Mr. Speaker, it is a great honour to rise today to address the chamber on this important subject.
Every society is judged by how well the most vulnerable fare among the rest of the population. Canada is no different. In this country, we have witnessed a spectacular decline in poverty, particularly over the last decade, under the previous government.
In the mid-1990s, poverty rates in Canada peaked. They reached a high in the mid-teens. People in the country who were at the bottom end of the economic ladder were suffering. However, gradually, over the course of the previous decade, we saw that number drop to 8.8%, which was both the lowest level in Canadian history and the biggest decline that has occurred under any government since the low-income cut-off line was established in 1976. To understand the reasons why, we have to examine the policy conditions under which it occurred.
Let us start back in 1976, when the low-income cut-off line was created. During that period, poverty was measured to be about 13%. About 13% of people had to spend more than 20% above average on the basic necessities of life, things like food, clothing, shelter, and utilities. That actually increased during the final eight years of the Trudeau government, from 13% to 13.8%.
Of course, that was a period in which middle-class incomes also declined. They declined by about 8%, according to the very first chart in the very first budget Mr. Trudeau's son introduced here in the House of Commons. In that time, poverty grew.
Now, that might seem counterintuitive, because Pierre Elliott Trudeau liked to style himself as a man who pursued a just society, one built upon massive state intervention, big government. Government was aggrandized under the pretext of creating social justice: taking from the rich to give to the poor. This is particularly interesting, because after the period during which Pierre Elliott Trudeau increased the size of the federal government to 24% of the Canadian economy, the middle-class incomes of average Canadians plummeted, again according to data the present Liberal government released in its recent budget, and poverty actually went up. This demonstrates that as government gets bigger, the poor get poorer.
That, of course, runs counter to all the narratives we have been taught for so long. We have been taught that big governments equalize society, that government and the state are like a grand fairness machine, constantly taking from the privileged in order to give to the many.
In fact, as government gets bigger, the poor get poorer. Why does this happen? For one, in a government-run economy, a company is rewarded if it has the best lobbyists. In a free market economy, a company is rewarded if it has the best product. Government-run economies are based on force. Free enterprise economies are based on billions, literally billions, of voluntary transactions. In a free market economy, millions of people, through billions of transactions, decide what businesses produce and at what price. In a government-run economy, the state tells people what they get and what they will pay for it. In other words, it is a relationship of force, and in any relationship of force, the most powerful win.
Who are the most powerful? They are the people who can afford to hire lobbyists to pressure the government, lawyers to get around the rules or to sue those against whom they are competing, and accountants to avoid paying the cost of the massive apparatus we call the state. Those are the powerful interests that always do best when government gets big.
We see this in the province of Ontario, where the government introduced something called the Green Energy Act, which was supposed to create jobs producing windmills and solar panels. What actually happened?
According to the Auditor General of Ontario, over the whole life of this program, a massive government program that forces consumers to pay higher electricity bills in order to purchase wind and solar energy would increase the cost of electricity by an extra $160 billion, above and beyond what it would have cost otherwise. Of course, those costs will fall on the backs of the people who can least afford it, the poor. Electricity and other utilities make up a larger share of the income of poor families than it does of rich families.
Furthermore, wealthy interests are able to pay to have a solar panel put on their house or to invest in a wind turbine park in somebody else's backyard. Wealthy interests are able to aggrandize their own financial situation by benefiting from the government forced pricing system that rips everyone else off. In fact, the former Liberal Party president, Mike Crawley, presided over a company that received a half a billion dollar contract in the process. A lot of wealthy insiders were made instant millionaires overnight and a lot of middle-class people were made instant food bank goers at the same time.
Food banks from places like Windsor have said that people have come in with their hydro bill, saying they have a choice to either eat or turn the lights on, so maybe the food bank can feed them so they can pay the bills. Again, it is a massive wealth transfer from the very poor to the very rich, from the have-nots to the have-yachts.
We see other similar examples. The carbon tax will raise the price of the basic necessities of life, things like heat, hydro, food, and shelter. Those are things on which a lower income family spends a third more of their income than does a wealthy family. In other words, low-income people will pay more as a share of their income than will rich households. The result is that those with the least will suffer the most. Who will benefit?
In Ontario, the government says that it is going to use the money to subsidize all kinds of green programs. Already such programs exist. One paid for five millionaires to buy the wealthiest car ever produced, the Porsche 918 Spyder, under the guise that this was a very green car. Middle-class taxpayers suffering to make ends meet were paying for millionaires to buy Porsches.
The story goes on and on. The Liberals and people on the left like to compare themselves to Robin Hood, taking from the rich to give to the poor. In reality, Robin Hood was not a redistributionist. Robin Hood was not a medieval Marxist. He was a tax fighter, leading probably the most famous tax revolt in the history of our civilization. He fought against heavy taxation by his arch nemesis, who was a tax collector, the Sheriff of Nottingham, and who at the time collected from the peasants and the landowners so he could aggrandize all of the adventures and the luxuries of the aristocratic elite.
In a much less admittedly dramatic form, we see that occur again and again throughout history. The result is that throughout history we have seen that as government gets bigger, the poor get poorer. We see in studies done by the former IMF director, when he compared big government countries, medium-size government countries, and small-size government countries, that countries with the smallest governments actually had the best social outcome; that is those countries where government represented less than 40% of the economy.
The empirical data shows that if we want to give people opportunity, particularly those with the least, we do so by getting government out of the way and unleashing the unmatched force of free enterprise to allow people to pursue their own dreams and benefit from their own work, invest in their own ambitions, and build up their own communities. That is the way to lift up those with the least. That is the way to build a stronger and more vibrant middle class. That is the reason why we were able to reduce poverty to unmatched levels under the previous government. It is the only way that the current government will continue to build on that success.