Mr. Speaker, I want to congratulate the members for Peace River, Edmonton—Spruce Grove and others who have in their usual cogent and analytical way broken down the budgetary process and shown clearly how the government would have been of benefit to Canadians if it had followed the advice which we had given.
We support Bill C-43 because we have concentrated on the budget and we have, with the skill of our members and by the force and persuasion of their arguments, and by Canadians backing us up, caused the Liberal government to see that improvements were necessary to Bill C-43. It was seriously flawed. It would have left our country and Canadians at a severe disadvantage in a number of key areas.
We are pleased that we did get the government to abandon its critically socialistic bent at thinking that the best way to advance and generate revenues into the treasury was to tax people and tax businesses as much as possible. By bleeding tax dollars out of Canadians and making them work harder to take care of an increasing tax load is not how the economy is invigorated. That has been proven wrong in every jurisdiction that has tried that particular process.
It is a matter of economic fact that when the tax load is reduced, yes, in the first year there may be some foregone revenue, it initiates a virtuous cycle. In fact, there will be more people working, whether it is because investment taxes are reduced and people do not mind investing in business, or because people think that they can keep more of their hard earned dollars to themselves. When that virtuous circle of more innovation is started with more creativity and more hard work, because people or businesses are paying a lower rate overall, we actually bring more revenue into the treasury for important social programs, such as health care and other programs.
The economic history books are filled with examples of how that works. It absolutely refutes the failed god of socialism that is embraced by the Liberals and the NDP. It refutes the vicious cycle that people such as John Maynard Keynes advanced for years. He said that if a person ever gets into trouble economically, all that person has to do is get into deficit financing. We would plunge the country into debt and deficit, borrow dollars, shoot that into the economy and everything would get invigorated and everyone would be happy. There is one problem with that. It is a two word problem called compound interest.
The government proved this, tragically, and especially through the Trudeau years when we saw the most radical increase in the deficit and debt in the history of our country. It was a vicious circle; it was not a virtuous circle. The Liberals just do not get it. Their idea is to always tax working people more. Tax them harder and tax businesses more and somehow it will create more. It simply does not happen that way.
On a provincial level, we can look at the Alberta tax cuts of the 1990s when the economy was turning down, the price of oil was down, and commodity wars were going on around the world. In fact, in that period of time Alberta lowered taxes and it increased revenue. It was an amazing thing. Predictable, but it still amazed people.
The same thing happened with the Reagan tax cuts. The people over there do not like to hear that. That started the same virtuous cycle of increased revenue. Of course there was also increased spending related to military spending. However, in terms of the revenue side of the ledger, revenues increased because more people worked, worked harder, and became more innovative because they were not being excessively punished for being hardworking, innovative and creative.
The Kennedy tax cuts of 1962 were, in terms of following and tracking that trend, the single most significant and deepest personal tax cuts of the century. They actually triggered a virtuous cycle that carried on for seven years. Then of course they were dampened by the democrat President Lyndon Johnson and his war on poverty, and the war that he launched in Vietnam. Thankfully, it took a republican to get the Americans out of there.
The members of the NDP and Liberal alliance just do not understand it. I am so thankful that our hardworking members were able to impress upon them and bring pressure to bear to recognize that the cycle of excessive taxation and excessive deficit is a vicious cycle.
They do not like to hear this either, but John Maynard Keynes was asked a question when the charts were put before him. It was pointed out to him that if we were to keep on that cycle of deficit financing and then have to deal with it through compound interest, even in the productive years, we would not beat compound interest. He was asked whether he though that the economy would eventually collapse in the long run? Do hon. members know what he said, which was what these people do not realize? He said “Do you know what? In the long run we will all be dead”. That is an absolutely irresponsible approach. That is John Maynard Keynes, the father of the failed socialist god that the Liberals and the NDP continue to worship over there.
We were able to correct that in Bill C-43 somewhat. The member for Peace River has shown how Canada is still disadvantaged. We were also able to ensure that the Atlantic accord came to be. It was Conservative members, especially from Atlantic Canada, who promoted the necessity for the Atlantic provinces to receive back a little bit of the promise of Confederation which drew them into Confederation in the first place. It was something that they had not been receiving under the Liberals. It was the hard work of our members that got that in place. We can support that in this particular budget.
We saw the environmental path the government was taking, especially with the NDP-Liberal alliance. After years of talking about Kyoto and after years of saying the government had this figured out, Canadian taxpayers' dollars are going to be used to pay polluters in other parts of the world, like China which is not even buying into Kyoto, to continue to pollute so that we could have credits here to help certain businesses continue to pollute. If that is not a bizarre approach to dealing with environmental problems, I do not know what is. I am thankful that with the hard work of our members here, we were able to correct that.
In terms of the gas tax provisions, we are finally giving some of those federal gas tax dollars back to the municipalities. That again goes all the way back to October 2003 when we proposed it. All of us have constituencies that have needs. There are development needs in the city of Penticton. This is desperately needed infrastructure money. There are needs in the water systems in Naramata. There are growth needs from Summerland to Peachland and Westbank. I am talking about Westbank, British Columbia, not the Middle East, and the demands on infrastructure are incredible.
It is not all about big cities. These smaller jurisdictions desperately need these dollars as well. They are growing too. The city of Merritt is growing at an incredible rate and needs those dollars. Near Merritt there is the city of Logan Lake. It does not sound like a large urban centre, but that city needs a firewall. It is located in a forested area and needs to protect itself from the devastations that we saw two years ago.
These are the kinds of areas where those federal gas tax dollars need to go. They need to go back to cash starved municipalities. We are pleased that members of our caucus were able to initiative the idea and then ensured that the Liberals carried through with it.
We still have some concerns. There will be some nose holding in terms of Bill C-43 because a number of areas have not been addressed that the Auditor General wanted to be addressed.
In the area of government waste, which we identified in the last election, there is some $6 billion still not being attended to. Three auditors general in a row used the same phrase. They kept asking, who is minding the store? That is a tremendous indictment against the government. The billions of dollars of government waste is not being addressed. It is tragic and it puts an unnecessary burden on Canadian taxpayers. That must be addressed.
The fact is that there are still large funds that are off-book, as the Auditor General calls it. The government has said that it does not want anybody looking at how these giant funds are audited. We are actually not allowed to see it. If the sponsorship fund is an example of what goes on in funds that the Liberals do not want anybody to see, it is all the more reason to look at those funds.
If my colleagues will forgive me, I will give a word of credit to the NDP members for doing what they did. It cost $4.6 billion to buy 19 votes. We should do the math. That is about a quarter of a billion dollars per person. The money that went into the sponsorship fund was about $250 million. There are about four million or so taxpayers in Quebec. That means the people in Quebec are only worth $60 apiece. The Liberal-NDP extorted a quarter of a billion dollars apiece. I give them some credit for that even though the things they want to spend the money on is a real concern.
I congratulate the hard-working members of our caucus who were able to bring to bear and improve the budget enough that we can support it. There are things in it that we have initiated and they will be good for Canadians.