Letter to the Editor – Ken Smith of Cornwall Ontario – Reigning in corporate tax cuts – April 14, 2011

Letter to the Editor – Ken Smith of Cornwall Ontario – Reigning in corporate tax cuts – April 14, 2011

The Quebecor Sun Media news chain, including our Standard-Freeholder, has circulated another dubious story on basement corporate tax cuts.
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Jim Hendry, editor of the Peterborough Examiner, has issued a new piece “Lower corporate tax cuts are an economic winner” for the multi-corporate news agency.
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Hendry cites Stephen Harper’s claim that the most recent $6 billion corporate tax cut will “generate 100,000 new jobs and $30 billion in investment to expand production.”
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I guess we should just take Harper’s word on that, given his shining record on accountability.
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Since the 2008 recession began 64,000 part-time jobs were created, replacing a decline of 11,000 full-time jobs. Stats Can reports a net increase of only 53,000 jobs between October 2008 and March 2011.
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And yet Harper proposes an upcoming leap to 100,000 new jobs with the latest $6 billion giveaway. The previous $54 billion of incentives to the largest corporations did not stimulate recognized job growth. So how is the current $6 billion reduction supposed to jumpstart our economy?
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How are large corporate banks and insurance companies going to stimulate Canada’s industrial revitalization and grow our production sector? The Harper job leap is a dangerous leap of blind faith.
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Hendry enlists economist Stephen Gordon’s view that falling worldwide machinery prices indicate a Canadian corporate investment in equipment.
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The Globe and Mail shows corporate cash reserves, since 2008, have increased by $83 billion. While spending less on new machinery as a percentage of GDP since lower tax rates began 10 years ago.
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Also, most corporate recipients are multi-national, using some of the funding to create jobs outside our country.

“What’s happened is this money was either paid out in profits or they are just sitting on it, which is not what you want in a recession,” explains David MacDonald of the Canadian Centre for Policy Alternatives.

So, Mr. Harper, how many times can you flog a dead horse?
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