Editorial - Martin's blueprint
Winnipeg Free Press
Thu 22 Sep 2005
Page: A13

Section: Focus
Byline:
Source:

PRIME Minister Paul Martin wants his government to
prepare Canadians for the ageing of the baby boom generation and for the
emergence of China and India as middle class societies. The government certainly
should adjust to these realities, but Canadians have already done so. Mr. Martin
underestimates the capacity of Canadians to recognize and solve their own and
their nation's problems when the government gets out of the way and allows them
do to so.

Mr. Martin expressed his reliance on government action and his blindness to
private initiative in many ways in his speech to top civil servants at Gatineau,
PQ, this week. "I believe in the good that government can do -- that government
must be the leader of national undertakings that express our highest aspirations
and reflect our deepest values," he told the mandarinate. "If that sounds like a
prescription for activist government, well, that's because it is."

Mr. Martin wants to improve the position of aboriginal people by building
better houses on reserves, empowering Indian leaders, and reforming Indian band
governance. But aboriginal people on reserves are the only people in Canada who
are prevented by law from owning property and from keeping the fruits of their
labours, and this is a main reason why they remain extremely poor. Mr. Martin,
however, sees government programs, not individual economic rights, as the
solution.

Mr. Martin recognized in his speech that Canada has to compete with other
countries for the footloose investment dollar. "We are making our business taxes
competitive and we will keep them competitive," he said. But a C.D. Howe Institute study
published this week found that Canada levies about the highest rates of tax on
corporate incomes among industrial countries -- 39 per cent in Canada compared
to 38 per cent in the United States, 24 per cent in Australia, 22 per cent in
the U.K. and 12 per cent in Sweden. By that reckoning, Canada's business taxes
are far from competitive.

Canadian industry has already adjusted to rapid growth in India and China by
sending manufacturing and high-tech jobs to those countries and by expanding oil
and mineral production in response to Asian demand. As a result the Canadian
dollar is so high that tourism is already down and manufacturing is hurting. The
effects of the Asian boom are already here: Despite Mr. Martin's grand strategy,
Canada is reverting to a resource economy.

Mr. Martin recalled the shock he suffered in 1994 -- "a rookie Finance
minister sitting across from international creditors, being lectured about how
we were headed for the fiscal wall - for me, they serve as an unforgettable
reminder that nothing we want to do ... can be accomplished if we allow
ourselves to be caught up in the vicious circle of fiscal irresponsibility."

Mr. Martin's belief in the good that government can do coupled with his
determination to keep reducing public debt obliges him to keep taxes high. He
knows he should reduce them, but his most cherished value stands in the way.

Length: 503 words