Mr. Speaker, I want to congratulate the hon. member for Regina—Qu'Appelle on his great idea of presenting Motion M-239, as amended to read as follows:
That, in the opinion of this House, the government should show leadership and enact a tax on financial transactions in concert with the international community.
My colleagues in the Bloc Quebecois and I generally support in principle motions as presented. And my colleague from Lac-Saint-Jean clearly demonstrated this. Wholesale unregulated globalization is a little scary.
So, as far as we are concerned, some regulating of international financial transactions, of shameless speculation, is good. Members will see why later in my remarks.
The meaning of “financial transactions” in general ought to be specified. This may be a simplistic example, but let us say I have $100 Canadian changed for American money because I will be travelling to the U.S. tomorrow morning. Is this kind of financial transaction likely to affect the Canadian or American dollar? I think not. Should there be a tax on this simple transaction? Again, I think not.
To sum up, yes, speculation should be taxed or regulated. Perhaps the meaning of the word “transaction” should be further defined, as we will see later.
Listening to the Reform member who spoke before me, it is clear that the Tobin tax can be interpreted any number of ways. People see what they want in it and it is blamed for many things.
When James Tobin—I want to make it clear that the premier of Newfoundland and former minister on the other side is not the one who came up with the idea of imposing such a tax, but rather an American economist named James Tobin—won the Nobel Prize in 1972, I am sure no member of the Reform Party sat on the jury, otherwise he would probably never have received this well deserved award.
Just because an idea is difficult to implement does not mean it should automatically be rejected. When my Reform Party colleague says it cannot be implemented and is unfeasible, and that a third issue could even be to consider reinventing Santa Claus, I think he is going a bit far.
When he says it is impossible to get all countries to agree to go along with a decision that would place legal limits on international financial speculation, he is perhaps forgetting that today, in 1998, we have the WTO, to which the very great majority of, if not all, countries belong. Only a few are missing.
Nonetheless, after several years of talks and negotiations—starting with the GATT, and moving on—we now have harmonized customs tariffs. Ten years before the first GATT rounds and before the WTO, various parliaments perhaps had debates in which they said that it would be impossible and unthinkably utopian to consider harmonizing customs tariffs internationally.
But this is what we have today. Why? Because countries realized that, if countries who engage in this sort of international trade wished to evolve in a constructive and secure manner, it would be a benefit to rich countries and poor countries alike to have a legal framework, a consensual framework for trade and tariffs, in order to increase international trade and revenues in countries that can benefit from such trade.
But there is a framework. How does it work? Who decides where meetings are held? The first ministerial meeting was held in Singapore, the second in Geneva, not too long ago, and amendments and improvements are being made. International institutions are capable of working in harmony. Why do people say that, if it is complicated, they will give up, abdicate their responsibilities and go home. I disagree completely.
The motion calls on us to move forward and give the matter more thought, in light of the new reality. Some will say that the idea was first put forward 20 years ago and that it has been discussed for just as long, but that it is not feasible.
Twenty years ago, Mexico had yet to go through a money crisis. Twenty years ago, Asia had yet to go through the crisis it is now facing. Twenty years ago, nobody had heard of George Soros who, with $10 billion, was able in only one day to make the pound sterling drop and make a billion dollars in profit.
The economic situation has evolved, why can our vision and our policies not do the same? Why stick to the idea—and I hope it is not shared by the majority—put forward by the Reform Party, that says “If it is too complicated, we give up and we will vote against it”.
We also have to use our head and say we sincerely do not believe that, with this tax, we want to tax everything. If I were to invest $1,000 on the stock market or put $1,000 in a mutual fund, I do not believe I would be a dangerous speculator with a lot of influence on the peso or the U.S. dollar.
However, people are playing Russian roulette with foreign currencies. People in Thailand and Mexico know full well that sometimes, and more often than not, it has a direct impact on their currency and hence on their national economy.
Let me give you an example. In the last edition of L'Actualité , we can read that Bill Gates, whose assets total $51 billion, could in one day restore the Russian economy. In today's economy, there are some people, some consortiums, some investment groups who can at any time use their money to influence and destroy whole national economies, and this will then trickle down to the regions.
This can have an impact at the international level. A few months or a few years down the road, unfortunately, Canada will be affected. In today's new economy, do we have to ask ourselves that question?
I was listening to the parliamentary secretary and I was somewhat surprised. He also talked about the difficulties related to the implementation of such a tax. He made reference to the May 1995 report of the Standing Committee on Foreign Affairs entitled “From Bretton Woods to Halifax”. If I may, I will quote from page 57 of that report. It says:
At this point, the Committee's view is that the feasibility of the concept has yet to be proved but that an attitude of openness is warranted. The objectives of a tax on currency speculation at least have sufficient merit and promise to deserve serious longer term examination within a G-7 context. We are aware of some research that has already been done, including within the Canada's Department of Finance.
However, ideas of this sort are still only in the very preliminary stages of investigation, much less deliberation. As even supporters of the concept willingly acknowledge:
—an in-depth feasibility study is needed to analyse the highly complex mechanics of foreign exchange transactions.
That was written in 1995, three years ago, nearly four years ago. “An in-depth feasibility study is needed”. What did the government do with those recommendations? What did the government do since May 1995 with this idea of a study committee? We never saw such a committee.
In closing, I want to propose an amendment to Motion M-239. I move:
That the motion be amended by removing the words “enact a tax on financial transactions” and replacing them with the following:
“promote the implementation of a tax aimed at discouraging speculation on fluctuations in the exchange rate”
This amendment to Motion M-239 would stress the notion of transaction, as I pointed out at the beginning of my speech, and would make the motion consistent with the Tobin tax.
I hope all members of the House will support the amendment and then Motion M-239 as amended.