Liberal fiscal update falls short

When the federal Liberals tabled their fall fiscal update recently, Canadians expected they would offer a timeline on how and when we could expect a return to a balanced budget. Alas, it was not to be. Rather, the finance minister presented a document filled with escalating debt, unprecedented deficit spending, heightened personal taxes, uncompetitive business tax rates, magnified regulation and red tape. Combined, this will continue to curtail business investment and suppress investor confidence in Canada.

This government has racked up billions in debt. They spent an additional $18 billion in their first year in office, far exceeding Trudeau’s promised $10-billion deficit. Today, his reckless borrowing and spending has resulted in a deficit more than three times expectations.

The fiscal update confirmed the Liberals intend to drive up the debt an even further $18 billion this year and an additional $20 billion in 2019. In fact, they offer no indication that they even have a plan to ever balance the budget. One does not need to be an economist to understand that more debt today means higher taxes tomorrow. The cost of this debt will be paid on the backs of future generations.

Family farms and small businesses — the backbone of our Canadian economy — are under fire as they face increasing hurdles. Red-tape, uncertain tax rules, limited ability to save money for a downturn, and the on-going increase in taxes is restricting growth and investment.

The fiscal update did provide a crumb of relief to manufacturers and farmers who need equipment, by immediately writing off new investments (up to 45 per cent from the previous 15 per cent). Although welcomed, many suggest it is too little too late.

Canadian businesses continue to face higher taxes and regulations than competitors in the United States. Many are forced to decide: face an uncertain future and potential bankruptcy or move south where lower taxes and reduced regulations make investment far more attractive. Many are choosing the latter.

Fraser Institute economist research indicates Canada’s lack of competitiveness is clearly related to its failure to attract investment. The obvious disconnect between business challenges and the government’s framework, translates into a 51-per-cent decline in foreign investment in Canada since 2014, compared to a 54 per cent increase of Canadian investment abroad during the same period. This bears the question, with investment declining substantially and capital leaving our country unabated, why would the Liberals hold firm to its regulate, tax and spend formula? In our province alone, billions of investment dollars have disappeared — taking tens of thousands of jobs with them. Lost pipeline investment has created a backlog of rail shipments and an oversupply of oil, pushing the price of Canadian oil lower.

Our stock markets are underperforming the U.S. by 30 per cent. Experts are anticipating a downturn. When this comes, the government response will be limited — the Liberals have already spent all our money.

Glen Motz is MP (CPC) for Medicine Hat-CardstonWarner.