Madam Speaker, I am happy to participate in the debate today, and it will come as no surprise that I will say up front that I will vote against the bill.
The Minister of Finance loves to yell in the House that this is a generational budget. What is clearly and unequivocally true is that this is a budget imposing massive, crushing and unforgivable generational debt. I cannot help but point out that our deficit is now just under $80 billion, a number that would make even Justin Trudeau blush.
Canada's productivity has slipped badly among G7 nations. Why? Capital is staying on the sidelines as confidence lags. Investments in equipment, new innovation and business efficiencies are on hold because of basic economic uncertainty. That is the essence of productivity. The last thing our economy needs right now is uncertainty, yet here we are.
I have listened intently to my colleagues on the Liberal side of the House talk about this budget, and it left me wondering how so many people have suddenly come down with a case of “sometimers”. Perhaps it is a form of political amnesia, because it seems that those on the front bench of this so-called new government have forgotten that they paved the way for this massive dive into new generational debt.
While the Prime Minister says his words were poorly chosen when he said “Who cares?” about dealing with Trump, what is said in jest often holds an element of truth. His “Who cares?” comment tells us a couple of things. Perhaps he is just going through the motions with the U.S., and CUSMA is the backstop, at least for now. He loves to say that Canada has the best deal right now. Well, frankly, that is a crock. We have the same CUSMA deal we had before the election, with a pile of new tariffs on everything outside that agreement. That is an abject failure. Maybe he does not care because he is hoping that Trump loses his court cases or perhaps loses control of Congress in the midterms, or that the U.S. economy finally feels the inevitable pain of tariffs, with job losses and inflation.
Silence and saying “Who cares?” are dangerous, misguided, irresponsible and frankly lazy. We are in a trade vacuum with a case of George Costanza's elbows-down shrinkage factor. Everyone knows it is a precarious game negotiating with Trump and his sycophant team of validators. Trump is a bit like Biff Tannen in Back to the Future Part II, where the bully controls the dystopian town and the people around him. Perhaps the strategy is just to wait him out and hope for the best.
When Trump opens up CUSMA, which he most certainly will, Canada's economic stability is literally on the table. The idea that we are going to supplant our trade with the U.S. with trade in other jurisdictions may appear to be an opportunity, but it is at best a long-term objective. If we ask anyone who has built a successful SME in Canada, they will tell us that it takes decades to develop the relationships and supply chains needed to provide solid predictability in our export markets.
Some 75% of Canada's exports go to the U.S. That may fluctuate, and it has over time, but fundamentally our relationship with the U.S. is never going to change in our lifetime. To suggest otherwise ignores facts, history and the natural political, geographic, economic and basic integration of our economies. The north-south network of supply chains, transportation and logistics, built over decades in relationships and confidence and trust in financial linkages, is not something that our manufacturing and service sector can abandon or miraculously recreate in other jurisdictions just because the Prime Minister says so.
It took 100 years for our economy to evolve to ensure the efficient movement of goods and capital and ensure stable supply chains. Saying that we are going to double trade with Europe is fine, but it is not going to fix our problems before CUSMA comes up for review. Let us be clear: Canada's economy has evolved over the past 50 years through technological change and the realization that trade liberalization was the only pathway to improving the Canadian standard of living.
Money flows to the path of least resistance balanced against return. Policy drives the creation of that path. However, as we developed our north-south trade strategy, we abdicated our responsibility in supporting a national manufacturing strategy and, most importantly, a national access to capital strategy.
I know this because I have spent the past 20 years helping Canadian start-ups commercialize their ideas against strong and sometimes insurmountable barriers against capital access. There were incredible successes in the Canadian start-up ecosystem, like Shopify and Hootsuite, among many others. BlackBerry is literally responsible for the creation of the Waterloo innovation machine that paved the way for Canadian entrepreneurs to chase their dreams.
The Harper government launched an incredibly helpful program to enhance the innovation sector through support to the angel investing community. It was inexpensive yet enormously successful, and it bridged the gap between ideas and capital. Angel investor groups popped up across Canada and aggregated substantial amounts of capital to support Canadian companies. Sadly, the Trudeau government cancelled this program.
Over the past 10 years, we have missed the boat in establishing an access-to-capital platform to support companies beyond the early stage phase. Regional development agencies could have been the platform for this, but are basically acting as bailout agencies instead of a network of strategic investment for Canadian start-ups.
I have seen dozens of companies leave for the U.S. simply because they could not obtain funding in Canada. The U.S. offered the solutions to risk-averse Canadians to provide a runway of support to these companies that wanted to stay here but simply could not turn down the opportunities south of the border. This should be low-hanging fruit for us. If the government is intent on nosediving our nation into debt, how about we first take a look at how we fund our brightest and best in this country and try to fix the gap between capital and ideas.
We need to incentivize Canadian capital to actually invest and stay here in Canada. Eight out of 10 start-ups ultimately fail. Angel investors, angel funds and venture capital funding vehicles are familiar with this risk, but as we navigate this uncertain time, as I said earlier, capital is staying on the sidelines. Fifteen years ago, it was easier for us to attract early-stage investment because it was the policy priority of the federal and provincial governments. Accredited investors organized and went on a tear of investing in Canadian companies. It was a beautiful thing, but investing fatigue has now set in because deal flow is weak and confidence is low.
The incentives for investing in start-ups today in Canada are non-existent. That is the barrier to investment. That is the tragedy of where we missed the chance over the last 10 years to provide incentives for investment. To be clear, this is not a tax break for the rich; this is an incentive for people who are willing to take risk on Canadian companies. Make no mistake: The risk is high. The two out of 10 that actually make it to market need years of mentoring and support, with multiple rounds of investment. Unless we are prepared to support this ecosystem, we will continue to tilt at windmills, watch our best and brightest move south and continue to weaken our domestic innovation ecosystem.
My leader is onto something. He is really onto something when he talks about eliminating capital gains taxes, provided that the gains are invested in Canadian companies. People understand this at the ground level. If we could provide this kind of incentive to support Canadian start-ups, we could build a more diversified economy where Canadian companies and capital stay here and grow here. This is the real nation-building effort, one company at a time. It will create confidence and enthusiasm and bring massive private capital reserves back into our economy.
Canada is over-regulated, overtaxed, disincentivized and uncompetitive, with the worst productivity rate in the G7. The government says it wants new ideas. I just threw several at it, all validated by past best practices and all cancelled by the Liberals.
The Liberals talk a good game, but talk is cheap. The “we believe in Canada” ad nauseam is offensive to me. It suggests that only Liberals believe in Canada. I also believe in Canada. My life's work has been dedicated to creating value for Canadians, jobs for Canadians and growth in my region.
My small grandchildren will pay the price for this, and only Conservatives will bring sanity and solid fiscal policy back to our country and put Canada first.