Mr. Speaker, I thank my colleague from the government for his comments. I would be very interested and curious in seeing the document he presented to the House because it flies in the face of information that I have received.
I am pleased to speak on Bill C-53, the small business loans bill. At the outset I would like to say that we in this party have been very much in favour of trying to find innovative ways in which small businesses can become more aggressive in trying to meet the challenges in their need to acquire capital in order to grow and become competitive.
While we agree with the notion of this bill and its intent, we have a difficult time with parts of it. The auditor general supports our contention that there needs to be more accountability in the system to ensure that the moneys go to businesses and that there is a mechanism of determining that the money actually goes to the businesses that need it. We must also ensure that those moneys are repaid, that they come back to the taxpayers.
We found that the moneys are being disbursed to companies that would by and large already receive bank loans. In effect this bill has been subsidizing the banks. The banks do not need subsidization. They are making some pretty fat profits and have been doing so for some time in spite of the recent downturn the entire economy is facing.
On the larger issue, our legislative agenda for the next few months is about as useful as pabulum. Look at the situation in our country today. The really big issues are a plunging loonie, an economy that is in the doldrums and an international crisis the proportions of which we have not seen since the Great Depression. Our health care system is collapsing. The CPP is in dire straits. And we see issues for the House to spend time debating that have very little meaning to those grand problems that affect Canadians.
We need to get back to dealing with the large issues. We need to use this House in a way that we can find the best solutions from within Canada and around the world and apply them to the problems at hand.
The health care system is eroding. Canadians are in pain and are on enormously long waiting lists. The future of the CPP is in crisis. Our economy is falling apart. And we are looking at small, minuscule issues dealing with these problems if we deal with them at all. Let us get down to brass tacks. Let us get down to the real issues at hand.
An important issue that Bill C-53 deals with is the economy. We have seen the lowering dollar. There has been a consecutive decline in the the GDP over the last four months. We have an unemployment rate which is 4% higher than that of the United States. Our productivity has declined. Our productivity was significantly lower than that of the U.S. when our dollar was 90 cents. It is still low at 65 cents.
The public may or may not be aware of this, but our dollar is declining for many reasons. Some people point fingers at the Asian flu. Some people point fingers at the Russian meltdown. The bottom line is when we point a finger at something, three fingers point back at us. It is true that some of these things are out of our control but many are within our control. There are many constructive suggestions that we can employ. The Reform Party challenges the government to employ some of these solutions.
How can we get our productivity up? The Canadian Federation of Independent Business put out a document three days ago. It articulately and eloquently shows that youth want to work but they are unable to work for many reasons. One of the biggest reasons they are unable to work are our high taxes. The government needs to reduce taxes.
There are some specific solutions that my colleagues have spoken about. We spoke about reducing EI premiums. Let us also reduce the CPP premiums. This is a provincial responsibility, but let us also look at reducing workmen's compensation premiums which also contribute to choking off the private sector. Let us also remove the existing surtaxes that crush the private sector.
There are surtaxes such as the capital gains tax. It impedes the private sector's ability to take moneys it has invested, sell things such as real estate and reinvest that money into the business. The capital gains tax restricts the movement of capital within our system thereby reducing our productivity.
The government should work with the provinces to decrease those taxes. I challenge the finance minister to bring together his provincial counterparts within the next two weeks to discuss these issues, make a plan and institute it as soon as possible. By doing this we can make ourselves more competitive, not by reducing the loonie but by dealing with the structural reasons of why our country is non-productive.
If we look at the history of the United States, the 1920s, the 1960s under President Kennedy, and the 1980s, every time there was a reduction in taxes there was a huge increase in the effectiveness of the economy. Why? There are increased savings and increased investment. There is also a greater desire to work because we know that the more we work, we will not have more money taken away from us.
We will also see a reduction in the black market, a significant problem in our country. By reducing these tax loads we will be able to reduce the black market. In 1992 under Prime Minister Mulroney we found that more moneys came into the public coffers for the reasons I previously mentioned.
We can deal with facts. Looking back in history we can see the constructive solutions that have already worked we and can apply them in 1998 to make them work for the people of our country today. I caution that this will not compromise the people who are most impoverished. It will make them more employable and will allow them to have more funds. It will rescue our social programs by making more funds available.
Reducing taxes will allow us to deal with another important structural problem, the brain drain which my colleague spoke about earlier. In 1997 we lost 46,500 of our best and brightest people to the United States alone. Compare that with 1990 when we lost 20,500. That is a substantial difference. There has been a substantial change.
Our best and brightest, the crème de la crème of our country are going south, not necessarily because they want to live there but because they see far greater opportunities there. Comparing the tax structures, after tax a family of two in the U.S. makes 44% more than a family of two wage earners in Canada. How can we compete with that? We cannot.
Earlier this year the business community combined with the educational community to provide a number of constructive solutions to deal with another factor that could improve our economy, the educational system. It involved innovative partnerships between the private sector and the educational system that would do much to address one of the core pillars of a strong, nimble and effective economy.
In a nutshell, the business round table had many recommendations. It recommended that all students learn at significantly higher levels and that the curriculum content reflects the higher expectations we would have of students. It recommended that instructional strategies and school choices vary to ensure success for all and that the system be based on performance by using a broad range of assessment tools. It recommended that schools have a major role in decision making, which would alleviate the rigid control over schools in what they can do. Schools should receive rewards for success, assistance to improve and penalties for failure to be effective teachers of today's youth. A major emphasis should be placed on staff development.
The round table also recommended that employee unions at individual schools be required to grant waivers on certain contract provisions governing the hiring and firing of teachers and principals and on the participation of staff in academic and financial planning.
I cannot overemphasize the importance of those recommendations. If we are going to have an effective, nimble and aggressive economy, we have to change our educational system. We have to give schools some control over what they do in terms of teaching. They must have control over their budgets. They also must have the ability to be assessed.
Teachers federations have traditionally been completely opposed to an assessment of a teacher's performance. I feel this is wrong. Good teachers will benefit from the system because they will not only be keeping their jobs but they will also be rewarded for doing a good job. It would add the needed element of incentive into the teaching profession. It would remove from the system teachers who are not doing a good job.
In any system, including this one, those who are not doing a good job get turfed. That may sound ruthless but when we are dealing with the future of our youth, we must give them the best opportunities we can. We owe it to the youth of today to ensure they have an opportunity for the best education possible.
We must strive not only to help those who are among the most underprivileged and disadvantaged. We must also encourage those who are the best in our system and give them the challenges they require to become individuals who can contribute greatly to our society.
The finance minister could do a couple of other innovative things. There is presently a limit on the amount Canadians can devote to foreign investment. It is now at 20%. The government should increase that to 30%. That would go a long way to enabling people to provide for their future. As we in the House all know, the CPP will not be there for those in my age group and younger as it has been for previous generations.
The finance minister could actually expand RRSPs, have a designated RRSP amount. Those moneys could then be used to invest in the private sector, in small to medium size businesses on Canadian soil. If the finance minister were able to expand RRSPs, it would not be a lodestone around the taxpayer neck. It would also enable Canadians to invest in Canadian companies on Canadian soil and create Canadian jobs. It would be an important tool for increasing investment and innovation in the private sector by using the dollars that already exist. It would not rely on taxpayers.
This is an important facet the prime minister and the finance minister should look at to enable us to put money into the private sector and to enable the private sector to do research and development.
I would be remiss in suggesting that we not ensure the research and development system including the National Research Council have the moneys to do the very good research it does. It should be encouraged to partner with the private sector so that it will have the moneys to build another pillar of the private sector, the research and development section. Therein we would have a much more productive and effective economy for the future.