Deflating some arguments about inflation

Daniel Blaikie By: Daniel Blaikie Posted:

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Hey there, time traveller!
This article was published 01/02/2022 (483 days ago), so information in it may no longer be current.

Inflation is a hot topic these days. All it takes is a quick trip to the grocery store to appreciate that this is not an academic issue. The rising cost of essentials is having a real affect on people’s ability to make ends meet.
The question is, what can the federal government do to fight back against inflation?
The political parties in the House of Commons are offering quite different answers to this question. How the government responds will have far-reaching consequences, so it is important that Canadians understand what is at stake.
Let’s start with the simplistic explanation of the Conservatives. They point to the massive income supports the federal government paid out during the pandemic and claim this spending is responsible for inflation. Their answer is equally simple — make massive cuts to government spending.
This is the Conservative solution to every problem, whether it makes sense or not. We are currently suffering the consequences as they apply this solution to health care in Manitoba.
The fact is there are many factors at work behind the increase in prices Canadians are seeing. Pandemic-induced production shutdowns across the globe, a domestic labour shortage and supply chain disruptions caused by extreme weather events are all factors driving up prices.
Liberals point to these challenges, throw up their hands and say there is nothing they can do but this is not true.
In the short term, they could heed the calls of the NDP to ensure that pandemic benefits remain widely available at $500 per week. Instead, they have chosen to restrict access to these benefits and cut the weekly rate to $300 per week. 
Spending by people living at the poverty line is not what is driving inflation.
They should also stop clawing back the benefit from our most financially vulnerable who depend on programs such as the guaranteed income supplement and Canada child benefit.
The recent increase in old age security to those aged 75 and older should be extended to all seniors. Everyone is trying to cope with the increased costs of living. Creating two classes of seniors is not the answer.
In the medium term, the government should establish a national pharmacare plan to lower the cost of prescription drugs, take regulatory action to lower cellphone and internet charges, build more social housing and take action to stem the overheated housing market. In all three of these areas, Canadians pay among the highest rates in the world.
We continue to live in challenging times. Some of the inflation is a result of the pandemic, but that does not mean government is absolved of all responsibility to keep prices affordable for the things Canadians need.

Inflation is a hot topic these days. All it takes is a quick trip to the grocery store to appreciate that this is not an academic issue. The rising cost of essentials is having a real affect on people’s ability to make ends meet.

The question is, what can the federal government do to fight back against inflation?

The reasons for inflation are not as simple as some would have you believe, and there are many ways to combat it.

The political parties in the House of Commons are offering quite different answers to this question. How the government responds will have far-reaching consequences, so it is important that Canadians understand what is at stake.

Let’s start with the simplistic explanation of the Conservatives. They point to the massive income supports the federal government paid out during the pandemic and claim this spending is responsible for inflation. Their answer is equally simple — make massive cuts to government spending.

This is the Conservative solution to every problem, whether it makes sense or not. We are currently suffering the consequences as they apply this solution to health care in Manitoba.

The fact is there are many factors at work behind the increase in prices Canadians are seeing. Pandemic-induced production shutdowns across the globe, a domestic labour shortage and supply chain disruptions caused by extreme weather events are all factors driving up prices.

Liberals point to these challenges, throw up their hands and say there is nothing they can do but this is not true.

In the short term, they could heed the calls of the NDP to ensure that pandemic benefits remain widely available at $500 per week. Instead, they have chosen to restrict access to these benefits and cut the weekly rate to $300 per week. 

Spending by people living at the poverty line is not what is driving inflation.

They should also stop clawing back the benefit from our most financially vulnerable who depend on programs such as the guaranteed income supplement and Canada child benefit.

The recent increase in old age security to those aged 75 and older should be extended to all seniors. Everyone is trying to cope with the increased costs of living. Creating two classes of seniors is not the answer.

In the medium term, the government should establish a national pharmacare plan to lower the cost of prescription drugs, take regulatory action to lower cellphone and internet charges, build more social housing and take action to stem the overheated housing market. In all three of these areas, Canadians pay among the highest rates in the world.

We continue to live in challenging times. Some of the inflation is a result of the pandemic, but that does not mean government is absolved of all responsibility to keep prices affordable for the things Canadians need.

Daniel Blaikie

Daniel Blaikie
Elmwood-Transcona constituency report

Daniel Blaikie is the NDP MP for Elmwood-Transcona.

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