Mr. Speaker, speaking of the very sharp contrast between the tax and spend Liberal federal government and the fiscally innovative and prudent way that the Government of Ontario, the Mike Harris Tories, runs its finances, I want to remind the federal Liberals of something that is occurring in the country right now. I want to read this for their benefit.
An article in the Globe and Mail yesterday stated “Ontario is on top of the world. Canada's economic heartland has put behind it almost 30 years of deficits, decline, bad government, unsound investments and painful restructuring and emerges as one of the most successful economies in North America, and in the world”. This is from the Globe and Mail , which is known to be somewhat friendly to the Liberal government of late.
The article went on to state “The latest calculations in finance minister Ernie Eves' fifth budget reveal that the province's economy last year grew by 5.7%”—and get this, Mr. Speaker—“better than anyone had expected, better than anywhere else in Canada, better than in the United States, better than any nation in the group of seven”. Imagine that.
Why are the citizens of Ontario blessed with such an incredible economy? Let me give an example. The article continued “Ontario celebrates the economic fruits of four years of measured, comprehensive income and property tax reform”. Translated, that means tax cuts.
“Thanks in part to those tax cuts, real disposable income over the past three years in Ontario increased by 11.6%, double that of the rest of the country. Corporate profits rose last year by 22.3% and real consumer spending rose 4%. An economy like that can generate 200,000 net new jobs in a single year”, which, surprise, surprise, Ontario did in 1999.
Contrast that with the Liberal government. Since 1993 there have been somewhere in the neighbourhood of 50 to 60 individual tax increases. The average disposable family income has decreased since 1993 by over $4,000. The average disposable income of Canadian workers has decreased by about $2,200.
The Liberals simply do not get it. They believe that the way to increase the tax revenue in government coffers is not to cut taxes, like most people in the real world would assume, to stimulate the economy. If taxes were cut citizens would have more money in their pockets to spend. Consumer spending would increase. Investors would invest in the economy, set up manufacturing plants and create jobs.
No, the Liberal philosophy is “We will simply hold the magic tax lever. In order to balance our budget we do not really have to grow the economy. We will let Ontario do that for us, or in spite of us. We will just wring that money out of the people of Canada, the businesses of Canada and the investment community”. That is what they have done.
That is how they got the money to balance the budget; not through prudent fiscal planning, but riding on the backs of the province of Ontario and the province of Alberta.
When Mike Harris and Ralph Klein formed their governments they said “We are going to get the finances of this country in shape. We are going to use a tried and true formula which we know has worked in numerous jurisdictions and countries around the world”.
That formula is simply this. Lower taxes equal a more buoyant economy. Higher taxes equal a sluggish economy. The government picked the first one. It was so simple, but the government does not get it.
In the last budget the finance minister claimed that he was going to give Canadians $58.4 billion in tax relief over five years. That sounds pretty good on the surface. We could almost get excited about it. Here is the real truth. From a $58.4 billion gross tax relief claim, we have to take away $7.5 billion over five years for social spending, which is the child benefit. Then we have to add to that $29.5 billion in increased CPP premiums because the Liberal government, which for so many years, unfortunately, has been in office in this country, has mismanaged the Canada pension plan since 1965 when it was introduced.
This is a good one. The solicitor general is going to love this one. The government has said that it will provide $13.5 billion in tax relief. It plans to schedule $13.5 billion in tax relief over the next five years. It plans on doing this but it will not do it so that it means $13.5 billion in tax relief or a tax cut.
For the benefit of the former parliamentary secretary of finance, the Minister of Health and the solicitor general, here is a simple formula. Let us say that I was a taxpayer earning $1 a year and paying taxes on that. The government says that it will, let us say, give me 13.5% in tax relief. I say “Whoopee”. However, what it means is that the government will not increase my taxes by 13.5% and therefore I will have a tax break. I look at my pay stub and say “Gee whiz, I did not get a tax break. All I got was no increase”. In Liberal terms that somehow translates into a tax break.
Let me talk about a couple of other things that the Liberal government has told us about its budget and the way it runs the country fiscally. All through this it has tried in vain to portray itself as being the caring and generous party of Canada. In the meantime, since 1993 it has cut $25 billion out of the Canadian health and social transfer. Does that sound like a caring, generous government? I do not think so.
Mr. Speaker, I know that you are a wise person sitting in that chair and I know that you probably get it before some of the ministers here. This generous, caring government cut $25 billion out of the CHST.
The government says it will end bracket creep. That is not a reduction in tax. It only means that a regular scheduled tax is again not going to occur. All the time the government has blown its spending budget. Every year since 1993 it has spent more than what it said it would. It basically adds up to a Liberal sucker tax cut, if I can use that term, or, in better terms, a no break tax break.
Canadians are waiting for it and they have not received it. While they look at the performance of the provinces of Ontario and Alberta, they say to themselves “Why does this Liberal not get it? Why can it not follow the example?” I hate to tell working Canadians but this government has never gotten it and never will get it. The only way Canadians will get substantive tax relief is by electing in the next federal election a Canadian Alliance government to sit on that side and bring in the tax cuts that they so dearly deserve.