Okay. It was just a point of clarity. So, as it catches your eye, whether it be virtually or in the committee room, the person who gets there will get there first. That's fine, and that's fair.
I want to talk a little bit about the share of the stay-at-home parents' participation tax rate. Before 1985, there were nearly zero individuals who paid more than 50%. In fact, in 2010, it was still a very small percentage; it was less than 10%, by my read of this graph. However, as we get to 2022, that number dramatically increases. We've seen an increase and a creep-up of the marginal effective tax rates for lower-income workers. As I said, this can often be more than 50%. On occasion, it can be greater than 80% for low-income earners, meaning they only get to keep 20¢ on every dollar they earn, which is incredibly disappointing and also incredibly demotivating to Canadians who are simply trying to go out there and work hard. It also has real challenges for us as we face a labour challenge. We should be doing everything we can to incentivize work. Instead, we are disincentivizing it.
As a country.... The Liberal government should be out there saying that it supports those who are going to work and trying to improve their lot. I believe the Prime Minister says, “the middle class and those [aspiring] to join it.” To those folks who are trying to join the middle class, we should be giving every handout; we shouldn't be slapping their hands as they try to climb up the economic ladder, which is, metaphorically, what is happening right now.
The marginal effective tax rate is driving people back into poverty. This is seen by the food bank usage. As we heard, the situation is “disturbing”. Many food banks have seen a double or even triple usage compared to pre-COVID levels. As the government takes a larger and larger share of Canadians' earnings, we throttle down; we take out the productivity and innovation of our economy. Of course, we are forecasted to have some of the lowest economic growth in the OECD going to 2060. We are also forecasted to be dead last in capital investment. We need private capital to drive innovation to grow our economy, and unfortunately we are not looking good on that front according to the OECD. It's extremely challenging.
Why is this important, Mr. Chair? Well, this is important because productivity drives our economy, which drives our standard of living. When productivity decreases, growth rates decrease, and when productivity and growth both decline, it's the most vulnerable who often pay the highest price, as is the case with inflation. When inflation goes up, the wealthy may be inconvenienced, but it's the most vulnerable who have to go to food banks. It's the cost of inflation. It's deficit-fuelled inflation fuelling spending that is driving Canada deeper and deeper into debt.
Quite frankly, Mr. Chair, we need to hear expert testimony on this. We need to understand—to an even greater extent than we do—what the impact of this deficit spending will be. We have seen that the marginal effective tax rate is a substantial weight or anchor on our economy.
I'll give you an example of the impact of the marginal effective tax rate.
Mom and dad each earn $30,000, for a total family income of $60,000. On the one hand, they pay $7,668 in combined federal income taxes and contributions—employment insurance (EI) and Canada Pension Plan (CPP)—and $1,729 in Alberta taxes and contributions, for a total payment of $9,397.... The total of benefits received minus taxes and contributions paid yields an initial family disposable income of $62,900.
Mom considers working overtime one month to earn an extra $500. As a result, family benefits would decrease by $99 while federal and provincial taxes and contributions would increase by $152, and the family’s disposable income would increase by $249...rather than by the full $500 [that she rightfully earned].
The family's marginal effective tax rate would round out to 50%. That's income earners, earning $30,000 each, giving over 50¢ on the dollar back to the government.
To earn that $500, the reality is that there were probably other expenses that had to be incurred along the way. There were probably additional transportation expenses. If this individual needs to take public transportation, there's the cost of that. If they own a car, there's gasoline and wear and tear on the vehicle. Then there are additional expenses with respect to child care, perhaps. Maybe she's working in the evening. That $249 could easily be eroded.
That's why many Canadians are feeling like everything in Canada is broken. For many Canadians, and I've heard this from Canadian after Canadian, it feels like work doesn't pay anymore here in Canada. We need to dispel that notion. We need to celebrate work. We need to incentivize work. We need to get that deal back, that broken deal that says if you work hard and make the right decisions here, you're going to be rewarded. You're going to be able to afford a house. You're going to have a little extra money to save for retirement. You're going to have a little bit of extra money even to go and have a vacation. You're going to be able to afford the basic necessities and not worry about making your bill payments at the end of the month.
Canada, more than ever, needs its entrepreneurs, its workers, to power our economy through. Unfortunately, this Liberal government is putting in barrier after barrier after barrier.
I'll give you another example of how this government is putting in barriers that are preventing Canadians from achieving their full potential. In this scenario, mom earns $30,000 and dad stays at home, for a total family income of $30,000. Mom pays $1,985 in federal income tax and contributions to EI and CPP, with no Alberta income tax, for a total payment of $1,985. The family also receives government benefits. The total benefits received, minus taxes and contributions paid, are $49,555.
Dad says he's considering returning to the workforce. He has an offer. He's excited to return to the workforce. He's going to be earning $30,000 a year. The family's disposable income, instead of increasing by that $30,000, would increase by only $13,350, reflecting the loss of federal benefits, provincial benefits and the rise in federal and provincial income tax. That means that his participation tax rate is 56%. That's for someone earning $30,000 a year. Man, that is brutal, especially when you consider the additional costs that may be necessary to return to work. Maybe he required some additional training and there were costs with respect to that education. Maybe there was a second car required if they live in a rural area. Now we may have actually put them behind the eight ball.
The reality is that the majority of stay-at-home parents are moms and some of them certainly want to continue doing this. Others want to return to the workforce. For those who want to return to the workforce, we should not be subjecting them to marginal participation tax rates in excess of 50%. These are women who have decided that they want to return to the workforce, and the government is all but stopping them by taking more than 50¢ on every dollar that they earn. These issues are incredibly challenging.
We'll continue to talk about the government's war on work. Quite frankly, I was looking forward to many of the witnesses testifying about that. Those who have been paying attention to my questioning would see that this is a repeated theme, and it will continue to be a repeated theme that I ask questions about.
If we were to reduce the marginal effective tax rate, particularly on low-income earners, that would alleviate a number of issues. It would give individuals more money to spend on food. It would also give them more money for rent and allow them to be in a better financial situation. It would, potentially, motivate more individuals to return to the workforce and ease our labour shortage. It only makes sense that the more we pay people, the more they would be willing to work. In this case, we are paying people less and less in net dollars.
Mr. Cross had great comments on this when he talked about the fact that Canadians are increasingly feeling like work doesn't pay in our country. You can see where that notion would come from. When the government is taking 50¢ on the dollar, work is certainly paying less than it has in the past. We have seen the marginal effective tax rate increase steadily under the Liberal government. Its war on work continues. We actually saw this a little bit with COVID benefits: If you earned $1,001, you got zero dollars, whereas if you earned $999, you got $2,000 of benefits. It's these types of cliffs that we need to avoid.
There are a number of different ways of looking at this. One is to potentially reduce income taxes on low-income earners. That might be an area of fertile discussion. Another would be to reduce the rate of clawbacks on low-income earners. That might be a good area to have discussion on. There is also the ability to increase the exemptions when clawbacks start or when income tax starts. I think these are all excellent and fertile areas for potential discussion.
However, doing nothing is simply not an answer. I just don't know how members of the Liberal government can look someone in the eye who is earning less than $30,000 and say, “Yes, we're taking 50¢ on every dollar you earn, sorry about that, so sad, too bad.” To me, that's unconscionable. What we need to see is reform, in some shape or form, so that people earning under $50,000 a year are not paying more than 50% of their money in taxes. We need to see paycheques go further.
You know, the government is certainly quick at grabbing money. They take more money; they take it; they take it, whether it be in carbon tax, income tax, this tax, that tax or any other tax. Sometimes, they'll point out that, yes, we give back this money. There is their famous GST rebate, with the marketing gimmick of calling it a “grocery rebate”, when it was simply the doubling of the GST.
They're certainly great at marketing. There's no doubt about that. Where they fall down is with respect to substance. Instead of taking all this money to Ottawa and then giving back little dribs and drabs of it, why would they not just leave it in the pockets of Canadians?
I had a private member's bill, Bill S-216—which has since been carried forward by Ben Lobb—that sought to give an exemption from the carbon tax to farmers for propane and natural gas. The government first said, “No, this isn't an issue. It isn't an issue. No way. This isn't actually costing farmers tons of money, Philip. You're all wet.” Then when organization after organization came out to say it actually was a problem and was costing the average farmer thousands of dollars in carbon tax paid in excess of their rebate, they came up with their own half-baked solution of providing a credit and a rebate system whereby they would take the money and distribute it as they saw fit. If you did the right thing here and the right thing there, the government would give you some of your carbon tax dollars back.
That is not how Conservatives work. In fact, I had an exchange with the Deputy Prime Minister and Minister of Finance that I think was incredibly illustrative of the difference between Liberals and Conservatives. I asked her about the dire situations in food banks, and she went on—I believe with 100% sincerity—talking about some of the challenges in her own local food bank and how the financial position many Canadians were in broke her heart. I believe she was absolutely sincere and I want that clear and on the record. Then she went on and said, “I wish we could give them all cheques.” That is the difference between Liberals and Conservatives: Liberals want to take people's money and give them cheques, while Conservatives want people to have economic independence to the extent that they never need a government cheque. It is that difference that very much defines the difference between the Liberals and Conservatives. That Liberal policy of taking money to give to others has never succeeded. No country has ever taxed itself into prosperity.
Winston Churchill described this strategy as a man standing in a bucket and pulling up on the handle to try to bring himself up. Clearly, the visual of that is exactly what it means, because you can't grow an economy by taking money out of the economy. That just doesn't make sense. When we take more and more and more money out of the economy, we inhibit the ability of Canada and Canadians to compete on the world stage.
In the U.S., they don't have a carbon tax. Businesses don't have to worry about a carbon tax. We actually heard in witness testimony here—and it would be great to hear another 10 hours of this—from the CFIB about the impact of the carbon tax on Canadian small business. Small business owners, farmers and rural Canadians are paying a disproportionate amount of the carbon tax. In many cases, they're paying thousands, if not tens of thousands of dollars over and above any rebate they would have received. This is incredibly inequitable and unfair, and it's another weight on Canadian businesses.
Canadian businesses need to be lifted right at this time. Right now, our productivity numbers forecasted by the OECD, our capital investment numbers forecasted by the OECD and our economic growth numbers per capita forecasted by the OECD are not a pretty picture.
The Liberal government, if it was serious about increasing prosperity for all Canadians—and perhaps I might say, most importantly, those who are most vulnerable—would have been serious about growing the productivity of our country and eliminating barriers to success.
Unfortunately, this budget was more of the same, which will just increase the barriers to success and make it incredibly challenging.
The great news is that Canadian entrepreneurs, Canadian business owners and Canadian workers are so tough that I think in spite of nearly anything this government throws at them, they will keep going.
To them, I say, “Thank you.” I mean that sincerely. Thank you to all the workers, to the business owners out there who are working 50, 60, 70 or 80 hours a week, only to see 50% to 60% of those efforts get appropriated by the federal government, which has an insatiable appetite for revenue.
Revenue grew incredibly post COVID, because of inflation. Millions and billions of additional revenue dollars were flooding into the coffers of the treasury, and the economic situation, because of the recovery from COVID, was good.
Keynesian economics would tell you that now's the time to save for the next challenge, but what does this government do? It continues to spend, spend, spend. Tax and spend—those are the only two economic solutions this government knows. If it sees an issue, it has two solutions: Tax it or spend money on it.
What this government needs is competent policy. We need effective tax reform. We need effective legislation to protect Canadian intellectual property. Unfortunately, all this government sees are two words: “tax” and “spend”.
There's a famous Ronald Reagan quote that says that when a Liberal sees something move, they tax it. He said, “If it keeps moving, [they] regulate it; and if it stops moving, [they] subsidize it.” That can really sum up the government's, the Liberals' economic policy. All they see is tax, tax, tax, and spend, spend, spend.
I would love to hear more witnesses testimony about what would be required to bridge the productivity and innovation gap that Canada is currently facing. Many of our OECD peer nations are moving further and further ahead of us when it comes to productivity, innovation and capital investment.
All those things are incredibly important. Productivity is really the standard of living of the nation. If a country can produce more goods more efficiently, its standard of living will go up. That benefit, if done right, should disproportionately help the most vulnerable, which is what I think we would all like to see and accomplish.
When I heard the Minister of Finance talk about how it broke her heart to see the individuals at her local food bank, well, how we fix that, how we solve that, is by making life easier by driving up productivity. When a country can make more goods, there is more prosperity by definition. Unfortunately, especially relative to many of our G7 or OECD peers, we are falling further and further behind.
I would love to hear witness testimony with respect to the budget implementation act that talks about, specifically, what this government could have done to enhance productivity; or if there are things in the budget implementation act that would increase productivity, I'd like to hear that too. I did not see any. All I saw was more tax and spend.
This is a serious issue. If we don't get this right—if we aren't able to fix the course of our productivity, of our capital investment and of our innovation gap—we will suffer for a generation, because we need to make those capital investments now to fuel our economy for the next 10, 20, 30 or 40 years.
When we make capital investments, when we invest in innovation, intellectual property or equipment, that equipment will make us more efficient and more effective, and will grow our standard of living.
The only driver of the economy is the private sector, and I would have loved to hear an additional 10 hours on how we could grow the economy. We heard the Minister of Finance and deputy leader talk about this. I believe she referred to it as Canada's “Achilles heel” that our productivity was not growing.
I think most of the members would agree—the numbers are in black and white—that our productivity numbers are challenging at best. The government has to have all hands on deck to do everything it can to enhance the productivity of our businesses and of our government, too.
There are a number of substantive issues that we could be hearing about right now with respect to the economy and the budget implementation act, but unfortunately, that wasn't the direction. Conservatives wanted to work collaboratively, in the spirit of democracy, to get this process on the road, as it were, in order to.... All we needed was to have the deputy leader and Minister of Finance for two hours and to have 20 hours of testimony.
I don't know why the Liberals want to make things so difficult for Canadians just to simply get the facts and understand the reality of the budget. It's almost as if they're allergic to transparency and are trying to avoid it, either through a lack of testimony from the Minister of Finance or through a lack of witness testimony.
If I were in government, I'm not sure I'd want to hear their track record over and over again. The worst economy since the 1930s.... Holy mackerel, those are some pretty astounding words. Then there was food bank usage doubling or even tripling.... Wow. The testimony we heard was just breathtaking. There was the CFIB, which talked about the impact of the carbon tax, its barrier to small business success and the disproportionate cost to our farmers and to our small business owners. Maybe that's why they've attempted to muzzle witnesses and remove their ability to testify through limiting the amount of debate and discussion.
It's not too late. We could push back the clause-by-clause if we got unanimous consent. They could just say, “Hey, we made a mistake. We realize the importance of witness testimony, and we want to support democracy. Let's just push the date back—I don't know, maybe a week—to June 6 or thereabouts. We could get the witness testimony, which would give Canadians the right to say their piece and would give parliamentarians the ability to review and analyze the data. Unfortunately, that's not the direction this government has set.
I was, for my part, more than willing to work on Saturday, Sunday and Monday, and, of course, I was more than willing and able to be there for Tuesday and Wednesday as well. As I said, I have great appreciation for the work the clerks do in arranging for speakers. The great news, too, is that it wouldn't necessarily necessitate travel to Ottawa in these extraordinary circumstances. I'm certainly more than happy to hear witnesses virtually. Ten hours more is just a couple of five-hour meetings, and we could be all done.
Candidly, I think the reality is that when a government spends $490 billion, there should be much more than even 20 hours of testimony on these very important issues. These issues affect millions and millions of people, and they will have a profound impact on our economy by putting greater and greater debt on our children and grandchildren, and even on our great-grandchildren.
I just don't think it's unreasonable to have 20 hours of witness testimony, especially when you hear some of the testimony that the finance committee has had the privilege of listening to.
The testimony of a couple comes to mind. One was the CFIB. It was a pleasure to hear some of the testimony with respect to the impact of the carbon tax on small business owners and how it disproportionately affects small business owners. Some taxpayers are paying tens of thousands of dollars in carbon tax.
Now we have the carbon tax two coming into place. I notice the clean fuel standards. The impact that will have.... So far, carbon tax one has led to meeting absolutely zero emission targets. That's not from me. That's from the commissioner of the environment. I heard that while I was at public accounts. At the same time, it has made the economy less competitive. I think that is an objective fact. It has also driven up inflation, according to Tiff Macklem of the Bank of Canada. Roughly 10% of today's inflation is because of the carbon tax.
The Liberal solution to this is to bring another carbon tax in place. If one wasn't hurting Canadians enough by driving up the cost of eating and heating, if it wasn't enough that it was hurting Canadian competitiveness, and if its ineffectiveness at hitting any emission standards wasn't clear enough, let's put in a second carbon tax. It's one that will, no doubt, be equally as effective at achieving emissions targets—which is not at all. It has a zero batting average, as it were.
It also drives up the cost of living. In addition to driving up the cost of living, it makes Canadian businesses less competitive, both at home and abroad.
It's estimated—and many farming organizations say this—that between the two carbon taxes, the cost to the average farmer could be driven up to thousands, if not tens of thousands of dollars.
We see the storm on the horizon. Even the Minister of Finance has acknowledged it. Canada has a huge challenge with respect to productivity. However, while they acknowledge the storm is coming, they refuse to take any steps to shield the Canadian public from it. They refuse to help Canadians invest in their economies by reducing the burden.
Excuse me, interpreters. I have to cough. I apologize to the interpreters.
What we should be doing is taking an all hands on deck approach. All parliamentarians should be putting their heads together to come up with the best ideas to solve the productivity gap. This is, as Minister Freeland said, Canada's Achilles heel. We have a huge challenge. This Achilles heel could stand to reduce, if not resolve, standards of living across our great country.
I would certainly love to be hearing witness testimony today about the productivity gap and the decisions legislators and lawmakers could make—provincially, federally and municipally—to drive up our productivity numbers and drive our economic growth.
Having the worst economic numbers in the GDP per capita since the 1930s should serve as a wake-up call. We are not going in the right direction economically. In fact, we are driving toward a cliff. Yes, I am sorry if it saddens the Liberals. We aren't pushing the accelerator. We want to stop this car and turn it around.
We believe that Canada should not be at the bottom of the pack, when it comes to it. Canada should be leading with respect to productivity. We have the hardest workers and the best minds in all the world here in Canada. What's holding them back? I'd put a Canadian scientist against any scientist in Germany or Switzerland or the United States. I'd put a Canadian engineer against any engineer in the world, whether they be in Ireland or Singapore or Japan. I believe we have the best and brightest individuals. I'd put our tradespeople up against tradespeople from around the world.
The problem is not the Canadian people. We have some of the best and the brightest. We also have some of the best post-secondary education institutions in the country, which have helped drive innovation across our country. We have all these wonderful seeds.
What else do we have? We're blessed. We're blessed by having some of the most bountiful natural resources in the world. Many of the natural resources or minerals or other resources that will be required to fuel the economy of tomorrow are located right here in Canada. Whether it be the nuclear industry, the electric battery industry or other industries, many of those critical minerals are located right here in Canada.
We have all the ingredients. We have all the ingredients for success. The challenge is the federal government's inability to create a framework, whether it be for the creation and protection of intellectual property or for the exploration of our natural resources, which is necessarily protective of environmental and workers' rights but at the same time balances our need for growth and productivity. This government seems to fail at both.
Life is increasingly hard for workers, for Canadians. As I said, the number of employed individuals going to food banks has doubled. Our productivity numbers are near the bottom of the OECD. For innovation, we're near the bottom of the OECD. We're forecasted by the OECD to have the worst economic growth going into 2060.
Today we're not even.... Today's discussion, or the motion, is not even necessarily about the substance of that. It's just about hearing more testimony. It's about getting more expert opinion, getting more thought, getting more comment and getting more discussion on the record from some of the best and brightest minds. For goodness' sake, the government needs it. Look where we are: food bank usage doubled, one of the lowest productivities, one of the lowest innovation numbers, one of the lowest GDP per capita, and the worst GDP per capita in our country since the 1930s. If that doesn't cry out....
All we're asking for at this point is just to hear some more experts. Often you'll hear the Liberals say, “We'll take no lessons from the Conservatives,” but if not from us, then please, please, please—I mean this sincerely—listen to the experts out there. Listen to the scientists. Listen to the engineers. Listen to the economists. It's wake-up time, guys. The economy is struggling. We are in an incredibly difficult economic position. Our inflation numbers are still high. Economic growth is decreasing.
In fact, the finance minister will talk about the last quarter having positive economic growth. That's true, but the problem is that most of that growth was left over from the preceding year and just spilled into January. In fact, the numbers in March show a very different story that's indicative of an economy in decline.
In the near term, we are facing a cost of living crisis, a housing crisis and rising inflation rates, with the highest interest rates in 40 years. In the mid to long term, we're facing productivity numbers that put us near the bottom of the pack. Innovation numbers, such as patents registered, etc., put us near the the bottom of the pack.
As well, economic growth and capital investment numbers are once again near the bottom of the OECD, and per capita GDP growth is the worst since the 1930s. To me, if I'm a government member, I want to hear every opinion I can, because clearly they don't have it right. They have not figured it out. They've been in power for eight years, and this is the record we have to show for it: the worst economic growth rate since the 1930s; falling productivity numbers; falling capital investment numbers; housing costs that are incredibly high; and food inflation over 10% for the last eight or nine months.
I think this government has some lessons it needs to learn, quite frankly, and I think this Minister of Finance has some lessons that she needs to learn. Not only would I encourage this government to take another 10 hours of testimony, but I would encourage the Minister of Finance to listen to that and to maybe take some advice from some of the great people who would be testifying.
I have to tell you, Mr. Chair, that there are many blessings to being a member of Parliament, and it is an absolute honour and privilege, but one of the greatest privileges that I believe I have is actually sitting on committees. You will not see me just on the finance committee: I will often sub in for various committees, because it's an incredible privilege to listen to some of the witness testimony. I learn something new—and I think I improve my own journey—nearly every time I sit at a committee and listen to witnesses.
I've been on committees as varied as justice, foreign affairs, finance and public accounts, and in many of these, I've heard very interesting testimony. I always try to keep an open mind when understanding and reviewing that, to improve our ability to be legislators. The more we can deepen our understanding of legislation through listening to witnesses and witness testimony, the stronger—and in a better position—I think we are.
We make decisions. This budget implementation act will affect not just Canadians right now, the 37,000,000-plus Canadians who are out there right now. It will affect Canadians who have not even been born yet, if for no other reason than they will be paying back the debts and deficits this government has incurred. We now have a national debt cresting towards $1.3 trillion, a deficit that's forecast to go as far as the eye can see, this despite the fact that the Minister of Finance said she would maintain the debt-to-GDP ratio, that it would not increase. This was the “line” that she would “not cross” under any scenario. Then, less than six months later, guess what? The debt-to-GDP ratio is going up.
Liberals would say, well, it's only for one year, so relax—we'll get it under control. The reality is, the government can really only plan for one year, and then a new budget will come into place. My bet, and perhaps you can capture this on the record—I would love to be wrong about this—is that the debt-to-GDP ratio does not go down in future years as forecast by the Minister of Finance. My bet is that this will be another broken promise.
What do I base that on? Well, a series of broken promises along the way....
Of course, the Liberals promised to balance the budget after their spending spree. They didn't, and in fact the deficits kept rising and rising. Then, of course, we had COVID and some of that to support. Of course, Conservatives supported that, and we understand that some of it was necessary, but there were also hundreds of billions of dollars spent during that time that had nothing to do with COVID and that drove up inflation and put us in the precarious situation that we are in right now.
I just don't understand how, in six months, the Minister of Finance went from saying, “Hey, we're going to balance the budget in five years,” to, “We're going to have deficits for as far as the eye can see, for years and years to come.” What changed in that time? These are questions I would have loved to ask the Minister of Finance.
I could show you, Mr. Chair, my list of questions. My next ones are with respect to productivity, because I really believe that productivity—and our productivity gap—is a substantive issue for the Canadian economy. It's one that, if we don't get it fixed—if we aren't a leader in productivity—can have significant economic challenges for us for a generation. We need to make sure we are growing the economy. Growth is absolutely critical, especially when...and growth per capita. We need to make sure Canada is getting wealthier for every individual, and it's particularly important with regard to the most vulnerable.
Instead, what are we doing? We're lowering productivity, which means there is a smaller pie for everyone to share. Then, as the pie shrinks—or doesn't grow as fast, perhaps, is more accurate—the government is taking an ever-bigger piece. The government started out with the carbon tax. Now there are going to be two carbon taxes. It started with, I believe, $15 per tonne. Now it's going up to $300 per tonne—I believe that's the plan with respect to the carbon tax.
The Income Tax Act.... Income tax was brought in as a temporary measure. “We just need to fund World War I, and then the income tax will go away,” or so the story went. Unfortunately, though, the income tax is still with us, and it's ever more prevalent. You can see that with respect to the marginal effective tax rate and the participation tax rate, which are disproportionately impacting.... Those who can afford to pay the least are paying the most. The idea that someone earning $30,000 a year would have to fork back 50 cents on the dollar to the government makes your head spin.
In fact, I have repeated this to many Liberals. I obviously won't mention any names, because that would be telling tales out of school, and I respect my colleagues too much to do that. However, at first they don't believe me when I tell them there are low-income earners who are facing a marginal effective tax rate of over 50%. Then I show them the numbers and the excellent work the C.D. Howe Institute has done, and they're surprised. Of course, their silence is often the recognition of guilt. I think they see.... They realize that something's not right. Of course, they're not going to come out and say that to me.
Like I said, I would defy one of the Liberal members to walk up to a single parent and say, “Yes, we know that if you want to return to work, we're going to take 50 cents on every dollar from you, but that's how we think it should be,” or walk up to a low-income senior and say, “Yes, ma'am, I know you want to return to work because the cost of living has been driven so high that you can no longer afford rent or food, and we thank you for returning to the labour force. However, we are going to take 50 cents, 60 cents or 70 cents on every dollar you earn, because we believe that's how it should be.” To me...I don't understand it.
You know, I've raised this in the House of Commons. At every committee meeting, I bring up the marginal effective tax rate, because I think it is such a substantive issue. I've yet to actually hear any attempt to rebut this, other than the occasional jeer across the hall in the House of Commons, saying, “No, this can't be true. That's ridiculous. That's laughable.” That's the only thing I hear. When we actually go through and.... I have to say “hats off” to one of the Liberal members, who came in after jeering me and said, “I want to understand this issue.” We sat down and talked about it, and he said, “Okay, you're right.” I hope there are more Liberal members who are aware of the marginal effective tax rate.
I'm certainly open to a non-partisan discussion about this. I believe that no one wants to purposely discourage work and that all members of the House of Commons want to see Canadians succeed and prosper. We need to resolve this issue and fix some knowledge gaps that exist. I realize that not everyone enjoys tax policy as much as I do, so maybe this isn't an area of interest or study for them.
It's incredibly important and incredibly powerful, because when you have high marginal effective tax rates, not only do you take the dollars and cents, but those dollars and cents are also associated with a sense of self-worth. If you don't believe me, for those of you who have children, when they reach adulthood and receive their first paycheque, look at them when they make that first paycheque. It could be mowing a lawn or washing dishes, as I did many years ago, but it's the feeling of self-worth that comes from work and making a contribution. There is all sorts of different work, from being a rocket scientist to being a neurosurgeon to working in whatever field you want, from being a pipe fitter to being a carpenter, but the value it gives to people cannot be discounted.
When the government says to someone that it is taking 50% of the value of that work, imagine that. If someone works for 40 hours and is left with only 20 hours' worth of their work, one out of two of their hours of work is being taken by the government. What an impact that must have, especially on those who are struggling to get by. Imagine that individual who can barely afford to pay their rent. Instead of their paycheque reading $1,000, it reads $500, and now they can't afford their rent. If they just had that extra $500 back, they might be able to make that rent; they might be able to pay for the groceries at the end of the month instead of going to a food bank.
The government—and I don't think these words are too strong to use—is literally driving Canadians into poverty with its high rate of marginal effective tax rates. The government has three ways of raising revenue, Mr. Chair, and it has employed all three ways to nearly the fullest extent possible. One is direct taxation, and with that we've seen dramatic increases in the marginal effective tax rates. We've seen the introduction of new small business taxes. We've seen the carbon tax and now the second carbon tax. Those are all direct ways of getting revenue.
The other way is through inflation. We saw that government revenues went through the roof when inflation occurred. Quite frankly, this is the oldest trick in the book. In fact, there is a term you may have heard, which is coin clipping. It dates back to the Roman Empire. When the Roman government ran out of money because it had overspent on whatever, it came up with a brilliant idea. It would reduce the amount of silver or precious metals in the coins, and that way it would have twice as much money to spend. Of course, what happened was that the government was initially able to collect a lot more goods, because it hadn't yet flooded the system with cash.
It takes a little while for inflation to kick into the system, so those who get the money first benefit the most.
Who had the money first? The federal government and the Canadian banks did. They've benefited the most from inflation, so the government has utilized inflation to its maximum benefit.
The other tool, which is really related to the other two, is deficit or debt spending. What this is doing is kicking the can down the street. Eventually, it will have to collect that revenue, either through inflation or through taxation.
When the government does that, the more it takes out of the private sector, the harder it is for the private sector to thrive. When we have an economy that is growing, perhaps the increase in government taxation can be handled by the private sector, and it will not have the type of deleterious impacts that we're currently experiencing.
Right now, that's not the situation. In fact, the economy is slowing, inflation is increasing, the deficit is increasing, debt is increasing, our productivity numbers are suffering and our innovation numbers are suffering, as are our capital investments and our productivity. As Mr. Cross said, we have the worst economic growth—GDP per capita, to be precise—since the Great Depression in the 1930s.
What's the government's solution to that? Is it to inspire, encourage, innovate or look itself in the mirror and ask how this federal government can be more effective at delivering services to help businesses?
The bureaucracy has not been given the resources it needs to succeed. We saw this with the Phoenix pay system. It was an absolute debacle. It was a disaster.
We saw this during the pandemic, as well, when the government agencies were able to get cheques out. I appreciate the efforts. I know many civil servants were working around the clock to get them out, but they did so with one hand tied behind their back.
Believe it or not, there are still parts of our civil service that program with the same programming language that I used in grade 10. I am not young, Mr. Chair. Some 20-odd years ago, I was using BASIC to program. That is still the programming language in some government programs today.
One of the areas I would have loved to hear about in witness testimony is individuals testifying about how other governments have used their resources to put themselves in a better position to succeed. There are numerous examples dotted across the globe of countries that have made the right decision, which has allowed their economies to grow and to do extremely well. It has lifted up their productivity numbers, lifted up their capital investment numbers and lifted up their per capita GDP numbers.
It would have been fantastic to hear some witness testimony, maybe about what Ireland has done, and other countries like Ireland. It has been able to increase its productivity, which is the GDP per hour. It's much above Canada's.
The United States is above Canada as well. Switzerland has quite a substantial advantage, despite the fact that it has far fewer natural resources than we have.
Right now, we are squandering the opportunity to win the future. We have all the necessary ingredients. We have an incredibly well-educated, intelligent and hard-working populace that is engaged and, by and large, committed to making Canada the greatest country in the world.
We have many great post-secondary institutions. There are many great universities and colleges that generate some fantastic ideas.
We've been blessed with incredible natural resources, and we have some technology that makes Canadian energy some of the cleanest in the world.
We have all the ingredients for success, to win the future and to be the most successful economy in the developed world. Of any advanced economy, we could be number one. There is no doubt in my mind that we could have the highest per GDP growth if we just got the government out of the way. That's what it really comes down to. We need to get rid of the gatekeepers.
There are so many paradoxes that we live in. We live in the second-largest country in the world, yet we have one of the highest prices of housing. We have one of the largest housing shortfalls of any advanced country.
How do we have all this land but nowhere for anyone to live?
We have tremendous natural resources. We have an incredibly well-educated, intelligent and hard-working populace, but we have one of the lower productivity numbers. Once again, the finger of blame points over and over and over to the failure of this Liberal government. These eight years have been very difficult for Canadians. There's just no doubt about it.
The cost of housing has doubled. We now have high rates of inflation and the worst economic growth since the 1930s. We have double the food bank usage. We have twice as many employed individuals going to food banks as we ever did. One in 20 folks in Mississauga go to food banks. We certainly heard from the food bank from within the chair's own riding, which said the situation was terrifying. I hope the chair and the rest of the Liberal members were listening to it. It's their eight years of economic mismanagement that have put us there.
The good news is that hope is on the way. Help is on the way, as a Poilievre government will turn hurt into hope and make the common sense, the common people, once again common in our great country. That is what we need to drive economic growth and make Canada the most prosperous country in the world. It is by increasing economic growth and by not having a GDP that is the lowest since the 1930s but instead having one of the highest GDP growth rates in Canada's history.
How do we do that? We get government out of the way. We remove the gatekeepers. We let Canadians do what Canadians do best. We let Canadians innovate. We protect those innovations through a logical framework that makes sense, that drives innovation in our great country and that allows Canadians to reap the rewards of the innovation investments.
If you listen to many IT experts across Canada and, really, across the world, they say that Canada generates some of the very best ideas in the world. The challenge is that those ideas just flutter away. It's not because the entrepreneur or the innovator is doing anything wrong or incorrect. They're not. What is doing something wrong is the federal government. The federal government has not put the frameworks in that are necessary to help individuals maximize their investments here in Canada. What happens is that those ideas flutter away to other jurisdictions. They go to Silicon Valley. They go to the European Union. They go to Asia. Instead of those ideas raising the standard of living for Canadians, those profits are realized in other jurisdictions.
We have an opportunity to change this. Our resources and Canadians' innovations should increase the prosperity of Canadians. What's going on right now is that we ship out our ideas. We ship out our resources. Then they're repackaged, manufactured or sold back to us at a premium. That gap in the supply chain, which in many of Canada's industries is missing, is the sweet spot. That is where prosperity is made. That is where productivity is grown. We need to regain that part of the supply chain in our economy.
We need a government that will turn that hurt into hope, that will turn that doubling or tripling of food bank usage around...and that will take a punitive and painful carbon tax and scrap it to allow Canadians to be more innovative, make those capital investments and be rewarded.
We need to have a country where, when people do bad things, they feel those consequences, but more importantly, when people do good things, they reap those rewards. It shouldn't be the bureaucrats in Ottawa who get the rewards of innovation. It should instead be the entrepreneurs, the workers and the business owners of our great country.
That is the country that I know and love. That is the country that I believe we will be again under a Pierre Poilievre government, where once again paycheques go further because taxes are reduced, where housing is affordable again, where work pays, where individuals feel safe again in our great country, where work is rewarded, where success is celebrated, and where Canadians come together in a collaborative fashion to restore Canada and to make Canada an economic leader once again—a country that can get its resources to market, that lifts the prosperity of all Canadians, that doesn't invest in a $5-billion pipeline that cost $30 billion to build, and tracking....
We need to be a country that can get things done again. Unfortunately, as I hear from constituents, from Canadian after Canadian, too many of them feel like this country is broken. They are working harder and getting less. Those earning more are paying less, and those earning less are paying more.
Quite frankly, they are not wrong. When you look at the marginal effective tax rate and you see someone who is paying a higher tax rate at $30,000 than someone who is earning $120,000, you can see they're not wrong, and they're not wrong when they see a senior, a low-income senior, earning less than $30,000 a year but paying a marginal effective rate in excess of 50%. When you see a stay-at-home parent wants to return to the workforce but their cost of doing business is greater than 50%, they're not wrong. When you see a country where passports take eight months to get out the door, they're not wrong. When you see challenge after challenge, and when you see a government unwilling to acknowledge foreign interference and have the public inquiry that Canadians demand, they're not wrong.
Do you know what? Maybe it does make sense, then, that this government does not want to hear 10 more hours of testimony. Maybe the Liberals want to stick their heads in the sand, just pretend that everything is okay, repeat their same talking points over and over to themselves and say: “Do you know what? Canada has never been better. We'll take no lessons from the Conservatives. Do you know what? We spent money on this. We spent money on that.”
The line that gets me the most, Mr. Chair, when Liberals rise in the House of Commons, is that they avoid any type of result, because there are no results to point to: the worst economy since the 1930s; a housing crisis, as it's more expensive than it's ever been; record deficits and debts; increasing inflation; high interest rates; and slowing economic growth. They can't point to that, so they just point to how they spent x billion dollars.
Well, do you know what? An expensive failure is not better because it's expensive. It's worse, because it cost you money. I can't imagine some of the Liberal ministers heading into a corporate boardroom and having a deliverable they're supposed to give. Whether it be the manufacture or the creation of a project—or whatever—they go in and say: “Yes, we failed. We didn't build that building we needed, and we didn't get that project done, but man, did we spend a lot of money doing it.” I just wonder if they ever listen to themselves: How does it make sense that failing expensively is somehow a blessing? It's not. It's worse.
I mean, eight years ago, housing was affordable. Now it's not. Yes, it's true, the Liberals spent a lot of money making it less affordable—or “unaffordable” might be the appropriate term—but that doesn't make it better. Now, instead of having affordable housing and a balanced budget, we have unaffordable housing and a massive deficit and debt.
I would have loved to hear, and it's not too late, guys.... The Liberal government still would have plenty of time to get this budget passed simply by extending for a week, for 10 more hours of testimony. If a Liberal member were to take the mike right now and say, “Do you know what? I've had enough. You're right, Mr. Lawrence. Ten hours of testimony is a reasonable request, Mr. Clerk, so let's get that set up”....
Actually, Mr. Chair, would the clerk mind answering me on how long they think it would take to get 10 hours of additional testimony?
