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Union and finance minister butt heads on auto policy

Nov 13, 2008 - 03:45 PM

DURHAM -- Finance minister Jim Flaherty said some of his constituents don't want him to bail the auto industry out but the Canadian Auto Workers are asking people to tell him he's wrong.

Mr. Flaherty has announced support for the banking industry to the tune of $75 billion in mortgage purchases. The cash will have the effect of freeing up liquidity on the banks' balance sheets, helping them maintain capital ratios.

But that decision has stirred controversy in another sector with the local MP saying some people in his Whitby-Oshawa riding are urging Ottawa not to bail out the Big Three North American automakers considering they may not survive.

"There are many people saying we should do something with respect to the auto sector. But I can tell you, even in my own riding ... which is the home of General Motors of Canada, there are also people who say don't do anything -- don't use my tax money to bail out an enterprise that may not survive," Mr. Flaherty said in Toronto.

"We have money available for innovation, transformational money if I can call it that, because at the end of the day we need car-makers who are making cars that people want to buy, so that there's demand. And there's a challenge there."

His comments appeared to contradict the positive message from the first ministers' meeting earlier this week, which left premiers with the impression Ottawa was poised to help the struggling industry.

An e-mail from the union was sent to members and supporters to encourage people to write to Mr. Flaherty and tell him they want help for the flailing auto sector.

"Whitby-Oshawa MP Jim Flaherty is telling the media that the only calls he has received from his constituents to date have been against assisting the auto companies," the e-mail said.

"Well, let's send him a message. CAW Local 222 President Chris Buckley would like you to call and/or e-mail Mr. Flaherty to send him a clear message about how much the auto industry means to our communities and how the government should do all it can to protect and preserve good-paying Canadian jobs."

Mr. Buckley said he is concerned that if the government doesn't pay more attention to the auto industry soon it could evaporate in Canada.

"I don't doubt for a minute that Mr. Flaherty's getting some callers concerned about using tax dollars to prop up General Motors, but I honestly believe there would be more people that would be encouraging him to act on behalf of General Motors," he said.

It's important to remember what GM provides for the community in terms of direct jobs, spin-off employment and spending power, he said.

The CAW is asking Mr. Flaherty to help GM through the credit crunch and address the root cause of GM's problems which Mr. Buckley said is dwindling market share due to unfair trade policies.

"Until the government addresses the unfair trade policies things are only going to get worse."


-- with files from Melissa Mancini and the Torstar News Network

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