Letters to the editor
In this recession, buying local has never meant so much for so many
Editor:
There has been much discussion recently about the auto industry, both in Canada and the United States.
It is important to consider a number of factors when considering a domestic product versus an import:
1. The auto industry has been and is very highly regulated by the American and Canadian governments, as well as some states and provinces. To some degree, regulation has affected how automotive companies are set up, how they operate and what products customers can purchase;
2. The "Big Three" -GM, Chrysler and Ford -have contributed more to the economy in both Canada and the U. S. Because of their extensive production facilities, the number of people they employ and their high content of North Americansourced parts;
3. With credit markets tightening up, it is increasingly difficult for companies (and individuals) to borrow funds at competitive rates. Some financial institutions (HSBC and Wells Fargo) have exited the automotive market entirely;
4. Ontario is the largest producer of automotive products in North America. With this, there is a tremendous benefit to the Ontario and Canadian economies. Not only does one Canadian auto job produce three Canadian parts jobs, but positively impacts the employment of four other jobs in Canada.
In addition, one auto worker and three associated parts workers generate about $40,000 to the provincial and federal governments in income taxes. These taxes fund health, education and social programs. These same four workers spend about $120,000 in their local economies with a further $18,000 generated in federal and provincial sales taxes. And don't forget, business taxes are generated from merchants.
For every Canadian auto worker, that's $58,000 generated to pay your child's education, your health care, your parents' retirements and other social programs.
If you haven't looked at GM, Ford and Chrysler products lately, look at them today. In excess of 50 per cent of Canadians are choosing these products over the 23 other import manufacturers. All three build great products, now have fewer recalls than imported brands, are safer and are achieving outstanding awards.
If you decide to buy or lease a product of the Big Three, you've indirectly generated $58,000 into the local economy by way of the four Canadian auto workers you have helped employ.
Something the federal and provincial governments can do to help the economy are:
* Eliminate or cut the GST on the sale or used vehicles (or impose a five per cent tax at MTO offices on private used vehicle sales) and let consumers decide what to buy/lease;
* Eliminate or cut the GST on the sale of new vehicles on a temporary basis until we get a continual increase in jobs and GDP and let consumers decide what to buy/lease;
* Purchase shares in all the Big Three if you're into this type of investment;
* Do not do anything that will affect what consumers want to buy (don't put incentives on one type of vehicle, causing disadvantage to the other vehicles);
* Increase the import tax on all vehicles by at least two per cent (permitted under WTO rules);
* Allow North American auto manufacturers (domestic) to export their products without limitations on quantity. Then we would have truly free and fair trade.
LINK:
In this recession, buying local has never meant so much for so many - The Daily Observer - Ontario, CA
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