Mr. Speaker, before question period, I talked about supporting the intent of this motion but felt that some of the ways of implementing the objective in the motion were impractical, one of which, as I mentioned, has to do with the United States legislation, which does not pertain to Canada as we have different legislation.
I also went on to point out that we had gone a long way when the Liberal government was here in 2001. We secured financial institutions, looked at regulations and set up the credit card database in which we have a large amount of data that has prevented us from going the way that the United States and other countries did. It was because we had secured our financial institutions.
The motion also talks about the aggressive targeting mechanisms used by credit card companies to ensure young people have credit cards. They offer them low interest rates to hook them in and then, when they get these young people in, they raise the interest rates, which is why so many people are now indebted.
As I said earlier on, we talk about the indebtedness of people and we need to do something about it. This is one of the reasons the Liberals took a leadership role in the Senate. We wanted the Senate banking committee to look at some of these issues and to aggressively look at solutions. The problem is real. The debt of most Canadians at this time, especially consumers, is huge. In my riding of Vancouver Centre, the cost of homes and everything else is so high. We have young couples in their thirties who are university educated. Some have MBAs and some are lawyers. Together, these couples are making a reasonable income but they cannot afford to buy a home. They have stretched themselves to the extent that they can but when one of them loses a job in this climate, they are within two pay cheques of bankruptcy. We need to be concerned about these people who also have large credit card debts that they need to pay.
Many of my colleagues have made the point that many retailers right now are in a credit crunch. This is all a vicious cycle. We know that when people are indebted they are not spending. They are hoarding and saving. They are indebted to credit cards companies. They have reached their maximum limits and therefore cannot go outand buy. The retail sector is suffering because of the inability of consumers to spend money on anything that is not basic. Shops, retailers and small businesses are hurting a great deal by this recession. They have their own credit crunch to deal with.
On top of that, the credit card companies are charging the retailers 11% and 12% interest rates, which does not allow the retailers to make a profit. Many of them are trying to bring about sales so they can encourage people to buy but they cannot do that and stay in business if they do not make a profit. They now have a choice. They either go out of business or they bring down their funds. However, if they do not make a profit, they will go out of business at the end of the day.
The financial institutions, which govern much of the credit card debts and the interest rates charged by credit card companies, need to show a sense of responsibility by making the credit card companies understand that by charging high interest rates and changing interest rates without enough notice to people who cannot afford to pay off their full balance, which will only increase now when people are counting their pennies and can only afford to pay the minimum amount, they are creating a huge problem. People's indebtedness will hurt this economy and any economic stimulus package or any development that we try to make to turn the corner.
This is a vicious cycle that we see happening, one that is creating a worsening situation all the time.
Now we know that typical of the Conservative government is a promise that it will do something about it. The Minister of Finance said that he would go off and deal with the credit card companies and get them to do these things voluntarily. However, when they told him to take a hike, nothing happened. We continue to see promises made in stimulus packages, in budgets, in all of these declarations by a government that never actually come to fruition. Nothing happens. Talk is cheap.
We, on this side of the House, knowing that we did not want to play politics with a difficult fiscal climate in this country, cut the government some slack. We said that we would support its package but that we put it on probation.
Time after time, we hear the verbiage that we are working on it and that we do care, but nothing happens. We have put the government on probation because at some point in time we need to find out whether it is just talk. We need to see the money flowing. We need to see the work being done to get the credit card companies to look at the problems. We need to see that the promises to spend money in certain places comes to fruition. We need all this shovel-ready stuff to occur. We need long term investments.
Those are some of the things that we are looking to the government to actually make good on and we are keeping our eye on the government on that basis. However, at the same time, we do not wish to be irresponsible. We know we are in a difficult time but we need to see something happening.
The motion brought forward by the NDP basically says that we need to do something. We have taken the bit in our teeth and have taken the initiative. We have started to do the work at the Senate by pushing this very aggressively in the Senate. We need some studies and we need some information. When I say studies, I do not mean studies in the manner in which the government speaks of studies, which is some kind of two year plan to do something that never comes to fruition. We mean that we need to get some data quickly. Time is moving and we need to get this thing sorted out now.
Good intentions are fine, and I hesitate to say this because it is very well-intentioned, but we know that the NDP have a tendency not to implement their good intentions and come up with some way-out ways to do this. However, we do agree with this motion because it is a good motion. The objectives and the intent are great. We have taken the initiative to do some work to ensure we have the right and most effective solutions to this problem.
I support the motion from that perspective.