Good Sunday Morning,
To revisit a bit of historical context I touched on back in July, when I found my first job in the 1970s, the minimum wage was about $3 per hr. You could buy a new car for about $3,000 and a new house for about $30,000. Today you can barely still buy a house in some parts of Canada for $300,000. A new car costs about $30,000 but the minimum wage is nowhere near $30/hr.
Interestingly, the 1970s were also a time when the "Oil Sands" were a long-shot that would never have survived without public investments from Trudeau's government. They were more accurately called the Tar Sands then and their development was considered a bold and innovative step, an investment in the future. On September 30, 1967, the Great Canadian Tar Sands facility opened north of Fort McMurray, Alberta. Fifty years later, things look a whole lot different.
In the 1960s and 1970s, the federal government's corporate income tax rate was 37 per cent. In 1980, it was reduced to 36 per cent. In the 1980s, the Mulroney Conservative government reduced the corporate tax rate by eight percentage points. Due to a huge deficit and a drastic increase in the national debt, the corporate tax rate was maintained at 28 per cent in the 1990s. From 2000 to 2004, it dropped from 27 per cent to 21 per cent. Then Liberal Finance Minister, Paul Martin, drastically cut the corporate income tax by six percentage points in three years. Then the Conservatives returned in 2006. Two years later, the global recession did not stop the Harper Conservatives from further lowering corporate income tax, from 21 per cent to 15 per cent," states this Green Party backgrounder on corporate taxation.
Oliver Wendell Holmes Jr. famously said: “Taxes are the price we pay for a civilized society.”
“Taxation should be fair, efficient, and effective. Today these fundamental principles are being distorted. The Green Party believes in living within our limits, ecologically and fiscally. We are committed to realistic, balanced, thoughtful action that will balance the budget and reduce the national debt." Vision Green
The Liberals might be spooked at the prospect of facing the electorate in two years with a ballooning deficit but Elizabeth warns that “Any tax changes that impact small businesses require more time to phase in restructuring. The government could have avoided this backlash if the House had adopted my Private Member’s Bill, the Creation of the Small Business Impact Assessment Act, which would have required advance review and evaluation of the impact of all government measures on small business.”
“Under Stephen Harper, corporate taxes dropped to 15 per cent, the lowest rate amongst G7 countries,” Elizabeth said in this news release. “By restoring the federal corporate tax rate to only 19.5 per cent, the Liberals could follow through on their promise to lower the small business tax rate to 9 percent. The corporate tax rate in 2000 was 28.5 per cent, while the U.S. taxes corporations at 34 to 37 per cent. This is hardly an impossible proposal.”
Susan Delacourt points out in iPolitics this week that Bill Morneau boxed himself in on taxes with his recent proposal to target small corporations and professionals. "Elizabeth May showed him the way out." She writes that Elizabeth seems to be handing the Liberals a possible escape route, by urging the government to consider raising the corporate income tax rate as an alternative to hiking taxes on small business. "As a bonus, May pointed out, it would allow the Liberals to reverse yet another Conservative measure."
"Politics is a fast-moving business," Susan concludes. "What sounded like a tribute (to Arnold Chan) last week could be a sound crisis-communications strategy the following week: Kill the talking points and listen more … especially to Elizabeth May." And especially since even Donald Trump campaigned on a 25% corporate tax rate. >>>
To reverse our growing trend towards income disparity, embrace new technologies to secure our future, and reinstate the funding for basic research and innovation, we need to move society's wealth back into circulation. We need to reactivate revenue streams that have been dormant for too long. "When asked why he robbed banks," Elizabeth writes in the Ottawa Citizen, "famous robber Willie Sutton was reported to have said, 'Because that is where the money is.' Our finance minister is facing a wall of anger, yet he is not even focused on where the money is. Look at the billions of dollars of 'dead money.' Described as such by former Bank of Canada governor Mark Carney, hundreds of billions in cash hoarded in large corporations are not being re-invested and would yield revenue without penalizing small entrepreneurs and professionals."
Elizabeth doesn't make these recommendations to score political points. Like Green leaders around the globe she takes her responsibility to find ways of building a better world seriously. A fair and simplified tax code that incentivizes productivity and innovation while closing the income gap and providing trusted services is everybody's business. Last July the climate news network reported that the next generation will have to pay up to $535 trillion to tackle climate change, relying on unproven and speculative technology, if we don't get our act together soon.
There is no time to be pessimistic. German Greens after having made some gains in last week's election now hold 67 seats and are said to be negotiating a coalition with Angela Merkel to help counter the rise of the Ultra-right. New Zealand leader James Shaw, who spoke to us on the Committee for Motion Development only days before the election, has been able to retain his caucus in that country. David Coon and the New Brunswick Greens are helping people understand the political process in that province.
In this audio interview with Michael Enright aired on CBC last Sunday, Andrew Weaver talks about the distinction between power and responsibility; how important it is for Greens to put good public policy ahead of political ambitions. "Our emerging economy is there to be seized and there is an appetite to do politics differently." People around the world want to see more authenticity in government. Consultation, yes but more than that. People expect a willingness to really listen and to adapt policy to a changing world. Greens believe in offering responsible solutions to pressing problems. And that's why Elizabeth is not yet prepared to give up on our current parliament. Constructive engagement with the government of the day while holding them to account is what Greens are good at.
Have a grand weekend,
"It is our job to work tirelessly for justice, for peace, and for a planet that can survive with a human civilization that thrives. This is the challenge that we take on as Greens." Elizabeth May, October 19th, 2015
This weekly missive is authored by Thomas Teuwen, our SGI EDA coordinator. Opinions expressed are his own. We welcome your comments and feedback. If you were sent here by a friend and would like to subscribe to our weekly email simply click here. You can also go to the archives section of our SGI website to read back issues.