative government’s record deficit, Stephen Harper still plans to borrow another $6 billion a year from our kids to reduce taxes for profitable corporations – leaving families to fend for themselves and our government awash in debt.
That’s the Conservative fiscal record – hardly a thing to boast about.
Author:John McCallum, MP for Markham-Unionville is the Finance Critic for the Official Opposition
