If you are a federal politician looking for an escape hatch from Bombardier’s controversial request for a billion dollar federal bail-out, one of the company’s vice-presidents recently provided it. Rob Dewar said federal help would be “…an extra bonus that would be helpful but is very clearly not required.” No helped needed, so case closed, right? Wrong. Prime Minister Trudeau still wants to help.
Why? With the company reportedly pushing to move jobs from Toronto to Mexico, the federal budget deficit more than twice what was promised and thousands of unemployed energy sector workers getting no bailout, what does the Prime Minister gain from giving a billion dollars to a company that doesn’t need it?
To find the answer, visit the wood shop.
Last month, a popular lumber retailer in Manotick, Ontario, called The Wood Source opened a new show room and warehouse, but only after filling out 1500 pages of government forms over six years and paying $600,000 in fees and other administrative costs—enough money to employ 10 people for a year. The company had to hire an arborist to write a separate report on each little poplar tree that would be cleared, including its size and species–this on few acres of otherwise useless brush. The government charged the business a fee for the loss of parkland—even though the land had never been a park.
You would think it was a pulp mill, not a lumber mill, as fully half the cost of the building was paperwork.
Forty years earlier, The Wood Source built a similar workshop and the government required a one-page drawing stamped by an engineer and a one-page application. Done. Approved. Ready for construction. The building is still in use today over four decades later.
Now, not only is the company besieged with government paperwork, its electricity bill has tripled to over $100,000 a year mostly to pay for government subsidies for wind turbines and solar panels, which produce only a minute fraction of Ontario’s energy.
The company’s part-owner, Tim Priddle, complained of these costs to a local provincial Liberal minister, who said, “I will put you in touch with some people in my office who can help you with various grant programs that may be available.” Why not just cut the red tape and energy costs and let the company keep its own money?
The same can be asked in the case of Bombardier. In November the federal government blocked the expansion of the Toronto Island Airport, which would have enabled Bombardier’s C-Series planes to land there. That effectively killed $2 billion worth of the company’s sales to Porter Airlines, at the same time as the Quebec and federal governments consider $2 billion in Bombardier bailouts.
That is not just wrong. It is strange. The Liberals claim the reason they have plunged us into deficit is to fund infrastructure. This project IS infrastructure, which a City of Toronto Report says would boost economic growth by $124 million and it would allow more business people to fly in and out of the business district, relieving car traffic between Pearson Airport and downtown.
Moreover, Liberal governments are raising taxes because they need revenue, yet the airport expansion would generate $55 million in revenue without a tax increase, according to a report by Urban Strategies prepared for the City of Toronto.
Similarly, the government has added new steps to the approval of pipeline projects that will delay the Energy East project by an additional nine months. The pipeline will carry western crude to eastern Canada, and help end the insanity of New Brunswick refineries buying oil from Saudi Arabia at a premium, while Albertans sell it to the Americans at a discount. Each day the pipeline is delayed costs the Canadian economy $38 million, according to former Encana CEO, Gwyn Morgan. He added that a single week of those losses cancels out the entire $250 million that Prime Minister Trudeau offered in stabilization money to help Alberta’s struggling economy. Here again is the irony: the government harms the Alberta economy with pipeline delays and then offers a subsidy to make up for it.
Elsewhere, they cut Tax Free Savings Account limits from $10,000 to $5500, and then announce they will force people to pay more to the government-controlled Canada Pension Plan.
They block growth and then subsidize growth. They raise taxes on savings and force people to save more. They weigh down a small business and then offer the same business a subsidy.
President Reagan used to say that when Liberals see an object that moves, they tax it. If it keeps moving, they regulate it. When it finally stops moving, they subsidize it. But why doesn’t the Liberal politician just stay out of the way in the first place? Because that would make him so much less important. He would have no role. It would be like airbrushing him out of the selfie.
The Liberal politician is the ultimate economic busybody—always turning up uninvited, always trying to be the centre of attention, always in the way and always causing more problems than he solves.
Our economy needs business – not busybodies – for Canadians to achieve their full potential.