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House of Commons Hansard #107 of the 40th Parliament, 3rd Session. (The original version is on Parliament's site.) The word of the day was billion.

Topics

Ferry ServicesOral Questions

November 30th, 2010 / 3:30 p.m.

NDP

Peter Stoffer NDP Sackville—Eastern Shore, NS

Mr. Speaker, I “moustache” the Minister of Transport the following question on the Northumberland ferry. He knows very well that the premiers of Prince Edward Island and Nova Scotia are concerned about the future of the Northumberland ferry.

Could the Minister of Transport please tell the premiers of Nova Scotia and Prince Edward Island and the workers on the Northumberland ferry that their careers and their jobs will be protected and that money will be invested as soon as possible by the government?

Ferry ServicesOral Questions

3:30 p.m.

Chilliwack—Fraser Canyon B.C.

Conservative

Chuck Strahl ConservativeMinister of Transport

Mr. Speaker, I think I “Movember” the answer but I better “goatee” my written response.

The ferry system in Atlantic Canada is extremely important to our Conservative government and that is why we invested $521 million in Marine Atlantic earlier this summer.

More important, as I mentioned on Monday, we realize the other ferry services in Atlantic Canada are also very important, and I hope to have an announcement on how we are going to deal with that very shortly.

Presence in GalleryOral Questions

3:30 p.m.

Liberal

The Speaker Liberal Peter Milliken

I would like to draw to the attention of hon. members the presence in the gallery of two renowned francophone artists. I would ask you to join me in welcoming Robert Charlebois and Luc Plamondon.

Presence in GalleryOral Questions

3:30 p.m.

Some hon. members

Hear, hear!

Statements by MembersPoints of OrderOral Questions

3:30 p.m.

Liberal

Derek Lee Liberal Scarborough—Rouge River, ON

Mr. Speaker, during the period for members' statements prior to question period, the member for Brant rose in the House and delivered what I could only regard as a negative attack on the member for Ajax—Pickering.

At the time, Mr. Speaker, you were partly distracted by another member in conversation, but the statement was so devoid of any subject of any merit and so flagrantly in disregard of your previous rulings and the rules of the House, I would ask the member to withdraw the negative comment and, if he does not, I would ask you to look at it, determine if it was in order or not and, if it is not in order, to have it struck from the record.

Statements by MembersPoints of OrderOral Questions

3:30 p.m.

Regina—Lumsden—Lake Centre Saskatchewan

Conservative

Tom Lukiwski ConservativeParliamentary Secretary to the Leader of the Government in the House of Commons

Mr. Speaker, I appreciate the comments by my hon. colleague, however I know that you do pay attention to S. O. 31s. You had given instructions to this House some months previous as to the tone and the quality of the S. O. 31s. I concur with my colleague that if you care to re-examine the statement by the member for Brant, I believe you will find it was completely in order.

He was speaking as to the actions of the member for Ajax—Pickering at committee who had, at one point, called for a member of the RCMP to appear at committee and then, quite frankly, without exception, did not appear to question the RCMP member who he had called as a witness.

All we are suggesting is that if members want to make this Parliament work, when they ask for a witness to appear before the committee, they should have the courtesy to at least show up themselves after the request has been granted to forward their questioning to the appropriate witnesses.

Statements by MembersPoints of OrderOral Questions

3:35 p.m.

Liberal

The Speaker Liberal Peter Milliken

I will review the statement. I did not hear it all. I was talking with someone else during part of it. I heard bits and then there was a lot of yelling, so I will examine the matter and get back to the House in due course.

Oral QuestionsPoints of OrderOral Questions

3:35 p.m.

Liberal

Judy Sgro Liberal York West, ON

Mr. Speaker, when the leader of the official opposition asked the Prime Minister a question regarding the economy, pensions, et cetera, the Prime Minister clearly said in his response that we had cut pensions.

It is very important that issues like this be very clear and, because of the fact that we can say a lot of things in this House that we cannot say outside, we should be as clear as we can be. The Liberals did not cut pensions. In fact, we increased pensions every year. In fact, it was the Liberals who brought the pension system that we have in Canada today.

Oral QuestionsPoints of OrderOral Questions

3:35 p.m.

Liberal

The Speaker Liberal Peter Milliken

I am not sure the hon. member is rising on a point of order. It sounds more like a matter of debate, which, of course, does happen from time to time in the House.

The House resumed consideration of the motion that Bill C-47, A second Act to implement certain provisions of the budget tabled in Parliament on March 4, 2010 and other measures, be read the third time and passed.

Sustaining Canada's Economic Recovery ActGovernment Orders

3:35 p.m.

Liberal

Scott Brison Liberal Kings—Hants, NS

Mr. Speaker, as the holiday season draws near, Canadians are examining their household budgets and they are worried. They are worried about how they are going to make ends meet and how they are going to pay their mortgages.

Canadian household debt, which is the amount Canadians owe in mortgages, credit cards and personal lines of credit, has grown to $1.5 trillion. That is $44,000 for each and every Canadian, almost $100,000 for every Canadian family.

These are historic highs, the highest levels of personal debt in Canadian history. Right now Canadians are having trouble making ends meet when interest rates are at historic lows. Canadians are naturally and justifiably worried about how they are going to make payments in the future, as rates will inevitably rise.

More troubling when they look to the future is that too many Canadians do not know how they are going to pay the bills, pay their mortgages and pay for their children's education.

On a number of fronts, the situation for Canadian families has deteriorated under the watch of the Conservative government.

Since the last election, Canadian household debt has grown by $200 billion. To put that in individual terms, the average debt that each and every Canadian carries has grown by $4,000 since the election of the Conservative government.

In terms of Canadian jobs, Canada's unemployment rate has risen from 6.2% in October 2008 to 7.9% as of last month.

The Conservatives have claimed that they have restored Canadian job numbers or job levels to where they were before the economic downturn. That is simply not accurate. That is false.

In fact, fewer Canadians are employed today compared to October 2008, and even that does not tell the full story. In the past two years, Canadians have seen a shift from full-time jobs to part-time work. There are 115,000 fewer full-time jobs today compared with October 2008.

It is true that many of these full-time jobs have been replaced by part-time work. Canadians know that not all jobs and not all work is created equally. Too many Canadian families have been left trying to make ends meet and provide for their families with only their wages from part-time work, in many cases with minimum wage jobs.

To sum up the Canadian jobs front since the last election we have, one, fewer total jobs and, two, a dramatic shift from full-time jobs to part-time work. It is shocking that the Conservatives continue to brag about this sorry record.

It is a reminder that the Conservatives really are out of touch with the challenges being faced by Canadian families. What is also worrisome is not only that the Conservatives are doing very little to deal with the challenges Canadian families face today, but the Conservatives are ignoring completely some of the real challenges that are on the horizon.

Canada, like many industrialized countries, is facing a significant demographic shift. Many families today are trying to take care of aging parents while at the same time they struggle to pay for their children's education. We are hearing the term now, the “sandwich generation”, and we read and learn of families who are taking care of children and parents at the same time.

The Globe and Mail did a very important series of articles on Alzheimer's and dementia a few weeks ago. One of the most striking and poignant profiles in that series was of a family with a 26-year-old daughter who had two little children and was taking care of those two little children and at the same time was taking care of her 52-year-old father who had early-onset Alzheimer's.

Canadian families are looking to their government for leadership. We need pension reform to prepare us for the demographic bubble and the shift that is occurring.

We need fiscal responsibility to try to get spending under control to ensure that we do not, along with the demographic shift and the challenges on social investment and pensions in the future, also have the fiscal incapacity to deal with those realities.

Canadian families want a government that is not just focused on this week's polls but is focused on the challenges and the opportunities 10 or 20 years ahead of us. They want the government to invest in the priorities of Canadian families.

Instead, Canadian families are being lectured by this finance minister who tells them that this is not the time for risky spending schemes. However, at the same time, this is the finance minister who is pouring billions of Canadian tax dollars into untendered fighter jets, U.S.-style mega-prisons, high-priced consultants and corporate tax cuts that we simply cannot afford now on borrowed money.

This is the same finance minister who inherited a $13 billion surplus from the Liberal government and then increased government spending by 18% in the first few years of the Conservative government, putting Canada into a deficit even before the economic downturn began.

This is the finance minister who said there would be no deficit and then missed every deficit target he ever set, finally, recently, giving Canadians a $56 billion deficit, the biggest deficit in Canadian history.

This is the same finance minister who lectures Canadian families about what he calls “risky spending schemes” instead of lecturing his justice minister and his public safety minister on their risky spending schemes.

On the cost of the prison legislation, the justice minister originally told Canadians that his prison bill would only cost Canadian taxpayers $90 million. Then he said that instead it was going to be $2 billion. So he went from $90 million to $2 billion.

Then we have the Parliamentary Budget Officer who has said that this prison legislation of the Conservative government would not cost $90 million and would not cost $2 billion but would in fact cost between $10 billion and $13 billion. Talk about risky spending schemes.

The last thing Canadians need would be a U.S.-style approach to law and order. In fact, if putting more people in prison led to safer communities, U.S. cities would be the safest communities in the world. We all know that is not true.

Instead of investing in the kinds of sensible measures that would reduce crime in Canada and actually protect Canadian citizens in their communities, the government is pursuing a failed Republican-style U.S. approach to law and order, which failed in the U.S. and has no better potential to succeed here in Canada.

I would like to speak a little bit about the government's other risky spending scheme, and I would remind the House that this same finance minister who lectures Canadian families on government spending has failed to lecture his defence minister on the cost of the untendered F-35 fighter jets.

The F-35s are set to cost Canadian taxpayers $16 billion. The Conservatives are prepared to throw taxpayer money away and pay a $3 billion premium for the F-35s, because the Conservatives stubbornly refuse to open up the process to competition.

U.S. Senator John McCain has expressed his frustration with the F-35s, calling the costs outrageous and saying, “I share our allies' and friends' deep disappointment about the cost overruns...”.

That is Senator John McCain, someone who knows a little bit about defence and understands the importance of respecting tax dollars.

Even the Auditor General has pointed out that the F-35s are a risky undertaking, saying, “I would hope that nobody is assessing...[these risks] as low risk”.

Yet this finance minister continues to lecture Canadian families about risky spending schemes. He completely refuses to reign in his own ministers and their risky spending schemes.

This finance minister who talks about risky spending schemes is also the finance minister who allowed his public safety minister to waste $1.3 billion on a 72-hour G20 photo op session in Toronto. That included $1 million for a fake lake, $300,000 for a gazebo, bathrooms that were 20 kilometres away from the summit site, $400,000 for bug spray, I guess the fake lake was attracting a lot of insects, over $300,000 for luxury furniture, $14,000 for glow sticks, millions on high-end hotels and over $75,000 on mini-bar snacks. Who the heck uses mini-bar snacks? It is the excess. I mean people should buy their own snacks. This excessive Conservative waste is insulting to Canadian families today.

Canadian families are having trouble making ends meet, struggling to pay their mortgages and their children's education, struggling to pay for Christmas presents at this time of year and to pay their taxes. They see this Conservative finance minister and his ministers wasting the Canadian taxpayers' hard-earned money on a frivolous Conservative government spending spree.

One of the Conservative members recently said the government was spending like Christmas, boasting about the spending of the Conservative government. When the Conservatives are wasting the tax dollars of Canadians, particularly during this season, it means Canadians have less money to buy presents for their children this Christmas. It means Canadians have it a little tougher to find ways to pay for their children's education. It means this winter, as the temperatures drop, Canadians are finding it tougher to fill their oil tanks and to pay for their home heating costs. At the same time, they watch the government wasting their tax dollars with out-of-control spending. No wonder they are enraged.

This is a finance minister who lectures Canadian families instead of lecturing his own Prime Minister who has increased the budget of the Prime Minister's Office by 30%. This is a finance minister who refuses to look in the mirror and take responsibility for his own risky spending schemes that have caused the tab for high-priced consultants to go over $10 billion a year. That is $10 billion a year for high-priced consultants. The finance minister's spending schemes have also caused government advertising to grow by 300%.

It is no wonder the Parliamentary Budget Officer said just last month that there is an 85% chance that this finance minister will break his promise to balance the books by 2015-16.

Canadian families, who are forced to balance their books every month, do not need to take any lectures from this finance minister who has failed to meet any deficit target he has ever set.

What Canadian families want and deserve is a government that will control government spending and restore fiscal order. Instead, we have the Conservatives who preach fiscal austerity while borrowing and spending more than any other government in Canadian history.

There is a better way. A Liberal government would clean up this fiscal mess created by this borrow-and-spend Conservative government. After all, it was the previous Liberal government under the financial leadership of people like Prime Minister Jean Chrétien and finance minister Paul Martin who eliminated the deficit.

Under the financial leadership of the member for Wascana when he was finance minister and the deputy leader of the Liberal Party in the House, the Paul Martin government was the last government to actually reduce government spending. That was the last government. It was the Liberals, under the financial leadership of Jean Chrétien and Paul Martin, who implemented the biggest tax cuts in Canadian history. We did this in a responsible manner during an era of hard-earned surplus. We did not do it on borrowed money.

A Liberal government would once again restore order to Canada's financial books. We would invest prudently in the priorities of Canadians, in learning, in family care. We would invest in strengthening pensions. We would invest in the jobs of tomorrow, in science, in research and development, and in the green jobs of the 21st century.

We would do this in a prudent way by reining in the reckless spending that has occurred and continues to flourish under the Conservatives. We would listen to Canadian families and we would ensure that we would invest in their priorities. We would partner with Canadian families and recognize that they face tough times. We would be there with them as a government, helping them get through these tough times, and ensure that in the future, we would emerge from these economic challenges stronger and more united, more competitive and more prepared to face the challenges of the 21st century.

The Mandarin word for “crisis” is the same word as that for “opportunity”. It is telling to look at the way other countries, including China, have invested their stimulus money. China has invested over $400 billion in energy modernization, in a clean energy grid, a smart grid, in clean energy production. In 2008, China became the world's largest producer of solar panels in the world, and in 2009, China became the world's largest producer of wind turbines. China is focusing on green investment with its stimulus package because it recognizes that the future economy and the jobs of tomorrow will be dominated by green economy jobs.

The U.S. has put almost $8 billion into energy modernization, investing in grid technology, investing in an energy grid, clean energy production and research.

In fact, China and the U.S. have invested jointly billions of dollars in a clean energy partnership focused on carbon capture and storage. What is frustrating is that in Canada we have a head start in this area now; in fact, 40% of the sequestered carbon in the world is stored in Weyburn, Saskatchewan. However, we have completely missed the boat on this important investment of two of our trading partners, China and the United States, and this partnership that they have to research and develop clean, conventional energy technology in carbon capture and storage. We have missed that opportunity. We should be working hard to get back to the table so we are part of that.

I mentioned the word for “crisis” and “opportunity” in Mandarin for a reason, and that is that we should never waste a good crisis. If we look through history, during any time of crisis, smart investors, smart governments and smart business people made smart decisions which enabled them to prosper as they came out of the period of crisis.

I fear that the visionless Conservative government has failed Canadians not only by failing to protect the jobs of today, but by not having enough vision and focus on the future to create the jobs of tomorrow.

Today I have spoken about the fiscal deficit the Conservatives have created. I could have spoken of the trade deficit the Conservatives have created and their failure to connect Canadians to the markets of tomorrow, but I have also spoken of perhaps the most troubling deficit, and that is the vision deficit of the Conservative government and its failure to provide a coherent vision for the future of the Canadian economy to enable Canadians to have some sense of hope for a more prosperous tomorrow.

Sustaining Canada's Economic Recovery ActGovernment Orders

3:55 p.m.

NDP

John Rafferty NDP Thunder Bay—Rainy River, ON

Madam Speaker, I was interested in my colleague's comments. Some of them I agree with. Some of them I think he perhaps might not understand, which brings me to the question that I have for him. He talked about taking advantage of the crisis. He is probably aware that usually governments do not use that for a positive effect. It is usually a negative effect. In other words, the crisis presents an opportunity to further the government's own agenda which is very seldom positive.

I wonder if my colleague would like to make any more comments along those lines on that subject.

Sustaining Canada's Economic Recovery ActGovernment Orders

3:55 p.m.

Liberal

Scott Brison Liberal Kings—Hants, NS

Madam Speaker, from a historic perspective and from an international perspective, I think many smart governments over time have used periods of crisis to make bold decisions that in the long term were very beneficial for their citizens.

If we look at stimulus packages in the U.S. in the past, the Hoover Dam is an example of a stimulus package that is still producing energy in the U.S. The GI bill in the U.S. was probably one of the most successful examples of stimulus in terms of providing education for people returning from the war. Many people believe that the GI bill in the U.S. was instrumental in creating the baby boom. In Canada, if we look at soldiers returning from World War II, investments in their education was a form of stimulus.

There are examples both in the past and in other countries where governments have taken a crisis and created an opportunity. But when the Conservative government was faced with a global financial crisis, its first instinct was not to bring in a budget and an economic package to benefit Canadians. Its first instinct was that the global financial crisis was a great time to put the boots to the opposition.

I agree with the hon. member that the government's instincts are usually to find political advantage, not to try to create a national or global advantage for Canadians.

Sustaining Canada's Economic Recovery ActGovernment Orders

3:55 p.m.

Liberal

Dominic LeBlanc Liberal Beauséjour, NB

Madam Speaker, I would like to begin by thanking my hon. colleague from Kings—Hants for his excellent speech. He has a remarkable understanding of the Canadian economy, and I often find his opinions and analysis extremely relevant.

My question is around the Conservatives' attempt to raise job-killing payroll taxes. I think the member shares my view that increases in employment insurance premiums on small businesses, for example, those in my riding in rural New Brunswick would have a very negative effect on job creation.

The director of provincial affairs for the Canadian Federation of Independent Business in New Brunswick is Andreea Bourgeois, an impressive woman. I am sure my colleague has had a chance to meet with her. I met with her a number of times over recent weeks and in the summer. The CFIB makes a very compelling case about the negative effect an increase in employment insurance premiums would have. It would inflict damage on small and medium size businesses that are trying to create jobs and hire people. It would inflict damage on the economy of regions like the one I represent in New Brunswick, and the one represented by my colleague from Kings—Hants.

Could he share with us his view on this irresponsible Conservative tax increase that threatens job creation?

Sustaining Canada's Economic Recovery ActGovernment Orders

4 p.m.

Liberal

Scott Brison Liberal Kings—Hants, NS

Madam Speaker, I very much appreciate my hon. colleague's question and I completely agree.

It is ridiculous to increase taxes on jobs during a recession. It makes no sense. Doing so would be pure nonsense. I do not understand why the government is going ahead with a plan that will raise taxes on jobs in January, when finding a job anywhere in Canada is already very challenging for most people.

It is ridiculous. It is bad for small businesses, it is bad for the economy and for entrepreneurs, and it is bad for workers and the unemployed. This is not the right time for it.

Sustaining Canada's Economic Recovery ActGovernment Orders

4 p.m.

NDP

Jim Maloway NDP Elmwood—Transcona, MB

Madam Speaker, clearly, we see that the longer the Conservatives are in government, the more comfortable they become with debt.

I wish I could talk to Preston Manning. I would ask him to re-read Animal Farm. When the old Reform Party and Preston Manning were in this House, I remember watching him on TV refusing his pension, along with the whole caucus over there. I remember when he turned the keys to the car over to the government and said, “Here is your car”. I guess he was going to walk. He refused to move into the official residence, as I recall.

Have things ever changed with the government. Now that the Conservatives are in power, they have forgotten all the things that they promised when in opposition. They are back to accepting the pensions now. I believe they are driving the cars. They went into the stimulus spending issue very willingly. They are as bad as any government has been in terms of spending money to attract enough voters to try to get a majority government.

Things have changed an awful lot with that group in a very short period of time.

Does the member have any observations that would confirm or disagree with that assessment?

Sustaining Canada's Economic Recovery ActGovernment Orders

4 p.m.

Liberal

Scott Brison Liberal Kings—Hants, NS

Madam Speaker, I thank my colleague for his very difficult question. He is asking for just a couple of examples of Conservative hypocrisy in this regard and, frankly, it is really tough to narrow it to just one or two examples.

This has been a government whose stimulus package has been a political stimulus package. It has been looking for political stimulus. The poll numbers are around 30%. The Conservatives cannot get above that. It is like that country music song Looking For Love (in All The Wrong Places).

This is a government that has been more interested in counting signs than in counting jobs. This is a government with a fetish for signs but a disinterest in creating real long-term jobs and opportunities for Canadians.

There is only one thing I would quarrel with in terms of what the hon. member said. He said that this government has been as bad as any government in terms of its spending, in his view. I would say that this government has been worse than any government in history.

I can remember when we were in government, the Liberal government under Paul Martin as prime minister. There was an expenditure review committee of cabinet. I was part of that committee. In fact, it was chaired by the member for Markham—Unionville. We actually worked to reduce government spending on a department by department basis. We went through items of departmental spending line by line. We worked with the public service in a very constructive and respectful way to find areas of lower priority where we could re-prioritize, areas where there may be some waste or duplication, with the goal of getting the best value for taxpayers while providing the best services for citizens. That is when we were in a $13 billion surplus. Respect for taxpayers, respect for hard-earned tax dollars, is not something we just do when we are in deficit. It is something we do with every hard-earned dollar we receive from the Canadian people.

I am very proud of the fact that the member for Wascana, when he was the finance minister, was the last finance minister in Canada to actually reduce government spending. I think that is a good thing. Whether we are in surplus or in deficit, we have to do that. It is morally the right thing to do, because people work so hard. Canadians work so hard to pay their taxes and they are just barely getting by. It is an insult to them to do anything but that.

The member used to be a provincial member in Manitoba. I would add that it is something that provincial governments, in some cases provincial NDP governments, in some cases provincial Liberal governments, in some cases provincial Conservative governments, have to do. The buck stops with them. The buck stops with provincial governments. The buck stops with municipal governments.

As we enter this period of health and social transfer debate, discussion and negotiation, in the coming years, with provinces with record high deficits and the federal government with record high deficits, we are going to have to watch every penny on behalf of Canadian taxpayers.

Sustaining Canada's Economic Recovery ActGovernment Orders

4:05 p.m.

Liberal

John McKay Liberal Scarborough—Guildwood, ON

Madam Speaker. tomorrow will be the beginning of December and I note that the original budget was presented on March 4, so some nine months later we are getting around to implementing some of the provisions of the budget.

I went back and looked at the original budget and I was struck by chart 1, interestingly titled “Rapid decline in deficits”. If ever there was a creative way in which one would describe this runaway deficit, this is the way to describe it.

Generally speaking, certainly when we were in government, we put the surpluses above the line and we put the deficits below the line. It is quite interesting that the Conservatives government has everything backward, or more accurately, upside down. The return to deficit should be all below the line and the surpluses of the previous government all above the line.

In an interesting way in which things are backward around here, where left is right and left is right and up is down and down is up. The government has it entirely upside down. In chart 1, this rapid decline in deficit, the Conservatives have all the deficits above the line and all the surpluses below the line. They did not actually include the surpluses of previous government, which should have been above the line. However, that would not have worked with the chart.

The interesting thing is the Conservatives were already in deficit in the fiscal year prior to the crisis with respect to the recession. They had already blown away $3 billion or $4 billion in deficit. Actually it is greater than that. It is $5.8 billion in deficit, so they were already in the hole before they started, before we got to the fiscal crisis and before we got to the issues with respect to the difficulties that the entire world experienced in the fiscal year 2008.

It is an interesting presentation. It is an interesting way in which one tries to describe up as being down and down as being up. The deficit is above the line, therefore apparently in some respects surplus, and a surplus has been below the line and therefore in some respects being described as a deficit. Given their challenges with respect to communications, one can readily see how one blows $130 million in the Prime Minister's office just to communicate that up is down and down is up.

The significance of this chart in the budget document dated March 4 is that it pretty well blows away 13 years of very difficult work on the part of the previous Liberal government. The previous Liberal government took over from the previous Conservative government, which had run up a pretty significant deficit the last year it was in office, something over $42 billion or $43 billion. It took something in the order of four years, I think it was in 1997 when we turned the corner. It was with a lot of pain, a lot of difficulty, where we had to get control over our spending and our revenue streams.

From 1997 through to 2005-06, when the last Liberal government held office, we ran surpluses and the Canadian taxpayers received the benefit of that surplus in two respects: first, in lower taxes; and second, in reduced interest rates. At some point in the previous Liberal government we were running 9%, 10%, 11%, 12% interest rates on mortgages, which was coming out of each and every pocket. As well, we were running inflation rates of 3%, sometimes 4%, sometimes 5%, which was an illusion of increases in asset value.

Two things happened in the previous Liberal government. First, the fiscal house was put in order by Messrs. Chrétien and Martin and the current member for Wascana. The second thing that happened was the monetary policy was also put in order. A band was implemented primarily by David Dodge, but also by Gordon Thiessen before him and followed up by Mark Carney, of setting the inflation rate at somewhere between 1% and 3%. That would be the band that would be an acceptable rate of inflation.

Fortunately the Conservative government cannot touch monetary policy. As a consequence, the monetary policy put in place by the previous government has remained untouched. Therefore that part of Canada's fiscal financial situation has not been messed up. The only thing that has been really messed up at this point is the fiscal policy.

Publicly I want to commend Mark Carney for continuing on with that band of inflation and his judicious and prudent use of monetary policy to achieve the best possible outcome for Canada. It is not without criticism. I am sure some members in the House would be prepared to criticize the governor on various points, but on balance, in my judgment, the governor has achieved that level of monetary stability which stands us well.

The other thing thus far that the Conservative government has not been able to mess up completely has been our financial services sector.

I recollect that when I first came here, which was back in 1997, there was an impetus on the part of financial institutions, particularly banks, to get larger, to be bigger, to bulk up, to start to be international players. They were losing their status as international players.

The pressure was on the Liberal government at the time, and particularly on the Liberal caucus and the GTA caucus, to allow banks to merge. Frankly, that was an attractive argument to many of us. I was one of them. Being from Toronto, I thought we should allow our institutions to get world-class status. I started out with the view that it would be a good idea. However, the Liberal caucus and Minister Martin had the idea that we should at least take some evidence and think about this before we allowed banks to merge.

Over the course of those caucus hearings we did change our minds, or at least I changed my mind as did a number of members of our caucus. We could see the benefit for the banks, particularly their directors and maybe some of their shareholders, but we were not overly convinced on how the Canadian public and the consumers of bank services would benefit. At the end, we decided there would be no mergers. That turned out to be a prescient decision because the banks therefore were unable to get into the acquisition of other financial institutions.

As a result of them being unable to get into the acquisition of other financial institutions primarily, which would have been American financial institutions and maybe some foreign financial institutions, they did not make a number of the disastrous decisions that came back to haunt primarily American institutions in the last few years. It was the result of a bit of good fortune, a bit of hard work and us asking ourselves the fundamental question: What was in this for the Canadian public and consumer?

The consequence of the consequence of the consequence is that the Canadian taxpayer did not have to bail out the financial services sector. Canadian taxpayers did not have to pony up moneys for that sector and therefore that crisis was avoided.

The previous Liberal administration had 13 years of difficult financial and fiscal decisions to make. I can criticize some of them, but, on balance, when Liberals left office, the financial and fiscal houses were in order. There was surplus in the accounts. Indeed, the first year of surplus for the Conservative government was largely a surplus created by the previous Liberal administration. Then there came one or two years of surplus and we started with the deficit. We now have a deficit picture that I previously described as upside down.

Now the government tells us that we should continue to trust its fiscal management, having run up a deficit in one year of something of the order of $54 billion, a cumulative deficit over the course of the next number of years of something like $165 billion. Then in kind of an interesting way, the Parliamentary Budget Officer said that there was virtually no chance the government would return to balance or surplus in the next five years, notwithstanding the protestations to the contrary by the government.

We are going to have deficits for as far as we can see. Generally speaking, we can give a reasonable prediction for two years. Heading out to five years is a bit on the remote side and there are a lot of things that can go wrong between now and then.

The Parliamentary Budget Office has described this stuff as fantasy and I tend to agree with him. The likelihood of the government ever returning to a balance or surplus is virtually non-existent.

There are two major reasons why there is no chance the government will actually return to balance or surplus. The first reason is it has destroyed the revenue bases. It is all wonderful to talk about how much fun we are having cutting taxes. The trouble is if one is to cut taxes, one also has to cut services.

There is not a corollary commitment on the part of the government to be fiscally responsible in terms of the cutting of services. It seems to want to have it both ways. It wants to run up the cost of government without any meaningful way in which to approach the reining in of costs. Simultaneously it wants to cut various revenue streams, giving ill-advised tax cuts, particularly corporate tax cuts, the result of which is deficits.

It is simple. No one can run a household or a business that way. There have to be revenues to offset expenses. If one is going to cut revenues, then one has to cut expenses. The government has not done it and continues not to do it.

Then we see the absolutely outrageous examples of how to blow money in very short order, the most significant of which was the fun and games at the G8-G20, which blew through something in the order of $1.2 billion or $1.3 billion on a weekend.

I am from Toronto and have the great honour to represent a riding in the east end of Toronto, in Scarborough, which residents there like to say is the centre of the universe. Not many people know that, but I am here to inform the House of that fact. Downtown Toronto is seen as a suburb of Scarborough.

We in the centre of the universe watched with horror, not only the spending but the image that was projected of Toronto around the world. The central image of the G8-G20 spending was burning police cars in the middle of intersections in downtown Toronto.

If ever there was some illusion that somehow or other this was going to project a good image of Toronto and all of the good things that go on in Toronto those burning police cars, those rioting people, the police in riot gear, the smashed windows of businesses and the whole ugly image that was presented was completely counterproductive to the $1.2 billion or $1.3 billion that was spent.

It does not seem to matter to the government that the government was advised well in advance by the then mayor, David Miller, and by the police chief, Bill Blair, that maintaining security, keeping security and giving security in downtown Toronto was going to be virtually impossible, that this would be an extraordinarily difficult task and it would cost literally thousands and thousands of man hours and literally hundreds of millions of dollars.

Now the bills are arriving. We got a bill in excess of half a billion dollars from the RCMP. We got a bill of $125 million from the city of Toronto police, and we have a current bill something in excess of $60 million from the Ontario Provincial Police.

Those are some significant bills and it was not as if the government was not told in advance that this would be costly and virtually impossible to do. What did it do? It essentially trashed the image of Toronto by doing something that it was advised it should not do at this location.

It is not as if it was not suggested to the government to put it in some other location. It could have put it in another secure location. It could have put it on, for instance, a military location where it could have already had security, it could have people coming and going, it could have had all the meetings that it needed to have and at the end of the day the infrastructure money would have been spent on upgrading a particular military base. I do not see what was so difficult about that.

The other thing that is really more curious than anything else is for the G8 spending the good folks in Muskoka for their time and trouble received $50 million in extras. These extras I am sure were welcomed by the folks in Muskoka. However, the same good folks in Toronto, somewhere in the order of five million people, got absolutely nothing. They got little or nothing.

Why is it that $50 million should end up in Muskoka and nothing ends up in Toronto? Toronto has the burning police car. Toronto has the smashed businesses. Toronto has the smashed windows, and Muskoka gets the gazebos. It does not seem to add up and it is a classic example of misspending and it is in some respects a typical story of why the government is in such a mess.

It has jacked up the deficit to $165 billion. That is your money, Madam Speaker, and that is my money. It has made very ill-advised decisions. It has run roughshod over the local mayor and the police chief and said, “You're going to have this conference, you're going to have it in downtown Toronto and we don't really care about your problems”. However, now the bills are starting to arrive home: $500 million plus for the RCMP, $60 million plus for the OPP, $125 million plus for the city of Toronto police, and that is not all. It is the city of Toronto taxpayers who are getting stuck with paying for the burning police car, the smashed businesses and the smashed windows.

It is an outrage the way in which the government runs roughshod over everyone. It destroys its revenue base and cannot seem to control its own spending.

Sustaining Canada's Economic Recovery ActGovernment Orders

4:25 p.m.

NDP

The Acting Speaker NDP Denise Savoie

It is my duty pursuant to Standing Order 38 to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for Bourassa, Radioactive Waste; the hon. member for Algoma—Manitoulin—Kapuskasing, Taxation.

Sustaining Canada's Economic Recovery ActGovernment Orders

4:25 p.m.

Conservative

Lois Brown Conservative Newmarket—Aurora, ON

Madam Speaker, I am always amazed when I hear members from the other side who have been in government for some time, who seem to have failed memory. Either that or it is very selective memory because I can remember in Ontario the cuts to health care, the cuts to education and the cuts to social services.

I also spent some time with members of the Canadian Navy this past summer and they talked about the significant cuts to the military and how they are only now under this government starting to see the ability to reinvest in their ships. What we saw when our soldiers were sent into Afghanistan by the former administration is they were sent in with uniforms to prepare them for jungle warfare, not for desert warfare. So what they literally did was make our military walking targets.

How does the member propose to pay for all of the promises that they keep making from the other side of the House? From our side of the House we know that if we take a look at the public accounts we will see in the pie charts that 47% of the revenue to government comes in through personal income tax and 13% comes in from corporations. So for a very incremental adjustment in lowering corporate taxes we are going to increase the number of people who are working who are paying personal income tax. That is going to be a benefit to our economy.

My question for the member is when are the Liberals going to come clean and tell us what taxes are they proposing to raise?

Sustaining Canada's Economic Recovery ActGovernment Orders

4:30 p.m.

Liberal

John McKay Liberal Scarborough—Guildwood, ON

Madam Speaker, this is classic Conservative speak. Up is down, down is up. This is the same wonderful gang that brought Ontario reams of deficits, which Premier McGuinty is slowly digging himself out from, and that was whacked and sideswiped by this recession. The same gang is bringing to Canada what they brought to Ontario; endless deficits and that the answer to all questions, including the meaning of life, is tax cuts. That is the answer to life and the hon. member says that is right. She believes it, that the whole world is going to be a whole lot better place because of tax cuts.

If Conservatives are going to have tax cuts, they had better come clean and tell people what services are going to be cut back because right now we have the worst of all possible worlds. They are running up the deficit and killing the revenue base. The consequence is deficits as far as one can see.

Sustaining Canada's Economic Recovery ActGovernment Orders

4:30 p.m.

NDP

Jim Maloway NDP Elmwood—Transcona, MB

Madam Speaker, I am very pleased that the member admitted that he was wrong for originally supporting the merger of the banks because I remember that time very well and there was a lot of pressure. Certainly the Conservatives who were the Reform Party in those days were out beating the drums for allowing the banks to merge, but to give the finance minister and the prime minister of the day full credit, they did resist that.

It is a bit of an irony because that is what saved the hide of the government when the economy went south in 2008. Had the mergers been allowed to happen, had we followed the same pattern as the United States, and we have no reason to believe that it would have been any other way, we would have seen the long-tail financial liabilities that at the end of the day the people in the United States have had to accept. Let us face it, the money in the banks is simply the people's money. It is the senior citizens in my constituency who put their deposits in the bank, and if the bank is totally irresponsible and buys financial instruments that result in huge losses to the banks, they simply take it out of the pockets of the citizens of the country in the first place.

It certainly was a stroke of luck for the government of the day to hold off allowing the banks to merge. Another reason that the government of the day was successful in doing what the current government cannot is that we had a very robust economy in those days. It was easier to do what the members have been talking about because the economy was good, but nevertheless a decent job was done.

Sustaining Canada's Economic Recovery ActGovernment Orders

4:30 p.m.

Liberal

John McKay Liberal Scarborough—Guildwood, ON

Madam Speaker, I thank the hon. member for his speech masqueraded into the question. I do agree with him.

May I say to the hon. member that it was not entirely luck, with respect to financial services. That was a fairly long and extensive hearing process the Liberal caucus went through under the chairmanship, at that point, of the member for Spadina. We delved into quite a number of areas.

One of the other interesting areas was that we kept the capital ratios up, because there was a huge pressure on the government to reduce capital ratios so that more money could be put into the system to go after loans. Of course, that is putting good money into the more dubious loans because when there is more money in the capital spending account, all the managers have to get that money out. If they do not get that money out, then they do not get to use it. And so, those things end up being done.

I might say to my hon. colleague that the Liberal approach is, so to speak, a non-ideological approach. I supported, when we had surplus, aggressive tax-cutting regimes, both personal and corporate. I think we have to have a competitive tax regime. That is just reality. We do not live in some sort of isolated universe, free from the tax rates of New York or Michigan or California or whomever our other competitors might be. We have to be competitive with those with whom we trade.

Having said that, we certainly should not enter into ill-advised tax cuts when we are running a deficit of $60 billion. There is dumb, and then there is dumber. That is in the dumb, dumber, dumbest category, that we run tax cuts and destroy our revenue base just when we are trying to dig ourselves out of a deficit hole. I throw up my hands with respect to these folks because I do not really have much hope.

Sustaining Canada's Economic Recovery ActGovernment Orders

4:35 p.m.

Liberal

Jean-Claude D'Amours Liberal Madawaska—Restigouche, NB

Madam Speaker, I would like to remind the members of the House that it was not very long ago that a good Liberal government here in Ottawa was making sure that the Canadian deficit and debt—particularly the Canadian debt—were decreasing gradually. As we all know, as our debt decreases, we pay less interest, and the less interest we pay, the more services we are able to provide to the public. Then the Conservatives arrived, trying to play God and perform miracles. In less than two years, the amount we paid down on the Canadian debt was completely wiped out, bringing us back to where we started.

What does this mean? It means that we must now pay additional interest that we were no longer paying. Additional interest payments mean that the public is getting fewer services. So who is paying the price?

I am asking my colleague to tell the Canadian public who, in the end, must pay the price for the Conservatives' mismanagement of Canada's public debt and deficit.

Sustaining Canada's Economic Recovery ActGovernment Orders

4:35 p.m.

Liberal

John McKay Liberal Scarborough—Guildwood, ON

Madam Speaker, there is a pretty short answer to that. The member will, everyone watching will, everybody in this chamber will, even the hon. member who is the chair of the finance committee will have to pay for this mismanagement.

The hon. member was not here when Paul Martin was the finance minister, but he would talk about two things. He would talk about a vicious cycle and a virtuous cycle.

A vicious cycle is when we are constantly paying our debt, the debt keeps costing us more and the faster we run, the more the debt ratchets up.

A virtuous cycle is exactly the opposite. A virtuous cycle was entered into in 1997 and it basically ended in 2007. The virtuous cycle is that when we started to pay down our debt and deficit the interest rates would go down with it, and so we could actually pay it down faster. It is a simple concept to understand. Anybody who owns a mortgage understands that if interest rates actually decline and their payments remain the same, the principal amount of the mortgage goes down more quickly. That is a virtuous cycle.

The current government has reversed that. We are now in the vicious cycle. We have ratcheted up the deficit and interest rates are sure to follow.