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Notes for an Address by Prime Minister Jean Chrétien on the Occasion of the 3rd World Chambers Congress

September 16, 2003
Québec City, Quebec

I am delighted to be here to address the Annual Meeting of the Canadian Chamber of Commerce and the World Chambers Congress.

I want to take this occasion to welcome delegates from around the world to Canada. And to Québec City. You have come to a country that is in very, very good shape. A confident country. With a fantastic future.

I am glad that you are holding international meetings in Québec City today. Because the situation in Canada is now very different than it was the first time I addressed the Annual Meeting of the Canadian Chamber of Commerce as Prime Minister.

It was nine years ago this week that I spoke here in Québec City to the Annual Meeting of the Canadian Chamber of Commerce. The mood in the room was very sombre. Not upbeat like today.

At that time, Canada had seen 28 straight years of budget deficits. Thirty-seven cents of every dollar of government spending went to debt service charges. Our debt to GDP ratio was 71% and rising. High interest rates, and relatively high taxes were discouraging investments and harming our quality of life. Unemployment was high and job creation was slow. And a separatist government had just been elected in the Province of Québec. The Wall Street Journal was calling Canada a candidate for third world status.

In my speech that day, I set out what the government was going to try to do to turn the situation around. It was an ambitious agenda. But an agenda which cynics and even realists probably did not expect us to achieve. But achieve it we did. With the help and support, discipline and leadership of Canadians. And that is why the country is in such good shape today. That is why the international press now talks about the Canadian model with admiration.

We did not govern for the short term. We took a longer term view. And, I believe, we transformed Canada and prepared it well for the 21st Century. So that today we are probably better positioned that any other industrialized country.

Let me review for a few minutes what I talked about nine years ago.

We knew that sustained job creation required structural reform to make our labour markets more flexible.

I promised that day in Québec City a reform of unemployment insurance to shift it from passive assistance to active help for people to find jobs. We implemented that structural reform and took other steps to make our labour markets more flexible. Premium rates have drastically been reduced for employers and employees. Parental and maternity benefits have substantially increased. I think, while there is much more to do, we can say we have delivered.

We knew that we had to prepare Canadians for the new economy. I promised that day in Québec City that the government would help Canadians to further their studies and acquire the knowledge necessary to prepare for the specialized jobs of tomorrow.

Today, we can look with pride at what we have accomplished in terms of scholarships, savings for post-secondary education, research, faculty recruitment and a huge university infrastructure program. Here, too, while there still is much more to do, we can say we have delivered.

I promised that day in Québec City that we would help eliminate obstacles for single parent families and persons with disabilities to find work. We have made huge progress in these areas. Particularly, through the National Child Benefit which is the single most important new social program since medicare.

Here, too, while there is much more to do, we can say we delivered.

When we took office, we inherited a 42 billion dollars deficit. Which was 6% of GDP. We promised to reduce it to 3% by the end of the third year of our mandate. And, here in Québec City, I outlined how we would proceed with a top to bottom review of all departmental programs. We reduced the size of the public service. We cut unnecessary programs. We reduced program spending from 16% of GDP in 1994 to just over 12%.

We succeeded beyond anyone’s wildest expectations. Here, too, we can say we delivered.

In the space of four years, the federal government eliminated the total federal deficit. And we have now had six balanced budgets in a row. We have cut our debt to GDP ratio from 71% to just over 40% and we have paid down more than 55 billion dollars of debt. Debt servicing charges are now about 20 cents for every dollar of government revenue. We made the largest tax cut in Canadian history. Taxes are still coming down and interest rates are lower than they have been for many decades.

We are the only G-7 country to have a surplus this year and to project a surplus for next year.

I also promised concrete measures to improve the business climate for entrepreneurs, to help business benefit from new technologies, to develop foreign markets, and to promote Canadian tourism. I stated my support for Team Canada approach to trade. In each of these areas we can say we delivered.

And, that day in Québec City, shortly after the election of the Parti Québécois, I set out that the first duty of a Prime Minister of Canada is to maintain national unity. And I made it very clear that I would fulfill that duty. We went through a difficult time. But, today, we have a federalist government in Québec. Federalists have the majority of seats from Québec in the House of Commons.

And, to say the least, my party is looking forward to the next federal election much, much more than is the Bloc Québécois. So, here too, although the job is never complete, we can say we delivered.

I am extraordinarily proud of these achievements. I am proud that we have put our public pension system on a sustainable basis for the next 50 years. Something no other country has done.

I am proud that the economy has been able to generate nearly three million new jobs since we have been in office.

I am proud that our standard of living has increased by 20% since 1997.

I believe that my successor will inherit a country in a very, very strong position. We have made the structural reforms that Europe wishes it could make. Our fiscal situation is sustainable for today and the long term unlike those countries whose deficits are growing rapidly.

We have done what is required to ensure that Canada can lead the world in meeting the challenges of the future. We have done so in our own way. And it has defined who we are.

In the 21st Century, ideology has been redefined. The right wing believes in tax reductions at any price. At the expense of public services and public infrastructure. And while the right wing preaches fiscal responsibility, it runs deficits. The left wing believes in spending regardless of the fiscal situation. And like the right wing, deficits and their effect on future generations just do not matter.

We, in Canada, have chosen a different approach. What I call the radical centre. Where fiscal sustainability, living within our means, balancing our budgets, is the only way to achieve our medium and long-term objectives.

It is fiscal sovereignty which enables us to share our prosperity. To empower citizens, invest in kids and help foster creativity and innovation in the knowledge economy. To strengthen our universal publicly funded health care system. To be able to expand medicare to cover home care and catastrophic drug costs on a national basis. And to invest in public infrastructure.

I have always made the argument that government is a force for good in society. This has become particularly evident this summer.

Between SARS, mad-cow, and the electricity black-out, we have seen more than ever the need for activist government. To deal with public health issues. To deal with public infrastructure. None of which is cheap.

I received a letter two weeks ago from more than 200 business, union, voluntary sector, education and local government leaders in Toronto. They called for expansion of affordable housing stock, more investment in public transit and community services infrastructure. They called for more investment in public education, more support for early childhood development, and more support for access to high quality post-secondary education. They called for action to reinvigorate tourism, for government to invest more in research and development and in the arts.

I congratulate them. While the letter I refer to speaks for Toronto, it sets out an agenda for all of Canada. It is very much the agenda we have followed since we balanced the budget. In fact, they are calling on governments to build on all of our budgets since 1997. And, in particular, on our last budget, where we made long-term investments in each of these areas.

It is an agenda I agree with. An agenda that will require government to be focussed. Not to be all things to all people. It is an agenda of large public investment. None of which will be cheap. But if these investments are not made, Canada will not be competitive in the long run. I am glad that so many senior business leaders, including all the bank presidents, recognize this fact and call on the government to make these investments.

But they must also recognize the implications of this agenda. Because if we are to maintain balanced budgets, which we must, these new public investments inevitably mean that there cannot be any new large tax cuts in the near future.

The tax cuts of the last few years have made our tax system competitive. Our budget deficits have been eliminated. Now the challenge for the future is to eliminate social, environmental, and infrastructure deficits.

But government cannot focus only on domestic policy. Good global citizenship is part of governing in the 21st Century. Canada must continue to support multilateral approaches to global problems. The major challenges of our time include poverty, environmental degradation, infectious disease, regional conflicts, organized crime, and terrorism.

These cannot be addressed by nations acting alone, however powerful. Harnessing globalization for the betterment of people through expanded trade and smarter development also demand coordination through multilateral organizations.

The failure of the World Trade Organization meeting in Cancun, last week-end, is very worrisome. I have said for a long time that agricultural subsidies of developed countries must be radically reduced to give developing countries, particularly in Africa, the chance to improve living standards of their populations. The developed world has an obligation to act. And to act quickly.

On behalf of the people of Canada, I call on the European Union and the United States, and all members of the WTO, to reflect again on what happened last week-end. And to reconsider their positions. It is not too late.

I have always believed that good global citizenship is essential to serving the interests of one’s own citizens. But it is also an expression of our idealism and common concern for humanity.

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