Toyota posted a record-breaking $22 billion in profits this year, representing more than a 30% increase from their financial returns from the previous year.
Yet, even in such profitable times, the corporation apparently needs over $220 million in aid ($110 million each from the Federal and Ontario governments) to refurbish its own aging plants.
It is said to bring 450 new jobs to Cambridge and Woodstock within the next 10 years.
There will also be 1,000 co-op jobs created.
That’s $151,724 per job – over an entire decade. The average salary for those jobs that this handout will create will almost certainly not be that high.
Who could actually use those funds?
The funds might be better used to help the massively overtaxed and overcharged residents of Ontario and Canada. The same residents who now cannot even access homeless shelters, as those who cannot afford Ontario’s ballooned housing fees compete with a large number of new refugees and illegal migrants for extremely limited spots.
So why is this ridiculous and fairly obvious form of corporate welfare going through?
Simply said, Kathleen Wynne and Justin Trudeau likely understand that their recent push towards a carbon tax and their recent tax policies have not been good for business competitiveness, especially when factoring in the recent steps taken by our southern neighbors to lower their tax and regulation burdens.
Therefore the government is aiming to counteract their own disastrous policies by buying the happiness of corporations through taxpayer funds.
This is a dually ineffective action.
Firstly we are reducing our own competitiveness for arguably a weak moral gain than we are spending money to make up those losses. In effect making sure that we are just paying more for the exact same results with the addition of a pat on the back.
Worryingly, this may be a trend.
For example, in Ontario, this mentality is on open display when it comes to the skyrocketing hydro rates, which was a crisis largely created by selling off a significant portion of Hydro One shares. Many experts pointed out that the government seemed to sell the shares at less than they ought to have been worth.
Then, as the government saw the immense cost of that process, they began to use even more of the taxpayers’ money to placate those hardest hit. Subsidising the cost of electricity by … passing off the cost to consumers in the long term.
The worst part is that a significant part of this subsidy goes to interest payments from the extra-provincial debt, rather than to those that need it most.
And all of this is on top of the removal of HST already costs the province $1 billion per year.
Throughout all this, the taxpayer loses, but the government and businesses are left scratchless.
Perhaps it’s time we thought more about how we manage the economy, aiming for efficiency and wealth creation, and less about moral superiority.