Wednesday, January 7, 2009

CCPA: Spend billions to boost economy

The CCPA is a left leaning research group. Certainly most of the areas that the group recommends expenditures are deserving of more investment. The percentage of GDP being used as a stimulus is in line with what some economists have recommended however it is doubtful that Harper will spend that much. Flaherty would rather have less govt. spending and more money will be used for tax cuts. As a result the Harper govt. may very well create just as great a deficit by depriving govt. of revenue if not more than the CCPA plan that contains more govt. spending.
The Canadian Taxpayer's Federation certainly will not like the CCPA plan nor even the Harper expenditures to help 0ut the auto companies. I heard a spokesperson on TV and he at least was consistent in calling for tax cuts but no bailouts for what he called failing companies. At least this is a consistent view but Harper is no longer working for the Taxpayer's Federation and to keep his job he must at times ignore his ideological preferences. Even Harper is a Keynesian for the moment at least! There will certainly be money spent by the govt. as part of a stimulus package by Flaherty but probably nowhere near what the CCPA recommends, just enough to buy off the Liberals.

Spend billions to boost economy: Canadian Centre for Policy Alternatives
Last Updated: Tuesday, January 6, 2009 11:38 AM ET
CBC News
The Canadian Centre for Policy Alternatives has jumped the gun on Ottawa and released its annual Alternative Federal Budget.
The centre suggests the federal government should spend $32.9 billion, or 2.1 per cent of GDP, in 2009 to stimulate the Canadian economy. It says the economy would get a three per cent boost and 407,000 jobs would be created.
The CCPA is an Ottawa-based research institute that calls itself one of Canada's leading progressive voices in public policy debates.
If the centre actually had access to Ottawa's coffers, it would first spend $14.7 billion to strengthen and build municipal infrastructure, affordable housing, child care, and post-secondary education.
That would suit the Association of Universities and Colleges of Canada. On Monday, it called on Ottawa to invest in post-secondary education in the Jan. 27 budget. It says Canada's schools need at least $5 billion in maintenance and renewal work.
The Canadian Centre for Policy Alternatives also says Canada's employment insurance program needs fixing. It would spend $3.4 bil­lion to increase benefits to cover 60 per cent of insured earnings and extend benefits to 50 weeks.
Another $9 billion would be used to help reduce poverty and increase income for seniors, children, and the working poor.
The alternative budget would spend $5.8 billion to invest in training and education as well as energy retrofits. And it would take advantage of the sagging housing market by buying up ground floor condominiums in major cities to create more affordable rental housing.
But don't bother looking for tax cuts in the alternative budget.
"Government spending provides more stimulus than tax cuts because it creates more jobs," said David MacDonald, the co-ordinator of the Alternative Federal Budget. "People who have jobs spend. People who lose them do not."
However, the federal finance minister has strongly suggested tax cuts are on the way.
"There are a couple of ways to stimulate the economy," Jim Flaherty said last week. "One is spending on the infrastructure side and other ways, and tax reductions — leaving more money in people's pockets — is also stimulus to the economy."

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