An interview with Claude Généreux, national secretary-treasurer of CUPE. By Pierre Ducasse
Pierre Ducasse: With the recent economic crisis and the return of deficits, governments are tempted to make cuts to public services and employee benefits. How should we react?
Claude Généreux: It’s important to remember that workers didn’t cause this crisis. Some attempts have been made to plant amnesia in the public opinion regarding the root of the crisis.
In reality, the return of the deficit stems from the financial crisis in 2008, a crisis created by big business. The very people who caused this crisis, and who raked in profits based on speculation, later pleaded with governments to save them once they were out of luck.
The deficit we face today is not a structural one; but rather one related to the current climate. It’s not a result of public spending or public services.
PD: Should we believe that governments “have no more money” and “have no choice” but to make cuts?
CG: No, that’s far from the truth. Sure, some countries have more trouble than others. But in Canada, we are in a relatively good position. Deficits will be absorbed quite quickly. In Ontario, for example, the budget will be balanced within seven years. Public spending is clearly not out of control.
In Wisconsin, the public finance crisis and the subsequent attacks on unions were completely fabricated. Wisconsin had absolutely no deficit before the government started giving massive tax breaks to big business.
PD: Should tax fairness be an important issue in the federal election campaign?
CG: Definitely, yes. We have found ourselves in a situation where Harper is lowering corporate taxes while we struggle with a deficit and cuts to public services. The government is suffering from self-inflicted fiscal anorexia.
The ratio of taxes paid by corporations as compared to individuals is half of that of the 1960s.
But alternatives do exist. We could start by re-examining certain tax loopholes without harming the economy whatsoever. The United States has a combined corporate tax rate reaching nearly 40 per cent. In Canada it’s closer to 30 per cent—that’s a 10 per cent gap. We’re already ahead of the game in terms of corporate taxation compared to our closest and biggest competitor. There is room to manoeuvre.
And then, there’s the question of natural resource royalties. In Saskatchewan, for example, royalties on potash are a mere five per cent. It’s a reminder of what Duplessis did in the 1960s, when he sold Quebec’s North Shore iron for “a penny a ton.”
The Harper government argues that tax cuts for businesses will create jobs in the long term. But we believe investing in people and in public services will have a bigger, immediate impact on the economic recovery and for job creation.
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