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© BOPINION THE GOVERNMENT MUST DO MORE TO The IFP - Halton Hills | Thursday, July 28, 2022 Q So = S EE] Ss =} Ee] 2 = a PRICES, WRITES MICHAEL CHONG MICHAEL CHONG Column The cost of living con- tinues to skyrocket. In May, the consumer price index, Canada's mai inflation barometer, rose 7.7 per cent — the largest year-over-year gain since 1983. Everything is costing more — bread, beef, gas, nt, appliances. And the list goes on. Energy prices rose 34.8 per cent on a year- over-year basis in May. This dramatic increase is hitting Canadians hard at the pumps and having a downstream effect on oth- er items, such as groceries and durable goods. InJune, Statistics Cana- affected by rising food pric- es (up 9.7 per cent in May). Canadians continue to pay more for basic food staples, including fruits, bles and meat. ed to cool, prices are still double what they were six ars . Factors external to Can- ada have no doubt contrib: uted to domestic inflatio: including COVID-19-1 relat. ed supply chain disrup- tions and Russia's war on § Ukraii : It's also clear, in my far) a) wn | o 7 _ = = =) wn OUT OF CONTROL opinion, that the arm's- length and independent Bank of Canada did not re- spond quickly enough to rising inflation. But the Trudeau gov- ernment doesn't get a free e rising cost of ing the gasoline of fis- tal st stimulus on the fires of inflation. December, I wrote ing. Since then, the govern- ment has, I feel, introduced a budget that only further contributes to rising infla- tion. The government is now spending $70 billion more anny than before the pandemi: That's 1 more than four per cent of Canada's GDP per year in additional spending. This is fuelling inflation — and it's not sus- tainal the budget should have focused on controlling spending. It should have in- troduced meaningful tax breaks for struggling Ca- nadians, including fami- lies and seniors. It should I have el cour: consumption. Finally, it should have put in place stronger measures fe to pre tect Canadiai extending themselves. and taking on foc {oo ia debt. The ment must ist dot etter to to sad. dress the rising cost of liv- ing that disproportionate- ly impacts lower-income individuals and families. Michael Chong is the MP for Wellington—Hal- ton Hills, and the shadow minister of foreign affairs Ser the official opposition. can be reached at chael. chongax@parl.gc-ca. TO LEARN HOW TO SUBMIT YOUR OWN CONTENT VISIT THEIFPCA SNAPSHOT Bill McKenzie photo A green frog explores the Hungry Hollow area. Do you have a great local photo you'd like to share? Send it to sleblanc@metroland.com, along with a brief description. INTEREST RATE HIKE WILL HURT MANY CANADIANS The Bank of Canada gressive move to increase interest rates. ‘hat increase will im- pact many individuals. The underlying story is just how serious the risk of inflation is to the Canadian economy, and that such ex- treme measures have been taken. Three facts help paint the picture of the severity of current i ionary concerns. One: The one per cent increase to interest rates was four times the size of recent interest rate hikes. Two: Thecurrent policy interest rate as set by the Bank of Canada is 2.5 per cent, which is the highest since the financial crisis of 2008. Three: Canada 's infla- tion rate is 81 per cent, qnich is the highest since PETER WATSON Column Interest rate hikes are a delicate balancing act by the Bank of Canada, wit plenty of pros and cons on the impact they will have. Consider this a financial trade-off. Financial pain will be felt by many individuals from both higher borrow- ing costs and — likely — continued decreases in the value of people's largest as- sets, t their homes. e Canadian economy, this increase = interest rates and the ex- pected future interest vate increases could push our economy into a recession. The priority is to get in- flation under control, which will slow price increases and wage hike demands. Consider this the necessary ps to maint asi economic foundation. It's short-term pain for long-term gain. is, ulti- mately, will be good for our economy; however, many will be hurt in the process. Peter Watson, of Watson Investments MBA, CFP, R.EP., CIM, FCSI offers a weekly financial planning column, Dollars & Sense. He can be contacted through www.watsonin- vestments.com. SIGN UP FOR OUR WEEKLY NEWSLETTER AT HEIFP.CA. ABOUT US This newspaper, published every Thursday, is a division of the Metroland Media Group Ltd., a wholly-owned subsidiary of Torstar Corporation. 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