Federal Election: Does Anyone Deserve Your Vote?

We are currently in the midst of likely the shortest election campaign timeline the Federal government can run, and I am hearing the odd soundbite that makes me perk my ears up, but is there really anything to get excited about?

Using BNN Bloomberg’s write-up about where each party stands so far, I wanted to give my own two cents on them. It’ll be easier to read through the promises on the Bloomberg site than here, but I provide colourful commentary!

Corporate Taxes

The Conservatives want to make companies pay three percent of their gross revenue in a digital service tax if they don’t pay corporate income tax here.

That seems pretty weak to me for a political organization that says it wants companies to pay a “fair share of taxes”, but maybe I’m missing more details here.

The Liberals want to raise corporate income tax on the largest banks and insurers from 15% to 18% on all earnings over $1 billion dollars. They seem to think that this will raise $2.5 billion dollars over the next four years for the federal coffers.

Again, this seems very weak to me. What about doing this to all corporations with revenues over a billion dollars? What about getting to a corporate tax rate of 20% on all earnings over $2 billion dollars? Make it more progressive where those organizations that are the most successful, pay a bit more? There are a lot of countries that tax corporations more than Canada does.

The NDP also wants to do a 3% increase on corporate tax rates but doesn’t seem to have all the additional stipulations of being for banks only or for profits above a billion dollars. They also note that they want to create a temporary tax on large companies that enjoyed a windfall due to the pandemic.

That seems like a weirdly selective tax, and I’m not a fan of those. We also know that it’s rare for taxes to be temporary in nature, even if that’s the original intent. Lastly, they’ve said they want to make internet giants “pay their fair share”, the language is so soft that it’s almost not worth mentioning. I expect numbers and details and not catchphrases.

Energy and Environment

The Conservatives do think about power, but maybe not as much about the environment. The things they want to do are all focused around increasing our energy source development so that we can make more money as a country. They do want to introduce a zero-emission vehicle mandate for the sale of light duty vehicles having a requirement of 30% zero-emissions by 2030 and they want to invest a billion dollars in electric vehicle manufacturing here in Canada, but those are drops in the bucket when they also want to invest $1.5 billion dollars in Newfoundland’s offshore oil industry.

Their lack of a proper balance here makes them a non-contender for me. With recent reports stating that we are way behind stopping this planet from heating up more than 1.5 Celsius, I want to see more focus on renewable energy, lowering pollution and was hopeful to see a take on that which considers the financial needs of Canada and Canadians.

The Liberals have been behind on their talking points. I think the Conservatives pushing out a full platform from the start threw them off a bit.

The NDP have some okay ideas, but they don’t back them up with any kind of financial numbers on how they’ll be achieved. They say they’ll set a target for reducing emissions by at least 50% by 2030, and be net carbon-free for electricity generation by the same time and non-emitting for electricity by 2040.

But how will Canada afford that? What if they don’t stay in power long enough? Their plans should be restricted to the four to eight year time horizon a party has when given control over the government.

Fiscal Plan

The Conservatives pledge to balance the budget over the next decade and that their jobs plan will reduce unemployment. That’s not impressive to me.

The Liberals say that they’ll invest an additional $6 billion to support the elimination of health system waitlists. That doesn’t seem like a very strong fiscal plan unless those that are waiting for surgeries and specialists are the highest tax revenue supplying people…

The NDP promise to balance the budget when “it is prudent to do so”. Whatever that wishy washy statement means. I’m not impressed by this either.

So that’s zero for three in what I’d consider good fiscal policy so far… Weird that the Conservatives who are often all about fiscal planning dropped the ball in this area. Maybe because they realized that during world changing events, promises here can be ropes around the neck?

Housing

Housing is probably one of the biggest election issues this time around because I think so many people realized that during a pandemic, you don’t want to share as much space with other people, especially stranger roommates or in giant high-rise towers with a bunch of common areas.

The Conservatives want to build one million homes over the next three years. They want to ban foreign investors for two-years. They will not tax Canadians’ capital gains on the sale of their principal residence and they want to adjust the mortgage stress test in hopes of reducing the perceived discrimination against small business owners, contractors and other non-permanent employees.

I think there are some good pieces here. Their build goal seems fairly strong, though still not enough if our immigration numbers and birthrate stays fairly consistent to how it was pre-pandemic. I like that they are trying to help more people pass the stress test and get a house, but that will only increase the prices of houses in competitive areas, and the short term ban on foreign investors probably won’t do much in my opinion.

The Liberals want to commit $1 billion dollars to loans and grants for rent-to-own projects. They want to give those under 40 a first-home savings account that’s tax free to save up to $40,000 towards their first home. They want to double the first-home buyers tax credit to $10,000. They want to reduce the cost that people pay for the CMHC mortgage insurance by 25%. They want to build, preserve or repair almost one and a half million homes over the next four years. They want to ban blind bidding. They want to do a temporary ban on foreign ownership for two years like the Conservatives. They want to expand the upcoming tax on vacant housing, and try to figure out a way to stop renovictions as a way to increase rents.

There is so much to unpack here, but as many people have stated, the Liberals have had time to try to do these things over the last six years to make some of these things happen. They knew it was an issue and didn’t make any inroads on these kinds of things. The Canadians under 40 thing with regards to purchasing a first home with help from a tax-sheltered account seems like an arbitrary age. Why put any age limit on it at all? If you want to buy your first home in Canada, here’s an account to help you save. Simple. Effective. I wonder though what the loss in tax revenue might look like with an account like this allowing people to reduce their taxable income… but if we could all save, we’d have full TFSAs and RRSPs and life would be grand and that’s not really what’s happened.

The NDP makes some stronger moves and some weaker moves with their proposal. They plan on bringing back 30 year CMHC insured mortgages. They are looking to build 500,000 affordable housing units within ten years. They want to add a 20% tax on foreign home buyers. They want to waive the federal portion of GST/HST on construction of new affordable rental units. They want to provide a $1,500 homebuyers tax credit as a rebate so you get it when closing on your home and don’t have to wait until tax time. They want to allow people to buy a home with money provided by friends and roommates. They want to make home inspections mandatory when selling a home. And they want to give families in need of housing up to $5,000 per year in assistance for rent.

Longer mortgage timelines will increase the price of houses as it create a false narrative of affordability. Half a million houses over the next ten years is pathetic when the need is closer to half a million houses per year. A twenty-percent tax rate on foreign buyers is the best of the three parties, but also potentially a bit weak when you’ve had a housing market that has seen gains larger than that over the last couple years in certain markets. I see lots of detailed promises, but I don’t think any of them are going to have the overall effect they are hoping for. Since the NDP is unlikely to form the next majority government, their ideas should be even more revolutionary, especially when it comes to one of the most important considerations of this election.

Jobs and Economy

The Conservatives think they can just “restore” one million jobs lost due to the pandemic within a year. One of the interesting things for me reading over their promises for jobs and the economy is how focused they are on spending money on employment and employers. They want to pay up to 50% of a new hire’s salary for six months following the end of the CEWS. They want to launch a “super EI” that temporarily provides 75% of salary when a province is in a recession. They want to reject mergers that reduce competition but more importantly that lead to layoffs. Over the course of two years, they want to invest $250 million into grants for organizations that improve employment outcomes. They want to provide low interest loans to people that want to upgrade their skills. And most strangely, they want to appoint a minister to be responsible for red tape reduction.

So much of this is interesting to me as most of it seems pretty small time and useless for the majority of people. I don’t see anything here to be excited about if jobs and economy are high priority for you.

The Liberals want to extend the Canada Recovery Hiring Program until the end of March of 2022. They want to help the country’s tourism industry get through the winter since we all know they had a pretty bad time over the last two years. They want to extend COVID-related insurance coverages for media production stoppages. And they want to provide all federally regulated workers with 10 days of paid sick leave with a note basically saying “if they can get it through”.

Overall, lots of weakness here too. Nothing worth writing home about, nothing that’s a stand out promise for most Canadians. It’s a shame really as it’s the Liberal’s election to lose and the economy and jobs are part of the whole affordability issue that is quickly taking hold squeezing the middle-class turned lower-class.

The NDP is promising the same million jobs as the Conservatives. They are talking about a $20 minimum wage. They want to build towards a guaranteed livable income for all Canadians. They want to require large employers to spend at least one percent of payroll on training their employees each year.

It seems like the NDP plan would have the most impact for Canadians, but I feel like raising the minimum wage is actually going to reduce the number of jobs available in the market. When you last went into a grocery store, how many self-checkouts did you see? Companies will find ways to automate jobs if the salary of a human is more expensive than the technology to replace them and just think, the less employees a business has, the less they’d have to spend on training.

In the end, if our capitalist system is going to continue to exist, a Universal Basic Income needs to happen soon. Jobs are not being created as fast as our population is growing.

Personal Finance and Taxes

The Conservatives had me laughing with their idea of a GST holiday for a month this fall. It’s kind of a silly idea, but also something about it oddly appeals. Like a weird sale on products purchased at retail stores. Other than that, they are looking to have someone look into bank fees and require more investment management fee transparency.

While this isn’t a homerun for the Conservatives, it’s better than the Liberals and their “no specific proposals to date” that Bloomberg posts.

The NDP are looking at increasing capital gains from 50% inclusion to 75%. They want to add a 1% tax on households with fortunes over $10 million dollars. They want to increase the highest tax bracket to have a federal tax rate of 35% for income above $216,511 and they want to implement a luxury goods tax on yachts and private jets.

All of the things the NDP are talking about here seem like “duh” moments to me. Again, I don’t think they go far enough with their proposals and so some of it seems like trying to play to their base while avoiding pissing off the super rich. It’s a weakness though that is a bit disappointing. I think a new tax bracket should be added for income above $500,000 per year of around 40%. I think they need to work harder to close tax loopholes and deal with people avoiding paying taxes. I think they need to think about how non-income related money increases a person’s wealth and better reflect on what kind of taxation should be undertaken there.

Why a luxury tax on just yachts and private jets? There are people buying thousand dollar sweatshirts. Surely, they can afford to pay a few extra bucks on that? Will it make the government a ton of money? Maybe not, but it could mean the difference between going into debt with your federal budget or not.

Retirement and Seniors

The Conservatives want to spend $3 billion dollars in long-term care renovation funding over the next three years and they want to prevent executives from giving themselves bonuses if their pension plan is not fully funded.

These sound pretty prudent considering the state of the world. I have no idea how far $3 billion dollars will go in fixing the long-term care situation Canada finds itself in, but I don’t think these promises account for the retirement boom that we are on the cusp of with the Baby Boomers exiting the employment market and looking for additional care. When you have 3 in 10 Canadians looking to retire, something serious needs to be done about where they are going to live, how they are going to be cared for, and how we will afford it all as a country?

The Liberals surely have plans for all of that, right? Their promises so far are to permanently increase the GIS by $500 a year for single seniors and $750 for senior couples. How far would $40 extra per month go for you? Their plan is also to give a tax credit in hopes of making their homes more accessible so they can live in them longer, and introduce a multigenerational home renovation tax credit so that kids can take care of their aged parents.

This plan makes me feel a little sick to my stomach as it basically passes the buck regarding responsibility to where the government is like “we will give you some tax credits to take care of this problem for us”.

The NDP want to provide a guaranteed livable income for seniors and Canadians with disabilities and they want to ban new for-profit care homes and potentially take over current for-profit ones (that part is less clear).

This plan also doesn’t make much sense. I get that for-profit care homes might not be ideal, but it incentivizes building them, and with the slow speed of the public sector to address this issue, I don’t know that banning this opportunity to receive private support makes sense. Regulate, sure… But ban? Nope.

I expected to see some more fully thought out plans when it came to this piece as I see it as one of the foundational challenges our country needs to face right now.

Child Care

The Conservatives want to scrap all of the child-care funding deals that exist today in favour of a refundable tax credit between $4,560 and $6,000. I would have to do research to better understand if that would be advantageous or not, so I can’t speak to that, but if it created simplicity in the delivery of funds, then I’d be all for it.

The Liberals want to make it so that there is a 50% reduction in average fees for early learning and child care by the end of 2022, and reduce child care fees to $10 per day on average within the next five years (everywhere outside of Quebec) and invest up to $30 billion dollars over the next five years to make a Canada-wide child care system a reality. This seems like a lot of cost for taxpayers to undertake. I agree that we need to make childcare affordable, but then they slap on five year dates, and I just have to shake my head.

The NDP are pledging to create a $10 per day universal child care system. Their messaging is simple but it also doesn’t provide enough insight to understand when it would be undertaken, what the cost would really be, what universal means in this context. Again with the great sound bytes but not the best details.

Small Business

The Conservatives want to provide a bunch of tax credits, rebates and loans to try to get small businesses feeling supported, but as usual, they are so myopic in their approach that very few will probably qualify, keeping the price down, and the political value during an election high. They want to give a 5% tax credit on capital investments made in 2022 and 2023 with the first $25,000 being fully refundable. They want to provide a 25% tax credit on amounts up to $100,000 that Canadians personally invest in a small business over the next two years (whatever that means… could be good…) They want to provide loans of up to $200,000 to help small and medium sized businesses in certain areas and even are talking about loan forgiveness of up to 25%. They want to provide restaurants a 50% rebate for food and non-alcoholic drinks purchased in dine-in establishments from Monday to Wednesday for one month, once it is safe to do so. And they want to provide a 15% tax credit for vacation expenses of up to $1,000 per person for Canadians to travel in Canada during 2022.

The rebate for restaurants had me laugh. It’s like those horrible parking signs where you can only park here on specific times on specific days with specific vehicles. Overall, this plan seems detailed, but will it really help those in the most need? I’m not sure. The idea of having a tax credit on business investment is interesting and worth looking into further as someone that runs my own business.

The Liberals don’t seem to have much in the way of policy promises yet except to say that they’ll introduce a tax credit to help businesses invest in better ventilation. Meh.

The NDP are interested in trying to cap credit card merchant fees to 1%, implement a hiring bonus to cover the employer’s portion of EI and CPP for new and rehired staff, and is going to continue wage and rent subsidies that the Liberals created until small businesses can fully reopen.

I don’t know that the federal government can easily cap merchant fees, can they? Other than that, there is nothing really here either. Out of the three parties, it looks like the Conservatives are really hitting the job, jobs, jobs arena hard!

Technology

You’d think this is where my attention would be as someone passionate about technology, but I don’t know that there’s much here that I expect the Federal government to do at this point.

The Conservatives want to connect every Canadian with high-speed Internet by 2025, cut income tax on new patented technologies developed in Canada (whatever that means), allow foreign telecoms to operate in Canada as long as Canadian companies are given reciprocal access, and ban Huawei equipment from being used to protect national security.

The only thing that matters here is the high speed Internet line item. The rest are weird or dumb. American telecom companies don’t have control over whether or not Canadian companies can launch services in the USA. It just seems like such a weird limitation. Typical though of lots of Conservative policies… they sound interesting until you really think over their effect.

The Liberals have nothing to talk about at the time of this page being created.

The NDP want to put a price cap on cell and Internet bills and expand cellular and broadband coverage as well as declaring high-speed Internet an essential service. I’d love to see these changes happen, but without a timeline, and further details, these are just political ideas and not actual potential plans.

I think I’ve made this very clear before. Our cellular plans should be required to be within 20% of the G7 average price on a feature for feature comparison. We shouldn’t be one of the most expensive countries. I don’t care the size of our country. If you can’t make money with that kind of pricing, then innovate until you can or let someone else take your market share.

As for Internet, I wonder what high-speed is according to the Federal government. Is it 1Mbps down and 1Mbps upstream? Or 10Mbps?

Trade

As a country of mortgages and trade, what do the different parties say about one of the pillars of our GDP?

The Conservatives want to pursue an agreement with Australia, New Zealand, and the United Kingdom to set-up a free trade deal. This is a horrible waste of time and resources in my opinion. They aren’t big enough trading partners to spend resources making this happen and our current deals with them don’t seem to be a big enough issue in our economy, so why pursue this!?

The Liberals haven’t said anything apparently yet.

The NDP have provided some one-liners that aren’t even worth writing out about broadening opportunity and unfair tariffs and unfair trading practices.

Overall, it doesn’t seem like anyone really cares about trade for this election cycle, which is strange to me because trade is important. A lot of our natural resources get exported and we import a lot of manufactured goods. Shouldn’t trade have been given more thought?

Conclusion

The current party promises are all fairly weak. There is very little shakeup in what our country would look like if these plans were instituted. They don’t give me a strong vision for a better future, just more of the same.

The things that stand out to me are related to trying to block foreign home buyers, potentially increasing minimum wage, no ideas on how to really handle the giant amount of seniors, no major tax code changes, maybe some help for businesses big and small, and we should all have high-speed Internet soon, right?

We need to be pushing back on the issues of our time. How are they really going to make housing more affordable? How are they going to make it so Canadians can afford the current average standard of living or better? What are the big issues of our time and what are they specifically doing to address it? What is the cost, what is the turnaround time, what is the expected benefit?

If I handled running projects like the government handles winning an election, no one would work with me, and I help build and maintain websites for a living, which isn’t as important as helping shape an entire country.

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