The vocal and very public war of words between the federal government and Ontario's Liberals doesn't appear to have died down. The two sides continued to bicker bitterly over the federal budget Tuesday.
Ontario Finance Minister Dwight Duncan said he's disappointed by Jim Flaherty's fiscal plan. Duncan said his counterpart in Ottawa has come up short when it comes to delivering a budget that would have helped the province's ailing manufacturing sector. Duncan said Flaherty failed to fix employment insurance inequalities that, he argues, hurt Ontario workers.
Duncan noted that the budget was a "missed opportunity" for Ontario and Ottawa to work together during a tough economic period. Ontario has been calling on Ottawa to give direct financial aid to industry.
Duncan's comments follow weeks of harsh words between provincial and federal politicians. Last week, Flaherty said the Ontario Liberals had a "lack of leadership and vision" to deal with the province's economy. Ontario Economic and Development Minister Sandra Pupatello didn't take the comments lightly. She said Flaherty was a "cartoon character" and said he was guilty of spreading "bald-faced lies."
On Tuesday, Flaherty didn't back down.
"(Premier Dalton) McGuinty's legacy will be to take Ontario into 'have-not' status in Confederation," Flaherty told CTV Newsnet's Mike Duffy Live.
"My concern about Ontario is this: Taxes in Ontario for business are the highest in Canada," he said. "Why would someone invest in the province of Ontario when they can invest in Quebec, they can invest in Manitoba, (or) they can invest in British Columbia?"
He said those provinces are lowering their corporate taxes and so are remaining competitive.
In the budget tabled Tuesday, Flaherty extended a tax break for manufacturers on new equipment, stating that he hoped that would stimulate new investment. The Tory government will also give $250 billion to the automotive sector over the next five years. The money will be earmarked for research and development to create more fuel efficient vehicles.
Canadian Auto Workers president Buzz Hargrove said Ottawa's strategy is on the wrong track.
"This money should be the first part of a much bigger long term automotive strategy, not a one-time gesture to rally voters," Hargrove said.
Ken Georgetti, the head of the Canadian Labour Congress, told CTV News that the Conservative budget has done little to help the average worker.
"Mr. Flaherty should be ashamed of himself. With the crisis that's hit the manufacturing and the forestry sectors in this country, to say and do very little on that is irresponsible," he said.
Georgetti said the government is ignoring the fates of 350,000 workers who lost good manufacturing and forestry jobs over the last few years. But some economists say the Tory plan to give tax breaks for equipment investment is the right approach considering its tight financial position.
"It's giving tax relief to the companies that stand a chance of investing and prospering in the longer-term as opposed to more of a subsidies route where you're propping up companies that have a lower chance of thriving," RBC economist Derek Holt said.
With files from The Canadian Press
