I might mention what occurred during the Prime Minister's visit to China. President Bush managed to persuade the Chinese to put voluntary restrictions on their textiles in the U.S. but our Prime Minister refused to follow suit. Without a shared commitment with the U.S., we do not have the power to do the same.
We continue to dole out massive foreign aid to China. While we face these challenges of China as a new competitor, we continue to dole out foreign aid to it, to a global military and economic superpower. Now we see that China wants to buy some of our companies which leads me to this question. Will some day China buy some of our biggest natural resource companies with CIDA money?
What about the United States, the country the Prime Minister does not see? While he travels all around the world, changing his tune daily on missile defence, trying to assemble some kind of G-20 organization, he ignores the G-2, the largest economic relationship in the history of the world, the relationship between the United States of America and Canada. We will not always be able to piggyback on the United States. In fact, our free trade efforts have stalled. We see across the country disputes and obstacles to free trade rising, whether it is lobsters in Yarmouth, or flowers in the Niagara Peninsula or disputes with agriculture and softwood lumber that have only become worse.
The United States has its own challenges on fiscal and trade deficits, and without new emphasis on strengthening our relationship, we can be sure that the resolution of these problems is more likely to harm Canada than to help us.
There is no country in the world that would not be delighted to have the United States as a neighbour and economic partner. This government, however, appears to be unwilling, or unable, to take advantage of this economic relationship, the most productive of any in the world.
A few statistics do back up our contention that it is time for a major change. It is in fact time for a bold budget, not just time for the minority compromise we have seen in this Parliament.
During the past 40 years Canada's GDP per worker has remained little changed compared with that of the United States. We remain stuck at about 85% of the American level. Unprecedented in our history over the past decade or so, our standard of living relative to the Americans' has declined. For a nation that has endured numerous innovation, competitiveness and productivity programs from the federal Liberals, we have precious little to show for it. We are where we were 40 years ago.
As the Conference Board of Canada put it last week, “Lest any Canadian think that the productivity gap is irrelevant, it more than accounts for the income gap of $6,078 per Canadian”. Having a family of four with some $24,000 a year less income to spend than it would have in the United States is nothing to celebrate.
Unemployment rates in this country are stuck well above those of our American neighbours. This has persisted for a quarter of a century. It was not always this way. Back in the early 1970s Canadian and American unemployment rates were the same. Ours were often even lower and now they are locked into a gap that should be unacceptable to the government and unacceptable to Canadians. It is unacceptable to this party.
The TD Bank pointed out recently that Canadians' purchasing power has risen only 0.24% a year over the period of the Liberal government. In other words, Canadian living standards and disposable income have not risen at all.
This is my problem with the federal government and with the Prime Minister. I got into partisan federal politics originally because I wanted to see something done about the federal deficit. So many Canadians wanted to see something done about it.
The reason we wanted to see something done with the federal deficit was not so the federal government could hoard Canadians' money and waste it on its pet projects. We wanted to see it for the benefit of Canadians. That has not happened. That is only going to happen when Canadians get rid of the present government and its irresponsibility.
There are other challenges that are not addressed in the budget. There is still no national securities regulator, no plan for a discussion, no plan on how to proceed with something which virtually the entire business community in this country has been demanding. There is no plan on how we are going to deal with the issue of bank mergers which is not going to go away.
Equally ominous with regard to our future productivity is the fact we are no longer getting our fair share of foreign direct investment. In fact we have been experiencing a net outflow. Sadly, too many Canadians and Canadian businesses see better opportunities elsewhere. There is little prospect of reversing this trend unless and until there are major changes in tax policy affecting the Canadian business investment environment.
The tax cutting measures brought forward in the budget, all of which we have supported and will support strongly, should nevertheless be bolder and they should be implemented sooner. They are affordable. In fact we cannot afford not to do them. We must get on with them.
High marginal tax rates should have been addressed in the budget. They have not been, especially for people like researchers and medical professionals whom this country is trying to attract and trying to keep. Effective marginal tax rates have hit an astounding 80% for lower income Canadians faced with clawback provisions on key social benefits.
Do we need any more evidence that we need strong tax reduction and a tax overhaul? We wanted to see the capital tax eliminated in the budget. It is a job killer. It has no place in the Canadian tax system and it should be gone before the planned phase-out in 2007.
The evidence is clear that the effective business tax rate in this country remains well above that of the United States. The C.D. Howe Institute has stated that Canada's effective tax rate on capital is 31.5%, substantially higher than in the United States where it is 20.1%. Our business tax rates are not competitive with those in the United States, period, and will not be even after the reductions in this budget.
Countries such as Ireland and Australia have moved aggressively on tax reduction for business and individuals. They have shown the benefits. They are bringing in investment. They are bringing in new revenues. They are moving forward both in terms of their economy and their social services. This country should be able to do the same. We should have the richest country in the world, not one just struggling to maintain its place.
Let me conclude by saying that a budget is one of the most serious and solemn acts a democratic and responsible government can make. Even in a minority government context, a budget should not be just about ensuring the survival of the government or the triumph of the party. It must be about ensuring our future prosperity as a country, our success as an economy, and our security as a society. It must be the expression of a vision.
Sadly, there is no such vision in this budget. Avoiding an immediate hanging is one thing. Expressing a vision for the future is another.
The government may avoid being defeated in the House, but it cannot avoid being criticized. Our duty as an official opposition is not to keep the government in power, or to defeat it, but to ensure that it is serving the interests of Canadians.
There are many things in this budget that we do not like. There are many others we would like to have seen that are not there. Many problems that could have been addressed in this budget were not, such as income support for our farmers and rural economy, the long gun registry, the unaccountable funds in foundations. Passage of this budget does not mean the days to debate and challenge the government on those measures will not come very soon.
Many of the positive steps taken by the Liberals in this budget do not go far enough or occur fast enough to have a substantial impact on the well-being of Canadians. Most of the money for child care, for gas tax transfers to the cities, and for climate change is delayed until the end of the decade, and there is absolutely no plan in place on how to actually spend it anyway.
As I have said, we will not defeat the government at this time. In this budget the government is following the Conservative Party's lead on some areas that are important to Canadians. It is moving forward on tax relief, on defence and support for caregivers. We will continue to hold the Liberals to account where spending is unfocused and wasteful.
At a time in world affairs when decisive and determined action is needed especially on the economic front, I believe that the Canadian government is in fact dithering. It is dithering on living standards. It is dithering on productivity in the Canadian dollar. It is dithering on taxes, dithering on the environment, dithering on infrastructure, dithering on child care, dithering on foreign policy, dithering on bank mergers, dithering on management and accountability, dithering on out of control programs like the gun registry, dithering on aboriginal issues. I could go on and on. The Liberals are playing for time. They are simply dithering with our future.
When the times comes, and it will, this party will be ready to give Canadians new pride in their past and new confidence in their future.
Mr. Speaker, I move:
That the motion be amended by adding after the word “government” the following:
but however regrets that the budget does not reflect Conservative principles since it fails to immediately implement the proposed tax reductions for Canadians; proposes spending to implement the fatally flawed Kyoto accord instead of addressing real environmental issues; contemplates massive spending on a bureaucratic child care program instead of delivering child care dollars directly to parents; makes no commitment to the agriculture sector and rural Canada to provide aid at a time when Canada's regions need it most; does not eliminate the wasteful spending on the long gun registry; does not immediately provide adequate resources for Canada's military, so that our armed forces can become fully combat capable as well as equipped for peacekeeping duties; continues to place billions of dollars in foundations and trusts contrary to the express recommendations of the Auditor General; and indulges in a massive increase in bureaucratic spending.