Mr. Speaker, it is a pleasure today to speak to Bill C-72 on income tax amendments.
Once again we have missed the boat. Once again the government has not dealt in a profound and fundamental way with an issue that is affecting Canadians across this country.
The Prime Minister has said in the last two weeks that Canada is doing fine. Our productivity is fine. He says this based on one study, the KPMG study, paid for by his government. This flies in the face of every single other study, any other analysis I have ever seen in and outside Canada.
The Canadian economy, our productivity and our competitiveness are among the lowest in the industrialized world. Among all G-8 nations we are the bottom of the barrel. That is nothing to be proud of because it is far less than what we can strive for as a nation.
The government is telling the Canadian public, patting us on the head, “Smile, be happy. Don't worry, we have social programs that will take care of you”. What a bunch of nonsense. What a pile of tripe. That is totally unacceptable. All we need to do is speak to Canadians and ask what is bothering them. Are they happy with the economy? Are they happy with their job opportunities? Are they happy with the opportunities their children have? Most of them are not. This is not a figment of their imagination. This did not appear overnight. This is not something that has been happening over the last few weeks. This has been happening for years and it is not getting better. It is getting worse.
We are not lacking in solutions. My colleague from the other side articulated a number of them. He mentioned the problems. Members from the Reform Party and other parties have articulated solutions. There is much that binds us together and there is much that is in agreement. What we do not have is somebody to take the bull by the horns and say that these are the best solutions we can find, these are the reasons we are going to this and, by heaven, we are going to do this.
This country has seen a lot of studying; it has not seen a lot of action. What Canadians are sick and tired of is the malady of studyitis that we have in the House of Commons, an ailment that causes intellectual gridlock. This whole place grinds to a halt. It does not function well. It is a poor use of taxpayers' money and does not serve the people of this country, who elect us to do a job, to help them help themselves, and indeed to help those who cannot help themselves. We have failed.
Let us look at some of the facts. Should we be happy with unemployment? No. Our unemployment rate is much higher than that of the country to the south of us. It is much higher than many of the G-8 countries.
Our productivity is sliding. It is the lowest in the G-8.
Our competitiveness has been dropping too. Why? The primary reason, and we all sound like broken records, is taxes. To take into consideration the concern that members on all sides of the House have, we do not want to introduce tax cuts that will compromise anybody, particularly the poor and middle classes. We want to make sure that the people of this country, regardless of their income, have the power to be the best that they can become and the power to take care of themselves.
Perhaps a fundamental difference between ourselves and the traditional Liberal thinking is that we believe most Canadians can take care of themselves better than governments can and we want to give people the power to do that.
The other side of the coin is to make sure that Canadians who cannot take care of themselves have a social network that can provide for them.
Thank heavens we are not like the United States. Historically we have had good social programs which have been there to take care of those who cannot take care of themselves. However, we do not speak about the current threat and future threats to those programs. Pensions, health care, education and welfare programs are all in jeopardy. They are in jeopardy because we do not have a healthy economy. We cannot have strong social programs unless we have a healthy economy.
By maintaining high tax levels, by not rationalizing the rules and regulations that choke off the private sector, by not keeping the rules that we need and removing those that we do not, we compromise the very essence and the ability of our economy to perform. Canadians cannot provide for themselves and pay the taxes that will enable the government to provide the social programs to provide for those people who cannot provide for themselves.
It is all intertwined. The failure of this government to do what we and others have been telling it to do for years is an abrogation of its responsibility. It is a violation of its duty, primarily to those people who are the most underprivileged individuals in our society. It is an abrogation of its responsibility to the beleaguered middle class, which is having increasing difficulty being able to acquire the basics for themselves and their families.
Government members like to talk about research and development. They want to provide money for it and we applaud that. What is the single most important factor in enabling research and development to occur in this country? The most important thing the government can do, and recent studies show this, is to give companies the money to do the research and development themselves. They do not necessarily want government handouts, but they at least want the ability to do this. The way they can do this is to have tax cuts, which will enable them to reinvest in their companies and become more competitive.
One of the saddest things we often hear about is the brain drain. The brain drain is a complex situation and is linked to many factors. Many Canadians who go south do not want to go south necessarily because they will make a little more money. They want to go because they have the ability to work in companies, work in universities, work in institutions where they have the opportunity to put their skills to the best possible use. The U.S. actually enables that to happen. That is something which we in Canada need to take a cold hard look at.
Let us consider tax rates and the money left in people's pockets after taxes and compare that to the United States. A couple working in the United States makes 44% more in after tax dollars than the same couple in Canada. How can we justify that? How can we be competitive?
Even the Prime Minister's own pollster, Mr. Marzolini, said very clearly in the last month that it is the high tax rates in this country which choke off the ability of the Canadian economy to function properly.
The woeful neglect of this situation is a damning indignation on this government which cannot be tolerated, let alone respected.
Governments will not provide money for education if they have a poor economy. In my riding there are high schools in which students have to write exams on paper that resembles toilet paper. They have had to downgrade to paper that is pathetic. Kids, even when they are trying to rub out their answers, rip right through it because schools do not have enough money to buy reasonable paper.
In British Columbia students are sharing textbooks. They do not even have their own textbooks. The schools do not have the money to teach our students who can then become employed in the future.
The government may take comfort in saying that we have the social programs to provide welfare and employment insurance, but that is no comfort to Canadians who want to work. Most Canadians do not want to be on welfare or EI, they want to work.
The unemployment rates we talk about do not take into consideration the underemployment rates we have in the country. There are legions of university students who come out with good training only to find that the job opportunities in their chosen fields are few to non-existent. What kind of message are we sending the youth of today? That after all their hard work they will end up slinging hot dogs or burgers at McDonald's? That is what is happening now. It is a waste to our economy and the potential of our country. It cannot be allowed to happen.
My colleague spoke about the pension issue and how the Reform Party has put together constructive solutions to rescue our pensions. The CPP will not be there for the people of my generation and subsequent generations because the amount of money that will be required to fund the CPP will simply not be there.
In the next 20 years the number of people who will be over 65 years of age will go from the 12% to 25%. The number of people who will be working to provide the tax base to pay for the CPP and other social programs will simply not be there. What do we do? Will the government do what it recently did and jack up CPP rates almost 50%? It certainly will not be able to do that in the future because at some point in time there will be a collapse. We cannot continue to raise taxes and the demands on the individual without the system falling apart.
Let us talk about solutions. Let us talk about how to fix this system. There is much we can do. One thing we talked about is productivity. I have spoken about tax cuts. Let us increase the minimum personal exemption. There are a number of innovative things we have discussed today and in previous times concerning education, in terms of enabling schools to have the money to do what they have to do to train the kids of today. We should also consider innovative projects like those in Europe which link up the educational facilities with the private sector, enabling students to get work experience early on. There are also innovative ways of looking at tax credits to do that.
We could consider a flat tax or a flattened tax, which has just been introduced in Alberta. Rather than having the complex tax system we have now, by flattening it or by having a flat tax we could simplify the system. It would be a lot simpler and easier to employ. It would save the individual and indeed the economy a lot of money. The proof is in the pudding when we look at other countries.
In the Nordic countries and other European countries people were labouring under very, very high tax rates in the 1970s and 1980s. For example, in the case of Sweden, its interest rates went up to 500% overnight. There was a huge exodus of capital from the country. Interest rates had to be jacked up to stop that.
In England, the tax rates jumped to almost 90%. All the best and the brightest, and those with money to invest, create jobs and build the companies within England left. There was an economic collapse within England. The people who were hurt the most were the poor and the middle class. They could not get jobs any more. The jobs had left.
Furthermore, the resources that were required by the government to provide social programs were not there. They saw the collapse of their health institutions. Many people suffered needlessly as a result of the high taxes.
The Nordic countries got smart; a lot smarter then we are. They lowered their tax rates and simplified their tax system.
What has happened? England is a lion in Europe and indeed in the world in terms of not only its economic performance, but more important, the health and welfare of its citizens.
In the Nordic countries we have seen something similar happening. The socialist mentality that was embedded within those countries, which said that the government would be there to take care of its people, is gradually being eroded. People are now beginning to provide for themselves.
This is ending the culture of dependence that was ingrained into that society; a culture of dependence that, sadly, is becoming more ingrained in our society. That is lethal for any economy and worse for the health and welfare of citizens.
With respect to the basic personal income tax exemption, there is no reason, as the hon. member opposite mentioned, the government could not do that tomorrow. The government could bring a bill to the House. It could do it by order in council, which is what it does 80% of the time on important decisions. Cabinet just says “We are going to do this” and it is done. It does not come to the House.
Twenty per cent of the decisions to be made are brought to the House. Unfortunately, most of them are about as essential to the workings of this country as a healthy dose of pabulum. It does a huge disservice to the collective ability of members to bring what they can to the debate in a meaningful way.
There are many people in this House from all political parties who have an extraordinary amount of experience, intelligence and energy to bring to important debates, if the Prime Minister and his friends in the PMO would only allow that to happen. The issue of democracy in this country and the lack thereof is perhaps best spoken about in another very interesting debate.
With respect to the child care tax deduction, why do we not treat families equally, those who choose to have one parent stay at home to care for the children and those who choose to have both parents work? Why do we not have equity in the tax system? There is no reason that cannot happen.
I send this message to the government members who have spoken in a disparaging way about parents who choose to stay at home to care for their children. There is no more valuable job in this country than a parent who stays at home to care for their children.
It is not only the most valuable job, I would submit that it is the most difficult job. I would not want to trade places with those parents who stay at home to do the very difficult job of bringing up children in the society we live in today, but it is essential.
There have been medical studies and analyses done around the world. The Minister of Labour will attest to this because of the hard work which she and her husband have done on the head start program in Moncton.
The impact of a parent on the development of a child particularly in the first eight years of life is unparalleled. The positive and negative impact that can have is unlike anything else that can take place in the development of that child toward becoming an adolescent and after that an adult.
The positive impact of loving, caring parents in the development of children through providing a secure environment and the basic needs is far more important than any money they may have in their pockets. It is far more important than any material goods that can be given to children. Parents staying home and doing that are not only contributing to society in the most valuable way possible but they are contributing to the development of children in a way that nothing else can compare to.
The last point is on pensions. Our party has put forth constructive solutions to have super RRSPs, to increase the amounts Canadians are allowed to invest in their RRSPs. Certainly the CPP will not be there for them. Why the government does not give Canadians an opportunity to take care of themselves is beyond me.
If we have super RRSPs and increase the amounts Canadians can invest in markets outside Canada, if we enable people to invest in their own health and welfare and give them the tools to take care of themselves, that is the greatest gift we can give to Canadians. By doing that there will be more money to provide for those people who are poor and middle class who cannot take care of themselves. The solutions are out there. We do not need more studies, we need action. I challenge the government to take up that challenge today and to act now.