That, in the opinion of this House, the government should: (a) take immediate action to promote job creation and address the persistently high unemployment rate among Canadian workers, particularly high among young Canadians, in the context of the International Monetary Fund prediction of yet higher unemployment rates in the future unless swift action is taken; (b) take immediate action to ensure all Canadians can rely on a stable and guaranteed pension as they plan their retirement in a period of record household debt and declining stock markets; (c) take immediate action to fix the crumbling infrastructure essential to our economy and the security of Canadians; and (d) maintain the full public sector contribution to the Canadian economy so as to take advantage of low interest rates, undertake strategic public investments, increase Canada’s competitiveness, avert another serious recession and create jobs in Canada.
Mr. Speaker, I stand today to introduce the first opposition day motion in this parliamentary session.
Over the past few months, the Conservatives have continued to boast about Canada's economic recovery, even in the face of economic turmoil abroad and stagnating growth here at home.
Canadians know that the government's assurances do not reflect reality. We have lost far too many good quality jobs that made it possible for families to make ends meet. Canadian families' budgets are becoming tighter and tighter because of debt. Furthermore, international economic stability and the very slow economic growth are threatening to plunge us into a new recession.
The primary economic problem facing Canadians right now is not government debt, but slow recovery and the weak job market. The Conservatives' plan to cut spending will make the situation worse instead of better.
We, in the official opposition, know that now is the time to make strategic investments to promote economic growth and attack the real deficit: the jobs deficit. Canadians are tired of talk. What we need now is action. The Conservative government must reconsider its failed approach of something for nothing corporate tax and spending cuts and, instead, put in place a jobs plan, a plan that gets Canadians back to work.
The job market is currently more fragile than it was before the October 2008 crisis. The unemployment rate has risen to 7.3%, while the number of part-time workers and the number of workers looking for full-time employment has increased very rapidly. Quality, full-time jobs that allow families to make a living are very hard to find in every region of the country.
The actual unemployment rate, which includes discouraged workers who have left the labour force and part-time workers who would like to be working full-time, was 11.1% in July 2011, a very significant increase over the July 2008 rate of 9.4%.
In fact, despite the government's repeated boasting about its jobs record, close to 1.4 million Canadians remain unemployed. When people lose jobs, it is a tragedy for those individuals. When we include those who have become discouraged by weak job prospects or who are underemployed, that number rises to close to two million, two million individual tragedies. That is two million Canadians for whom the government's boasting is just a slap in the face.
The lack of progress in getting Canadians back to work is disappointing to say the least. If today the same proportion of Canadians were working as before the 2008 economic crisis, 420,000 more Canadians would have jobs.
The IMF recently predicted that Canada's unemployment rate will rise this year and that in 2012 our economy will grow far more slowly than anticipated.
To make matters worse, only 39.6% of the officially unemployed qualify for unemployment insurance, even if they had paid into the program themselves, which means that only two out of five Canadians are actually qualifying for the benefits that they have paid for, and only 26.8% of the real unemployed are covered by EI benefits. Canadians are facing both rising unemployment and decreasing EI coverage, adding insult to injury.
At the same time, household debt has hit record levels of 150%, leaving families struggling to make ends meet.
The government's lack of leadership on job creation has real economic costs. Our lower unemployment rate today represents lost wages alone of more than $20 billion, not to mention the billions of dollars in economic stimulus and tax revenues that go along with them.
What is the result? Our economic growth has become stagnant. Economists in all areas have lowered their forecasts with regard to Canada's economic growth. The Conservatives' budget is thus based on growth projections that are no longer realistic.
The BMO deputy chief economist has noted that even if Canada and the U.S. avoid another recession, Ottawa will fall far short of the estimates for growth in the finance minister's last budget.
The Conservatives claim that the solution to all of this is simply more of the same failed policy of no strings attached tax cuts for the same wealthy corporations. However, with the money they have received in tax breaks, large corporations have invested outside of Canada, have paid themselves, their executives, exorbitant bonuses, and have moved good-paying, quality Canadian jobs overseas. Canadian corporations today are sitting on $500 billion, $120 billion of which is through corporate tax cuts, at a time when the economy is in dire need of investment.
Instead of excusing itself because we are doing better than sicker economies in the G8, the government must put in place policies that encourage private sector investment in our economy here at home. If we want others to express confidence in the economy, we must take the lead by investing in the economy, not by cutting billions of dollars in public spending. Economists agree that it is the wrong time to take money out of the economy.
Doug Porter of BMO told the finance committee this week that recent drops in government bond yield rates are a sign that financial markets are stressed about economic growth prospects, not government deficits or inflation.
The Conference Board of Canada has also emphasized that this is not the time to put the brakes on government spending and government investment. Instead, the government must be willing to step back and consider its approach in response to economic reality.
The Canadian economy is facing serious economic risks as a result of our dependence on American and European markets. The American economy remains extremely weak as a result of the flat housing market, high debt levels and the change from a program involving weak recovery measures to one involving budget cuts.
Fear of a double-dip recession has caused a sharp drop in the stock market over the past few months. The OECD and the IMF are predicting a very slow recovery for developed economies, which will have a major impact on Canadian exports.
TD Economics has indicated that, while the United States should be able to avoid a recession in 2011, any unpredicted drop in the markets could plunge Canada into another recession. Scotiabank economists have stated that we are facing a very real possibility that the Canadian economy could be the first to fall into a recession.
The government must be willing to be flexible and must consider its planned spending cuts in light of global economic instability. However, despite the fragile global economy and Canada's shakey economic recovery, the Conservatives want to cut off all stimulus and cut tens of billions of dollars out of the economy.
Radical spending cuts, even before the private sector is prepared to start investing again, hurts Canadian families and Canadian communities.
The Governor of the Bank of Canada has made it clear that this is no for undercutting demand in the economy. That is why he is keeping interest rates low.
In the past, the ability of Stephen Harper's Conservatives to predict Canada's economic future has been appalling.