Mr. Speaker, I appreciate the hon. member who just spoke. He is probably the most knowledgeable member in the House on agricultural issues, so when he speaks, he speaks with a force of authority that very few members in this House can enjoy.
I want members to remember three numbers. The first is $25 billion. The second is $5 billion. The third is $0.5 billion. I know that by the end of my speech members will appreciate those three numbers.
The figure of $25 billion represents the biggest single loss to unit holders and shareholders on a Canadian stock exchange in one day. The figure of $5 billion represents the cost of a one per cent reduction in the GST. The figure of $0.5 billion represents the alleged tax leakage from income trusts. These three numbers represent the ultimate in incoherence and incompetence of any Canadian government, save except possibly the Mulroney era, but even the scandal plagued Mulroney government did not sink to that level of incompetence and incoherence.
The Conservative government has no plans. Whatever plans it has on the environment and on the economy and on social economy, it really is not sharing with anyone else in this chamber or in this country. Members of the government, frankly, would not know a plan if it kicked them in the backside and that is clearly demonstrated by those three numbers.
Regarding the $25 billion, members will recollect that during the election, the neo-conservatives said they would not tax trusts. At every whistle stop across the country, the Conservatives said that they would not tax trusts. On every occasion, the current Prime Minister and the then finance critic said exactly the same thing, in spite of the serious questions raised about tax leakage in the Department of Finance paper in 2005.
Instead of waiting for all of the evidence, he made this promise, and to the everlasting dismay of thousands of hard-working Canadians, they relied on that promise, to the detriment of their portfolios. Some even were telling me that they bought based upon the promise of the Prime Minister and the Minister of Finance.
The current Prime Minister and the then finance critic made their promise in spite of being fully briefed by the Department of Finance prior to their making that promise, yet they made that rash and reckless promise in the face of very difficult evidence. The consequences were predictable and the consequences were devastating, and that $25 billion is irretrievably gone.
Having gotten themselves inside the doors of power, they are now faced with the discipline of power, but for the first while, they frankly ignored all of the advice the Department of Finance would give them on various issues. If the Department of Finance said that a GST cut was not a very good idea, they ignored that. If the department said that tax credits would result in an incoherence and an inconsistency in the income tax system, they decided to ignore that as well.
When the department said that the best thing to do was broad-base tax relief so that all Canadians received the same relief, that thresholds move up and rates move down, they instead raised the rates and then went on this propaganda campaign and said that they had lowered the rates. They demonstrated a unique technique, unique to the government, namely, take a lie, repeat it over and over until it takes on the force of truth.
Incoherence mounting on incoherence mounting on misinformation; plans are not part of the lexicon of the government. The budget is generally written by the last guy out the door of the finance minister's office. This is, frankly, retail politics run amok.
What do we have? We have a Prime Minister and a Minister of Finance who make reckless promises that cost hard-working Canadians $25 billion, compounded by a $5 billion GST cut, which absolutely no one noticed and which every thinking person says is absolutely stupid. This is further compounded by cheap tax credits that introduce an unparalleled level of incoherence into the system and leave everyone bewildered.
The only ones who are really happy about this level of incoherence in the system are tax accountants who have to sort out for ordinary Canadians what credits they can and cannot claim.
The Prime Minister and Minister of Finance are in serious need of adult supervision.
Having ignored his department for the greater part of the year, the finance minister , however, yields to the siren song of tax leakage. This is a minister who blew five billion bucks on GST in a heartbeat against the advice of every economist in the country, and now starts to go down the rocky road of income trusts.
This is a file where the evidence is highly theoretical, frequently ambiguous and often contradictory, just perfect for the bull in the china shop finance minister that we have. And boy, did he really take to it, destroying $25 billion in an afternoon. It would take a whole herd of bulls several years to be as devastating as that bull was in one afternoon.
He ignored the evidence of the so-called tax leakage and ignored the issue of whether it was from flawed modelling. Instead of isolating the leakage, which frankly is primarily with non-residents, he decided to take a sledgehammer to the sector regardless of the consequences.
He ignored the advice that an entity tax judiciously applied to the point of leakage would probably address the major part of the issue. For some bizarre reason he decided to exempt real estate trusts from his bull in a china shop treatment, but ignore other sectors that have legitimate claims to differential treatment.
What quickly became clear at the hearings is that the minister had done no market analysis. Nothing. He had no idea of the consequences of his action. He did no study. He phoned no one. He was completely surprised, like all other Canadians, that this was going to cost Canadians $25 billion. He had nothing.
Then when the committee asked for the basis for his analysis, he sent out blacked out documents so no one could make any kind of a reasoned analysis as to whether, in fact, he knew anything or if he did know something, on what basis he made his decision.
The finance minister was as surprised as everyone else that he blew $25 billion on the basis of an alleged $0.5 billion tax leakage. Does this make any sense? First, he has a questionable grasp on the truth. Second, he destroys. Third, he turns around and then he says he is sorry, he is really sorry that he destroyed all these hard-working Canadians' savings. It gets worse.
In order to help the Canadians devastated by this bull in the china shop, the Liberal Party offered up a solution this week, led by the hon. members for Saint-Laurent—Cartierville and Markham—Unionville and suggested a way in which two-thirds of the value could actually be restored to Canadians. The finance minister would have none of it. As he said this morning, he is not interested. He would rather devastate Canadians' savings than admit that he might have made a mistake.
The Prime Minister and the Minister of Finance pride themselves on their image of decisiveness. Well, they made a decision and they got it wrong; they got it decisively wrong.
Remember, $25 billion, $5 billion, $0.5 billion. He blows $5 billion in a heartbeat, destroys $25 billion in an afternoon, and worries himself sick over $0.5 billion. It is incomprehensible, it is incoherent and it is idiotic.