Debates of Sept. 29th, 2011

Opposition Motion--Canadian Economy

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

Mr. Speaker, it has been a pleasure working with my hon. colleague in terms of both the pre-budget consultations and the finance committee.

What we perhaps need to recognize is that all the programs and opportunities that I have just talked about are in the budget. These are in phase two of the economic action plan. It is hardly an austerity program when we maintain increased health care spending to the provinces. It is hardly an austerity program when we maintain our transfers for social services and education.

Like everyone, we want the employment numbers to improve. The best way for employment numbers to improve is for businesses to have confidence and be competitive in a worldwide environment where they are going to want to spend their hard-earned money. The finance committee this morning heard about the importance of having a really competitive tax environment for businesses to invest in.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, when I reflect on the government's policy, in terms of priorities it was not that long ago when it said its first priority was to give huge tax breaks to corporations.

I listened to the member speak. We were talking about jobs and the need to create and generate jobs here in Canada. The government seems to be downplaying infrastructure jobs.

My question to the member is this: does she not recognize that, depending on what government does with its potential to generate revenue and how it spends its money, in certain areas more jobs can be created through creating infrastructure than by handing down a tax break or something of that nature? In fact, a good way to increase the number of jobs is through infrastructure and construction jobs. Sometimes investing in infrastructure programs will deliver more jobs than a corporate tax break. Would she not agree with that?

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

Mr. Speaker, again I have to reflect back on what has happened over the last couple of years, when extraordinary support was given for infrastructure across Canada. In my riding, there were roads, sewers and water. There were unprecedented expenditures in that area.

I also look at what is happening going forward with the building Canada fund. That fund still exists and is something that municipalities look forward to. Let us not forget about the gas tax. For the first time, municipalities are going to have a source of revenue for their infrastructure that they can count on.

We absolutely believe that infrastructure is important; we also believe it is critical to have a competitive tax environment to create jobs in this country.

[John Weston, Conservative, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

Mr. Speaker, I have a question related to the one just asked by the Liberal member.

Bertrand Russell said that not only does the heart affect language, but language affects the heart.

Time and again we hear our colleagues across the floor talking about these tax breaks as if people are giving money to corporations.

I would ask my colleague to remind us that these companies, which create jobs, are still paying taxes, and the more revenues they make, the more taxes they pay so that government services can be provided.

I know it is a very simple thing, but I think that thought gets lost in their rhetoric. Perhaps the member could elaborate on that.

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

Mr. Speaker, that is a very important question. It not only is about the industries putting back, but people also often do not follow what happens with the profits from our corporations. Those profits from our corporations are part of what funds our Canada pension plan and part of what funds the investments of our grandmothers' RRSPs. They count on companies that are successful in Canada.

If companies are profitable and can make more money, they pay more taxes. Ultimately, what we have to ask is what happens to those profits, and they help everyday Canadians in many ways.

[Mike Sullivan, NDP, York South—Weston, ON]

Mr. Speaker, in her statement the member suggested that the Conservative government is investing heavily in research and development, and we applaud that investment. I do not remember voting against it, though I know the government bundled it all together into a big thing. When it bundles things together and says we voted against specifics, it is difficult.

My concern, though, is that the member referred to the forest industry being given $60 million to innovate and tap into new opportunities abroad. We know there is a lot of research and development done in Canada, and there are examples in Canada of research and development being done in the country and the manufacturing being done outside the country. The best and the most heinous example of that is Nortel, and we know where that went.

What do you say to that kind of approach? Is it right to be spending the money on R and D here and then shipping the jobs elsewhere?

[The Acting Speaker, Conservative, Barry Devolin]

I would like to remind all hon. members that comments and questions are directed to the Chair and not to their colleagues. I know this is an unusual structure for some.

The hon. parliamentary secretary.

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

Mr. Speaker, I think there are two important things to look at here. One is that the Forest Products Association of Canada put the highest priority on that particular fund in terms of encouraging innovation.

When I talk about abroad, I am talking about the development of markets. One of the companies in my riding of Kamloops—Thompson—Cariboo, for the first time ever, was looking to ship its products over to China. We are talking about expanding markets, which is absolutely critical for our forestry industry and its ability to innovate at home.

[Robert Aubin, NDP, Trois-Rivières, QC]

Mr. Speaker, I thank the member for her presentation. I would like to reassure her and say that the fact that we do not vote with her every time does not mean that we do not understand the government's proposals; it means that we believe that we can do better by doing other things. In this regard, I read a study about inequality released this summer by the IMF. It indicated that the more equitable the distribution of income, the longer and the more stable the periods of economic growth.

In light of this study, I would like to know how the member justifies the government's policy, which consists of giving gifts to big business, gifts that end up in investors' pockets and not in our country's economy.

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

Mr. Speaker, again I thank the member for asking what I think is a very important question.

The best thing we can do for Canadians to change the distribution of wealth is to create jobs. That is what phase two of our economic action plan would do. We know that providing people with opportunities to have the jobs they want and need is the best thing we can do for Canadians and for the economy.

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Mr. Speaker, first, I would like to mention that I will share my time with my colleague from York South—Weston. You will no doubt be happy to know that I will not be reading from a newspaper today, so I should not have any problems with this speech.

I know that this debate has to do with the economy and job creation. I am going to assume that our colleagues on the government side are interested in creating jobs. We are as well. However, what we hear a lot from the government is rhetoric, slogans or mantras claiming that there is a direct correlation between tax cuts—particularly corporate tax cuts—and job creation.

Let us be clear. There are a number of ways to create jobs. There are a number of ways for the government to stimulate the economy and create jobs. Tax cuts may be one way, but there are also other ways, such as investing in infrastructure, redistributing wealth or making direct investments to benefit low-income households or the unemployed. All of these measures will have very different effects on economic recovery and economic stimulus. These are effects that can be assessed, and this has been done by the Department of Finance, so by a government department.

A few of these measures were evaluated based on their multiplying effect on the economy. For example, the Department of Finance determined that for each dollar of corporate tax cuts, approximately 30 extra cents would be added to the GDP. That is the least effective measure of the six evaluated by Revenue Canada. One of the most effective measures involves direct help for the poorest households or the unemployed; for each dollar invested this way, $1.70 is added to the GDP. In terms of infrastructure investments, $1.60 is added to the GDP for each dollar invested.

And for measures related to housing investments, $1.50 in economic growth is generated for each dollar invested. These measures have very different effects. Some are more successful and promising than others. Corporate tax cuts are the least promising and successful.

This is easy to understand. Direct measures to help low-income families and the unemployed generate so much economic growth because the money is immediately invested in the economy. Households need this money to invest directly because they have no money to save. It is invested directly into the economy. Investing in infrastructure or housing is just as easy to understand. It creates direct jobs and allows private businesses to benefit from infrastructure to make the economy work.

These three measures have direct, positive impacts on the economy. When it comes to reducing income tax, the impact is extremely weak. Can corporate tax cuts help the economy? In certain cases, yes. Take, for example, a private business that does not have the cash needed to make investments. It wants to invest in the economy but does not have the money to do so. At that point, income tax and corporate tax cuts will generate the money it needs to be able to invest.

However, that is not the current reality. The liquid assets the private sector currently has available, in dividends, investments or funds set aside, have increased, going from $157 billion in 2001 to $477 billion today. Let me be clear: Canadian companies are currently sitting on a mountain of $477 billion. That is money they could be investing. It is an increase of $320 billion in 10 years. Of that $320 billion, I would like to specify that roughly $120 billion comes, once again, from the Canadian public purse through the corporate tax cuts enacted by the previous Liberal and Conservative governments.

What are the corporations doing with this $477 billion? They are not investing it right now. Why not? There are a number of reasons that we will not necessarily get into at this time, but the economic context is such that they have decided not to invest.

What impact will corporate tax cuts have on the Canadian private sector? They will not lead to more investment. If the profitable corporations are currently not investing, if they find the current context not suitable for investing the $477 billion they have today, not to mention the additional revenue they will earn, then they will see no additional reasons to invest.

That is why corporate tax cuts are not the best approach in the current Canadian economic context. However, it is the only significant way the government has found, with what it calls the low tax agenda, to stimulate the Canadian economy. The Department of Finance has clearly stated that corporate tax cuts have no impact on job creation. The proof is in budget 2009, budget 2010, but not in budget 2011. We can presume that the government was too embarrassed to add those cuts in budget 2011. Budgets 2009 and 2010 clearly show that corporate tax cuts have no impact on job creation. I repeat: they have no impact on job creation. And the government has no proof that a single job has been created as a result of its corporate tax cut initiative.

What impact will this have on the Canadian treasury? We are talking about a loss of $4 billion to $6 billion this year. That is a loss of approximately $10 billion to the Canadian treasury over two years. That $10 billion was not invested; rather, it has helped to build the mountain of cash on which private companies are now sitting. In the past 10 years, we are talking about a net loss of $120 billion to the Canadian treasury. This money could have been invested in infrastructure rather than transferred to companies where it is not doing any good.

We are currently talking about an infrastructure deficit of approximately $100 billion. The hon. members for Quebec know that there are striking examples in Montreal. We need to invest to replace the Champlain Bridge. This summer, we saw the news about the Ville-Marie tunnel; this is symptomatic of the state of our infrastructure. This type of problem exists in the larger centres and in my riding of Rimouski—Neigette—Témiscouata—Les Basque, where I spent the summer meeting with municipal councils. I have 39 municipalities in my riding and most of them need infrastructure, whether it be recreation centres, new municipal offices, road infrastructure or water systems. There are pressing needs. We are talking about $100 billion for Canada.

According to Revenue Canada's figures, the money that is currently being given to companies so that they can add it to their mountain of cash—the money that is not being used for anything—could be invested in a more beneficial manner.

Let us be clear. If companies want to invest, they can do so. They are currently in a position to invest but they choose not to do so. They are not going to choose to invest more and create jobs if they are given tax breaks such as the ones the federal government gave them in previous plans.

According to the Department of Finance's figures, the NDP's program is much more effective in terms of stimulating the economy and creating jobs. We are talking about investing in infrastructure and providing direct support to low-income households and unemployed workers. These are measures that will help to increase employment. The direction that the Conservatives are taking and their failure to act are putting us in an increasingly perilous situation, as demonstrated by the warnings from financial firms, banks and the International Monetary Fund, among other things.

By adopting the NDP's plan, we would be going in the right direction; we would be creating employment and stimulating the economy. I would like to invite the government to go in this direction, specifically by voting in favour of the motion put forward by my colleague, the finance critic.

[Shelly Glover, Conservative, Parliamentary Secretary to the Minister of Finance]

Mr. Speaker, I would like to ask a very clear question, and I hope our colleague can give us a clear answer.

The NDP and our government clearly disagree when it comes to taxation. The NDP wants to raise taxes on Canadians, and we believe in lower taxes. This was demonstrated when our Conservative government reduced the GST twice, from 7% to 6%, and then again to 5%, thereby easing the tax burden on Canadian households.

The NDP voted against lowering the GST both times. It is even proud of its position. This is what the current NDP finance critic had to say:

“Cuts to the GST take us in the wrong direction. I am very proud that our caucus stood opposed to that”.

Is the NDP still proud of its vote against cuts to the GST? Does the NDP still believe that lowering the GST was a bad idea?

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Mr. Speaker, I am very pleased to answer this question because what she said is true. It is not just the NDP that has said so. Most serious Canadian economists have shown that if stimulus and economic recovery were the goal, lowering the GST was probably one of the least effective ways of achieving it.

The Conservatives should have lowered income taxes, but we did not have that debate. Cutting taxes would have been a much more effective recovery measure. Decreasing the GST from 7% to 5% reduced federal tax revenues. This contributed in great part to the fact that, between 2006 and 2011, we slipped into the red: the federal government went from a $13 billion surplus to a deficit even before the recession.

Cutting the GST was probably the worst measure that this government could have adopted. It was a purely political move that did nothing to stimulate the economy or promote recovery.

[John McCallum, Liberal, Markham—Unionville, ON]

Mr. Speaker, I would like to congratulate my colleague on his speech. I have a question to ask him about the government.

As we know, the budget was tabled eight months ago, in February. The Conservatives seem to think that nothing has changed. In fact, last February, the world was in fairly good economic shape. Now, the opposite is true. The global economy has been dealt a serious blow.

How can the Conservatives believe that a policy that was appropriate 10 months ago, is still appropriate today, when the circumstances have changed dramatically?

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Mr. Speaker, I thank my colleague for his very relevant question.

I feel as though we are in Groundhog Day today. This situation reminds us of what we went through before 2008, when the federal government was hiding and denying that we were about to enter an economic recession. Today, the same government is still blind to the fact that we are about to enter a recession. It is not the NDP saying this. The majority of financial and economic institutions are saying that we are in danger of soon heading into a recession and that immediate, concrete measures to stimulate the economy are necessary.

The Minister of Finance seems to have his head in the sand and, as he did during the previous recession, he is denying that there are problems that require solutions other than slogans or mantras. Some facts are even substantiated by his own department, so it appears that he does not read the documents.

[Mike Sullivan, NDP, York South—Weston, ON]

Mr. Speaker, I rise in support of the motion presented this morning by my colleague from Parkdale—High Park. I would like to thank her for her excellent work. I represent a riding which is a perfect example of the need for immediate action on the economy. The Conservatives say that they have a jobs plan and that it is working. That is just not true, and is nowhere more evident than in my riding.

The riding was once the proud home to much of the Canadian manufacturing industry. As we have heard this week, Ontario has lost 300,000 manufacturing jobs in the recent years. York South--Weston had: Canadian Cycle and Motor Company; Moffat stoves; McClary appliances; Massey-Harris; de Havilland; Fruehauf; Scott-Woods; Canadian Gypsum; MacMillan Bloedel Limited; A.P. Green; Dominion Bridge Company; Ferranti-Packard; Kodak Canada; Levis; Crosley Radio and Television; Schnier; Carl Austin; Acme Screw and Gear; Pepsi-Cola; and lots more. They are all gone.

Tens of thousands of good manufacturing jobs are now lost. Some companies went out of business, some went elsewhere in Canada and some began manufacturing in the U.S. or overseas to take advantage of cheaper labour. No one in the government did anything to try and stop them. Therefore, with all these jobs lost, what remains are service sector jobs at minimum wage or unemployment.

My riding has 25% higher unemployment than anywhere else in Toronto and Toronto's unemployment is already higher than the national average, currently at 8.9%. Cuts to Service Canada offices in such a needy area will make the difficult task of accessing employment insurance and other services provided by these offices even more so.

In addition, my riding is home to a population which is nearly 60% immigrant and over 10% of the people in my riding are not yet Canadian citizens. Immigrants have a much more difficult time finding work, as language and other barriers are more difficult to climb for them. Recent cuts to immigrant services by the Conservatives has had a devastating impact on settlement service agencies and other community agencies that assist these immigrant populations. Further cuts by the government would make an already intolerable situation much worse.

The government frequently points to its record in infrastructure spending as having successfully reversed the recent recession. It is not so in York South—Weston.

First, there was virtually no infrastructure spending in my riding. Most of the projects were for the city of Toronto to replace some water mains. The total spending was well under $5 million and well under the $50 million spent in Parry Sound—Muskoka. We received perhaps 100 temporary jobs, no permanent infrastructure jobs. That did not make much of a dent in the 7,000 or so people who are currently unemployed in the riding.

The spending spree is over but the problem persists. The unemployed in my riding sometimes are lucky enough to find jobs outside the riding. However, without investment and transit infrastructure, these folks spend as much as four hours each day commuting to work. Plans for a new light rapid transit system were recently shelved and the federal government did not offer any contribution toward its construction.

Here is a great example of where the government could be creating local employment and helping the economy of Canada generally. I have long advocated the use of electric trains for regional rail services in Toronto. The government could both contribute to greenhouse gas reduction and economic development by providing infrastructure funding for electrification of rail services. The current plans for diesel trains, some of the money coming from the federal government, has neighbourhoods angry. Provincial leader Andrea Horwath of the NDP has made electrification of rail services a part of her strategy for carrying Ontario forward. She said:

New Democrats won’t put people’s health at risk by sending dirty diesel trains through people’s backyards. We'll take a new, cleaner, greener approach and use electric trains from the get-go.

We would like to see that part of the strategy for moving Canada forward. Therefore, we continue to have productivity sapping road congestion with no alternative and no vision for one.

The national public transit strategy put forward by my colleague from Trinity—Spadina is a way to encourage the Conservative government to take a more active role in helping build the infrastructure we need and create jobs. Cutting back on public transit funding, if that is part of the upcoming austerity plan, is taking Canada backward.

A huge proportion of the unemployed in the riding are young people. For them, the unemployment rate is significantly higher still. None of the measures put in place by the government has helped them secure family-supporting jobs.

These kids are part of a group that service agencies call “the Mike Harris generation”. They are the kids whose mothers and fathers were punished by the Conservative government in Ontario in 1995 with huge cuts to their support systems. These kids have learned that governments are the enemy, that governments punish them not help them. In desperation, some of these kids turn to criminal activities. The government's answer is to build jails. That way at least part of the social housing crisis would be taken care of.

What is wrong with Conservative economic policies is that they are not forward looking. Steady as she goes, doing the same thing we did last year allows other countries the opportunity to leapfrog over Canada in the race to be on the leading edge of economic growth.

For example, we all know that carbon-based fuels are a finite resource. We are all concerned about air pollution and climate change caused by burning fossil fuels in ever-increasing quantities. We all know that creating and harvesting alternative sources of energy as well as becoming more energy efficient will be important activities for any country to move forward. However, the Conservatives will soon end the energy efficiency credits for homeowners yet they have done nothing to spur investment in green energy technology.

There are huge demands for windmills and solar panels but most are built in other countries. We are not investing in Canadian-made electric trains for regional and long distance service. We should be leading the way. That requires decisive action by the government.

Many of my constituents are seniors living on fixed incomes. Their costs keep rising. They would love to make their homes more energy efficient. The jobs that might be created to do this work would be sorely welcomed in the riding. However, the uncertainty of the assistance available from the government makes this another temporary solution.

I recently met with the president of Greensaver, a Toronto-based energy retrofit company that pioneered the idea of an energy audit to show where savings would be best in a home. It assembled a team of trained workers to install solar water heating systems but had to lay them off when the government assistance dried up. Companies need predictable long-term programs not makeshift temporary plans.

The Conservative government has made quite a few comments about how raising taxes on big businesses would kill jobs. That is not true. We are not asking for a raise in taxes, just to reverse the tax breaks. Tax breaks given to large corporations by the Conservatives have gone directly to increase the profits of those already profitable corporations. They are not creating jobs. In turn, these excess profits are used to line the pockets of the directors and shareholders of these corporations. These tax breaks are not linked to job creation but to increasing profits. If members do not believe me, here is a quote which backs up my assertion:

The Leader of the Opposition has called for an increase in taxes on these very same enterprises from 15% to 19.5%. That means that the after tax profits, which come from these companies and go directly into the pension fund of the workers the member purports to defend, would be reduced.

It does not state that jobs would be lost. Rather, it states that profits would be reduced.

Who said that? It was the Parliamentary Secretary to the Minister of Transport, Infrastructure and Communities and for the Federal Economic Development Agency for Southern Ontario.

As my colleague from Beauharnois—Salaberry has stated, the NDP does not wish to raise taxes. We merely wish to reverse the Conservative tax giveaways to already profitable corporations. The government has admitted that its tax giveaways went directly to profit levels not to creating jobs.

[John Weston, Conservative, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

Mr. Speaker, yet again my colleague has shown the NDP acerbic skepticism toward profits as though profits were evil. He somehow uses a deft hand to say there is a difference between raising taxes and cancelling taxes that have been previously reduced.

I have a question for the member. Yesterday, the European Commission made a proposal to the 27 member states of the European Union concerning a new measure to tax financial transactions, which would mean that many common financial and banking transactions would be taxed. That is an idea that the NDP has traditionally supported. In fact, the NDP's industry critic and co-chair of the NDP caucus, the member for Burnaby—New Westminster, once introduced a bill to tax financial transactions in Canada.

What does my friend, the member who just spoke, think about that?

[Mike Sullivan, NDP, York South—Weston, ON]

Mr. Speaker, the banking industry in Canada is already on very secure footing as the result of years of maintaining regulations.

I know the Conservative government members opposite do not like regulations and would like less government. However, we have a solid banking industry in this country. Part of the reason for that is all parties have resisted attempts by the banking industry to deregulate itself. When the banks wanted to merge we said no.

With regard to the NDP hating profits, that is not the case. We understand that corporations need to be profitable in order to survive. They need to be able to show a return to their investors.

We are concerned that already profitable corporations are being given a handout by the government's reducing the amount of taxes they pay. What happens when the government reduces the taxes that are paid by already profitable corporations? It does not create jobs, as the minister has agreed. It increases their profits and decreases the amount of money available in the Canadian revenue stream, which then increases the pressure on the government to either reduce services to Canadian citizens or to raise personal taxes in order to compensate by an equivalent amount, billions of dollars.

We are opposed to that.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, the member made reference to the manufacturing industry. It is an industry that has been hit in terms of phenomenal numbers, tens of thousands, not only in Ontario but in provinces across the country.

On the policy front, the Conservatives have dropped the ball on the buy America provisions. We encourage the Conservatives to take a stronger stand because this has an impact on our manufacturing industry more than on any other industry across Canada.

Would the member agree that a buy America policy hurts manufacturing jobs? The types of jobs the member referred to involve export to other countries, especially the United States. Therefore, when there is a buy America provision, it prevents consumers from purchasing those items that are important, that generate and create the types of jobs that he is talking about protecting.

Would the member agree that the Conservatives have dropped the ball on that issue?

[Mike Sullivan, NDP, York South—Weston, ON]

Mr. Speaker, I agree that the buy America policy will in fact hurt Canadian jobs.

We have some buy Canada policies, particularly in the provinces. The Liberal government in Ontario has waived that policy for the purchase of diesel trains for the air-rail link in order to buy the trains from Japan.

[Peggy Nash, NDP, Parkdale—High Park, ON]

Mr. Speaker, my colleague spoke earlier about the importance of infrastructure investment. He and I share neighbouring ridings.

Could the member explain how important it is to have infrastructure investment in shovel-ready projects, for example, on clean electric trains in our neighbourhoods so that we do not have diesel trains running throughout our communities?

[Mike Sullivan, NDP, York South—Weston, ON]

Mr. Speaker, the federal government launched a project some years ago to create a corridor through both of our ridings that would carry 464 diesel trains a day.

Both the communities and the community activists have opposed the notion that diesel trains should be the way that these commuters would travel through our riding.

We need action on the part of the federal government to support the creation of an industry that would build these electric trains and insist that this train corridor be serviced by only electric trains.

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

Mr. Speaker, before I begin my speech, I would like to say that I will be sharing my time with the member for Markham—Unionville.

Throughout the country, growth is slowing down, jobs are being lost and there is record unemployment among youth. A government's main task is to ensure prosperity, not only for our country, but also for every Canadian. No one should be forgotten.

The Prime Minister believes his plan to rebuild our economy is very easy. It involves cutting corporate taxes and reducing the government's role. This means cuts and job losses, but the government should be focusing on preserving and creating jobs.

As the party that put the Canadian economy back on track on the heels of poor Conservative fiscal management, we know what it takes to deal with a debt crisis and a deficit. It takes fiscal discipline along with growth and healthy revenues. In other words, people need to be working.

How do the Conservatives respond to all of this? They cut corporate taxes and the government's role. If you are worried about losing your job, the government thinks it is your problem. If you have already lost your job and cannot find another one, the government thinks it is your fault.

Unlike this government, the Liberals are focusing on policies that ensure prosperity, growth and jobs. We are here to say, as has been said in other eras when unemployment was high and times were tough, that it is the government's responsibility to work with companies, large or small, to increase business opportunities, give hope, and provide more opportunities for change and development.

Canada's economic prosperity has always depended on strong international trade. Under the Conservative government, Canada is now seriously lagging behind on the international scene. A significant rise in job creation will not come without a serious effort focused on international trade.

Canada's trade deficit with the rest of the world was $753 million in July 2011. That was our fifth consecutive month with a trade deficit. Since January 2009, Canada has only had nine months of trade surpluses, but 22 months of trade deficits.

The Conservatives' failure to act has led to a contraction of the Canadian economy at a time when we simply cannot afford it. Our real gross domestic product fell by 0.1% in the second quarter. This latest decline in the GDP is a good indication of the ineffectiveness of the Conservative plan, which focuses too much on corporate handouts that are not reinvested, instead of focusing on Canadians and their needs, such as job creation, education, professional training and health care.

Young people are especially affected by the government's failures and its inaction when it comes to the things that matter the most. Statistics on the high youth unemployment rate this summer prove that this government did nothing to create the jobs students needed precisely when they were trying to save money for the upcoming school year.

This summer, for instance, the average unemployment rate for students aged 15 to 24 was 17.2%, up from 16.9% in the summer of 2010. As a point of comparison, the unemployment rate in the summers from 2006 to 2008 was below 14%.

Another sector that suffered this summer was tourism, which this Conservative government consistently neglected. Worse still, this government even made decisions that were extremely detrimental to the tourism industry. We are already going through very tough economic times, and the Canadian industry cannot survive if this government brings in policies that undermine entrepreneurs.

From eliminating the GST visitor’s rebate, to hiking the air travellers’ security tax by 55% for foreign flights, to refusing to send a Canadian pavilion to Expo 2012, this government has done nothing but hurt Canada’s tourism Industry. Foreign tourism is a very lucrative source of revenue on which the various levels of government in Canada and hundreds of Canadian communities rely, and those communities deserve federal leadership to help bring tourists to our shores.

But the Conservatives' attack on employment extends far beyond tourism and young people. Small businesses have also been completely ignored by the Conservative government. Small and medium-sized business owners and municipal leaders are absolutely shocked that Canada will not have a presence in South Korea for Expo 2012, when South Korea is such an important trade partner for Canada. Our 2010 Expo pavilion in Shanghai saw over 6.4 million visitors and facilitated 46 high-level business meetings that generated many agreements and partnerships.

The Conservatives prefer to ignore all that because making cuts is more important to them than maintaining and creating jobs. The lack of skilled workers, the need for more investment in infrastructure and the increasing burden of red tape are a constant source of frustration for small business owners. The only thing holding a number of them back from expanding is that they cannot find the skilled labour they need. What is more, after three years of promising to cut red tape, all this government has done is conduct another study. We need measures right now because Canadians need jobs right now.

Since this government is more concerned with its ideological beliefs than the needs of Canadians, it is not surprising that the Conservatives have completely shirked their responsibilities in a number of recent developments with our trade partners, which could have an adverse effect on Canadian businesses and workers.

The government was asleep at the switch when President Obama announced the provisions of his “Buy American” policy in his economic recovery plan earlier this month. It was taken by surprise even though, in two speeches before the bill was tabled, the President clearly indicated where his administration was headed. The so-called exemption for Canada in 2009 was clearly ignored in the $400 billion plan proposed by President Obama. The consequences for Canada will be serious and the Conservatives' incompetence in this matter is unacceptable.

With the “Buy American” policy promoting the purchase of American products, country-of-origin labelling for agri-food products, and the Canada-U.S. tax treaty, Canadian interests have been systematically ignored by the Americans and the Conservative government has not done its job.

It is high time to focus on what is important: jobs. No miracle will save Canada from the troubling economic situation in which it finds itself. The government must invest in people, in our infrastructure, and in our capacity for research and development. The government must invest in helping needy Canadians rather than wasting taxpayers' money on punitive laws that will not make our streets safer and on fighter jets that Canadians do not need.

[Anne-Marie Day, NDP, Charlesbourg—Haute-Saint-Charles, QC]

Mr. Speaker, I would like to congratulate the hon. member on his speech.

The labour market is currently weaker than it was before the October 2008 crisis. The number of full- and part-time workers who are looking for full-time work has increased very rapidly. Quality, full-time jobs that allow families to make a living are very hard to find in many regions of the country.

Can the hon. member tell us how things are going in his riding?

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

Mr. Speaker, at the beginning of my speech, I gave some figures that showed that the unemployment rate across Canada has increased. In my riding, things are no different. A good full-time salary is not the same thing as a part-time one. If the full-time salary is not good, the part-time one is not going to be either. This is affecting people across the country.

In my riding in eastern Montreal, we definitely have problems. People are working two or three jobs and are still not earning as much as they did at their regular job. We spoke today about jobs that were lost in the manufacturing industry—an important industry—and that have not been recovered.