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Business challenged to accept the NDP.

Business challenged to accept the NDP

For many businessmen, it was their worst nightmare.

Others are still hoping they will wake up from the dream.

Just a few weeks ago a New Democrat government in Ontario was not imaginable. Now it is the harsh reality for a business community which is still learning how to deal with this totally unforeseen, and unwanted, situation.


Since its surprise victory in the Sept. 6 election, the NDP has attempted to calm the business community's fears about the socialist spectre.

Party veteran Floyd Laughren, MPP for Nickel Belt, said he understands the tensions of the business community.

"They'll have to judge us by our actions," he said.

"We would be stupid beyond belief to damage or alienate the private sector," he stated, admitting that it would mean self-destruction for the party.

Laughren said the new government knows there is a recession coming. "We've got to cope with that."

There won't be many surprises from the NDP, he added.

On one controversial party policy, Laughren said the switch to public auto insurance in Western Canada was not as traumatic as some are predicting in Ontario.

Many of the employees of the private insurance sector were absorbed by the new system, Laughren said. "It didn't result in massive layoffs."


The NDP victory sent tremors all the way to the American investment community, which is still trying to determine what happened.

University of Maine economics professor Peter Morisi, a specialist in Canadian affairs, said that many Americans were shocked by the NDP victory, believing that it runs counter to political happenings in the rest of the world.

Morisi doubts that the NDP will be able to carry through with many of its promises.

"I think the NDP is going to become like the Liberals very fast," he predicted.

The professor was speaking by telephone from his office in Orono, Maine.

Ontario already has a heavy tax burden, a large bureaucracy and an extensive social safety net that does not give the government much room to manoeuvre, Morisi noted.

Morisi warned that, if the new government brings in its promised minimum corporate tax, it will "bode very poorly" for the economy of the province.

The professor laughed when asked about the NDP's promise to raise the minimum wage to 60 per cent of the average industrial wage.

"It's just a great time to raise the minimum wage," he said sarcastically.

Noting that Americans don't have infinitely long memories, Morisi said, "Americans do remember long enough to recall that the spectre of statist government in Canada is not dead."

That memory goes back to the Federal Investment Review Agency and the National Energy Policy of the Trudeau federal government.

Morisi said the NDP provincial government is regarded as more bad news.

"It's going to take a long while to win investor confidence."


Back in Northern Ontario there seems to be a more cautious view of the NDP victory.

Sault Ste. Marie's Les Weeks, president of the Northeastern Ontario Chambers of Commerce, sees some positive aspects of the NDP victory.

"I think it might bring good things to the north," Weeks commented.

For example, he said northern MPPs will play a prominent role in the cabinet and the party caucus.

Weeks will be watching to see how the government proceeds on its promises. "Their program for the north was certainly interesting."

The NDP had proposed a Northern Fund of $400 million over two years to promote economic development, job protection and creation, and improved services throughout the region.

Weeks supports the NDP belief that not enough tax money is returning to the north.

There are several ways to return the money, he said, including the transfer of more government offices and more investment in highways.

Such investments "will just multiply themselves time and time again," he said.

NDP party policy states that $100 million per year should be made available for the four-laning of the Trans-Canada Highway.

Weeks believes four-laning is badly needed. He said some drivers head south on U.S. Interstate 75 rather than driving down Highway 17, meaning lost business to restaurants and hotels along the Canadian route.

However, another promise by the NDP has Weeks concerned.

"The increase in the minimum wage scares me," he admitted.

Weeks said the ripple effect of a fast rise in the minimum wage would throw the economy "out of whack."

He warned that, if the Rae government is too radical, the province will pay the price today and the NDP will pay the price in the future, by being defeated.

Dryden's Hugh Syrja, past president of the Northwestern Ontario Chambers of Commerce, also believes the north could benefit from powerful cabinet members from the region.

However, Syrja believes it is too soon to speculate on which moves the new government may make.

The northwestern chambers would like to see the Trans-Canada Highway four laned from the Manitoba border to Sault Ste. Marie.

The minimum wage proposal is of concern to many northwestern businesses, particularly those in the tourism sector, Syrja said. "It would certainly affect the economy."

Representatives of the northeastern chambers will be making their annual trip to Queen's Park in November and hope to meet Premier Bob Rae and his cabinet.

In past years the group met the NDP in opposition, Syrja said, noting that the concerns of the region are known to the party.


Patrick Reid, president of the Ontario Mining Association, believes the NDP government will be reasonable.

"We don't join those who think the NDP are going to shut the economy down. That would be ridiculous," Reid stated.
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Title Annotation:New Democratic Party of Canada
Author:McDougall, Douglas
Publication:Northern Ontario Business
Date:Oct 1, 1990
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