Bea Bruske, President of the Canadian Labour Congress, released the following statement after meeting between the Bank of Canada Governor and a delegation of representatives of the labour movement:
“Canada’s unions were pleased to have the opportunity to meet with the Governor and Deputy Governors from the Bank of Canada and brief them on the realities facing workers and their families today.
“While we understand and respect the Bank of Canada’s mandate to independently set monetary policy, we remain deeply concerned about the Bank’s preoccupation with encouraging companies to push down wages, at a time when so many workers struggle to make ends meet. We believe this approach is not consistent with changes to the Bank’s mandate that was to take the labour market and the goal of maximum sustainable employment into account when establishing monetary policies. A strong labour market and Canada’s low unemployment rate needs to be prioritized and preserved. By continuing to press for lower wages, the Bank risks overstepping their role of communicating policy and instead takes on the role of business consultant.
“We raised concerns about the Bank’s rapid monetary tightening pushing our economy into a recession, with potentially devastating impacts on everyday people. A recession would mean thousands of Canadians thrown out of work and downward pressure on wages that are already lagging well behind inflation. Mortgage and loan defaults could skyrocket. We would see substantial damage to people’s quality of life and risk long-lasting economic harm for workers and their families.
“It is critical to remember that our economy is not just a series of data points on a line graph, our economy is driven by working people. Families of all shapes and sizes, in communities large and small. Should our nation’s monetary policy decisions trigger an unnecessary recession we know that precarious and low-wage workers, in particular women, Indigenous, racialized, recent immigrant workers, are hit the hardest. Reducing consumer confidence with policies that target the welfare and wellbeing of the most vulnerable is not the pathway to the economy we want to build. When workers prosper, our economy grows and strengthens.
“The prudent thing to do right now would be to slow down interventions designed to slam the brakes on Canada’s economy. The Bank should hold off on further interest rate hikes until we can see the result of the sharp policy actions already undertaken. The economy is already starting to cool, as we have seen with contractions in sectors like real estate.
“We must ensure that the medicine is not worse than the disease.
“It is the Government of Canada that is ultimately responsible for setting our nation’s fiscal policy. We urge the government, as it has through its recent agreement with the NDP to provide targeted inflation relief, to adopt policies that ensure workers and their families are not made to pay for an inflation crisis they did not create. In this regard, the lack of government action to crack down on price gouging, greedflation and making corporate profiteers pay their fair share is of particular concern.
“We are also worried about how some Conservative politicians use overblown rhetoric around how Canadians are suffering while suggesting the way forward is to actually cut government help for families struggling with an affordability crisis. While this approach is consistent with the Conservative Party’s past record of cutting health care and other services people rely on, cuts like this today would make life substantially harder for thousands of working families.”
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