The Bank of Canada hiked interest rates to 4.5% in January – the 8th hike in 11 months – even though previous hikes have shown that while the impact on inflation is minimal, the impact on the working class, the young and the poor is devastating. Real wages and living standards are falling dramatically, as the cost of mortgages and loans have sky-rocketed, along with the credit card debt which ensures Canada will continue to have the highest levels of household debt of any OECD country. This is a sure-fire way to drive the country into deep recession, creating mass unemployment, and even more downward pressure on wages and pensions, public services and social programs.
Rising prices and profits are the major cause of inflation, which both the Bank of Canada and the federal government (and opposition parties) have chosen to ignore. Instead they point their fingers at workers and their unions who are struggling just to keep their heads above water with collective bargaining focused on real wage increases and cost of living allowance (COLA). Bank of Canada governor Tiff Macklem has declared that unemployment is too low, and that deliberate action to increase unemployment is the bank’s goal. And in this they will be successful. The January hike is projected to result in 300,000 job loses, on top of the big lay-offs already rolling out in the technology and auto industries, among others. The worst is yet to come with all the misery that mass unemployment and declining wages and living standards create.
Who benefits from these policies? The same corporations and Big Businesses that benefit from rising prices and sky-rocketing profits. That’s whose interests the Bank of Canada and the Liberals are protecting with high interest rates and soaring prices and profits.
What’s needed is action to curb corporate power and profits.
The government must act to protect workers’ jobs, wages and living standards, and Parliament must be forced by a mobilized public to demand this minority Liberal government take urgent action now.
The Communist Party demands that the government act immediately and urgently to:
- Roll-back interest rates
- Roll-back and freeze prices on food, fuel and rents
- Raise wages and pensions, create jobs, and introduce a Guaranteed Annual Livable Income
- Double corporate taxes and enact a windfall profits tax
- Legislate wealth and inheritance taxes on the rich
- Slash military spending – fund Medicare and education, build social housing, transition to publicly owned renewable energy and slash carbon and GHG emissions
Central Executive Committee, Communist Party of Canada