00:00:00.000Welcome to Canada's most irreverent talk show. This is the Andrew Lawton Show, brought to you by True North.
00:00:12.640Coming up, we work our way through a Christmas wish list for taxpayers with our friend Franco Terrazzano of the Canadian Taxpayers Federation.
00:00:21.820The Andrew Lawton Show starts right now.
00:00:25.340Hello and welcome to Canada's most irreverent talk show, the Andrew Lawton Show here on True North.
00:00:34.100Just a few days until Christmas, and then we have a week after that, the New Year beginning.
00:00:39.920So it is time for us to put all of our cards on the table and demand what it is that we want from our lawmakers.
00:00:46.080Perhaps New Year's resolutions, maybe holiday gifts, you never know.
00:00:49.480The Canadian Taxpayers Federation has done exactly that, a taxpayer wish list, courtesy of our friend Franco Terrazzano, the federal director for the CTF.
00:00:59.060A dozen bills for MPs to introduce in Parliament.
00:01:02.560Some good stuff on there from requiring transparency for corporate welfare, though I would say just perhaps ending corporate welfare.
00:01:09.760And ending automatic MP pay hikes, ending the gas tax on tax.
00:01:14.460Some good stuff, big and small here, but I thought it would be a good opportunity not just to talk about the taxpayer wish list for the coming year,
00:01:22.360but even just some of the general themes that we've seen from the past year and the year ahead from a taxpayer perspective.
00:01:28.640Franco, welcome as always. Good to talk to you, sir.
00:01:32.000Hey, my pleasure. Thanks for having me on.
00:01:34.280Now, do you think that you are going to get many of the things on your list from government,
00:01:38.640or do you think you're getting the very expensive, heavily taxed coal?
00:01:42.500Well, yeah. Well, I mean, of course we're hoping so.
00:01:46.220I mean, the reason that we put these specific policies and potential bills out is because we were looking for something where we thought all politicians on all sides of the aisle can really get behind and move on.
00:01:58.140And we also wanted to give opposition members, whether NDP, whether Conservative or whatever, an opportunity to put forward private members' bills.
00:02:07.120Because sometimes we hear these opposition MPs throw their hands up and say, well, what do you want us to do?
00:02:13.000Well, what we want them to do is to get off their butts and start pushing some good private members' bill forward.
00:02:17.220Yeah, and I should say for context here, I mean, I think that if anyone were a fiscal hawk and they wanted to sit down and say, what are the, like, big sky, the sky is the limit ideas,
00:02:27.800they would come up with a list of, you know, philosophical concepts that might be a little bit radical in the current political environment.
00:02:35.060I'd say all of these are entirely attainable.
00:02:38.360You know, as much as I would support you if you had said abolish the income tax, that's not the direction you've gone with this.
00:02:43.620Well, that's exactly right. We're looking at the political climate and seeing where are some wins that we can do to make taxpayers' lives a little bit better, right?
00:02:52.200Because taxpayers need some relief, need a little bit more affordability in our lives, and we also need to reduce some government waste.
00:02:58.600And that's why we picked some topics here that we thought that all politicians, no matter where you are, can agree on.
00:03:04.560And Andrew, you said, well, I would want to abolish corporate welfare.
00:03:07.280Well, of course, that's the Canadian Taxpayers Federation's position.
00:03:10.380But one of the reasons that we put forward a bill to improve transparency around corporate welfare is just to make sure that there's actually some type of fiscal guardrails over there in Ottawa.
00:03:22.360Yeah, and I'm of the belief here, and perhaps this is overly idealistic, but I don't think it is, that if there were more transparency and accountability,
00:03:29.880a lot of the things we'd see wouldn't happen because I think governments tend to take advantage of how clouded and opaque a lot of these mechanisms are.
00:03:37.680And I think corporate welfare is a great example of that.
00:03:42.260I mean, in that piece of, that bill that we put forward on corporate welfare, we want to require every single member of parliament to be forced to vote in parliament before they gave a bunch of taxpayers' money to businesses.
00:03:56.360And we think that if they actually had to stand up with their names and vote on it, there'd be a whole lot less pork for certain hand-picked businesses.
00:04:04.420One idea here that I think it's important to talk about, I mean, we've spoken about the carbon tax.
00:04:09.780The Liberal government has doubled down and tripled down and quadrupled down on this.
00:04:27.280So what happens here is that you have the federal government that charges its sales tax on top of the price of gas, but also on top of all the per liter fuel taxes.
00:04:37.220So you add up all the per liter fuel taxes on top of the price, and then they charge their sales tax on top of that.
00:04:45.940And essentially what it means is that when the price of gasoline rises or when the other fuel taxes rise, this tax on tax costs Canadian drivers more.
00:05:07.340And speaking on profiting through the back door, another one on our list was to end the escalator tax on alcohol.
00:05:13.900So far, we've seen alcohol taxes go up twice during the pandemic.
00:05:18.220They're getting ready to go up again in 2022.
00:05:20.560Now, this escalator tax, it was brought in in the 2017 budget, and what it does is that it increases federal alcohol taxes every year by the rate of inflation.
00:05:31.580Now, obviously, this reduces affordability, but there's even a more pernicious element here, right?
00:05:39.320It allows our politicians to increase their tax take without actually voting in parliament.
00:05:45.100It allows them to duck accountability.
00:05:46.800Now, of course, at the Canadian Taxpayers Federation, we are against higher alcohol taxes, but if you're a politician and you want to increase taxes, at the very least, you should have the spine to stand up in parliament and vote on it.
00:05:59.880Yeah, and I mean, as I understand it, that's something that is constitutionally required.
00:06:05.600Taxes have to be very transparently and directly put into place.
00:06:09.300So the idea of an escalator tax, and I know that is a legal mechanism, but it certainly would contravene the spirit of the law, which is that governments have to be very clear in demarcating, yes, this is a tax.
00:06:21.220Well, it certainly goes against that, the very important principle, which is no taxation without representation.
00:06:30.780So let's, I mean, we'll return to the list in a moment, but I want to talk about some of the bigger picture themes here, because I think most people would agree that the pandemic has been a disaster for taxpayers.
00:06:41.000And I know that there are probably some arguments, in fact, many arguments, in favor of the idea that if government's going to say you can't work, it has to fill that economic void in a way.
00:06:50.140And I know that every country around the world has put forward billions and trillions of dollars of pandemic response mechanisms.
00:06:56.780So some levels of big spending were inevitable here.
00:07:00.100But I know that at the same time, that's no excuse for just not paying attention to fiscal restraint, which seems to be where we've gone as a country.
00:07:08.180Well, let me just piggyback off that, right?
00:07:11.300You've heard a lot of people who have said, well, you know, spending has gone up because of the pandemic.
00:07:17.140Well, if you look at the spending in 2020, the vast majority of the federal government's spending is not related to COVID-19, even during 2020.
00:07:28.680And then, Andrew, let's look back to pre-pandemic.
00:07:31.440Well, in 2018, the federal government was spending all-time highs.
00:07:34.300The Trudeau government was spending in 2018 more than in any single year during World War II when the federal government was spending that.
00:07:41.840So we have to remember that context of the massive spending that was going on even before the pandemic.
00:07:48.300Andrew, let's take a quick look ahead until 2026, which is what is covered under the last budget.
00:07:54.440Well, the federal government is using the cloud of COVID-19 to go on a debt-fueled spending binge.
00:08:00.900By 2026, Finance Minister Chrystia Freeland wants to increase permanent federal government spending by more than $100 billion.
00:08:11.280That is years after COVID-19 first touched down.
00:08:15.760And I know there was that report from the Parliamentary Budget Officer a little while ago that we were on track to run up deficits until I think it was like 2070 or 2072 or something like that.
00:09:17.260Well, this could have been the most expensive election in Canadian history.
00:09:21.000We saw estimates saying that this could cost us $600 million.
00:09:25.880But, Andrew, that's not even the real full cost that taxpayers need to be worried about.
00:09:30.020We need to be worried about paying for these election promises.
00:09:33.480The Liberal Party, they wanted to spend $78 billion more than their last budget, which was a huge spending budget, as we just talked about.
00:09:42.820So, what we heard from the Liberal Party was more borrowing, but we didn't hear a peep from them on when they're going to balance the budget.
00:09:51.300And I think if you look at Trudeau's track record, remember back in 2014, he said the budget would balance itself.
00:09:58.800Then you look when he's running for Prime Minister first in 2015.
00:10:01.940He said he would balance the budget by 2019.
00:10:04.620Well, of course, he missed that target by a country mile.
00:10:06.980So, I think if you look at the track record of Prime Minister Justin Trudeau, then you look at his Liberal Party's promises in the last election, I think it's a good bet that the Liberals will never balance the books.
00:10:18.700Yeah, and I know you had pointed out during the election that no party was really putting forward a solid vision that gave a clear path towards balancing the budget.
00:10:28.280I mean, at least Aaron O'Toole and the Conservatives were talking about the importance of balancing the budget.
00:10:32.760They said they would do it within 10 years, but not really a concrete plan on how to get there.
00:10:38.200So, are you concerned that a lot of these things are just no longer relevant in the Canadian political discourse?
00:10:44.700Well, let's talk about what the Conservatives put forward, right?
00:10:47.880So, I guess a little bit of kudos for mentioning that they would balance the budget, but I mean...
00:10:53.560Yeah, they at least pretended it mattered.
00:10:55.860Yeah, it was in the platform, but even O'Toole's plan was not credible.
00:11:01.160Like, we're talking about the largest amount of federal government spending pre-pandemic, and then this massively bloated budget.
00:11:10.200O'Toole could barely find any places to save some money.
00:14:53.280You joined a great panel discussion we had on this show a couple of months back on inflation.
00:14:57.260And I think that's a huge issue, where just the sheer disconnect between the government and the average Canadian household is massive.
00:15:06.300Well, you know, first of all, thanks for having me on that panel.
00:15:09.360I think one of the reasons that politicians are trying to turn a blind eye to the inflation problem is because, well, guess who's behind the inflation problem to a large degree?
00:15:21.920Let's just talk about how the Bank of Canada is printing up new dollars to buy up all this Government of Canada debt.
00:15:27.600The Bank of Canada has created $370 billion during the pandemic.
00:15:31.700And if it sounds like a lot to you, well, it is.
00:15:34.480That's a 300% growth in the Bank of Canada's assets.
00:15:38.460And a lot of what the Bank of Canada is buying up with these newly created dollars is Government of Canada bonds, which is just federal debt, right?
00:15:47.620So it sure seems like Ottawa is using the printing press to finance a good chunk of its deficits, which means that it's devaluing our money and our paychecks and our savings account.
00:15:59.640Now, you can see why these politicians obviously don't want to talk about it, because they deserve a large part of the blame.
00:16:06.900And for these politicians to really tackle the inflation problem, well, they're going to have to roll up their sleeves, they're going to actually have to make some tough decisions, they're going to have to show leadership, reduce their own pay, and they're going to have to take on the union bosses.
00:16:20.660Yeah, and this is where you get into the big problem of this, because I would say, going back to your wish list for a moment, some of the things you're calling for here, transparency for corporate welfare, this should be an issue where the Conservatives and the NDP could work together.
00:16:41.920But, you know, an Auditor General for spending within First Nations communities, a lot of these things should not be partisan, but in so many areas, they are.
00:16:53.060And, like, when are we just going to have some politicians that really work for Canadians, rather than this business interest, this union boss interest, or their own interest?
00:17:02.360Because on that list, too, Andrew, and we've talked about this before, is the fact that all Members of Parliament have received two pay raises during the pandemic.
00:17:11.380Now, if these politicians were really working for us, it should have been a no-brainer to, at the very least, stop these pandemic pay raises for the MPs, right?
00:17:22.020Your backbench member of Parliament is collecting a lot of dust right now, but he's also, or her, is also collecting an extra $6,900 since the beginning of the pandemic, which is just absolutely absurd when you think of just the carnage that has happened to so many people in the private sector.
00:17:39.020Job losses, pay cuts, small business owners, right?
00:17:42.200People who have done everything right their whole life, put money away so that they can reinvest in their community.
00:17:47.600Well, they've been taking it on the chin, all while their supposed representative in Ottawa has been collecting bigger paychecks.
00:17:54.300And we've even identified 31 jurisdictions across the world, there's probably more, that at some point had their politicians reduce their own pay.
00:18:01.920I always like to point to New Zealand, because almost immediately, New Zealand's Prime Minister, ministers, and even top bureaucrats all took a 20% pay cut, because they wanted to show solidarity with their struggling taxpayers who are signing their paychecks.
00:18:16.620There is no reason why we couldn't have seen that in Canada.
00:18:21.200And just talking about accountability here, one of the items on your wish list we've talked about in the past in the Alberta context, because they moved forward with legislation on this,
00:18:30.320implementing recall for federal politicians.
00:18:33.660This is something the federal government could do.
00:18:35.640The cost would be relatively negligible, because the cost is only triggered when there is a recall campaign.
00:18:42.900But ultimately, this is something that we haven't heard any discussion about federally.
00:18:46.360It wasn't in the Conservative platform.
00:18:48.280Federal Conservative politicians, nor any federal politicians, are taking this up.
00:18:53.120Well, that's why we're starting to talk about it, and we're pushing it, right?
00:18:56.420And we have to remember, we've had recall and initiative in British Columbia since 1995, and we've seen some successes there.
00:19:04.500Fortunately, we just had it passed in Alberta this year.
00:19:07.360That's a big win for taxpayers and accountability in 2021.
00:19:11.020Andrew, I'd just like to talk about one of the key things about Alberta's recall is that it also goes to municipal, so you can hold your councillors and mayors accountable.
00:19:18.240So that's why we're creating, we are creating, trying to create some momentum to get it at the federal level as well, because I think we can all agree from coast to coast, one of the places that is lacking transparency and accountability is Ottawa.
00:19:32.700Yeah, and you know, the further removed Ottawa gets from the people it represents, the less accountable and transparent government gets.
00:19:39.060And I'd say the less representative policy passed in Ottawa is of the people it's supposed to be representing.
00:19:44.960So hugely, hugely beneficial to put direct democracy on the table in that form.
00:19:51.300Just looking, generally speaking, I know we've talked about the deficits that are going to be arising for the next 50 years and all the Liberal campaign promises.
00:19:58.880What's the big story you're watching in the year ahead?
00:20:01.320Well, the big story, and if I can say stories, is going to be spending, borrowing, government borrowing, and inflation.
00:20:12.100We've seen inflation numbers quite high in Canada.
00:20:15.540I think that might be the key economic issue for so many families, right?
00:20:20.920We're seeing the prices go up in grocery stores.
00:20:23.680We have seen very high gas prices here in Canada in the fall.
00:20:27.080And I just think that, especially coming off of a time when so many people lost their job, many people took pay cuts,
00:20:33.880I think a rising cost of living is really coming at the worst possible time for so many Canadians.
00:20:38.860So I think that is going to be perhaps the key economic issue, and it'll likely also go into one of the key political discussions.
00:20:46.700And, you know, I think it's very important to note here is that this inflation is showing all Canadians that there is no such thing as a free lunch when it comes to government spending, right?
00:20:57.260This unprecedented amount of spending, this massive amount of borrowing has been driving up the cost of living.
00:21:03.240And on that note is another thing we have to keep an eye out on, and that's the tax hikes that we're going to be seeing next year.
00:21:10.240Alcohol taxes are going up again next April.
00:21:12.680The carbon tax is going up again to 11 cents per liter next April.
00:21:16.700And it turns out the joke is going to be on taxpayers again, April Fool's Day 2022.
00:21:23.380One story as well that I'll be paying attention to, and I know you've done a lot of work on this, is the gun buyback.
00:21:29.360So right now the Liberals have racked up huge expenses despite not actually buying a single gun back.
00:21:36.120Now, my approach on this is as a firearms owner, whereas I knew you've come at this issue from a taxpayer's perspective.
00:21:42.680But what's interesting here is that the government set, when it put this gun ban in place in May of 2020, a two-year amnesty period, which expires in May of 2022.
00:21:51.760So that's less than six months from now.
00:21:54.080Canadians were supposed to have that two years, or as much of that two years as possible, to turn in their guns to the government.
00:22:00.680Right now, there's not even a mechanism to do that, yet the government's still spending money to administer this non-existent program.
00:22:07.800Yeah, I mean, all the makings of a boondoggle.
00:22:52.380But it gets even worse than that because you also heard the RCMP union say that it could actually make Canada less safe.
00:23:00.940And that's because it's going to divert resources from actually tackling crime to tackling law-abiding citizens.
00:23:09.300So we hear that it's going to be ineffective.
00:23:11.940But we also know that it's going to be extremely expensive.
00:23:15.780And that's where the CTF comes into this, right?
00:23:17.920Because the parliamentary budget officer says that, well, the cost just to reimburse these gun owners could be up to $756 million.
00:23:28.240But even that cost leaves out the biggest cost driver, which is the administration cost, which is the staffing cost.
00:23:35.460Now, fortunately, we've seen reports from the Fraser Institute that estimate, well, I say fortunately, thankfully, we're getting some numbers.
00:23:43.240But unfortunately for taxpayers, the cost of administrating this whole thing could be in the billions and billions of dollars.
00:23:51.080Yeah, fortunately, we know, not fortunately, that we have to pay for it.
00:23:54.280Well, we'll certainly keep an eye on that.