- Member of Parliament
- Liberal
- Scarborough—Guildwood
- Ontario
- Voting Attendance: 62%
- Expenses Last Quarter: $111,926.23
- Government Page
Mr. Speaker, of course it could have been tabled earlier. Whether that would have been a wise tabling, I do not really know.
This is part of an array of initiatives on the part of the Government of Canada to mitigate the complaints we are all hearing. There is not a member in this House who has not heard about the inflationary pressures on our constituents, so as part of an entire array, I think this bill is a worthy initiative. The fiscal policy is being handled as well as it can be handled, with maybe a slow start on monetary policy. I still think the Bank of Canada is moving forward on that front as well.
When taken together, the array of measures and initiatives on the part of the government writ large is an appropriate response to a worldwide phenomenon on a relatively small economy, and hopefully—
150 words
- Hear!
- Rabble!
- add
- star_border
- share
- Jun/7/22 4:24:23 p.m.
- Watch
Madam Speaker, in saying “a false solution to a real problem”, the hon. member described it better than I did, and I think he is right.
With respect to the revenues, yes, inflation has that effect of giving the revenues a temporary boost, but it is a temporary boost, because once we get the revenues in, the bills start arriving as well, so the costs of running a government are actually going to be much greater because there is necessarily going to be wage inflation, which is essentially what government is.
As to spending the revenues that are coming in, I would not go for that kind of an idea immediately. There have been various relief elements, particularly for seniors, that have been distributed over the last couple of years.
132 words
- Hear!
- Rabble!
- add
- star_border
- share
- Jun/7/22 4:22:09 p.m.
- Watch
Madam Speaker, I appreciate that question from the hon. member, because in a speech I made about a year ago, or sometime around then, I flagged that particular issue. In fact, from my own grocery shopping, I recognized that inflation was here. I actually sat down with the PBO at one point and said, “I don't understand why we are not more alarmed about inflation.” People from the Office of the PBO had an explanation that I frankly could not understand, but that said, they were still very helpful in trying to explain it to me.
The Bank of Canada had described inflation at that time as “transitory”. I think it recognized that it was on its way but did not recognize that it was possibly going to be more long-standing than it had previously anticipated, and if there is an issue to be had there, I think that is a legitimate point.
159 words
- Hear!
- Rabble!
- add
- star_border
- share
- Jun/7/22 4:11:54 p.m.
- Watch
Madam Speaker, I find the motion actually pretty easy to vote against. Whoever wrote the motion has been quite brilliant at describing the issue, but not nearly so brilliant at describing the solution.
You might be interested in knowing, Madam Speaker, that I do all the family shopping. I also do the gas purchases and I buy materials for the house. I remember buying two-by-fours during COVID and I had to go to three stores to try to just get one two-by-four and the cost was 100% more than I paid in years previous. I agree with the description of high inflation for everyone, that gas is more expensive and that the cost of food is up. I have experienced that personally.
What the hon. members from the Conservative Party do not seem to realize is that the supply chains were pretty badly messed up during COVID. Some were out because the countries were locked down. Some were not able to produce the products they had previously. Take for instance, microchips. We could not get any microchips for anything, including a car. Again, within my experience we live in a neighbourhood where we bought a couple of cars and for a considerable period of time there were no cars on the car lot. In fact, we could buy a used car for what we paid a year or two previously for a new car. Just a simple thing like microchips has in and of itself driven up the cost of living quite dramatically.
Add to that the great resignation. People simply do not want to do the jobs that they were doing pre-COVID and that in turn has driven up the cost of labour. I took note in the Report on Business Magazine last weekend that the Royal Bank of Canada has just given a 3% increase across the board to all of its staff because it knows it has difficulty recruiting and retaining staff. We have had representations from Irving, which is building our warships. Its biggest challenge is, again, recruiting and retaining staff, even with substantive increases in salary.
Add to that the Putin war, which took supply chains that were really badly messed up by COVID and only made them more difficult. Sanctions do mean something. They mean that certain products that we are used to purchasing simply cannot be purchased any longer from the Russian-based sources. Add to that the fact that Canada is about 2% of the world's economy. We are in effect inflation takers as opposed to inflation makers. Even for products that we have in substantive quantities such as oil and gas, wheat and various other mineral products, we do not actually get to set the prices. The prices get set by places other than Canada. As I say, we are price-takers, not price makers. We are inflation takers. We are not inflation makers.
On a point of information, as much as the Conservative Party would wish to pin the inflation upon the Prime Minister, I would suggest respectfully that it is a bridge too far even for them.
What is the Conservative solution? The Conservative solution is a reduced consumption tax, and if we do that on the GST and the tax on carbon, everything will be resolved. That is possibly the worst idea ever. Any economist in Canada will say, with the notable exception of Stephen Harper, that if we want to generate government revenues we should be taxing consumption and we should be reducing the tax on labour.
Income tax is a tax on labour. Consumption tax is a tax on consumption. In effect, it is taxing the person who works hard and reducing the taxes on the person who plays hard. If we reduce the consumption tax, it is practically a guarantee that large oil and gas companies and other companies as well will backfill with price increases, and I would expect that our Conservative friends would have recognized that before drafting this motion. The consumer gets no relief. The government revenues are drained. Rich companies get richer, and the working person gets increased income tax. Hardly what one would describe as a brilliant solution.
Finally, there is carbon pricing. The most effective way to reduce carbon consumption, short of turning down the thermostat or reducing unnecessary travel, is to apply a tax to it. If, in fact, the tax is collected and applied as it should be, then, in the end, the lower-income families will actually receive rebates in the mail. In Ontario, that means $745, and in Alberta, it means something in the order of just over a thousand bucks.
There are those who say they cannot adjust. For some that is actually true. For others it is simply a lifestyle choice. However, if we are going to be serious about carbon reduction, then we have to apply this sort of tax, which has repeatedly demonstrated to be the most effective way to reduce carbon consumption.
Given that inflation is real, given that we are just 2% of the world's economy, given that we are a trading nation and highly dependent upon external trade, given that the Putin war will not end any time soon and given that inflation is well beyond the Bank of Canada target, what is a relatively small but prosperous economy to do?
We will start with some of our strengths. We have a relatively low debt-to-GDP ratio, possibly the best in the G7. It is the same thing with jobs, as we have had 115% job recovery in the post-COVID era. We have a number of products that the rest of the world wants. There are, frankly, more jobs available here than there are people to fill them. Something about over a million positions are begging for people. Again, we have heard that from various employers who are looking for people to fill positions and simply cannot find them, so we are in a relatively strong position.
Then there are some direct relief measures. The Canada child benefit in my riding is worth over $100 million per year. That is a significant relief to those constituents of mine who have children. The $10-a-day child care plan, which is just being rolled out in Ontario, will help a lot of people and it will make a significant difference in terms of the choices that those who wish to take advantage of the program have. In some instances, particularly during the earlier part of this government, we were able to reduce the tax margin for those with lower incomes and apply relief to those who actually needed it the most.
However, we should recognize that the Bank of Canada is the main player here. It has control over monetary policy. The Bank of Canada's monetary policy is independent from government, as it should be. It is possibly the worst idea in the world to have the government control monetary policy because government interests and central bank interests are not always lined up. As an example of that, I might point to Turkey, where the government of the day has taken over monetary policy. That has led to something in the order of 70% inflation. The central bank has renewed its 2% target. We need to recognize that interest rates are going to rise and possibly even dramatically rise.
Our strong monetary policy is our most effective weapon. We have a relatively decent fiscal position. We do not need to yield to the siren song of reduced consumption taxes.
1270 words
All Topics
- Hear!
- Rabble!
- add
- star_border
- share
Madam Speaker, I would say that my hon. friend from Sherwood Park—Fort Saskatchewan is a little premature in his enthusiasm.
Has the hon. member thought about how much the Putin war is contributing to the rate of inflation with respect to oil, gas and commodities in multiple trillions of dollars? Has he thought about how the clogged supply chains, created largely by COVID, have contributed multiple trillions of dollars to increased prices? Has he thought about the pent-up demand created by COVID that created multiple trillions of dollars? Has he thought about the U.S. economy, which has an inflation rate considerably in excess of Canada's, and that being our major trading partner? Also—
119 words
- Hear!
- Rabble!
- add
- star_border
- share
Madam Speaker, I want to go to the central, core point that the government is apparently entirely responsible for the inflationary aspect of our current economy.
An hon. member: Hear, hear!
31 words
- Hear!
- Rabble!
- add
- star_border
- share
- menumenu
- notificationsnotifications
- home
- mailmail
- searchsearch
