Political Action

RTO/ERO PAC POLICY: We are a non-partisan group, which is strongly issue-oriented. We do not support individual politicians or their party, with money or editorial space.

PAC Update: Three Pressing Issues

Of the eight issues with which the Political Action Committee is dealing now, the following three seem particularly pertinent in these difficult economic times.

Harmonization of the PST and GST

Early this spring we began investigating the impact of PST/GST harmonization.

In April, we drafted a letter to the premier and finance minister on the subject and withheld the letter pending further investigation.

In July, provincial RTO/ERO sent to the districts a fact sheet and background paper, which provided much information about sales tax harmonization, its impact upon people and business, and steps the government plans to take to mitigate the negative impacts of harmonization.

In short, a single, combined 13% sales tax will be applied to all items currently subject to the PST and GST and to many items that currently are not subject to the provincial sales tax - products ranging from school lunches to houses.

To compensate for the increase in the number of items being taxed, the government is planning a series of rebate cheques for families earning under $160,000 and for single people earning under $80,000, as well as an income tax reduction, and changes to the sales and property tax credits.

Businesses will receive tax cuts, too.

[Ed. Note: Details are available on the RTO/ERO Web site.]

Our concern remains whether the mitigating steps taken by the government will be sufficient to neutralize the increase in sales tax revenues and whether these mitigating steps - rebates and income tax reductions, et.al. - will be distributed fairly.

Provincial RTO/ERO has asked the political action committees of eleven districts, including District 39 (Peel), to contact local MPPs in order to urge them to ensure that the coming changes do not harm seniors, and to urge them to maintain a dialogue with RTO/ERO.

Regressive vs Progressive Taxes

A sales tax is often called a regressive tax since it hurts low-income earners disproportionately, because low-income earners spend a proportionately higher percentage of their income on taxes on purchases.

This is compared to the income tax, which is often called a progressive tax, since it places a proportionately higher percentage of the tax load upon those most able to bear it.

Based upon our local PAC discussions to date, we would urge the government to ensure that the steps that they take will protect all low income earners, as well as seniors, many of whom fall into the low income category.

When the committee meets later in September, we will determine how best to contact our MPPs and how best to present our message to them.

Smart Meters

When the concept of "smart" hydro meters was first discussed a few years ago, we understood that these meters might be beneficial to individuals and to the environment because the meters would allow utilities to determine when households were using hydro and to reward, with lower rates, those households using power in "off-peak" hours.

We now know that there is a darker side to "smart meters".

Smart meters are to be mandatory.

While off-peak rates for "smart-meter" households are low during off-peak hours - in the range of 2.9 cents per kilowatt hour compared to 5.7 cents for households with regular meters - they are considerably higher during "mid- peak" and "on-peak" hours, typically 6.4 cents and 9.3 cents, respectively.

"Off-peak" hours currently run from 10:00 p.m. to 7:00 a.m.

As a result, once 'smart-meters" are universally installed, unless we use power only in the middle of the night, hydro bills may be much higher than they currently are for most people.

Furthermore, "smart-meters" give the hydro company the ability to turn off power to houses during times of heavy usage.

We wonder what this might imply for seniors who generally suffer during heat waves and whose lives might be at risk if their air conditioning is shut off during extreme temperatures.

We wonder, too, what will happen to individuals with life-support equipment that may be similarly shut down.

Consider, as well, single parents with a couple of jobs trying to make ends meet.

Are they to stay awake into the wee hours in order to do laundry and vacuuming so as to conserve money for rent and groceries?

We have concerns and will be expressing these to the premier and others.

The Economy

We have already reported that in January of this year, we wrote to Prime Minister Harper voicing our objections to the sell-off of "signature" Canadian corporations to foreign interests.

In the past twenty years, 1,500 companies have been sold to foreign owners - 600 of these during 2006-2007 - under this government's watch; companies like Inco, Algoma Steel, MacMillan Bloedel, the Hudson's Bay Company, Dofasco, Labatt, Molson, Alcoa and, even, the Montreal Canadiens.

Unlike the provincial premier and cabinet ministers, who typically respond in detail to our concerns, the prime minister did not reply.

Executive Correspondence Officer M. Bourque, wrote to say that our comments had been "reviewed carefully" and forwarded to Industry Minister Tony Clement who would also "appreciate being made aware of [our] concerns".

The loss of our major corporations damages Canada's economic security.

We detailed many of the dangers to the prime minister:

"First and foremost . . . is that strategic corporate decisions now are made in other countries where Canadian interests play no part in the process. The loss of head office operations also means the loss of high skilled, high paying jobs and the highly capable people who perform them. Also lost are research and development departments, and high value support services including legal, accounting, advertising, . . ."

"Canada loses the competitive advantage that comes with being a global centre of expertise in an economic sector."

"Also, foreign owned, branch plant head offices come into direct competition with remaining Canadian companies . . . further expos[ing] Canadian firms to collapse or takeover."

We told Mr. Harper that the sell off of Canadian resource sector operations to third world bidders is especially worrisome since these buyers can lack the corporate discipline of American and British corporations and may not always have peaceful intentions toward us.

Finally, we told the prime minister that we understand that Canada needs foreign investment, but that selling off Canadian companies does not guarantee job creation or capital investment.

Even with investment and job creation, profits are repatriated to the home country, often avoiding Canadian taxation.

Foreign ownership frequently means the stripping of company assets and the collapse of the business.

We urged Mr. Harper to use the Investment Canada Act to screen foreign takeovers, and impose rules limiting foreign ownership in various economic sectors, and to limit the percentage of shares in "signature corporations" that may be held by foreign owners.

In June, we wrote to Mr. Clement asking for a reply to our January letter.

In his August 12, 2009 reply, Mr. Clement appeared to read past one of our key issues: that foreign takeovers do not guarantee investment in Canada.

Instead, he equated takeovers with investment and said that such investment was critical to our long-term growth and prosperity by fostering technology transfers, management and production expertise, and by forcing Canadian businesses to adopt changes that improve their productivity.

He went on to cite studies saying that Canada is "growing globally competitive firms" faster than the rate of foreign acquisitions.

He cited statistics suggesting that in 2008, Canada invested abroad $132 billion more than was invested in Canada by foreign interests.

We will examine his figures.

As yet, I cannot speak for the committee concerning the minister's response since we do not meet until September 29, but I remain concerned..

U.S. Steel bought Stelco Ltd. in 2007, after guaranteeing that steel production in Hamilton would continue and receiving provincial government guarantees for employee pensions.

U.S. Steel reneged; the plant was shut down; and the federal government is suing U.S. Steel for breech of contract.

The patents of Canada's bankrupt Nortel Networks, long-time world leader in telephone technologies, are on the verge of being sold entirely to Sweden's Ericsson AB, despite being sought by Research in Motion, of Waterloo, Ontario.

There are just too many instances in which the negative reality of the hollowing-out of our corporate sector does not match the theoretical benefits of takeovers in the global economy.

New Members Welcome

The District 39 (Peel) Political Action Committee (PAC) meets, from September to June, on the last Tuesday of the month.

The starting time of 9:30 a.m. was chosen to avoid most of the morning rush.

We meet in the board room of the Ontario Educational Credit Union Limited, in the Educators' Centre, on Edwards Blvd., in Mississauga.

Newly retired teachers are most welcome to join us.

Archive of Position Papers

Our Position Papers deal with five issues (education, energy, health, long-term and home care, and safeguards for seniors) which are of the greatest concern to us.

These papers sum up our political position, without reference to party affiliation.

Please use the menu, below, to find the material which most interests you.

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