Mr. Speaker, I am speaking today, of course, on Bill S-3, An Act to implement conventions and protocols concluded between Canada and Colombia, Greece and Turkey for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income.
The Liberal Party of Canada recognizes that Canada is a country whose prosperity is based on trade. We have a small, open economy, and as such, we depend disproportionately on external trade for our wealth and prosperity and our standard of living.
The fact is that when the Canadian economy is healthy it is because we are producing and exporting more than we are consuming or importing. The sale of Canadian goods and services to foreign markets is the source of Canadian jobs and prosperity, and securing access for Canadian exports to foreign markets is essential to the Canadian economy and to creating the jobs of today and the jobs of tomorrow.
With this in mind, we understand and support the principle of free trade and the principle behind Canada's tax treaties with our trading partners, and as such, we support the goals of Bill S-3. But we are very concerned about the state of Canada's economy and we are very concerned about Canada falling behind in terms of our share of the global economy. We are concerned about the Conservatives' mismanagement of Canada's finances and their mismanagement of our important and vital trade relations.
The Conservative record on international trade has been troubling. The Conservatives have given us, for the first time in 30 years, a trade deficit, in fact a $4.5 billion trade deficit. That is the largest trade deficit in Canadian history and it is the first annual trade deficit that Canada has had since 1975.
What is troubling about this is that, for a small, open economy such as Canada's, when we are actually buying more from the world than we are selling to the world it is an ominous sign in terms of our ability to strengthen and continue to build our standard of living and quality of life. That is an ominous sign in terms of our ability to protect the jobs of today or create the jobs of tomorrow.
In the first nine months of 2010, Canada has accumulated a trade deficit of $7.6 billion. This puts us on pace now for an even more massive trade deficit this year than the record trade deficit that we had last year.
The Conservatives have to take responsibility for these massive trade deficits. It was their misguided trade policy that has failed to defend Canadian interests in the world. Under the Conservatives we have been far too dependent on the U.S. market. We have seen how vulnerable we are to U.S. protectionism, whether it is Buy American provisions or other protectionist measures in the U.S. Congress.
The Conservatives have not only failed to defend Canadian jobs against U.S. protectionism, but they have failed to effectively defend Canadian jobs in the world by building the kinds of important trade relations that would enable Canadian companies to diversify their trade relations.
The Conservatives spent their first three years in office chiding China and ignoring India. The Conservatives turned their back on a remarkable and profoundly important 40-year relationship with China, a relationship starting 40 years ago when Prime Minister Pierre Trudeau had the vision and foresight to lead the first western developed country to establish diplomatic relations with post-revolution China, building a profound social, cultural and foreign trade relationship with China. The Conservatives turned their backs on that relationship for ideological reasons in their first three years of office and set the relationship back decades.
We have seen the Conservatives' clumsy foreign and trade policy with the treatment of important trading partners like China, Mexico, the Czech Republic, at a time when it held the presidency of the EU. More recently, I do not have to remind Canadians or this Parliament as to how embarrassing it has been to watch the Conservatives' bungling of our vital relationship with the United Arab Emirates, and the internal cabinet squabbles that have come to light between ministers on this issue. The fact that we have squandered a vital trade investment and defence alliance with the UAE demonstrates a Prime Minister, a cabinet and a government that are not really ready for prime time when it comes to the world stage, that really are unsafe at any speed, as Ralph Nader would say. This is part of the cost Canadians have paid for having a Prime Minister who really has never been outside North America without a government jet and a motorcade.
It is important that we have prime ministers and governments with foreign experience and an understanding of the world. Canadians benefit from prime ministers and governments that have that kind of understanding of Canada's place in the world.
The Prime Minister does not do multilateralism well. In fact, that is because he does not really believe in multilateralism. The Prime Minister was critical of the G20 when Paul Martin, as the Liberal finance minister, was leading the charge and in fact building the G20. The G20 has emerged as the principal and most important voice of financial reform today, during and after the financial crisis.
Canadians should take some pride in the fact that it was a Canadian finance minister, Paul Martin, a Liberal finance minister, who looked ahead and saw the need to expand the G8, to build a G20 that would welcome in some of the emerging economies and be ready for whatever turbulence emerged on the global stage, but also to deepen relations and governance among our countries as we deal with what are no longer issues that are faced by individual countries but increasingly by the entire world.
Again, when we talk about emerging economies, we have talked in the last few years about the BRIC countries. We could say today perhaps it is more the BIC countries because it is Brazil, India and China; Russia has had some challenges. There is the next wave of emerging economies, the CIVETS countries, Colombia, Indonesia, Vietnam, Egypt, Turkey and South Africa. It has never been more important for Canada to diversify and deepen its trade relations with some of these economies. Canada has a natural advantage to do that, and that is our multiculturalism.
Over the weekend, I met with a group of Chinese Canadian business people in Winnipeg. I also met with a group of Indo-Canadian business people in Winnipeg. Winnepeg, like a lot of Canadian cities and towns, has emerged as a very multicultural community. What is really quite remarkable is that we look at multiculturalism as a successful Canadian social policy, and it is. Increasingly, it is not just a successful social policy, but it is a source of immense economic advantage because our multicultural communities are among the most entrepreneurial communities we have in Canada. They also represent natural bridges to some of the fastest growing economies in the world, which leads me to what a Liberal approach would be on trade and foreign policy.
We would build a global network strategy that leverages on the rich connections that Canadians have around the world, connections that derive from our multicultural communities, and our universities which are educating citizens from around the world today. We recognize the importance of partnering with Canadian businesses, universities, civil society and private citizens to better identify and capitalize on trading opportunities and foreign trade relations and influence around the world.
We would return to the very successful team Canada missions. We would focus them on sectoral areas where we have a comparative advantage, such as education, clean technology and clean energy technology. We would focus on creating the jobs of tomorrow by building bridges and deepening our ties with the markets of tomorrow in areas where Canada really has something to offer: clean conventional energy, water treatment, education.
Canada has some of the best universities anywhere. I come from Nova Scotia, a cradle of higher education in Canada. I am immensely proud of Nova Scotian universities and the role that Nova Scotian universities play in educating people from across Canada and around the world. I think we can do more to attract students from around the world to study in Canada. That would be a really good and important thing to do for the future of Canada.
If we look at the CVs of cabinet ministers from India, China and Brazil, over half of them have some educational experience either in the U.K. or the U.S. That educational experience gives the United States and the United Kingdom a lifetime of relations and influence on those countries through those individuals. Educational experiences are critically important in terms of trade and foreign relations.
A Liberal government would introduce a Canada global scholarship program which would enable young Canadians to study abroad at universities around the world, to learn the cultures and the languages to become citizens of the world. It would enable young citizens of the world, particularly from the emerging economies, to study here in Canada, to exchange students between our countries, to attract students to Canada and to encourage Canadian students to study abroad.
We would be building a global network advantage where Canada and the next generation of Canadian graduates could be the most networked and connected citizens anywhere in the world. Canada would be seen as the best place in the world to get an education, to start a career, perhaps to return to one's country of origin, but to represent a natural bridge to a country with which the person has a great fondness and respect.
Education is an industry that can benefit from more foreign trade. When we attract students from other countries to study at Canadian universities, that is a form of trade. It is a form of trade that not only helps create jobs and prosperity today, but for decades to come will strengthen and augment our influence in the world through trade relations, foreign relations and the creation of jobs.
We would take a very different approach as a Liberal government to deepening and diversifying our trade relations. We would ensure that Canada was not trying to escape the world, but was once again shaping the world. Whether it is on the environment, defence or security policy, the Canadian voice would be heard again and it would be an effective voice.
I want to speak about the fiscal mismanagement of the Conservative government. A Liberal government would clean up the fiscal mess created by the borrow and spend Conservative government. I would remind the House that the Conservatives inherited a $13 billion surplus from the Liberals, which was the best fiscal situation of any incoming government in the history of Canada.
The Conservatives increased government spending by an astonishing 18% in their first three years in office. That is three times the rate of inflation. They combined these massive spending increases with reckless tax policy to actually give Canada a structural deficit even before the downturn began. Now the Conservative legacy is a $56 billion deficit, the biggest deficit in Canadian history.
While Canadians are watching the Conservatives plunge Canada deeper into debt, they are asking themselves what they are getting in return. Let us compare the stimulus package of this Conservative government to the stimulus packages of other governments.
Other governments invested in long-term competitiveness, modernizing their energy systems, energy production and energy transmission, helping households and companies cut their energy consumption so that when the recession was over, ultimately companies would become more profitable and at the end of the month households would have a little more money in their back pockets.
The Conservative government was more interested in buying votes than in building competitiveness. It was more interested in counting signs than counting jobs. The stimulus package was a hodgepodge of spending measures aimed at short-term politics, not on long-term prosperity.
We often hear the Conservatives talk about Canada's debt and deficit numbers compared to those in other countries of the world in a favourable way, as if Canada is a lot better off than many other countries. However, when we combine federal and provincial debt numbers in Canada, we get a startlingly different picture.
If we combine federal and provincial numbers for something called gross debt, our gross debt to GDP ratio is actually at 82.5%. To put this in perspective, the U.S. is around 83%, so we are almost as bad off as the U.S. in terms of gross government debt in Canada. That figure is worse than those in Germany and the U.K. The fact is that provincial and federal debts impose a burden on all Canadian taxpayers. There is only one taxpayer.
In the coming years, as we now enter the negotiation around the health and social transfer culminating in 2014 with the new agreement, these issues are going to come home to roost. We are going to see increased pressures on Canadian provinces to deal with an aging demographic. Fewer Canadians will be working. More Canadians will be relying on retirement income and depending on an increasingly challenged health care system.
How have the Conservatives been preparing for this? Has there been any discussion on how to prepare for that demographic shift? How have they been saving for a rainy day in the future? Let us look at what the Conservatives have been doing.
They have proposed spending $16 billion on untendered fighter jets, and $10 billion to $13 billion on U.S.-style mega prisons during a time when crime rates are on their way down. They spent $1.3 billion for a 72-hour photo op for the G20 and G8 summits. Spending on the G8 and G20 summits included $1 million for fake lakes, $300,000 for a gazebo and bathrooms that were 20 kilometres away from the summit site, $400,000 for bug spray, $300,000 for luxury furniture, $14,000 for glow sticks and, of course, millions on high-end hotels.
The last finance minister to cut government spending in Canada, not just to hold government spending but actually to cut government spending, was the hon. member for Wascana. It was a Liberal government, and under the leadership of finance minister Paul Martin, that implemented the biggest tax cuts in Canadian history after having paid down the biggest deficit to date in Canadian history.
We will once again cut corporate taxes in the future but only after we pay off the Conservative's deficit and get Canada back in the black responsibly, not on borrowed money. We will also invest in the priorities of Canadians, in Canadian families, in learning, in jobs, in pensions and in family care. We will not invest in the these wasteful priorities of the Conservatives.