Mark Milke is a Calgary author and columnist who has written multiple reports on subsidies to business.
If federal Access to Information records dated back to Confederation, it is possible that we might know of another corporation, still in business, that has been a chronic recipient of taxpayer funds longer than Bombardier Inc.
Absent such data, it appears that the Montreal-based company is the oldest business in the business of seeking government funds.
Bombardier received its first subsidy from the federal government in 1966. That was 50 years ago. It was a “conditionally repayable contribution,” which means a company has to be successful in whatever project the loan is attached to, or taxpayers are not repaid. That 1966 taxpayer cheque for $5.25-million would be worth $37.5-million in 2015 dollars (to which all following amounts are adjusted).
That is one reason for the federal government to deny Bombardier yet another taxpayer-funded “investment” – political-speak for corporate welfare or subsidies to business. In the spirit of David Letterman, let’s count that first bit of government lolly to Bombardier as reason No. 10 to deny the company more tax dollars.
Reason No. 9 why Prime Minister Justin Trudeau should close the door on yet another Bombardier cash call? Because the company’s latest request for almost $1-billion (U.S.) – $1.4-billion Canadian – would be its 51st request to the federal government in 50 years.
Reason No. 8, and this is a long one: If Bombardier is granted yet more taxpayer money, it would be in addition to the almost $1.2-billion granted or lent to the company by the federal government since 1966. There was another $1.2-billion in corporate welfare to another aerospace company, de Havilland, which Bombardier swallowed in 1992, and almost $1.4-billion “invested” last year by provincial taxpayers in Quebec. Add all that up, and you have $3.8-billion (again, that’s in 2015 Canadian dollars) to Bombardier.
Reason No. 7: Bombardier has not paid back previous past monies delivered to it by the federal government. Over the years, I have filed multiple Access to Information requests to obtain such information. Bombardier went to federal court to block detailed repayment records. Last November, Industry Canada noted that the company has repaid $543-million – much less than the company has received (and not adjusted for inflation).
Reason No. 6: Corporate welfare designed to “save jobs” does nothing of the sort. It simply “recycles” employment from one jurisdiction to another, depending on which government is the latest “mark” for a subsidy-seeking corporation.
Reason No. 5: Over the past week, Canada’s energy companies have announced the following layoffs: Husky: 500 people in addition to 280 last fall and 1,000 contractors. Suncor: 1,700 employees over the past year. Cenovus: 1,500 workers. StatOil: 220 employees. TransCanada: about 500 employees. Precision Drilling: as many as 4,000 workers.
Despite those layoffs, no corporate welfare is planned for the energy sector. And nor should it be: These and other corporations are restructuring to survive. That’s how healthy companies are created.
Reason No. 4: Rescuing one company (again) means that tax dollars must be taken from other, more successful enterprises.
Reason No. 3: The latest data from the Canada Revenue Agency shows that those Canadians with taxable income below $20,000 (1,545,240 Canadians) paid slightly more than $1.5-billion in federal income tax in 2013. At about $1,000 per low-income taxpayer, and assuming that 2016 figures will mimic previous years, most of those 1.5 million taxpayers will pay about $1,000 each in federal income tax this year – just to be sent to Bombardier.
That brings up reason No. 2 to deny Bombardier more government funding: Another $1.4-billion in taxpayer cash will end up helping the company’s share price. That, as The Globe’s Eric Reguly pointed out Wednesday, would reward the “Bombardier and Beaudoin family members who remain in control of the company in spite of their epic management sins.”
The No. 1 reason Bombardier should be denied yet another taxpayer infusion of cash? Because no sensible case can be made for sending more corporate welfare to a company for 50 years – fully one-third of Canada’s post-Confederation history.Report Typo/Error