Madam Speaker, before addressing some aspects of this bill, I would like to congratulate my NDP colleagues for their clear and pertinent suggestions in response to the government's empty proposals.
In my presentation, I will be using some words that the Conservative government hates, such as “tax”, “poverty” and “social programs”. Canada is not far behind the U.S. when it comes to the dubious distinction of having the largest gap between rich and poor, and the provisions of this bill will make no difference. This trend is the result of changes in both markets and government policy. It is worrisome not only in terms of intergenerational equity and equality among people, but also because of the quality of life and economic development issues.
Income disparity between rich and poor has increased more quickly in Canada than in the United States over the past 15 years and, with the arrival of this Conservative government, became even more noticeable. Among developed nations, the American society is the most unequal, more so than the United Kingdom, Italy, Australia and Japan. Canada comes next, in fifth position, where the richest get 40% of revenues and the poorest 20% of the population only gets 7% of the income.
This growth in income disparity is not unique to Canada. It is prevalent among countries that have adopted neo-conservative policies over the past few years. Experts say that this phenomenon is related to the set of factors at play in market forces and to the institutional framework. Some of the market forces involved are globalization of the economy, which leads to low-skilled workers in rich countries competing against those in poor countries. The initial result is that, in the case of the former, there are job losses and salary reductions. I will come back to salary reductions and the loss of purchasing power by Canada's middle class. Technological change also contributes to this trend. However, I would like to focus on the nature of neo-conservative policies.
One of the most frequently cited factors related to the institutional framework is the weakening of unions. The balance of power between workers and employers has been eroded in recent years. We need better unions to ensure better social justice in Canada. Mechanisms for the redistribution of wealth—such as taxation—that ensure that all wealth does not flow into the same pockets, have been weakened. Social programs are another means of redistributing wealth.
I will speak about unemployment and give a few statistics. I know that our friends across the way like to pat themselves on the back. I know that they live in a bubble and see everything through rose-coloured glasses. There is a crisis all around us in western economies. The United States has an astounding amount of debt and is almost unable to pay it back. Every day, Europe is on the brink of a crisis and here in Canada, they are boasting, saying that everything is going well, saying that the economy is humming. But their bubble could burst at any moment. The Conservatives' illusions are very fragile.
I want to come back to the issue of unemployment. If we were to ask the Conservative members how many people in Canada are unemployed, I am not sure that many of them would be able to give the exact number. But here it is: 1.5 million people in Canada are unemployed. There was a significant increase in July. If we count all the people who are looking for work and those who are receiving employment insurance benefits, the unemployment rate is 11.1%. In July, that rate was 9.4%. But they are saying that everything is fine, so nothing is being done about it.
They say that cutting corporate taxes will create jobs. That is not true. It is entirely untrue. The facts complete disprove such claims.
Just look at the example of Ontario, where the combined federal-provincial corporate tax rate was cut by 45% between 1999 and 2010. During this same period, investments in equipment and machinery dropped from 8% to 5%. The money these companies saved in taxes was not reinvested in the economy, did not create jobs, and was not used to buy machinery. Where did this money go? It went into hedge funds. It went into speculative bubbles. And what happens to bubbles? Sooner or later, they burst.
I want to come back to the issue of unemployment. The Conservative government keeps repeating that we have recovered from the recession. The official employment rate in 2011 was 61.9% and 63.4% in 2007. We have not yet reached the pre-recession employment rate. It is clear that the Conservative strategy of doing nothing is not exactly helping kick-start the economy.
“Inequality, poverty and the middle class”—that is the title of this part of my speech which, I am sure, our friends across the way are extremely interested in. I see one who seems quite interested.
Inequality has increased in Canada because the income of the wealthy—and, even more so, of the very wealthy—has increased faster than all other groups. The gap between the average of the richest 20% and the poorest 20% in Canada also grew from $92,300 in 1976 to $117,500 in 2009.
The gap between the rich and poor does not speak to the situation of middle-income Canadians. It appears that this group did not fare much better over that time, according to the Conference Board of Canada [an organization that is generally well respected by the government]. The median income of Canadian households increased from $45,800 in 1976 to $48,300 in 2009, which represents a very modest increase of only 5.5% over 33 years.
The middle class is what drives our economy. Middle-class Canadians from Montreal's south shore were told today that, not only would their purchasing power not increase, but they would have to pay a toll every day when they cross the bridge to go to work. What an excellent way to encourage the middle class and to help Canadians get out of debt. I have not mentioned it yet, but household debt is skyrocketing; we have one of the highest rates of the OECD. Instead of coming up with solutions to increase the purchasing power of middle-class households, the government is putting tolls on bridges.
If I were in their shoes, I would be very discouraged by today's announcement. It will cost them $50, $60 or $100 a week just to go to work. That is unbelievable. Why were things simpler in the past? We built a bridge and people crossed it. Now the government is coming up with all kinds of stories. It is trying to convince Montrealers that it is paying for a bridge for them. The federal government will not be paying for this bridge. It is the people of Montreal and of the south shore who will end up paying for it.
This brings me to the end of my speech, as I am sharing my time with the hon. member for Hamilton Mountain.