Mr. Speaker, it is a pleasure today to speak to the opposition motion. I will be splitting my time with the shy, demure wallflower who is a friend to all of us and a great member of parliament, the hon. member for Saint John.
I agree with many of the points the Canadian Alliance motion includes today, for instance, focusing on core priorities and not only on Liberal leadership driven spending, and the strengthening of national security and defence spending significantly. I am absolutely certain the hon. member for Saint John will be talking further on this in a more detailed way, but I think it is safe to say that the Liberal's peace dividend has created a defence deficit in Canada post-September 11.
The budget, which increasingly seems as though it will focus on the issues brought to the forefront by the events of September 11, will probably ignore some of the issues that existed prior to that. I think the defence issue needs to be addressed. There is strong agreement among Canadians that defence and security issues were allowed to slide under this Liberal government. The hon. member for Saint John will be elaborating on that.
Reducing EI premiums further is important. Reducing payroll taxes, which creates a direct disincentive to hiring workers, would make a great deal of sense at this time. As for profit incentive taxes in general and eliminating capital taxes, I do not believe it is necessary to spread the elimination of capital taxes over a three year period. It is a $1.3 billion expenditure. I believe the government could to do that this year. It would reduce the disincentive to investment, which we have in Canada, in a very sensible way without the risk of going back into a deficit position.
I am concerned with the fact that the Canadian Alliance motion does not specifically mention agriculture. I think the opposition motion is making the same mistake that I fear the Liberals will be making in the budget, which is presenting a budget, which will probably be a mini-budget if not a micro-budget, that focuses on the September 11 issues but ignores some of the systemic problems and crises that we had in Canada prior to that. Among those is agriculture, and issue that we need to address. The farm safety net framework in Canada needs to be addressed.
Programs that existed in the past, like GRIP, were far more successful in addressing the issues facing farmers. They enabled farmers to survive if not thrive in difficult conditions much more so than the government's current programs, including NISA and AIDA. Some industry analysts have estimated losses to the grains and oilseeds sector to be $2 billion this year.
One the issues that desperately needs to be addressed by the government is the farm safety net framework. If programs are, by design, inaccessible to farmers who need them, it does not matter how many billions of dollars the government puts into a particular program. I will give the House an example of that.
In my riding of Kings--Hants, we have a large level of agricultural output. In fact 50% of the agricultural output for all of Nova Scotia comes from my riding. It has a greater agricultural output than the entire province of Prince Edward Island. However, my riding has had four years of drought. The AIDA farm aid packages and the NISA packages are based on the last three consecutive years. As a result of that, effectively, if a program is designed around a farmer receiving 70% of the last three years' output and, coincident with that, we have had three virtually non-existent years in terms of production, that program does not deliver anything to the farmer.
I have seen it in my own riding in Nova Scotian and I can empathize with western farmers. It has been an absolute disaster. However this is a national crisis and I would like to see the government, the official opposition and all members of the House pay more attention to the issues of agriculture.
One of the issues the CA opposition motion does address in some ways, although it does not specifically refer to it, is that of productivity. In recent years we have seen significantly lagging levels of productivity growth compared to almost every other country in the industrialized world, in the OECD, and certainly compared to productivity growth rates in the U.S.
The most visible or obvious reflection of that lagging productivity growth has been our weak Canadian dollar. That limp loonie has become almost a national embarrassment to Canadians but, more specifically, a direct reflection on the standard of living and quality of life of Canadians. Canadians do not always realize this but under this government we have seen 20% drop in the value of the Canadian dollar as compared to the U.S. dollar.
I was in a high school in my riding a couple of weeks ago where I asked how many of the students were wearing articles of clothing from the U.S. They all put up their hands. In fact, 35% of everything Canadians buy comes from the U.S.
I asked one student, who had on a pair of sneakers, whether they were from the U.S. His response was, yes. I asked him how much they cost and he told me they cost $100 Canadian. That means those sneakers are $20 more expensive now than they would have been in 1993 when the government took office simply because of the depreciation of the Canadian dollar.
If we do the math: 35% of everything Canadians buy comes from the U.S. and a 20% drop in our purchasing power, that represents a 7% drop in the standard of living for Canadians. It has been a drop in the standard of living that has been in some ways a stealth drop because Canadians have not necessarily noticed it immediately. In time, Canadians will connect the dots and they will realize that the government has depreciated the Canadian dollar to such an extent that not only has it affected our sovereignty as a nation through corporate takeovers, but it has dramatically reduced our standard of living and quality of life as Canadians.
The question could be asked: What would we do to strengthen the value of the Canadian dollar in the long term? There are no short term or easy fixes, but strengthening productivity in the long term would do a great deal to strengthen the value of the Canadian dollar. The government's reticence to addressing the productivity issue has done a great deal to threaten and compromise Canadian economic sovereignty. We have seen that on the corporate side, for instance, with the fire sale on Canadian corporate assets that has occurred in recent years, whether we look at the oil and gas sector, the energy sector, the health sector or the paper sector. One can look at a company like MacMillan Bloedel. What company could be more Canadian than MacMillan Bloedel? It was taken over by Weyerhaeuser. Why? Because we provided such a great opportunity to companies, individuals and corporate entities from other countries to purchase Canadian corporate assets at this incredible discount.
The Prime Minister's response to that has been that a low Canadian dollar is good for exports, or that a low Canadian dollar is good for tourism. If we take the Prime Minister's logic further, the logical corollary of his argument would be that reducing the Canadian dollar to zero would be really great because we would be the greatest exporting nation in the world. That is why economists laugh at most of what the Prime Minister says when he talks about the Canadian dollar.
We need to take steps to eliminate and reduce the types of taxes that attack investment, such as capital gains taxes. We need meaningful tax reform in Canada, in a general sense. We need to address our regulatory burden in Canada, such interprovincial trade barriers. The government's principal focus should be to create a federal and provincial level of co-operation around the single issue of productivity.
Security and defence should also be considered but beyond that we need to address issues that were relevant and important to Canadians prior to September 11 because these issues are not going to disappear because of September 11 and its aftermath.