If a neighbour knocked on your door and asked you to invest in his invention, would you be able to weight the pros and cons and make a decision on whether to invest your own money?
Or what if your financial advisor asked if you wanted to invest in a higher risk investment portfolio or a lower risk, lower payoff option – could you figure out how to instruct her on which path to take?
Most people would answer “yes” and “yes” to the two previous questions. After all, investment opportunities present themselves to people all the time in one form or another and we all somehow figure out what to do with our money.
Why then does the government take the power to make some of those decisions away from you?
There are all kinds of taxpayer-funded government programs out there that take your money and then hand it over to businesses through grants and sweetheart loans. Whether it’s a government loan or a cash handout, when businesses do happen to succeed, guess who keeps the profits? Yes, the business owner, not taxpayers who indirectly footed the bill and took on the risk. And if the business fails, taxpayers lose money just the same.
Instead of the government taking money from your pocket and giving it to that neighbour you (and probably your bank) already decided to turn down, governments should simply leave more money in your pocket through lower taxes in the first place.
Doing so would allow you to buy goods and services from new or existing businesses in Saskatchewan or perhaps invest in a business of your own. In both situations you would be helping to create jobs.
Last year the Wall government moved to empower you with more of those decisions by cancelling a government program that gave your money to the film industry.
As the industry had grown dependent on big handouts from taxpayers, they raised quite the stink about the funding cut. They painted a picture that suggested the government’s existing subsidy program was important as it created all kinds of spin off jobs. However, what they neglected to tell you is the provincial government provided more than just the one subsidy program for the industry; it also funded things such as the industry’s sound stage in Regina.
Proponents also forgot to mention many film companies receive
generous subsidies from the federal government too. In other words, the ‘small government handouts’ that ‘created all the jobs’ weren’t so small at all. There was also no mention of the fact jobs were killed by the subsidies as well. After all, when money is taken from your pocket, those are dollars you no longer have to support local businesses.
While the film subsidy ship has sailed, proponents of the industry did raise a good point – there are plenty of other industries receiving handouts from the Saskatchewan government.
For example, the film industry noted the potash industry receives handouts for head office jobs located in the province. According to Enterprise Saskatchewan, the government provides
“a $100,000 allowance per job” and is “available for qualifying corporate office positions.”
Good point – those subsidies should be phased out too. Another worth getting rid of would be the subsidies for those who invest in
labour-sponsored investment funds.
Hopefully the Wall government’s upcoming budget phases out other business subsidy programs in favour of phasing in lower taxes for you in the first place.
Colin Craig is the Prairie Director for the Canadian Taxpayers Federation
