The following article by National President Paul Moist appeared in the National Post February 25, 2010.
As the country emerges from recession, our federal government will be faced with spending choices that will affect Canadians for years to come. How the government chooses to spend – or not spend – in the coming federal budget will define us as a nation, and will strongly impact quality of life for all Canadians. With looming infrastructure, education and social deficits, a balanced budget should not be our only goal.
The federal government has signaled plans to shrink the deficit to less than a tenth of its size over the next five years – to be achieved, apparently, without any tax increases.
But our fiscal deficit – compared with those of other countries – is manageable. Canada’s job shortage, and our physical and social infrastructure deficit, is not. Here, we require new public funding in order to remain competitive. The focus of this budget, above all else, should be on public investments that stimulate the economy, support the vulnerable through a slow recovery, and ensure a sustainable future for the next generation.
Rushing to erase a deficit after a recession can actually prolong stagnation – as it did in the U.S. in 1937, when employment slumped after post-depression stimulus was replaced with austerity measures. Fortunately, today, in Canada, we don’t have to rush. Canada is in the best fiscal situation of all G7 countries. Interest rates are low, and the federal debt/GDP ratio - a key measure of the country’s financial health - is half of what it was during the recession of the early 1990s.
The outlook for Canada’s labour market is less optimistic. Economic recovery is expected to be slow and lengthy. And even with the current federal stimulus, Canada’s unemployment rate remains unusually high - at 8.5 per cent, it’s a full point higher than the government predicted in last year’s budget. Of the new jobs that have been created, many are part-time, offer fewer working hours, and little – if any – benefits.
In addition to tackling the jobs deficit, we need to ensure that good jobs are available for the next generation. Without sufficient planning, this will be difficult. Canada’s baby boom retirees will leave a shortage of skilled workers, and without a national commitment and immediate plan for training and education for future workers, our unemployment rates will stay high, even as skilled jobs go unfilled.
In the coming budget, the government will have the opportunity to make public investments that create new jobs and set up a sustainable future for the next generation of Canadians.
To mitigate a skills deficit and subsequent labour shortage, Canada should be investing in education and training – this means transferring more funding to the provinces to ensure more accessible, affordable post-secondary education at universities, colleges, and apprenticeship programs.
In a time when infrastructure spending is still greatly needed, Canada has a golden opportunity to invest in national “green” infrastructure. This would encourage the growth of green industries, with the lucrative potential to make Canada a leader in green technology and innovation. And beyond the short-term payoff of job creation, green investments keep delivering a cleaner environment and ongoing energy efficiency and cost savings.
Finally, investing in public services creates more jobs than tax cuts, and improves living standards for all Canadians. Seniors’ care – already under pressure – will fall under additional strain as the baby-boom generation ages. Canada urgently needs a national strategy and increased funding for public long-term care services. A national early learning and child care program would allow more parents of young children to participate in the workforce. Affordable housing and social assistance programs provide essential support to the vulnerable. Public recreation programs, libraries and transit help to support the many families who have had to curb their spending during the economic downturn.
In a time of deficit, public sending boosts employment while creating something of lasting value for future generations. Investing today for better economic and social well-being tomorrow should not be seen as a fiscal burden. However, focusing solely on erasing a manageable deficit, while failing to invest in the future, could leave a legacy of social imbalance that may be felt for decades.