Mr. Speaker, today I stand here with a great deal of pride in being a Reform member of Parliament who was a part of the Reform team that put together the taxpayers' budget that was presented across Canada. I am proud of that, but what we are talking about today goes far beyond partisan politics.
It goes to a problem that truly threatens the country. It deals with a problem which has come from successive flawed assumptions under which governments have been operating for some time. I will talk about those flawed assumptions later.
I would first like to talk about the warnings that have come from various sources which the government must not ignore. These warnings come from various groups and individuals across the country and from around the world. They are telling the government that its target of reducing the deficit to 3 per cent of GDP in three years simply is not good enough.
These warnings have come, as I have said, from a variety sources. Most recently they came from Moody's Bond Rating Agency. They have come over the past from the C.D. Howe Institute, and from the Fraser Institute at various times. The warnings that this target is not good enough came from the Wall Street Journal and the Washington Post just a few weeks ago.
I attended a conference in Toronto in November entitled "Hitting the Wall" at which the warning came from a wide range of speakers from various backgrounds who had been involved in governments which had gone through economic collapse and had been part of government and opposition parties who were involved in the clean up after the economic collapse. Their warning was very clear. It was that the scenario we are living right now is so similar to what they lived through in their countries that Canada should heed the warning.
The warning came at this conference from a Japanese bond buying agency that said that already Canada is paying unnecessarily high risk premiums on money that it borrows from outside the country. The reason I say that the risk premiums are unnecessarily high is that if governments in the past had been more serious about setting targets far stronger than the 3 per cent of GDP in three years, we would not be paying interest rates nearly as high as we are paying now. The warnings came from a public sector actuary who talked about the fact that the Canada pension plan is non-sustainable. It is not actuarially sound and it cannot be sustained under the present set of rules.
The warnings came from others, but there were several consistent messages that came from each and every one of the speakers at the conference. I know the government has heard these messages before but it should hear them again. The messages are as follows.
First, Canada has a serious overspending problem. It is a very simple and direct message and the government must hear it.
Second, the problem must be dealt with quickly. Again, this message has been given by people from across the country and around the world but it does not appear to have been heard.
The third message is that the Minister of Finance's budget is a last chance budget. The speakers at this conference, "Hitting the Wall", to a person said that this is the last chance. If the government does not get serious beyond the target of reducing the deficit to 3 per cent of GDP in three years there is a very real possibility of economic collapse.
This is a last chance budget because it will be much more difficult for government to deal with the problem next year than it is this year. It will not happen. The political will just will not be there to make the extremely tough cuts and to take the tough measures that will be necessary a year from now.
Compounding interest, rapidly increasing debt, ever-increasing proportions of government spending going to interest payments on the debt would all make it much more difficult next year. These speakers said that there is no precedent in the world where a government has taken the tough measures necessary without going through economic collapse.
The warnings are there. The Liberals should consider this Reform budget as another warning. There are a lot of measures in it that I have heard expressed as recommendations by people in my constituency and in other places across the country who I have spoken with over the past several months and years. These are not just measures which were dreamed up by a group of Reform MPs. These are measures that have been proposed by Canadians.
I would like to go through something that is presented in our budget material and talk about the flawed assumptions which have led to the mess we are in now, the flawed assumptions which this Liberal government will continue to operate under. Then I would like to go through the positive results that would arise from the new set of assumptions which the Reform Party has presented. I will begin by reading the motion which we are debating today. The motion reads:
That this House reject this government's totally inadequate target which reduces the deficit to 3 per cent of GDP within 2 years and will leave Canada, at the end of the period with a federal deficit of about $25 billion, a federal debt of over $600 billion, $50 billion in annual interest payments and higher taxes.
That is the motion we are debating today. This motion stems from one of the flawed assumptions under which this Liberal government has been operating since it came into power a year
and a half ago. I will go through these and talk briefly about the consequences which arise from them.
The first assumption is with respect to jobs. The assumption is that government can solve the unemployment problem through public spending. That is the flawed assumption we have laid out in our budget today. In fact, that assumption was presented an hour or so ago by a member from the Liberal Party when he was talking about all of the things which his government had done. One of the wonderful things that member said was that his government had created jobs. I believe he said that his government created 40,000 jobs.
When Reformers reminded the member across the floor that it probably was not his government that created those jobs, that it was probably the private sector, the member backed off on that statement. He realized the error of his ways, at least for the moment. The error was that government does not create jobs; private business does.
The consequences of this flawed assumption and operating under this flawed assumption are that government spending is now at an all time high and there are over a million unemployed people in the country. If government spending would create jobs I would suggest that all Canadians would have more than one and more than they need.
Governments have been overspending to a point where we have an accumulated debt today of over $550 billion. Governments have been overspending for 30 years. Has that helped to deal with the problem of unemployment? The answer is no, we have over a million unemployed Canadians today and that is an unacceptable level of unemployment.
The second flawed assumption is in the area of social security. The assumption is that government is the best provider of social security through publicly financed universal programs. I think I can fairly say that is the assumption the Liberal government and past governments have been operating under.
The consequence of operating under this flawed assumption is that despite big government programs, the social fabric of Canada is unravelling. Health care, pensions and other programs are in financial trouble. Programs like UI and welfare create a disincentive to employment.
The third flawed assumption is that government spending, deficits and debts are okay if they are incurred in the name of jobs and social security. The consequence is that government spending and overspending are the biggest threats facing Canadians with regard to social programs today.
I invite members opposite to read our budget with an open mind and to consider its contents seriously in the final preparations of the budget to be presented next week. I certainly welcome their questions.