What's his price today. John McCallum admits the Liberal plan to raise corporate taxes will cause job losses. Stephane Dion stated corporate tax cuts had to be included in the 2008 coalition agreement. Dion signed it. Layton signed it. Duceppe signed it.
And yes, Michael Ignatieff signed it. And now we are told how bad corporate tax cuts are? But wait. The coalition in 2008 talked of the national daycare plan, that regurgitated dream of the Liberals since 1993. Never happened then. Won't happen now. They planned on introducing said plan along with maintaining the corporate tax cuts. They also boasted of plans for roughly $40 billion in stimulus spending.
Fast forward to March 2011. It's the early days of an election campaign. The coalition rails against the corporate tax cuts, ignoring the fact they were passed by a majority of votes in Parliament in 2007. The Canadian economy has weathered the storm better than most countries on the planet. Why? A major reason is those corporate tax cuts.
For all of Stephane Dion's faults, he realized how important those cuts were to keep the Canadian economy growing. Ignatieff and Layton don't seem to get it. Today Ignatieff again attacked the corporate tax cuts, citing the banks, oil companies, and insurance companies as not needing any more tax cuts. So it's time for a little economics 101.
1. Banks are bringing in large profits. Is that really a bad thing Mr. Ignatieff? When someone wants to start up or expand a small business, where do they go? The banks. If someones business is struggling with the recession, where do they go for funds to get by? The bank. When someone wants to buy a car, where do they go? The bank. Does Ignatieff not realize that the number one reason the auto sector was in such dire straights was the fact the banks cracked down on credit due to lower profits? Lower taxes, bigger profits. More cash to put back into the economy.
2. Oil companies. Ignatieff and Layton, not to forget Duceppe, seem oblivious to the fact the oil industry contributes billions of dollars to government revenues. Revenues for health care and transfer payments Mr. Duceppe. They also provide highly paid jobs and invest heavily in R&D. It's also funny the coalition only mention Alberta's "big oil". Isn't Newfoundland experiencing an economic revival because of oil?
3. Insurance companies? Many insurance companies took a huge hit on investment losses due to the meltdown of the American markets. The coalition themselves point out corporations that don't make a profit don''t pay taxes. Do they realize corporations that make a profit do?
All of this is sound reason for going ahead with the corporate tax reductions. If that's not good enough for Layton, is the price of six cabinet seats and limos still acceptable?
4 comments:
Vert thoughtful and well thought out. It is perfectly logical to me. Although commonsense just seems to leave the room when the losers talk.
Keep up your posts.
Had it not been for Paul Martin our banking system would have seen mega mergers an as well, Canada would be an economic basket case like our best friends to the south.
Ireland dropped their corporate taxes to 5% and it did not stimulate anything. It just reduced revenues for the country and not put Ireland into the global economic dumpster. It did not stimulate business, it sank it.
I own a business, a business I started two decaded ago, with no help, no money, but with ambition, creativity and risktaking and a sound business plan. When I had no money, the banks didn't want to know me. When I ceated wealth on my own with no help from the banks, they were all over me wanting to find new ways to serve me.
How much was the promised National Daycare in the previous elections?
Doesn't anyone ever think about how various pension plans are funded, including CPP? They all need investment income, of which dividends form a major part. And dividends are paid for out of after-tax dollars. Higher taxes = lower dividends = problems for pension funds.
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