44th Parl. 1st Sess.
May 2, 2022 11:00AM
- May/2/22 2:44:51 p.m.
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Mr. Speaker, Canada now has the third highest inflation rate in the G7 at 6.7%.
What this means for Canadians, in concrete terms, is that if they did not get a 6.7% wage increase in the past year, they became poorer. On top of that, the cost of groceries has gone up 8.7% over the past year, and that is the second highest rate in the G7. It seems as though the minister is wearing rose-coloured glasses while making her budget forecasts. Obviously, it is not working.
When will she change her approach and start acting for Canadians?
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- May/2/22 2:45:29 p.m.
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Mr. Speaker, I thank the hon. member for his question.
I am glad the Conservatives are finally admitting that inflation is really a global phenomenon. Canadians understand that very well. The latest inflation rate reported for Canada was 6.7%. In the United States, it is 8.5%. For the OECD, it is 7.7% and for the eurozone, it is 7.3%.
Putin and COVID-19 caused inflation.
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- May/2/22 3:07:14 p.m.
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Mr. Speaker, record inflation under the government affects not only Canadian seniors but their children too. With two children in university, an all-too-familiar Alzheimer's diagnosis forced a family in my riding to dip into their meagre retirement savings to support their loving father in his time of need. This is a reality that far too many Canadian families are experiencing.
Informal caregivers are the backbone of this care economy. What specific measures will the government be introducing to help young families care for their aging parents?
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- May/2/22 11:08:04 p.m.
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- Re: Bill C-8
Madam Speaker, regarding the government's budgetary policy, one of the big challenges this country faces right now is inflation, which is driving up the cost of everything. I would love to hear the member's thoughts on that and on the government's role in that, and what he thinks can be done to help ease the cost of living for Canadians.
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- May/2/22 11:08:36 p.m.
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- Re: Bill C-8
Madam Speaker, I am not an economist, but I am pretty sure that we will not fix the inflation problem by extolling the virtues of cryptocurrency. There is one thing I do know, which is that seniors are always the first to suffer as a result of inflation.
Their purchasing power has not increased, although groceries, gas, prescription drugs and housing costs have all gone up. Everything has gone up. The only thing that has not increased is their old age pension, because the government is incapable of being there for seniors.
The government has created two classes of seniors: those aged 75 and over, who got something, and those aged 74 and under, who got nothing. Does inflation affect those under 74 any less? I do not think so.
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- May/2/22 11:10:20 p.m.
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- Re: Bill C-8
Madam Speaker, just to follow up, my Conservative colleague talked about inflation that is impacting not just Canada, but countries globally.
One thing we do not talk enough about is the skyrocketing concentration of wealth and the rampant inequality that is growing in our country. We see that we have the lowest corporate tax rate in the G7. We have tax havens that are designed to protect the super wealthy.
Does my colleague agree that we have a big issue when it comes to the concentration of wealth at the top and that the super wealthy could afford to contribute more so that we could build affordable housing, so that we could make sure that people have pharmacare and so that we could tackle the toxic drug supply and the overdose crisis? I appreciate my colleague for always speaking and trying to find solutions.
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- May/2/22 11:28:26 p.m.
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- Re: Bill C-8
Madam Speaker, I am pleased to rise at third reading to contribute to the debate on Bill C-8.
Two of the themes I have heard so far this evening that are emerging from the debate have to do, first, with inflation and, second, and relatedly, with the incredible increases in housing prices that Canadians have been facing that have made it very difficult for Canadians to afford a home. As we are hearing more often, it is causing many younger Canadian adults to give up altogether on the dream of ever owning their own home to be sure, and in many cases even just to find a home to rent. More and more people are having to stay with mom and dad a lot longer than they planned, if they have the good fortune of having parents who have a home that can accommodate them.
What I want to offer that I do not think has been said enough when we talk about inflation is to point to a couple of studies that have come out in the last several weeks by Canadians for Tax Fairness and the Canadian Centre for Policy Alternatives, which have said that up to a quarter of the inflationary pressure that Canadians are currently experiencing can be attributed to price markups by companies for their products that go above and beyond their increased costs. Companies in the grocery business, the oil and gas business now as prices spike, banks obviously, insurance companies and big box stores have seen incredible increases or a growth in profit that is higher and faster than the growth of their costs. That is not to say businesses are not facing increased costs, but some of the largest businesses appear to be using that as an opportunity to gouge Canadians, whether it is at the pumps, the store or wherever they sell their wares. This is contributing as much as 25% of the increase in costs that Canadians are currently experiencing.
We could listen to the Conservatives talk about the problem of inflation all day. They would have us believe that it is only government spending that has contributed to inflationary pressures. They do not want to talk about international supply chains. We do not hear them talk about that. We just hear them talk about the government borrowing during the pandemic. They could be talking about the extraordinary increase in profits that far exceed the increase in costs that many of the largest companies in Canada are experiencing, but they do not. They only want to talk about where they see government as the problem.
The problem for Canadians, when they are looking for people to elect to provide some real solutions, is if they elect people who can only appreciate one kind of problem, it is like a tradesperson who only knows how to operate one kind of tool. The fact is tradespeople need to know how to use all of the tools in the tool box because they are confronted with novel problems and not all problems are the same and not all solutions are the same.
Cutting government spending sometimes is the solution to certain kinds of problems, but it is not the solution to all problems. Indeed, fixing some of the problems that we are facing right now requires government investment, but when we talk about the extraordinary price increases and profit increases that we have seen in certain industries that are really hurting Canadians in the pocketbook, the answer is to take those folks on. The answer is some regulation and legislation that will hold them to an appropriate standard and make sure Canadians are not getting fleeced by the private sector. As I said, there is some real evidence that that is going on, and it is not a big enough part of the conversation. If it is 25% of the problem for the budgets of Canadians, it certainly does not make up 25% of the conversation here, not even close, let alone 25% of the solutions that are being proffered by the government.
How do we know this is in part the case? We can look at not only some of the company profits I was talking about, but we can also look at some longer-term trends and the way they have accelerated during the pandemic. We have seen it with Canadian billionaires. There are not a lot of them, but man, do they ever have a lot of money, and man, have they ever managed to grow their net worth astronomically over the last two years of the pandemic. That is some serious evidence.
If we go back just to last fall, the Parliamentary Budget Officer issued a report that said that 1% of all Canadians have 25% of the wealth produced in the country, while 40% of Canadians are trying to get by sharing only 1% of that wealth. That was not always the case in Canada.
These are some of the important themes that are based in economic data that the government and the official opposition have to start taking seriously because we are missing the mark in the conversation about inflation by only talking about the extent to which government spending has contributed to that. In fact, we are in a time when, if we listen to most economists, we are in an inflationary period that is driven far more by supply constraint issues than we are in an inflationary period driven by excessive demand or money in the market.
It is true that, in some cases, there is an overheated market and housing, which is the second theme that I want to touch on. It is that par excellence. We have seen that. We have seen extraordinary price increases in the market. There are folks in the Conservative Party who have talked a lot about this here in the House. They would have us believe that this is simply attributable to some of the liquidity that the government injected into the market at the outset of the pandemic. They will talk about the Bank of Canada printing money. They want Canadians to believe that this is the whole story, that this is the only reason we have seen massive price increases in the market.
In fact, housing prices have been doubling about every five years or so for the last 20 years at least. I will speak to that, just because that is about as long as I have been paying attention to the housing market. This is not a new trend. It is a trend that has been accelerated, but it speaks to something that has been going on for quite a long time.
The particular financial measures that the government happened to adopt, most of which, incidentally, was money that was shared directly with Canadian households through the wage subsidy program and through the CERB program. There was a direct transfer of wealth from the government to individual households on an unprecedented level. If we look at the percentage of government spending that went to those direct transfers of wealth to individual households, while the pandemic was happening and while people were out of work, it is quite impressive.
These were not people who were then taking CERB money and buying multiple properties. Let us not kid ourselves. Two thousand dollars a month is not very much. There is nobody with an income of $2,000 a month who is going to the bank and saying that they wanted to buy the house down the street and having their bank sign off on that. Give me a break.
It is just absurd that people here would be out, say, on leadership campaign tours pretending that, somehow, the billions of dollars of government money that went to people who had lost their job during an unprecedented health crisis and were not making more than $2,000 a month are pouring gasoline on the fire of housing speculation and house prices.
What is a lot more likely is that these people, these 1% of people who have 25% of the wealth, for all sorts of reasons, including Liberal and Conservative governments, successive governments in this century, lowering the corporate tax rate from 28% in the year 2000 down to 15% today, were looking around and wondering, how are they going to make more money with their money, because that is what they do. They have whole companies, banks and advisors. There are whole industries predicated upon people with tons of money figuring out how to make tons more.
The fact of the matter is that anyone who has the job of figuring out how to make more money on money has been looking at the Canadian real estate market, not just in the last two years but in the last 20 years, and drooling all over the place, because it has been an excellent place to grow one's money for no effort.
Unless the government is going to get serious about taxing back some of that extraordinary wealth so that it can be invested by democratically elected governments in priorities like indigenous housing, reducing our emissions, and making prescription drugs more affordable and dental care accessible, we are not going to solve the housing problem. This is because part of the problem is that too much private money is trying to multiply itself in the economy and that it is free to do that. We have seen that with those tax breaks.
With regard to the 1% of people in Canada who share 25% of the wealth, they do not know what to do with all their money, so they are bidding up the price of houses and owning that because they like the idea of further growing their wealth by renting out houses and apartments at extraordinary rates to Canadians, and that is a huge part of the story of what is driving the extraordinary growth in housing prices, which is putting housing out of the reach of too many Canadians.
Here we are. If we just listened to the official opposition, all we would hear about is the role of government, and we would be missing the mark. That is why, if we listen to what they are saying, they do not have any good solutions.
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- May/2/22 11:42:51 p.m.
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- Re: Bill C-8
Madam Speaker, this is something I am hoping we are going to have an opportunity to get into at the finance committee in our study of inflation. I have been advocating to try to get some representatives from the grocery industry there.
I think it is a notoriously opaque industry, and in this time, when we step back and see the extraordinary growth of profit that exceeds the increase in cost, as it must, because otherwise we would not see an increase in profit, it is time to shine a little more light on industries like grocery. I would add telecommunications, for instance, where Canadians are known to pay extraordinarily high prices compared to other places in the world. We tend to have an oligopoly structure to some of these key industries. We should be applying more public scrutiny to those industries.
One of the quicker fixes that we have proposed as a party, and we saw the Liberals adopt it with respect to banks and insurance companies, is to have what we have called an excess profit tax or a pandemic profit tax, where we tax the extraordinary profits in the pandemic period at a higher rate.
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