Economic Crisis and Coalition

Canadian Labour Congress Statement

Why We Need a Coalition Government
to Deal with the Economic Crisis.

The Economic and Fiscal Update released by Finance Minister Flaherty on November 27, 2008 demonstrates that the Conservative government has no intention of seriously dealing with the global economic crisis and the prospect of fast rising unemployment.

The recent G-20 Summit meeting called on governments to “take urgent and exceptional measures” to stimulate their economies in a co-ordinated way to stop a slide into a global depression.

The incoming Obama administration in the United States plans to invest $500 to $700 billion in January 2008 to create 2.5 million jobs over the next two years, with a major focus on public infrastructure, the environment and improved unemployment benefits.

The governments of Britain, Australia and China have already followed up on G-20 calls for investments of about 2% of national income, which would amount to $30 billion in the case of Canada. The European Union have just introduced a major package.

Instead of acting here, the Conservative Economic and Fiscal Update pretends that yesterday’s tax cuts have already done the job and says that “the Government is planning on balanced budgets or better for the current and the next five years.”

Instead of investing in jobs and people, the Conservative government plans to cut spending by almost $2 billion next year. That is on top of cuts to equalization payments to the provinces of $1.8 billion next year and $5 billion the year after. The government plans to raise more than $2 billion next year by selling off public assets (at what will be fire sale prices). It also signalled a move to shut down pay equity in the federal jurisdiction.

The Economic and Fiscal statement put forward a rose-coloured economic forecast which completely ignores the reality of large recent job losses and a looming recession. It forecasts economic growth of 0.3% next year, compared to the TD Bank’s forecast of a fall in Gross Domestic Product of 1.1% in 2009. It forecasts an unemployment rate of under 7% next year, while TD Bank forecasts the national unemployment rate will rise from 6.2% today, to 7.6% in 2009, to 7.9% in 2010.

In short, the Conservative government has no positive plan to deal with the crisis and intends to respond to a downturn through cuts rather than needed investments in jobs and people.

Rather than work to bring Canadians together, they chose to use the excuse of a crisis to try and ram through a partisan and mean-spirited agenda.

The Conservatives are unwilling to make Parliament work and refuse to provide Canadians with the leadership they need to weather the deepening economic crisis.

We deserve better.

The Canadian Labour Congress has called for a major package including:

– A multi year public investment program covering basic municipal
infrastructure, energy conservation, public transit and renewable energy,
twinned to Made in Canada procurement programs;
– Investments in job creating public services like child care;
– Improvements to Employment Insurance benefits and increased
investments in training;
– Measures to protect workers’ pensions and improve public pensions;
– Concrete action to save manufacturing and forestry jobs and to help hard
hit industries restructure thorough new investments.

We are greatly encouraged that the Opposition parties are prepared to work together around a positive agenda and strongly support efforts to provide Canadians with an alternative that works in the country’s best interests.


  • Really excellent statement, Andrew, & good work yesterday.

  • Go PEF Go !

  • There is a disturbing report that the coalition government will be advised on the economy by a council of Frank privatize it McKenna. Paul slash it Martin, John free trade it Manley, and Roy public health care Romanow. The government needs to be run by elected members of parliament, not Liberal retreads, and an NDP slatwart who can be out-voted. This is an attempt to diminish the NDP contribution to the government on the economy and pump up the big bank end. Will McKenna step down from the TD bank job? Will Manley leave the CIBC board?

  • Hi,

    I was reviewing this article and it seems as though we need to take ourselves back to investing in people on all levels-on a micro-level i.e. the poor, homeless, OW & ODSP recipients those who are weak will at some point dis-empower those who are stronger on a financial level. Believe it or not, the homeless person sleeping on the street costs everyone money, how? Police time, investigation, pan-handling; these monies can be used in a different way to help the poor and it can be monitored, crime-invest in those who are criminals can promote growth in our economy how? providing them with business and educational opportunities will in turn stimulate our economy from a micro-level to marco-level. Those who are weak drain the system i.e. social welfare system should be temporary, if we invest in the weak individuals of society our economy can be boosted significantly and Canada will be the leader in North America. Those who are weak hold back those who are strong. Make business grants, very low interest rate loans exetremely accessible to inventors, people with wealth creating ideas, there should be no poor among us because this is where our economy needs to be strengthened. Let’s draw a mock GDP anaylsis, take those who are in prison, living off the system, on the street, etc-for example give them a business opportunity or a job etc-the GDP will be boosted-huge growth in Canadian economy. This will certainly boost the Canadian economy, significantly. Believe or not everyone in children and youth have something to offer our GDP. We will come out as leaders in North America. We will be able to participate in large scale investment opportunities throughout the world more confidently.

  • Duncan, I hear you saying that a coalition government with such an advisory board would be worse than a Harper government and separate opposition parties.
    That the existing set up would have more potential of achieving PEF goals, unless a different advisory board is developed for the coalition, or perhaps in any case.

  • Not worse Leigh. What I do not like is the Liberals spinning when we need new policies.

  • agreed, thanks for clarifying. people have been postulating about downing Harper but not forming a coalition as you know, but it seemed a possible outcome of that scenario could be a possible majority of unsavoury disposition in the shorter term.

  • There is no need for any stimulus. Supporting this coalition with the Bloc Bastards is disgusting. We in the West will not let it happen. Be prepared to fight, we are.

  • “There is no need for any stimulus.”

    You must be a survivalist.

  • My objection is to an oversight committee of the economic plan that includes not one woman, not one francophone, and not one trade unionist. What this looks like to me is an attempt to forestall a renewal of Employment Insurance, increase in the minimum wage, and generally attempts to reduce precarious employment. One of the great Keynesian points is that attempts to reduce wages in a period of stagnation, produces more stagnation. Martin, Manley and co. were sucessful in the 1995 budget, in forcing people to work for less. Precisely the opposite course is needed today, that is the meaning of stimulus. Does our oversight committee from Bay St. get that? Rising real wages is the policy objective the coalition needs to pursue. Every business body has been agressively pushing the opposite since about 1979.
    The debate we need to have is about what the coalition can do in going beyond saving Bay st. and corporate capitalism, which from the Liberal side is the name of the game. Agreed, a return to macro-economic thinking is good, fighting recession/depression is good. But we need to introduce support for new forms of social ownership, and, as well, reversing income equality, not just stimulating for stimulation sake.

  • Could the advisory board be a case of “Only Nixon could go to China?”

  • Normally I would be with Duncan on this one: hardly a stellar group of Wise Men. On could argue that in fact the so-called wise men were the fifth column of neo-liberalism in Canada. Or even better the Barons who switched sides during the battle.

    But here is the thing. The Wise men may not be so wise or at least not very independent thinkers.

    Let me call this pickle theory of politics. Free Trade, tax cuts, fiscal retrenchment and the neoliberal litany were very much the ideological brine of their day.
    Hence we got neoliberal tasting pickles.

    Today the brine is very much the same with one important change: fiscal stimulus. So we should get a little sweeter tasting neoliberal pickle with these wise men.

    Oh wait that puts me Duncan’s side…Anybody want a pickle?

  • I think that it is improtant to participate with all. Important to choose the priority and relevant solution. Don’t be worried. It wll be gone later……… Wrok correctly and with full of believes…

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