Thank you, Mr. Chair.
When I first saw that this motion had come up for consideration, it was quite confusing. I'm part of the class of 2019, so I've spent half that time, or close to it, Zooming in, but in my understanding, from the time I have been here, legislation has a process that it follows. It gets introduced, it gets debated in the House and then it gets voted on to go to committee.
Now, I guess the trouble I'm having with this motion is the fact that we have not, in the House, voted to send this Bill C‑32 to committee, so I'm not quite sure why we're having this motion. In fact, it is somewhat offensive in this sense. Canadians have voted in two elections, one in 2019 and the unnecessary election in 2021, which both brought forward minority Parliaments. They voted—both those elections cost hundreds of millions of dollars—and they sent us here to consider legislation.
I think they would have a lot of trouble understanding why this committee would presuppose that Bill C‑32 would actually pass in the House. I think that's the underlying message of this motion. You're asking the committee to study something which is not been sent to committee by the House.
I find it quite unusual. It's not following proper process to try to bring this motion to committee before a vote has been taken place.
I want to give a real-life example of this. Many of you are familiar with my private member's bill, Bill C-256. Many of the Liberals are. I spoke to many of them about Bill C‑256. Some of them are here today in this committee meeting.
Bill C‑256 was what was called the “supporting Canadian charities act” and was designed to build on existing law that would give a waiver of the capital gains tax to private shares and real estate similar to what currently goes on with publicly traded securities. Now, for example, if you want to make a contribution of your publicly traded stock to, in the Winnipeg context, say, the Canadian Museum for Human Rights, you can do that, and you'll get a tax receipt for the full amount of the contribution and you'll get a waiver of our capital gains tax. That's been the law of the land for over 20 years. My bill wanted to expand that to the sale proceeds of private shares and real estate.
Now, the reason I'm bringing it up is that I went through all the proper processes. I had the bill drafted, I introduced it into the House, we had our first hour of debate and we had our second hour of debate. I spent months talking to colleagues and all parties of this House, from the Green Party to the NDP to the Bloc, to the Liberals, in trying to gather support for this bill.
I did all the things that we are supposed to do as legislators to bring my legislation forward. Then, after the second hour of debate, it was brought up for a vote. This is not sour grapes, this is fair enough, and I accept the will of Parliament, but Parliament did not vote to send Bill C‑256 to committee. In fact, it would have come to this committee had it passed.
Looking back on it now, if this is the way things are to be, the next time I bring up a private member's bill, I'm going to bring a motion to the finance committee every time, and I would encourage every member to do that. Just bring a motion and have it considered by committee before the House even votes on it. Why bother with inconveniences like a vote in the House of Commons? Let's just skip that step altogether, bring it to committee and consider it here.
What would have happened, I wonder, if I had done that and this committee had agreed to hear Bill C‑256 before the vote in the House? What if we had agreed to have a study about it and we had spent weeks doing clause-by-clause, hearing from witnesses from the various charities across the country, hearing from tax accountants who could give us advice on the bill and hearing from the public service, who could give us advice on the bill? What if we had done that in advance of the vote in the House?
You know what would have happened, Mr. Chair. We would have wasted a pile of time.
I don't think the underlying flaw with this motion, Mr. Beech's motion, is that it presupposes the will of Parliament. It's asking to study a piece of legislation that we have not voted on to send to committee, and that is a fundamental flaw.
Now, I do want to talk a little bit about some of my experience on this committee. Some of you may remember that I was on this committee in my first year here, and then I went over to the foreign affairs committee. The year I was there, we were able to talk to the governors of the bank. The outgoing governor, Mr. Poloz, was here, and the incoming governor, Mr. Macklem, was here. This was in May and June of 2020. I had rounds with both of them. The funny thing is that I look back on those rounds quite often now because they are very interesting.
The round with Governor Poloz went something like this. Don't you think that this program of quantitative easing that you're engaged in of increasing the money supply might trigger inflation, and that inflation might trigger an increase in interest rates? I gave him historical examples, for example, what happened in the Weimar Republic after World War I, when the Government of Germany started printing money in order to fund war reparations and hyperinflation took hold, in fact, and people were literally going to the markets with wheelbarrows full of cash, not knowing how much things were going cost.
Do you know what Mr. Poloz's response was to whether it would cause inflation or interest rate hikes? He said no, that we were in such a deep hole that parliamentarians should be concerned about deflation, that it would be the worst thing that could happen. He said that we were not going to have inflation and that interest rates, if they went up one day, would be a nice problem to have.
You guys go back and listen to that tape. That's exactly what he said. It's a very interesting conversation.
Do you know what? A month later, Governor Macklem came, and I asked him the same thing. I asked if this program of quantitative easing that he was embarking on was going to have some effect, that increasing the money supply from $1.8 trillion to $2.3 trillion, almost 25%, might have an effect on the cost of goods in our economy. Well, do you know what he said? He said no and that we were in such a deep hole that they were not worried about inflation, that it wasn't going to happen and that they were not worried about interest rates going up. He said that, if interest rates went up, and maybe they would, that would be a good problem to have.
These guys both said that.
Fast-forward to today, when interest rates have gone up from the basis point of a 0.25% overnight rate to 3.75% in about six months. People's mortgage payments have quadrupled on top of the tripling of the carbon tax. People's mortgage payments are literally quadrupling almost overnight.
Now fast-forward to today. What are these same folks saying? We have Mark Carney saying that he thinks that Bank of Canada went too far and that they should have curtailed its quantitative easing program sooner. We have Deputy Governor Beaudry, who is at the bank as we speak, saying similar things. Even Governor Macklem is saying these things now. It is quite concerning that this has all gone on.
I'll just add one other thing. I want to talk about Prime Minister Paul Martin for a second. Before Paul Martin was prime minister, when he was finance minister in 1995, he brought down what was the most draconian budget in the history of this country. If you aren't familiar with it, I would urge you to go back and read about it. What he did was he cut transfer payments. He cut transfers to provinces for health and education. Can you imagine a government today trying to do that? He did it. Why did he do it? That's a rhetorical question, because I have the floor, so please don't answer it.
Why did he do it? Why did he cut transfers to the provinces? Did he just wake up one morning and think that this would be a good idea, that maybe we would balance the budget a little more quickly? Did he do it because he wanted to? Well, no. We know he didn't do it because he wanted to; he did it because he was forced to.
Why was he forced to? It's because big government spending had forced up interest rates in the 1990s to 6% or 7%, debt service had become a massive proportion—does any of this sound familiar?
Don't answer that. It's a rhetorical question, as well.
Government deficits, debts, had grown, interest rates had gone up and debt servicing was a massive part of the government's financial obligations, just like it's becoming now. The conservative estimate, which I think comes out of the fall economic update, is that next year the debt service will be $40 billion, up from $23 billion, almost doubled and almost as much as the health transfer.
But that's not exactly why he did it. Do you know why he did it? He was forced to. He was forced to because the bond rating agencies downgraded Canada. The Wall Street Journal or the Washington Post—one of those papers—called Canada an economic basket case on the verge of being third world status, which was the terminology they used back in that day.
Paul Martin didn't do it because he wanted to, because it made him happy to do it, he did it because he was forced to. I worry a lot—and I've talked about this before in my speeches in the House—that we are heading down a similar path. I cautioned about it in the past because I lived through the years of high interest rates.
Mr. Chair, I'm going to go off topic just for a second if you'll bear with me. When I bought my first place back in 1989 in Winnipeg—it was a condo in Osborne Village—it cost $86,000. I had a $75,000 mortgage with TD Bank. Do you know what my interest rate was? It was 12.75%. It was a first mortgage. That was a good rate. That was a very good rate to get. I was lucky to get it.
We are heading down a very dangerous path and this statement does the two things that are going to make it even worse. It's just bad medicine. It's bad medicine for the economy. What are those two things? They're increasing spending by at least $20 billion over the next five years, and they're increasing taxes. They're increasing taxes on Canadians through the paycheck taxes.
My pet peeve is the excise tax. They actually want to charge more—6% or 7% more—for a beer. That's sacrilege in Canada. Leave the beer alone. Let people have their beer. That's what they want to do. They think that's the solution.
Now they want to tax share buybacks. What I find interesting about that is that when they brought in the TOSI rules one of the things they changed was they said, if you're going to keep income in your company that you're not using for business purposes—what they called passive income—we're going to increase the tax rate to your nominal tax rate, and essentially what you would pay if it was considered to be personal income. The interest that you earned, or the dividends you earned, on the passive income inside a company, that was going to be taxed at a higher rate.
Why did they do that? It's because they wanted that money out of the company and in the economy doing something. That was the tax policy reason for it and so business people all over the country started to shed their passive investments and remove them from their company so that they could reduce the tax burden that the government had suddenly imposed on them. I say suddenly because that's exactly what happened. There was no consultation around that at all.
Now, fast forward to three years later and they bring in a policy, ironically, that's designed to do the exact opposite when it comes to publicly traded companies. The purpose of a 2% tax on the share buybacks is to force companies to keep their passive income inside their companies. Companies, whether they're privately held or publicly held, are not being treated the same.
You're saying to privately held Canadian corporations, no, you can't have passive income in your company. You're going to pay a penalty for that. They say to publicly traded companies, no, you've got to keep that money in your company because you might need it to expand your operations.
Government shouldn't be telling publicly traded companies what they need to spend their money on. That is an intrusion of the state that should never, ever happen. These companies should be able to decide on their own whether they need that capital in their company or not, but that's a whole other story.
So I am disappointed. That would be a kind word to express my feelings about this fall economic update, but, more than that, about the underlying procedural unfairness of this motion to presuppose the will of the House, to assume that the NDP is actually going to vote with the government when it comes up for a vote at second reading.
They haven't stood up and done that yet. They might not. Maybe some of them will finally see the light and realize the error of their ways, see how they've gone down the wrong path with this government. The fact of the matter is that we don't know. This motion assumes that this is in fact the case, and that's just wrong. It's wrong, but if this motion actually passes, I'm going to be doing this all the time. I'm going to bring motions on my private member's bill. I think we should all consider bringing motions on bills we're interested in to have pre-studies on them before they pass the House. Why not?
We're doing it here. I guess things have changed around here.
So with that, I am very, very concerned about this change in process, which I think can have only a deleterious effect on how we consider...by the way it also presupposes that when we're debating a bill in the House, it doesn't matter. I hear that all too often about time allocation. Time after time after time, the government cuts off debate in the House. “Those MPs—they couldn't possibly have anything useful to say. Let's get it to committee where there can be a real discussion about it.” It doesn't matter. Why are we spending billions and billions and billions of dollars on this place? Why are we spending billions of dollars renovating the Centre Block when time after time after time the Liberal government basically says it doesn't matter? It doesn't matter. MPs don't need to speak in the House on this. Let's send it to committee before it even passes, before you even know what the will of elected officials is. Let's send it to committee before the votes even happen. That's just not right.
So with that, I think I have made my point. I'm going to cede my time and the floor at this point, Mr. Chair, but I would ask to be put back on the speaking list just because I may have other important revelations that will be of the utmost importance for consideration here at this committee today.