Harper unfazed by market crisis
Dion accuses Conservative Leader of leading Canada's economy to a performance that lags even the troubled U.S.
BRIAN LAGHI AND CAMPBELL CLARK
Globe and Mail Update
September 15, 2008 at 12:35 PM EDT
OTTAWA and ST. JOHN'S — Stephen Harper says Canada has survived the worst of the financial crisis that is gripping the United States and predicted yesterday that the fears of a recession are in the past.
“I don't think the atmosphere should turn to one of complete doom and gloom,” Mr. Harper told reporters this morning as he kicked off the second week of the Conservative Party's re-election campaign.
“My own belief is if we were gong to have some kind of big crash or recession, we probably would have had it by now.”
The Prime Minister said that, although there are significant problems in the United States, its economy is still resilient and not in recession.
“I wouldn't throw in the towel on any of this quite yet,” he said. “My own belief is if we were going to have some kind of big crash or recession, we probably would have had it by now.”
Mr. Harper has pitched his party as the best-placed to handle turbulent economic waters, particularly in opposition to Stéphane Dion's Green Shift, which includes a tax on carbon. However, his declaration that the fears of a recession are behind the country may somewhat undercut that argument.
Nonethelessss, Mr. Harper used the U.S. financial crisis to argue that the ideas of his opponents are unworkable in the current climate.
“This is not a time for wild experiments and new taxes or grand new spending schemes,” he said. “Governments must be able to act with prudence during a difficult economic time.”
Mr. Dion shot back by suggesting Mr. Harper has been a rudderless economic manager who spent on election-minded gimmicks but led Canada's economy to a performance that lags even the troubled U.S.
Mr. Harper has called for a stay-the-course economic plan for uncertain times, but Mr. Dion said the Liberal “Green Shift” would cut taxes on areas that would stimulate the economy – incomes, savings, and business profits.
“The difficulties in the United States are something that we worry about. But still, they are outperforming the economy of Canada today. Their first six months [of 2008] have been better than ours in terms of economic growth.”
“Mr. Harper did nothing to prepare Canada [for] that. Nothing to invest in the productivity of our economy. Made bad choices regarding the way he spent – he spent more than any other government before him, but he built nothing,” Mr. Dion said.
He said Canadian economic growth was slower than that in the U.S., and other G8 countries, in the first six months of 2008, and that Canada lost more jobs in July than in any month since 1991, when Brian Mulroney was prime minister.
He added later: “And what is the plan of Stephen Harper, anyway? It's the same mistakes that have been done under Mulroney. He spent a lot, he has no direction, and we are close to deficit and close to a recession.”
Mr. Harper has built his campaign around an argument that he is a steady hand for managing the economy, and that Mr. Dion's so-called Green Shift is a risky venture for uncertain times.
Mr. Dion, however, rebutted that it is a plan that would stimulate the economy, cutting taxes in the right places, and weaning the Canadian economy from over-reliance on fossil fuels.
“What is the main problem that the world has today? It's energy costs. And it will grow. It's not something that will disappear. So if you have a strategy to make this country more energy efficient…you will increase the profitability of our economy, and its productivity. And it will create green jobs,” the Liberal leader said.
Before making his remarks, Mr. Harper announced a spending promise worth $147-million that would allow self-employed Canadians the opportunity to access maternity and parental benefits enjoyed by other wage earners who pay into the EI system.
“Ironically, self-employed Canadians who are successful and who create jobs must pay into the EI system on behalf on their employees, but cannot access those benefits themselves,” Mr. Harper said. “This is not right.”
Currently, self-employed Canadians cannot contribute to the Employment Insurance scheme and, thus, are not eligible to receive maternity benefits that other employees who do pay into the fund enjoy. Those Canadians eligible for maternity benefits and want to remove themselves from the work force to stay home with their newborns can receive a year's worth of benefits at around 60 per cent of their salary.
There are currently 2.6. million Canadians who work for themselves in the country.
The program would be funded by premium payments. It is another in a series of tangible announcements that the Conservative began making during the last election. They include notions like help for apprentices, GST cuts and other pledges.
Asked if announcement was an effort to attract female voters, Mr. Harper said it was a policy to respond to a real need.
In St. John's, Newfoundland, Mr. Dion unveiled a $250-million proposal for funding refits of fishing boats to make them more energy efficient, and argued that using less fuel will save them more as diesel-fuel costs rise than Mr. Harper's proposal to cut diesel taxes by two cents a litre in four years.
The same approach will make Canadian businesses more competitive, especially if corporate and personal taxes are cut, fuelling savings and investment, he argued.
“We need to cut taxes on the productive activities – on our income, savings, investments. On the investments the fishermen need to do to have good vessels – we need to cut taxes on that. And we need to shift it to pollution. And then it will be good for the economy because you will cut taxes on productive activities. It will be good for the environment because you out a price on pollution. As long as it is free, it will be difficult to reduce it,” he said.
“And it will be good for the people, because we Liberals will cut taxes especially for middle and low-income Canadians. A family that is living with $20,000, they will receive $2400 of tax credits from the government.”
Mr. Dion continues to be dogged by criticisms, even from within his own party, that his plan is not getting through to voters, who don't understand it and fear it's just another tax.
Yesterday, as he campaigned in St. John's, John Efford, the federal natural resources minister in Paul Martin's Liberal government, said most Newfoundlanders don't get it, and are wary about being taxed more.
“I can tell you the average person on the street doesn't understand the carbon tax,” he told reporters.
Mr. Dion, however, insisted that it is good economics – and that Mr. Harper has focused on election-minded tidbits to attract voters. He didn't specify what he was referring to, although Mr. Harper has brought in a series of narrowly-targeted tax credits he promised in the 2005-06 campaign, for tradespeople's tools, kids sports programs, and bus passes.
“Stephen Harper is only concerned about the next day, the next poll, to show gimmicks to buy your vote for the next election. Never he's concerned about the next generation,” Mr. Dion said.
