Canadas mining industry is globally competitive, and has long succeeded without much in the way of government subsidies. It even thrived in the last recession by responding to market demand. Yet instead of letting markets drive mining investment in Quebec, the provincial government is bailing out the asbestos industry using taxpayer money - and this for a product that is harmful to human health.
corporate welfare
From the federal government to provincial governments, the tendency to hide information taxpayers have bought and paid for seems all too common. Regardless of the party label, few governments give up information that is potentially embarrassing without a fight.
Given the revisionist history in play, lets place that 2009 deal in proper context.
In late August, Ontario offered up $2-million to Dana Holdings and $3-million to Centra Industries, both in Cambridge, Ontario. Predictably, the usual flawed justification was offered: taxpayer subsidies will create or preserve jobs.
Milton Friedman once said his greatest fear about the 1979 bailout of Chrysler by the U.S. federal government was not that it would fail, but that it would succeed. Friedman didnt mean he was wrong to oppose it. What concerned him was how Chryslers rescue (approved by the U.S. Congress in late 1979 and signed into law by President Jimmy Carter in 1980) might lead some to draw the wrong conclusion: the notion that such actions save jobs, among other illusions.
Canadas federal election was supposed to be the Seinfeld campaigna contest about nothing, at least until the NDPs polling numbers shot up. But regardless of how campaigns are tagged, they are always about something. This latest one should be called the Santa Claus campaign. That is, promises galore with only scant attention paid to how such election-time Christmas gifts will be financed.
When the federal and Ontario governments transferred $14.5 billion in taxpayer cash to GM and Chrysler in 2009, they likely did so with the best of intentionsto preserve jobs, though no doubt southern Ontario votes also figured heavily into the equation. But in a recent analysis from Dennis DesRosier, the automotive analyst noticed that employment in the Canadian automotive sector, despite the bailout and economic recovery, continues to fall.