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Friday, June 27, 2014

Let’s get rid of low-skilled temporary foreign workers program altogether

I’ve never been one to promote laissez-faire economics believing, as I do, in a mixed economy based on economic liberalism with limited, prudent state intervention and regulation—i.e., a largely free-market economy based on a free price system, free trade and private property.

I have to say, though, that I find our current government’s schizophrenic approach to our free-market economy maddening in its inconsistency.

Propping up a national broadcaster—the CBC, of course—to the tune of a $1-billion a year subsidy so it can compete against private companies that receive little or no government support is a case in point. Forcing consumers to pay outlandish prices for milk, cheese, poultry, eggs and related products—through supply management—is another egregious assault on our free-markets.

The most recent case to cause controversy is the Temporary Foreign Worker Program, which the federal government overhauled a week or so ago, concentrating on the low-skilled workers stream.

Time will tell how successful Employment Minister Jason Kenney’s revised program will be, but I’m one who believes the market—not the government—should decide whether a business needs to increase wages to attract workers.

Moreover, I am not heartened by a C.D. Howe Institute’s report published earlier this year. The non-partisan think-tank says the program actually increased unemployment rates in B.C. and Alberta, and claimed that a goal of the program is to keep wages from “rising precipitously” in response to a shortage of workers.

How often does this government act to prevent prices from “rising precipitously?” So why are they being so accommodating to businesses by keeping wages from rising?

Prices at the gas pumps rose at an alarming rate without governments acting to tamp them down. Furthermore, we pay substantially above world prices for dairy products and, in that case, with the collusion of the government.

But, heaven forbid, that we should stand back and watch businesses pay $20+ an hour to hamburger flippers at fast-food restaurants.

To his credit, Minister Kenney has announced that employers located in regions where the unemployment rate is above six per cent will be barred from hiring temporary foreign workers. Also, he has placed a 10 per cent cap on the number of low-wage temporary foreign workers an employer can hire per work site.  That cap will be phased in, starting at 30 per cent, then 20 per cent on July 1, 2015, and 10 per cent a year later.

Justin Trudeau has condemned the phasing out of this anti-Canadian, low-wage program, describing it as “one of the most anti-Alberta federal policies we’ve seen in decades.” A policy more fitting of this description is, of course, his dad’s national energy program, a federal policy that sought to distribute Alberta’s oil wealth to poorer parts of the country, pretty much wiping out Liberal support throughout the province.

Now this lesser Trudeau seeks to curry favour with Fort McMurray employers who have to deal with low unemployment and a booming economy. Well, capitalism “cuts” both ways: employers get to set prices as high as the competition and consumers will bear and employees get to benefit from low unemployment. And this situation almost always plays out better when governments do not interfere.

If there is a genuine need for these workers, why not obtain them through permanent immigration channels? We allow in hundreds of thousands of permanent immigrants each year? Can we not change immigration strategies to accommodate regions with low unemployment and a booming economy? After all, in most of the situations I’ve read about, there seems to be more of a long-term aspect to the employment market than the Temporary Foreign Worker Program is intended to serve.

We fully expect that in 2016, after the phase-out period is complete, a Conservative government will decide to eliminate the low-skilled stream of the Temporary Foreign Worker Program altogether. I believe Canada is the only developed country that allows low-skilled temporary foreign workers, and it is not to our credit that we do. The government has no business subsidizing employers in this manner.

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