Manitoba, choices between corporate welfare cheques and broad-based tax cuts are secondary. Manitoba is broke.

Manitoba needs to cancel its corporate welfare credit card

By —— Bio and Archives--September 18, 2018

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Manitoba needs to cancel its corporate welfare credit card
Like an overly enthusiastic shopper with a maxed-out credit card, the Manitoba government is on a corporate welfare spending spree that it simply can’t afford.

Premier Brian Pallister just stopped by a new Canada Goose facility in Winnipeg with a gift of almost $1.5 million in taxpayers’ money. The government says money will support the “onboarding and technical training of the new sewing machine operators.” In other words, Manitoba taxpayers are paying Canada Goose $1.5 million to hire people to sew thousand-dollar luxury coats.


What tale of woe reduced Canada Goose to this need for taxpayer-funded charity? That’s a tough question. Right in the government release, Canada Goose cheerfully notes the total bill for the new facility is $15.8 million so it doesn’t seem to be short on cash. In fact, Canada Goose’s total market capitalization shows the company is worth more than $8 billion. It’s a good bet the massive multi-national won’t even notice the taxpayer cash on its bottom line and it definitely didn’t need it.

This wasn’t the only stop on the province’s corporate-welfare spending spree.

The province is chipping in almost $12 million for the True North Square project. Much of the money will go to sidewalks, greenspaces and a water feature. But the money will also go to a “194-unit residential tower at 225 Carlton St.”

That’s a modest description of the tower. The 225carlton.ca website does it greater justice. There’s going to be courteous concierge personnel and 24/7 security. The countertops are quartz. There’s a yoga studio and rooftop lounge. If it weren’t for the taxpayer money, who knows what the countertops would look like or where the residents would do their stretching?

Once again, it’s hard to imagine why the government felt the need to lavish this corporate welfare on True North. The government triumphantly points out that the private sector will invest $550 million in the project. Are taxpayers to believe the developers could secure more than a half-a-billion in financing, but would have pulled the plug on the project without the corporate welfare?

Unfortunately, this recent corporate welfare spending spree isn’t unprecedented for this government.

The provincial and federal governments teamed up to hand Maple Leaf $500,000 in taxpayers’ money to buy bacon-making equipment as part of a $35-million expansion. That happened mere months after the last provincial election. The corporate welfare was infuriating, but at least it came with jokes about government pork producing actual pork.

Listen closely. At this point in the column, government ministers and senior bureaucrats are shouting at their newspapers. They’re so loud it’s easy to hear what they’re saying. They want some acknowledgement of the jobs connected to these projects. They’re frustrated with the lack of context because Manitoba competes with other provinces that dole out corporate welfare too. What about the tax revenues generated by the economic growth, dammit?

Want to know what else creates jobs, strengthens competitiveness and generates economic growth? LOWER TAXES. Sure, businesses hire people when they get taxpayers’ money, but governments aren’t good at picking winners and losers because they’re often distracted by political expediency and staged photos with expensive coats. Individual customers and investors are better at driving true growth because they focus on good deals rather than press conferences. Manitoba would be better off if the government cut corporate welfare and lowered taxes for everyone.

But, for Manitoba, choices between corporate welfare cheques and broad-based tax cuts are secondary. Manitoba is broke. The province’s operational deficit is $521 million. It’s paying almost a billion dollars every year just to cover the interest charges on the debt. Manitoba simply can’t afford to spend taxpayers’ cash on fashion coat makers; luxury condo developers; or, even bacon.

This column first appeared in the Winnipeg Sun and is now free to reprint.



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