According to a recent article by Brian Lilley, the federal government is providing large amounts of aid to some of the most profitable companies on earth, in order to keep them in the country.
How much are they giving away?
$60 million to be exact, invested into Elysis corporation, “a new company started by Apple along with two of the biggest, and richest mining companies in the world, Rio Tinto, and Alcoa. The plan from these three industrial giants is to develop new technology to produce a zero-carbon smelting process for aluminum.”
Why give aid?
According to the PM’s news release, and Brian’s analysis “this is about creating jobs, thousands of jobs, according to Trudeau. Yet his own news release says it will create 100 direct jobs at Elysis.”
Brian broke down the costs to create each one of the jobs in this new company. Roughly $600,000 per job.
A continuing trend
These grand investments into massively profitable companies are not something new, but rather a growing trend within the Liberal government. I recently wrote about the $220 million in aid ($110 million each from the Federal and Ontario governments) provided to Toyota, a company which posted a record-breaking $22 billion in profits this year, representing more than a 30% increase from their financial returns from the previous year. There the cost per job was roughly $151,724 – over an entire decade.
What supports this trend?
Simply put we are becoming less competitive, and even if the Finance Minister continues to play with the numbers hoping to convince the odd Canadian things are ok, the data does not lie.
According to the Financial Post “current level of business investment— $336.5 billion (in 2007 dollars) — is lower than business investment for every quarter going back to mid-2012. Intellectual property investment, at $29.3 billion at the end of 2017, is the lowest since 2005, except during the recessionary crisis of 2008-09, when it was comparable.”
With regulations increasing and costs continuing to rise especially in comparison to our southern neighbor, Canada will have to make up the competitive difference through raw cash transactions continuously.
Thus creating the trend, we see now.
A better Idea
Instead of continuously raising taxes on 92% of Canadian families, to cover the costs of these massive grants and other inefficient policies, perhaps the government could provide an economic framework which would push business to make naturally efficient choices. Where it is actually efficient for business to produce cars in Canada without Canadians taxpayers covering the costs.
Sadly, at this moment as an individual looking in, all I can see is more regulations, higher costs, poorer Canadians, and a federal government patting its own back as the finances of the nation sink and their business friends profit.