It’s critical that we get Canada’s economy back on a solid foundation
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There have been numerous warning signs about the state of our economy over the past few weeks.
Fuelled by inflation worries, gold is trading at an all-time high.
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A recent Postmedia-Leger survey found that 70 per cent of Canadians feel that “everything in this country is broken right now,” and over three-quarters say they are most worried about “rising costs and inflation.”
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Year-over-year business insolvencies were up nearly 50 per cent in January, according to a report issued earlier this month by the Office of the Superintendent of Bankruptcy.
And Canada is on track to register another massive deficit.
The Office of the Parliamentary Budget Officer released its latest economic and fiscal outlook earlier this month and said that this year’s federal deficit would come in around $7 billion higher than expected — and that doesn’t account for recently announced pharmacare spending. This is driving the national debt to record highs.
But there are far deeper and more worrisome trends that are eroding our country’s economy.
Our manufacturing sector is struggling. Over the years, we’ve allowed our market to be flooded by cheap imports, and we’ve incentivized businesses to locate in cheaper jurisdictions that have little regard for safety and environmental protection.
Add to that our complex tax system that caters to the rich and special interests, the never-ending buildup of bureaucracy, and the smothering red tape and job-killing regulations that go with it.
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All these problems combine like an out-of-control freight train heading for a major crash.
I know many good and decent politicians on both ends of the political spectrum, and I always ask them: is this the kind of country you want to leave behind to your children and your grandchildren?
But our elected officials and civil servants are trapped in a system that no longer works for the benefit of most Canadians, and many of them are just as frustrated as the rest of us.
I came to Canada from Europe in 1954. My first job was working as a dishwasher. After several years of working at various factories as a toolmaker, I started my own small business in a rented garage. Over the years, I built that business into a global multinational corporation with operations in 28 countries and close to 180,000 workers.
I could never have accomplished all that if I had stayed in Europe. Sixty years ago, Europe had far too much red tape and far too many obstacles facing entrepreneurs. This is the situation we now face here in Canada.
I could live anywhere in the world, but I choose to call Canada my home because I believe it’s the greatest country in the world. My concern, however, is that our country has deteriorated over the past several decades.
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The basic fact is, if the economy doesn’t work, nothing else will. We won’t be able to adequately care for those in need. And we won’t be able to sustain the high living standards that made Canada a desired destination for people from around the world.
That’s why it’s critical that we get Canada’s economy back on a solid foundation. But how do we go about doing that?
We should start by balancing the budget and paying down the debt. According to the International Monetary Fund, Canada now ranks among the world’s most indebted countries, with a debt-to-GDP ratio exceeding 100 per cent.
We should also claw back spending and streamline government regulations — especially for small businesses, which are groaning under the weight of excessive red tape. And we should make it far easier for Canadians to start their own small businesses.
We should simplify our tax system — it’s something almost everyone agrees should be done, and yet no one ever does anything to fix it.
We should give more Canadians the chance to share in the financial success of the companies they work for.
And we should create the ideal conditions for small businesses to flourish and thrive, including eliminating their business income taxes so they can grow and create badly needed jobs.
These are all simple, common-sense fixes. So why aren’t we doing them?
National Post
Frank Stronach is the founder of Magna International Inc., one of Canada’s largest global companies, and the Stronach Foundation for Economic Rights.
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