Segal argues for fixed exchange rate at CAFP conference

Segal, president of the Institute for Research on Public Policy and most recently a nominee for the Conservative Party leadership, demanded that the government form committees to look at both the possibility of joining a monetary alliance with the United States and to look at the Canadian tax system.

He waded into the discussion about Canada’s economic policy by sounding a warning about our current good times.

“No boom goes on forever,” said Segal. “The cycle may be going on longer than we’ve ever seen before but it will not go on in perpetuity. We should not become complacent.”

That said, Segal went on to suggest what needs to be fixed.

“Canadians deserve a full blown examination of the benefits and costs of a fixed exchange rate system with the US.,” he said, arguing that exchange rate fluctuations sorely affect businesses that import and export from Canada.

Segal also argued a fixed exchange rate would close the wealth gap developing between Canadians and Americans, a gap that he said could hit 50% in another decade. A fixed currency would work to stem the brain drain by closing that gap.

In light of those possibilities, Segal called for a joint Senate and House of Commons committee to study the issue.

“This country needs a debate on monetary policy options,” said Segal.

He also called for a committee made up of federal and provincial governments, business groups, labour groups and volunteer organizations to be formed to report on how the Canadian tax system could be made “less complex, more fair and with better purpose.”

This committee he said could take a year and report back in September 2001, around the time of the next federal election.

“This is the time to get it right,” said Segal. “When we pass the balance sheet on to our children I’d like it to be in the black.”