The UCP government is nothing if not brazen.
Having failed to explain how the UCP government was going to set Alberta on the path to economic recovery Mr Toews, Alberta’s finance minister and treasury board president, decided to lecture the federal government what it must do to get the country back on track.
Yes, the UCP is now preaching to all Canadians, not just the poor souls stuck here in Alberta.
This is Toews’ four point plan.
Competitiveness & productivity
Toews said Canada’s economic recovery is entirely dependent on its ability to attract private-sector investment. Entirely!
He failed to explain how Canada can attract such investment but it’s safe to assume his advice to the feds would mirror his advice to Jason Kenney—slash corporate taxes.
We all know how well that turned out.
Alberta’s corporate tax rate dropped from 12% to 8%, billions of dollars disappeared from the government’s coffers, the deficit got worse…and corporations used the tax break to pay down debt, buy back shares and pay dividends to their shareholders.
The one thing they did not do was invest in the economy.
Get out of the way
Toews said the feds must get out of the way of economic growth (ie deregulate) and points an accusatory finger at Bill C-69 (“no more pipelines”) and Bill C-48 (“west coast tanker ban”) to support his argument.
Bearing in mind that Toews is advising Canada on how to reignite its economy and energy contributes only 10.2% to Canada’s GDP, a less Alberta-centric example would have been appropriate.
Nevertheless, let’s consider how well Toews’ “get out of the way” strategy (also known as cutting red tape) is working in Alberta.
So far it has not delivered the promised economic growth; it has however exposed the province to increased environmental degradation. The most recent example is the government’s spectacularly stupid decision to resurrect the coal industry by revoking (and temporarily reinstating) the Coal Policy thereby allowing Australian coal companies to turn mountains into open-pit mines.
Cut support for unemployed Canadians.
Toews admits temporary income support to Canadians during the pandemic was important but says “to move the economy forward, Canadians must have every incentive to return to work.”
Apparently 27% of small firms say some of their laid-off staff have refused to return to work. Instead of quantifying how many employees he’s talking about or why they refuse to return to work, Toews concludes Canada’s employment insurance plan is too generous and needs an overhaul.
Don’t pick winners and losers
Toews said the government must avoid “interventionist programs” and “market-distorting initiatives”—all political-speak for showering tax dollars on one industry participant but not another. He went even further stressing that governments “must use taxpayer dollars as if they are our own—with the greatest care and responsibility.”
Give me a moment to catch my breath!
Toews and his boss embarked on a multibillion dollar “interventionist program” when they gave TC Energy $1.5 billion in equity and $6 billion in loan guarantees to support KXL, only to have President Biden cancel its permit.
Toews has absolutely no credibility on this point. None.
A broader perspective
Toews concludes that this is a pivotal time in our history. In that he’s correct, but he’s misguided if he thinks the government’s response should be a single-minded focus on creating “an environment that positions the private sector for growth.”
The pandemic has had a profound social and cultural effect in addition to an economic impact on our society. We’ve learned a lot about our dependence on others and the value of community.
It’s time to acknowledge the importance of robust public services—solid K-12 public school funding, sufficient post-secondary funding to ensure students are prepared for the future and not buried in debt, public healthcare, and government support for seniors and other vulnerable citizens.
If we’re going to come out of this stronger and more resilient we need to learn from past governments that took bold action to recover from major crises like the great depression and WWII.
Why? Because authors like Robert Kuttner have shown that after the great depression and WWII governments that regulated the financial and business sectors, strengthened unions and supplemented good labour income with robust public services were rewarded by economic growth and full employment.*
And political scientists like Robert Putnam and Shaylyn Romney Garret have shown economic growth results from a reduction of income inequity.**
This is the time for visionary leadership, not a trite rehash of failed conservative policies.
*Robert Kuttner, Can Democracy Survive Global Capitalism?
**Robert Putnam & Shaylyn Romney Garret, The Upswing