Mr. Speaker, there are subjects we discuss with enthusiasm. There are bills that elicit much positive feeling and that are really worthwhile.
Unfortunately, I am somewhat less than enthusiastic about speaking to the matter before the House today. This afternoon, the debate is on the motion of the Minister of Finance for third reading and passage of Bill C-14. And what is Bill C-14 about? Is it something we can applaud? Is this a bill that will give us reason to rejoice and look forward to a happy and prosperous future for all Canadians and Quebecers?
This bill is an act to provide borrowing authority for the fiscal year beginning on April 1, 1994. The operative word is borrowing, and borrowing means deficit and deficit means debt. We are
now talking about getting into debt. The subject is the debts of this country and its citizens. Are these small debts? Are these debts we can pay back quickly? Were these debts incurred for capital spending on infrastructures and services that will be useful to this generation and future generations as well? Not exactly.
What we are talking about is the cost of financing a deficit of $40 billion. That is a lot of money, and not many people can appreciate what this amount represents. Put in simple terms, let us say this boils down to $100 million per day. If we consider the bridge for Prince Edward Island, which raised quite a few questions because people felt that $900 million was too much, this bridge would be paid for in nine days, which means that we could afford forty of these bridges, and I mean forty per year.
I suppose that could be called "looking on the bright side", but seriously, we should try and understand why we have to finance a debt of this magnitude. As the previous speaker pointed out, we are not paying the interest on our debt. We borrowed this money more than a decade ago. We borrowed, and since then, we have not paid back the capital and we have not paid back the interest incurred. We have not paid the cost of servicing the debt. Consequently, day after day, month after month, and year after year, the interest we have not paid off is being added to the debt. In fact, and most people who know something about compound interest will realize this immediately, we have a debt that is growing as a result of compound interest.
Are we unable to pay because we do not pay enough taxes or because we spend too much? I suggest we look at the figures and try to draw certain conclusions later on.
To begin with, the citizens of Quebec and Canada pay out roughly $120 billion each year in various kinds of taxes. This is a substantial amount of money and all of us can understand what it represents, since it either comes out of our wages or we pay it in the form of a goods and services tax.
What does the government do with these $120 billion? Well, it spends it on various programs which result in services to the public or in more or less durable goods. All of which means that we spend what we pay out.
The $40 billion deficit did not come about because we purchased services or goods without being able to pay for them. Basically, the $40 billion represents the interest on the debt which we are unable to pay.
And the debt is getting bigger and bigger. It now stands at $500 billion! It may even be higher than that since, as the member before me mentioned, it is growing at the rate of $85,000 per minute. In the few minutes that I have been speaking, the debt has increased by an amount which would allow several people to live quite comfortably for some time.
Imagine, $500 billion! Few people can appreciate what this amount represents. As you know, I am a teacher by profession and a good instructor tries to find ways to illustrate the subject matter he is teaching. Therefore, I have tried to come up with an example which would give Quebecers and Canadians an idea of what $500 billion represents.
So, here goes. The TransCanada Highway is a ribbon of asphalt about 7,000 kilometres long stretching from the Atlantic to the Pacific. Let us assume that the TransCanada Highway has four lanes: two heading from east to west, and two heading from west to East. This is a great deal of pavement, four lanes in all. Now, let me see if I have a coin in my pocket. It is unlikely though because it must have been eaten up by taxes. What if we were to pave this highway with one dollar coins, pave it from shoulder to shoulder, all four lanes, with loonies. Would we be able to get from Nova Scotia to New Brunswick or maybe even Quebec? How about Ontario, Saskatchewan or Manitoba? What about Alberta? Would we make it through the Rockies? Would we get to British Columbia? We are talking about 7,000 kilometres of four-lane highway, and loonies are, after all, a relatively small coin and we only have 500 billion of them.
I will give the House a few moments to think about this and then I will give you the answer. Not only would we be able to pave the highway from the Atlantic to the Pacific, we could go all the way back to the Atlantic and travel an additional 700 kilometres in the opposite direction. That is what $500 billion represents. Where are we going to get the money to reimburse a debt of this magnitude?
That is obviously a major problem. I have heard on the radio, seen on television, read in papers-claims to that effect were even made in this House-that Quebec's sovereignty poses a serious threat to Canada. I will say this. The real threat to Canada, let us not forget it, is this absolutely enormous debt, this crushing debt, which is going to ruin us all if we do not make the right moves.
Quebec's accession to sovereignty, I might add, would probably be a good time to change the current rules of the game and provide a golden opportunity to all parties to review these rules and finally deal with the public finance problem. Our public finances have obviously not been managed properly for decades and, as a result, an extremely heavy burden will be passed on to future generations.
They will have a heavy burden to bear. We already do. What is the per capita share of this burden? How much does each and every one of us owe on the public debt? Some say $16,000,
others $16,500. It all depends of course on the time of day, seeing that the debt grows by the minute.
For the sake of argument, let us say for the time being that each and every one of us, all 30 million of us in Quebec and across Canada, owes $16,384.22, but this figure grows as we speak.
We also know that, given the current interest rates, the debt doubles every six or seven years. So, unless we act now, unless we start paying off the interest on the debt if not the capital, six or seven years from now, the public debt will have doubled and each of us will owe anywhere from $32,000 to $33,000 on it.
If an individual goes to his or her bank or credit union and says to the manager: "Look, I have debts, about $16,000 worth of debts, and I would like to consolidate all that", the bank manager will frown, of course, but he or she will more than likely answer: "Let us sit down together and see what we could do about your lifestyle. Let us try and work something out".
But six or seven years from now, if you go to your bank manager with a debt of approximately $32,000, I have a feeling that his or her immediate reaction will be: "File for bankruptcy". Sometimes I wonder if we should not file for bankruptcy and just start over under a new name. I can see certain members have understood what I am getting at.
During the holiday season I volunteered to work with the Red Nose organization in my riding. English-Canadian communities probably have similar organizations where, during the holiday season, volunteers offer rides to people who have had a little too much to drink. These people make it home safely without having to drive their cars. It has become an institution in Quebec and in many other countries. The Red Nose organization allows people aware of the dangers associated with drinking and driving to act responsibly.
That being said, I offered to drive people asking for a ride home, and one of my constituents said during the ride, "Why not simply raise taxes to pay off the deficit so that we can get rid of it quickly?" I asked her by how much she thought her taxes would go up and she said, "By a small amount of money". When she understood that we were talking of $16,000 for the interest alone, she realized we had a real problem on our hands.
We are indeed in a dilemma. You see, if we increase income or consumption taxes, everyone will have less available income and, as a result, less money to spend on goods and services.
Mr. Speaker, you are indicating to me that I have only three minutes left so I will be quick. If we raise taxes, consumers will have less money in their pockets to buy things with; if they consume less, businesses will eventually sell less; if businesses sell less, they will lay off workers. And we will just have increased the deficit. However, if we cut spending, again people will be laid off. These people will stop contributing to tax revenues, and again we are in trouble.
We must redirect federal expenditures wisely, cut where it will hurt the least, and ensure that displaced workers can find new jobs. We have our work cut out for us; it will not happen as if by magic.
In conclusion, I must quote the Minister of Finance not because I like his comments, but because they scare me. The Minister of Finance said, "We clearly showed, in the first phase of our budget, that we would bring the deficit down to 3 per cent of GDP within three years. It will be the first time-he used the future-in 15 or 20 years that this goal has been achieved". I hope so, but he should have said-it would have been more accurate in my opinion-"it would be the first time". He could also have stated that it was not, unfortunately, the first time such promises were made to Canadian and Quebec voters. Although I sincerely hope that this budget will fulfil the promises made to us, I am afraid that it is just another illusion.