This is no way to run a federal government. Flaherty continues to throw insults at the government of Ontario and the provincial Liberals are being bullied into making archaic tax reforms that died with the Harries Tories.
This time, it’s Flaherty saying that the McGuinty government should reduce taxes in order to make Ontario’s manufacturing sector more competitive, but the reality is that this strategy just doesn’t work. We’ve seen it before (“Tax Breaks Don’t Work”) and we’ll see it again, but depleting your treasury of revenue simply so that the upper crust and foreigners can make more money is a quick way to destroy your economy. Look at what’s happening in the US.
What’s troubling with these petty jabs from the federal government is that it won’t be long before the people of Ontario say enough is enough and make a decision to do something rash like bow out of the Equalization Program. Ontario pays more than its fair share to keep things going in this country and the people of Ontario are tired of subsidizing ‘short term’ resource programs in provinces like Alberta and Newfoundland.
The Ontario Liberals can’t control the US dollar, which is the primary reason our manufacturing sector is taking a hit. What the FEDERAL government can do is influence the Canadian dollar by lowering interest rates, which will put more money in the pockets of all Canadians. The FEDERAL government can also require minimum production requirements. The FEDERAL government can also implement export taxes on resources to ensure that all Canadians benefit from the high value of commodities and not just Albertans. The FEDERAL government can encourage international discussions with other trade partners to eliminate our dependence on the US for trade. The FEDERAL government can act like adults and stop using partisan politics to threaten non-Tories.
Instead, in the last budget, Flaherty implemented tax cuts that indirectly subsidize those industries that are doing well in today’s economic climate. Yesterday’s industries devoted to rocks, logs, oil and hogs.