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Home : Top Stories : Canada won't slip into a recession: Flaherty

Canada won't slip into a recession: Flaherty

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CTV News Video

CTV News: Jed Kahane on a fine economic line
CTV News: Adrienne Warren, senior economist, Scotia Capital
CTV Newsnet: Finance Minister Jim Flaherty
CTV Newsnet: Michael Hainsworth on the new numbers
Canada AM: BNN's Linda Sims on the GDP numbers
Canada AM: BNN's Marty Cej on the economy

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CTV.ca News Staff

Date: Fri. May. 30 2008 9:11 PM ET

Finance Minister Jim Flaherty says although Canada's real gross domestic product edged down in the first quarter of 2008, he doesn't think the economy will slip into a recession.

Data released by Statistics Canada on Friday showed real GDP dropped 0.1 per cent in the first quarter -- the first decline in nearly five years.

"We are well positioned to weather this period of global economic uncertainly," Flaherty told reporters Friday.

"Canada's economic fundamentals are solid."

Flaherty is in Montreal for the second day of meetings with provincial and territorial finance ministers.

"The fact that Canada's economy is slowing should come as no surprise to anyone," he said.

"Canada is not an island. We anticipated economic slowness last year for this year. Challenges abroad impact us here at home."

The finance minister noted that Friday's report blames the GDP decline largely on manufacturing cutbacks -- most notably in the auto sector.

"We've been looking state-side and figuring these are the people who are in recession -- not us. But this doesn't appear to be the case," BNN's Michael Hainsworth told CTV Newsnet Thursday afternoon.

Hainsworth pointed out there is one key factor behind the economy's slip.

"It has everything to do with the Americans, actually. American Axle -- which is a big supplier to General Motors in the United States -- had a huge strike. That idled production in Canada. The auto production component to our economy played the biggest role in why we ended up seeing our economy shrink."

Hainsworth said he has spoken with other analysts -- and it appears that the small economic decline may be a "one off" and a recession will likely be avoided.

Excluding the production of motor vehicles -- and the estimated ripple effects the industry has had on motor vehicle parts, wholesaling and transportation -- GDP for the remainder of the economy grew by 0.1 per cent in the quarter, Flaherty said.

He added that Ottawa has provided significant support for the auto sector and he hopes the industry will get help on the provincial level.

"As you know, I have been calling on the Ontario government to follow our lead and reduce the Ontario government's business taxes," he said.

Details of the report

In addition to manufacturing cutbacks, weather disruptions also hampered economic activity in the quarter, says the report.

At an annualized rate, the Canadian economy declined 0.3 per cent in the first quarter, compared with 0.9 per cent growth in the United States.

"The expectations were that the Canadian economy was going to grow... at a pretty moderate pace of 0.4 per cent," BNN's Marty Cej said Friday.

The report says economic output contracted 0.2 per cent in March.

Meanwhile, final domestic demand advanced 0.6 per cent in the quarter on strength of consumer spending.

Inventory accumulation, after two quarters of large build-ups, eased considerably in the first quarter.

Declines in manufacturing, mining and some transportation industries were partially offset by growth in retail trade, accommodation services, finance and insurance.

While the economy continued to create jobs in the first quarter, average hours worked declined -- partially because of bad weather.

Comments are now closed for this story

Chris
said

No real shock here. The the climbing dollar, the sagging manufacturing sector, this was predicted to happen by a lot of people, the only question was when.

Now it'll be interesting to see how the conservative supporters and the liberal supporters comment on here. I predict the conservatives will blame it on the previous liberal governments, and the liberals will blame it on the 'evil-i-have-a-hidden-agenda' Stephen Harper.


javid radfar
said

This is another great "achievements" of this conservative government. Isn't it the time to have an election and kick Harper out of the office?




herb
said

When will people learn? Whenever conservatives are in office, the economy tanks. It's a fact that their base supporters don't seem to get. And because the gov't made that silly GST cut, they can no longer afford to spend their way out of a recession.


Wade
said

Car sales were up the first quarter.

The problem is those car manufacturing jobs are taxed all the way to Asia.

The Ontario government does not seem to understand Pension Funds and Mutual Funds need a return for the retired investors. If the government is going to take all the profit the fund mangers just invest in an area they will get a return for the fund holders.




Chris
said

I was bang on with the first 2!


Scott
said

I'm sorry Herb, but did you state "spend" your way out of a recession. Has this Dominion learned anything from the Dark Trudeau years where 40% of the federal budget was going to financing the debt/deficit? Come on people, I'm seventeen and I even know better!


Mike - NWO
said

You know Javid and Herb.. Stick to the facts ok. This downturn in the economy has nothing to do with whatever Cdn government is in office whether it is Liberal, Cons or other.

This downturn has everything to do with the multitude of US economic problems and our relative good performance driving our dollar higher.

What would you like the government to do? And don't say grants or handouts to manufacturing because a band-aid such as that will not fix the problem and will end up being wasted money.


J.C.
said

The problem arises from the world economy and the investers. Since manufacturing is mostly affected it is Ontario that is hardest hit (mostly the auto industry and their unionized employees - Liberals in power)and Quebec. It is not necessarily the fault of the federal government no matter which party is in power. I happen to agree with Flaherty that Ontario should have offered tax cuts to industry instead of always giving bandaid solutions and money to the auto industry. Also it is time for Ontario to deversify more. I disagree with some of the comments above as when the Conservatives were in power in Ontario, (before Mike Harris)we had one of the richest and most successful provinces. I do not vote for parties, but rather the individuals who I think would do the best job and can handle the responsibilities. Currently Harper is the only one I see that is in the running that is capable. The other is Jack Layton, however the NDP rely or push for too many social programs and that would only make the situation worse. I just wish that the opposition would heed more attention to what is good for this country rather than wasting so much time on scandals and knocking everything as they try to dig up as much dirt as they can to gain votes.


Paul
said

I just love everyone's comments, they are always negative about the news, just like this annoncement. The only numbers they are given us, are the negative ones. This Country is doing VERY well, and people should stop complaining. Gas is AT least 40% cheaper then in Europe. Food is cheaper then any other industrial country like Canada. Houses are a lot cheaper then Europe or some part of the US.

So plse stop blaming the goverments, WE elected them, so we shoud just let them lead us. As for an election, well that's just wasting 500 million for getting the same thing.


D in Calgary
said

I like what Chris said "Now it'll be interesting to see how the conservative supporters and the liberal supporters comment on here." I'm no economist, but is this not more the result of the weak US dollar than any party's policies?


Roger T
said

Yes it will decline further if retailers are not adjusting their prices to reflect the rising dollar. With the cost of fuel & food prices rising who's gonna rush out and buy anything if our Gov't don't do anything.

As consumers, personal savings comes before anything in hard times, so don't expect us to rush out and buy because the retailers claim to adjust a few pennies and 1 or 2 dollars on their prices which are meaningless to consumers. The adjustments don't fool consumers.

No prices adjust to reflect the real price as the US pricing, means no business or purchases made.

Saving comes before the economy!


Dean
said

Economies have ups and downs. What if the gov't were to impose a flat tax on income of 20% and remove any and all loopholes for not paying tax. Everyone would pay a fair rate, no more shelters for certain people, scrap the GST, and see what happens to the economy. More money to spend equals more jobs. Pretty simple formula. What if we actually paid down the debt too? The gov't could then afford to reduce taxes even more. Even more money in our pockets! No bias spending on lobby groups or to garner election votes or to satisfy whining provinces and just doing what is right for the country,us, would really be a change. I realise this is simplistic but it can't be worse than what successive gov'ts, Liberal or Conservative, have done.


Jason Daniel Baker
said

I think that by the fall of this year we will see an economic boom the likes of which we have not seen since the 1950s.

People are learning the hard way how to be smarter with their money. The difference is that Canadians learned before everyone else did.


PBW
said

Is business a "steady state" phenomenon? Or is it influenced by outside factors that are beyond the scope of any government to control? The report notes that hours worked were influenced by inclement weather, consequently output is affected, thus the availability of goods for purchase declined, leading to a decline in sales which equals a drop in growth.

Perhaps we should also consider the "eggs in one basket" idea too. We are so heavily dependent on petroleum that when its supply becomes limited and demand rises simultaneously, stresses will be placed on the system. Being a nation relatively rich in fissionable material, why haven't we built more nuclear power plants and electrified our rail system? Being rich in water, why haven't we done more to develop a hydrogen economy?

As noted above, the politicians will blame each other. But why don't we blame them, for treating the government and development of our nation as a game that sees them do nothing but play for power instead of working for us - as they were elected to do.


Willie In SK
said

It has nothing to do with Harper or the Conservative party. It’s the Americans that made this mess and we have to clean it up. Here in SK we are not feeling very much of this as the boom from Alberta is spilling over into SK. But for those people in Ontario (Manufacturing centre) who usually vote liberal are feeling the pain, and they should, just look at the price of new vehicles, they are crazy, their jobs should be moved out of country and built cheaper, this would suit our (Canadians) way of life better (As we live way beyond our means). i.e. family of four each has a car. And the only other place that this is likely to happen too is the U.S. So even though we like to think of ourselves as distance from Americans we are closer than we believe. And for those tree huggers that think we should all walk to work, wake up and look at the facts, China is putting up several coal power plants every month at least (it’s a week I think) and gasoline is still the cheapest form of energy per liter on the planet. So I say open the flood gates to all industry in Canada screw the environment and this will be all fixed up.


Captialism is killing us...
said

This is a proof that Captialism is killing us and drop in GDP doesn't mean that any companies are losing profits - this mean that they're just not getting more and more but they still are getting considerably profit. .1% is nothing.

They probably paid Media to report this nonsense so that people will be lured to spend more to avoid so called depression age.

Whatever! Not buying any new car! I have everything - why buy more?


Gord
said

Actually Chris there is no blame here. I am a Conservative and there is no blame to be placed on the Libs or the current goverment. Neither can be held respondsible for the US credit crisis or the recession that it created down south. Poor banking practices by US mortgage brokers is the big culpert here. The only blame that may be allowed here is the current Ontario goverment for having the highest business taxes in North America thus driving investment away from that province. Here in Alberta things continue to be rosey, any Ontario people willing to take a high paying job, crave clean air and water,want lower taxes, a reasonably priced home, all you have to do is come on out there is lots of room in Alberta & Sask. One thing though we don't do the Liberal thing out here very well, we kind of frown on people that feel the need to have goverment do everything but dress them in the morning. We do things on our own out here.


Mark
said

Nice Chris. You picked it well.

I am an avid Conservative supporter, but I will not blame anyone, or give anyone credit.

This slowdown is all due to market conditions and the USA. the same thing would be happening if the Liberals were in power. Anyone who cannot see that has their blinders on.


Sonny
said

Should CANADA drop in another business quarter lets say .1% does that mean we are in a recession?

The U$ growth rate dropped from 4.9% to 0.6% and is heading even lower this quarter. The pundits call it a "slowdown."

Since we are dependant on trade wouldn't it be smart to supply our own needs first then consider trading more with Europe & Asia where there is growth.


David in Bowmanville , Ont.ario
said

High Gas prices & Energy Costs will effect
everyone including Bussiness I would say that the American Auto Industry is way Behind
and ONE of the BIG 3 Auto Companys will go out of ussiness soon .We can't Control the US Dollar , but there are some Tax changes needed to help Bussiness out at least .



truthseeker
said

You don't need reports to tell you the economy is going sour. You can see it around you. The global recession has caught up to Canadian's.


Roadrobber
said

It's interesting how some people in this forum are blaming Stephand Harper for this, even though the article clearly states the reduction is due to a slowdown in the automobile manufacturing industry.

The drop in GDP is as a result of production downtime for retooling, coupled with a strike by a major U.S. supplier, and dealer incentives to cut inventories. This along contributed to a 2.5 per cent drop in output for Canada's overall manufacturing sector. Statistics Canada said the slower auto sector was responsible for 40 per cent of that drop.

Excluding the production of motor vehicles and its estimated ripple effects on other sectors such as motor vehicle parts, wholesaling and transportation, GDP for the remainder of the economy grew by 0.1 per cent in the January-March quarter, this according to Statistics Canada said.



RRO
said

Any high school student will tell you that our economy is constantly in flux, we have booms and recessions, it is the reality. Further because of Geography we are tightly linked to the United States, which because of some horrible policies, is facing major economic downturns.
If anything the Canadian population should be happy. Despite all the troubles in the US our economy has suffered only a minor setback. Our GDP is still well over a trillion dollars.
Let's no blow this beyond what it is, it is a simple correction in an economy that was overheated for quite some time.


Jim
said

Canadian governments cannot do much in the face of a weakening world economy but they need to control their spending and do what this federal government was elected to do: cut taxes. We don't simply want a less corrupt version of the previous tax and spend government.


Alex Sz
said

It is disheartening to see the lack of intellengence in peoples' blame.

No government can prevent a GDP drop when your biggest market is having troubles of their own. It would be like saying, its Canada's fault that the US banks where so stupid. For you fools who comment on politics, get a real life and pick up an economics 101 text book. You would be at least educated.

So ends my soap box.


Dennis L. Krahn
said

The report mentions a number of causes for the decline: Americans, Liberals and Conservatives were not on the list.

Everyone, Liberal, American, Conservative, NDP or whatever needs to work together to improve the world economy.

Bitching, moaning and finger pointing will not keep any ecconomy on track.


Nick
said

To all you anti-Harper and anti-reason people out there.

This is not the fault of the Tory government.

The blame rests in large part on the shoulders of Ontario. The Auto Manufacturing Industry is in Ontario. They have high taxation and refuse to model their own economy in ways that they can mitigate a loss or stagnant growth in the Auto Industry. Ontario is inflexible.

To the anti-Capitalists in this country and the ones that lurk this news-site:

A Socialist state in Canada would demonstrate a rapidly shrinking GDP and a rapidly increasing Debt.


vic
said

I am a conservative but you have to be kidding me if you liberals out there figure you could have done better! As for the car companies, i do not feel sorry for them they have known for years that people were looking for gas efficent vehicles that is why the pacific rim car companies have done so well so do not blame the conservatives for there certian fall from grace. Also Herb, i feel sorry for you all you see is parties you do not see what is happening around the world, it is tough out there but Canada is still the best country in the wrold to live in my friend.


Doug BC
said

Let me see! Our largest trading partner is going through a major economic crisis,and our economy slows down.WOW!!! Who would have thought it""
This absoulutely MUST be Mr.Harpers fault.Oh.No wait,it could be the Liberals fault.
Really people.There will always be ups and downs in normal market cycles. And our tiny little economy is never going to have enough clout to change that. As an exporting nation,we need customers who can afford to buy our products.
The only thing even the best fiscal management here can do is perhaps mitigate the damage to Canadians by enocouraging savings,by creating a environment friendly to businesses who manufacture,and employing policies that allow for the removal of the word "profit" from our Canadian list of profanities.
And finally,I think staying out of debt is never bad policy. Either for government of for it's citizens. Living beyond your menas will always catch up,and the "piper" will have to be paid. Either by us,or by our children.
I personally think we are going in the right direction. Manufacturing is a challenge,but I think there is much that can be done. Of course that requires politicians who take off their partisan hats as actually talk to each other. Ooops. That might be the fly in the ointment.
Socialism vs free enterprise. Same old, same old. Maybe a united Canada is an outdated concept.


AA
said

Welcome to the Conservatives' era!


Dan from Alberta
said

Recessions happen - always have, always will. Who's in power at the time is just whoever's in power at the time. There is NO WAY that the US can have a slowing economy without ours doing the same. And just what is Harper's so called "hidden agenda" anyway? It's just so much more nonsense from the socialist, moronic leftist.


Eric
said

Well said to all the ones who drank the right coffee this morning. It's NOT a Liberal or Conservative thing. Its a market thing. The blame lays with the Canadian people. We are the ones who are so pesimistic in our approach. We beat a dead horse. Lets not loko at the past but rather to the future. No matter what happens, going forward, every industry, nation, and enterprise is, in some way, reliant on a natural resource of some sort. Renewable and non-renewable. Canada has plenty of it all. We just have to learn to make it all work for us. Hydrogen, Uranium, Plutonium, water, iron ore,, etc. We have the most, and the rest of the world needs it. We are the most economically and politically stable resource-rich nation. We are the Toyota of the resource holders. We have the right to "Capitalise" on our great nation and its productivity. Lets make Stephen, Stephane, Jack, and Gilles (if he wants in) work together. Imagine how good they would feel about themselves, if they could stand up and all give each other a pat on the back.


Josh in Ontario
said

Dear Herb: Bob Rae and P. E. Trudeau tried to spend their way out of problems and made it much worse. Look what they gave us, huge debts and deficits. What are their economic legacies?



Earl Robert
said

This is the result of a weak US dollar not any party's policies? I think Chris needs a wake up call.


Edward in Vancouver
said

I think that Canada is in very good shape considering past performance; largely because we have diversified our trade and not relied soley on the US. The Elepahant isn't as big as it once was. One just has to look at BC, which is doing very well despite a lagging forestry industry (our traditional bread and butter). This should be a model for much of the rest of the country.


pp
said

OH for heaven sakes. How much money did it take the gov't to figure this all out???

Any person with a high school education can see the economy is slowing down. What I want to know is an estimate on how long we can expect to 'suffer' before things start to turn around... 12 months, 18 months? more?

Oh well slowing of the the economy - it happened before and it will happen again, it's actually about time prices were readjusted and this will definately do that... now if the price of fuel would go down.




Jordan
said

I think that people need to calm down a little. The government is cutting taxes, which will drop government size and involvement in the economy. It's proven that less government intervention and size results in more economic freedom and that's directly related to GDP. I agree that the country as a whole needs to get away from relying so heavily on the automotive industry ad diversify our economy a bit more. The last thing that we need is for the government to deficit spend to try and "save" the economy. The government can't save the economy, it's impossible, it's way too big...and what's more, the economy will save itself! If the automotive industry keeps dropping (which really it won't because most of the causes of the drop are gone now) then people will look for new ways to make money, and it will only diversify the economy. The market will take care of itself, we just need the government to stop meddling in it, and I trust the tory government to do that.


Sonny
said

Some of the blame lies with conservative thinking. Cutting the GST did not spur consumption...

Flaherty should have been listening to the Ontario Finance Minister rather than bad mouthing the Premier & Province.

Republican tax cuts for the rich didn't work out for those who bought in to the American dream of home ownership through the "sub prime" products which is the root of the negative economic projections.


Wake Up People
said

GDP drops mean “Recession”.

Here are the reasons:
1. Lack of long term planning
2. Looine rising (mainly played by US, Canadian thought loonie rising because Canadian economy is strong and growing)
3. Gallup poll of CEO’s suggest that loonie rising is pride and good for Canada. ( I am not sure CEO’s understand what they were talking about.)
4. Short Vision and lack of basic understanding in basic economic concepts.

Now for this “Recession” we may blame the USA, very easy. But, to understand that Canada is mainly service sector - 75% of our export goes to the USA. So any pressure on US $ is going to harm rather then to help. I am talking about economy in general, not individual.

This is much beyond politics, this is management and planning. There were no measures taken for unexpectedly rising loonie, shrinking jobs, etc. Every one has part for this failure – Banks, Financial Institutions, public/private sector companies etc.

Jim


Tara
said

Javid Radfar - How is it you can blame the Conservatives for a slow down in the economy? Do you seriously think that if the liberals were in power they could wave a magical wand and the US wouldn't have had an economic slowdown, and the ontario manufacturing would all be ok? Oh and while they are waving that wand the canadian dollar would be mucher lower. Get serious! This would have happened no matter who was in power.


Mandosa
said

hello Herb? spend your way out of a recession? How about we just print off a million 50 dollar bills and give them to every Canadian. Your suggestion reminds me of Homer Simpson and friends trying to dig their way out of a hole. To which Mayor Quimby directs: 'No, dig up stupid!'



Steve
said

Flaherty has ZERO credibility with anything to do with finances. Look at what he did to Ontario. If Flaherty is saying this country will be fine, I'd say the reality is that we are in huge trouble, especially as long as Harper and his band of merry right wing reformers stay in power.


Out in the West
said

Just because the centre of the universe, Ontario, is having a slow down doesn't mean the rest of Canada is hurting. I live in BC and we are not having any slow down, in fact, we have a shortage of workers for BC. Anyone from Ontairo looking for work, come to BC or Alberta, guarantee you will find work. Mind you I will admit our forest industry is taking a beating, but other job sectors are screaming for workers.


Nanook The Pinko
said

Try Communism - you'll like it!


dk
said

This really has nothing to do with the government. And the gov't can't spend their way out. The NDP tried that in Ontario in 1991 and we're still paying it off!!

Like the saying goes, "It's the economy stupid!"


Sonny
said

Jim, the slowdown/recession is due in part to business decisions.

Some companies continue to make products - let's say Gas Guzzlers that Canada/Ontario can't sell to it's close export market like the U$ because of the high cost of shelter, food, gas etc.


PJ
said

Is this the same idea that the US economy won't effect Canada?
I guess that has been now proven incorrect.
Wonder when the government is going to start seeing reality.


Mr Chillz
said

The people of Canada need to google SPP & NAU to understand what is about to come in the future.


Andrew
said

You know, there is a way to not have the recession become, why dosn't the government step in and say "lets be a green nation, with all these factories emptying out,why dont we lease them, employee people, and devlop and build green technology like hybrid cars, ZENN cars, and Hydrogen Cars" Canada can become a leader in devlopment of Green technology, if your worried about the manufacturing sector why not, make it for green technology that's an area that can have massive benifits and improve Canada's imagine greatly as a green nation, and good nation. But while Harper is in power he'll do nothing and corporate greed will continue, and Dion dosn't have the b**ls to do anything. NDP for me on this one!


Trudy
said

I don't think people are just mindlessly swallowing what politicians say anymore. They say things like this hoping to create a false sense of well being. The last thing any politican wants is thinking citizens. But, people are thinking now, speaking up and one would have to be an idiot to not know we are in hard times and headed for worse. Prepare for the future today. African Proverb. Prepare people.


steve I. C.
said

Keep reminding us of the economy so we forget everything negative the government is dealing with. Like poor approval ratings.


Roger T
said

Notice he says "DOESN'T THINK" which suggest that he's not confident enough to say no recession. Which means this is why our economy is at a stall and manufacturing plants are closing.

Don't be fooled by his comment. It's just to shy away from the Bad PR which is headlines from around the world and the fallout in the Conservative Party!


Devon K.
said

I'll give the Tories some credit here. No one could have seen the dollar running up as fast as it did last year. No one could have acted fast enough either. That said I think the Tories did a pretty good job with what they had. The slow down or recession from the US happened and they cut taxes where they could knowing what they had to work with. The Republcans never did that. They just cut without regard for consequences.

The people in this country getting hit hardest are those in Ontario and Provincial Liberals and Tories there both saw the transformation in manufacturing for the last 10 years. They were becoming less and less competitive every month and did little to fix it.

I'd lay a big chunk of that blame on the executives at the Big 3 Car Companies who saw rising gas prices and still let their fuel economies fall!


BSC Cobourg
said

Not surprised, we know what a mess Flaherty left Ontario in as Finance Minister. He will end up doing the same for the country.


Stephanie
said

Neither the current nor former governments may be responsible for this economic downturn, but Mr. Flaherty's drive to spend, spend, spend (that's what tax cuts are), certainly hasn't prepared Canada to weather this storm. It has been proven time after time that trickle-down economics result in disasterous consequences - Reagan, Thatcher, and Mulroney all put their countries in far more debt than any "socialist" or liberal governments before them. This is a historical fact, not an opinion. And at least the social benefits of social spending can be enjoyed by all citizens, whereas supply-side policies benefit only those who already have ... a lot! I for one am tired of having my tax dollars wasted on business and corporations who help no one but themselves - if capitalism was such a great system to begin with, business wouldn't need to be subsidized by the state.

Once again, this is more evidence of Mr. Harper's poor judgment when it comes to appointing his MPs to key portfolios like Finance and Foreign Affairs - look at Flaherty's track record in Ontario, the province he loves to hate. He put that province in debt $6 billion dollars before the electorate finally tossed him and his cronies out of office. Now, for the first time in more than a decade, we don't have a surplus because he's been giving corporations tax breaks left, right, and centre. This is poor fiscal management and Canadians are going to pay the price. Can we please have an election NOW?!!!


Herb
said

I tired to respond earlier to people, but was censored. I'll try again.

Basic economics, and I mean basic, teaches you that governments run surpluses to pay for stimulus during down periods--they can even run deficits. You cannot run a country like a business, primarily for the fact that it is NOT an business! These guys slashed the surplus and now we have nothing. Not even the rainy day fund Martin had built up...Plain as that. Now we have to ride this thing out.




Brooke Allen Vaughan
said

First I have to say that this has more to do with the US economy the the Harper Goverment ( sorry Liberals ). But if you feel it necessary to blame the current Goverment than please remember that since this is currently a minority Goverment then the blame needs to be spread to all thoses Dion Liberals who supported the Goverment.

Brooke Allen Vaughan


brenda
said

This is a WORLD WIDE problem, not just Conservative nor Liberal problem. Can anyone say One World Government???? One coming right up, perhaps as early as 2012


Allan Eizinas
said

This does not look good.

If this trend continues, the recession should be well established by October 19, 2009, the date of the next federal election. The electorate always blames the government in power for a recession.

“It’s the economy stupid!”

Say goodbye to Harper and friends.


Lart from Above
said

The US economy slowed down in 2001 when George Bush came to power. In the first quarter of 2008, it grew by 0.9%. Can't blame Canada's recent problems on the US. Canada's been riding an oil bubble that transfers wealth away from manufacturing and service industries to resource producers. The Conservatives have failed to plan a strategy to respond to this; they just figured as long as Alberta was okay, the rest of us can freeze in the dark. Seems like an odd apprach for a party that theoretically would want to act as a national government. Don't think Ontario voters are going to put up with the Parti Albertois for much longer.


tony
said

Not suprising! Our country's population equals to two New York cities, so our manufacturing power is weak on the global stage. We only complain about our jobs being outsourced yet stay quiet when our corporations get bought out. We would rather be a dependent than a leader. We still live in a dream world. The Canadian Auto plant was killed by the realities of a high loonie, environmental laws, and high gas prices.



Shamaro
said

What's the first thing a Federal Finance Minister always says just before a recession hits? "Thre won't be a recession"!

So, now that Flaherty has said there won't be a recesion in Canada, we can pretty much expect one as sure as the snow is white!


Brian
said

When times are slow you need to spend to keep the economy going, everyone should go out and spend some savings.
.
While your at it try to buy Canadian where ever possible, even if it costs you a little more.
.
As for government, rarely can they have much affect, citizens can.
.
Save when the economy is hot, spend when the economy is slow and support Canadian product when ever possible.


Roger T
said

Devon K.
I'll give the Tories some credit here. No one could have seen the dollar running up as fast as it did last year......

Credit for what? The rising dollar is because of the battered US$ and their economy which is causing people to hoard the CDN$ which is why job lost is occuring in Canada.

Also, the oil in Ablerta is shelter our economy for "NOW" til the slow down really takes place globally and their is less demand.

A reccession is imminent!

Are you prepared to blame the Tories when it hits.


Doug in stratford
said

This could have been predicted with the current state of the US. No goverment could have changed this from happening.
But what really bugs me is the federal finance minister who was the ontario finance minster tell the current goverement to drop business taxes.....why didn't he do it when they were in power ????????????


Jayson K Mendoza
said

Canada as a country exports around 87% of all products to the United States as it is our natural trading partner due to geographic location. Under NAFTA Canada's relativly free access to the US market has been a major boon to Canada making one of the richest countries in the world and with a small population too.

This massive trade dependency on the USA also makes us vulnerable to downturns in the US economy and any US policy decisions effecting trade.

Therefore one can conclude that policy decisions from either government in Canada has little effect on the current situation.

The government in order to avoid following the US into recession had used its two major economic tools in order to influence the Canadian economy in the short term. They have lowered interest rates which encourages people to spend, and decreased the GST which also encourages people to spend. This is to augment economic fears and keep domestic spending strong as our economy is in a relatively strong state. In order for the Canadian economy to stay strong our domestic spending must increase to compensate for the reduction in spending south of the border. This will help counter the effects of the slow US economy the amount of downsizing that takes place as companies lay off workers to compensate for lower demand and to reduce costs.

While it is possible to channel money to specific industries using tax breaks, that will have a minor effect on the economy overall and the micromanagement might causes increased losses in other sectors which are neglected attention. Furthermore one must also examin the reasons for an industry slowdown in areas such as manufacturing because when transition is needed (ie. Change of product lines, practice, or other problems making them unprofitable) industry specific subsidies end up becoming a costly band-aid solution which in the end only delays the change which must occur in an open market system thereby prolonging the problem.


pwindle@gmail.com
said

I think Chris should replace Maxime Bernier...


ET
said

1) This man has absolutely NO credibility anymore. I think people see him for what he really is...(too rude to post here!)

2) "The finance minister noted that Friday's report blames the GDP decline largely on manufacturing cutbacks -- most notably in the auto sector." Anything SW of Toronto is almost entirely based on the auto sector, and businesses supporting it. Also, about one sixth of the country lives here...5 million or so? Oilberta might be booming, but we're already in a recession down here in SW Ontario...Flaherty is WAY out of touch, as usual.

3) Why does this man hate our country (especially his home province) so much?


Paul in BC
said

Flaherty and Harper have their heads in the sand, ignoring a faltering economy does no one any good.

They are ignoring the tough decisions that have to be made.

Do I have confidence in this government? No.

Why? Because they ignore the facts and spin their own marketing strategy to cone the rest of us.


Westcoaster
said

Goodness me. Do I detect some bitterness from people in Ontario? For years you have been at the top of the heap while the rest of the country struggled. Now when there is a downturn in the economy in Ontario, the blame "must" be laid laid on the Conservative's doorstep. Interesting how the rest of the country is doing so well under the federal Conservative's though. Newfoundland/Labrador, Saskatchewan, Alberta and BC are doing have very strong economies. Perhaps you should be looking at your own provincial government rather than the federal government. Oh and maybe the unions need to realize that they can't just keep bleeding the employer and asking for more and more. There must be a ceiling somewhere or you price yourselves out of a job!!


GTA
said

Huh! What recession? Funny how a slight slow-down in ONTARIO (only)constitutes an "oh my Gawd my hairs on fire, it's a recession", news headline. The ON economy has forever relied on fat government handouts, from both levels of government. Wake up - your automotive manufacturing sector is not competitive. Overpaid workers and too much Government involvement.


Mike from Canada
said

To "Westcoaster":

And while Ontario has soared since pretty well confederation, it has also doled out a great deal of its revenue to the Federal Government as a "has" province, a great deal of which was sent to every region in Canada, including BC.

As an analagy...you sound like a kid brother of a doctor. You are jealous of the money the doctor makes, although he used part of it to finance yor education...and now that your brother the doctor has stumbled a bit, you have the knives out...et tu Brute?


mac
said

Honda plant in Alliston is increasing production.

Cami plant also booming.

It's the deadhead US-run companies that are collapsing.

Stop getting your ideas about the US from watching the jet skiers at the beginning of CSI Miami.




Steve G
said

The economy....foreign affairs....ethics/accountability-it looks like the Conservatives have completed the trifecta of failure.




Fletcher
said

Westcoaster and GTA: the only bitterness I detect is from people like you who have an irrational contempt for Ontario. The majority of Canadians live in that province, which has, may I remind you, been the province providing all of the "hand outs" and propping up the rest of the country financially since Confederation (equalization, anyone?) If Danny Williams can take the high road and get past the past and stand beside Ontario in its time of crisis, surely the rest of the country can do the same. It is, after all, in our national interest. And everyone knows that once the oil dries up, all of these "successful" holier-than-thou provinces will be in exactly the same crisis as Ontario. The difference is that Ontario won't be gloating over your demise and will most likely be helping you back up on your feet, as it has done historically.

And workers are not overpaid - they are fairly compensated for their labour, and some might even dispute that. All workers in Canada deserve the same wages and benefits that the autoworkers union has successfully bargained for. Employers aren't doing us a favour by employing us - capitalism is a two-way street. I imagine that westcoaster and GTA would gladly forfeit their 8 hour workday, 5 day work week, paid vacation, living wage, and UI, to list only a few benefits, to avoid "pricing" themselves out of a job! Yeah, I didn't think so.


ASM
said

Flaherty prdicted 0.5% growth, instead of growth it went 0.3% the other way, thats a loss of 0.8%, Ahh the Flaherty of the old Mike Harris government has not changed at all.


Steve G
said

Fletcher

Very well said!


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