Bombardier deal bad for taxpayers
Bombardier CEO Alain Bellemare stands in front of a Global 7000 jet as he speaks during a press conference at Bombardier in Montreal on Feb. 7, 2017. (Allen McInnis/ MONTREAL GAZETTE)
No, Bombardier should not be loaned hundreds of millions in taxpayer dollars. It’s that simple.
Yet sadly the case still needs to be made.
Listening to Navdeep Bains speak about the great merits of the Quebec company’s CSeries jet on Tuesday afternoon, you would have thought he was the company’s CEO or official spokesman.
He’s not. He’s the federal Liberal innovation minister and he was announcing $372.5 million in loans handed out over four years to the aerospace giant for two of its jet programs – the CSeries and the Global 7000.
We’re left scratching our heads here. If the CSeries is so great, why won’t anyone else foot the bill for it?
Why doesn’t Bombardier just go get a loan from a bank, like regular Canadians do for their business ventures or home mortgage loans?
Throw into the mix Wednesday’s news that Brazil is seeking action on this issue from the World Trade Organization for what they view as unfair subsidies and it gets even more troubling. (One of Bombardier’s main competitors is South American.)
Fraser Institute fellow Mark Milke has done extensive research and writing on corporate welfare in Canada and, in his book Tax Me I’m Canadian!, shows Bombardier is one of the country's top recipients.
From 1966 to 2009, the company received 48 handouts from Industry Canada that added up to well over a billion dollars, adjusted for inflation. No other company received as much from the feds aside from Pratt & Whitney.
And while, at the time of those calculations, Bombardier was the 8thlargest employer in Canada, only five of the top 25 employers in the country received any handouts.
This is a clear sign there’s no meaningful connection between job growth and government handouts.
Most companies can and do survive without it. Bombardier must learn to do the same.
As we wrote in a previous editorial urging the feds to just say no: “The problem is that the more a company doesn’t have to face the consequences of its actions because of government bail outs, the more likely it will continue the practices that got it into financial trouble in the first place.”
At a time when most Canadians are feeling the pinch from low growth, this deal is just plain wrong.