Flaherty urges debt reduction to U.S. lawmakers

WASHINGTON — Canada’s finance minister shook hands with a congratulatory John McCain, sat down with other Republican lawmakers to urge debt reduction and extolled the virtues of majority government to a business audience on Wednesday in a visit to the U.S. capital.

Canadian Finance Minister James Flaherty speaks at the 41st Washington Conference on the Americas

Canadian Finance Minister James Flaherty speaks at the 41st Washington Conference on the Americas

WASHINGTON — Canada’s finance minister shook hands with a congratulatory John McCain, sat down with other Republican lawmakers to urge debt reduction and extolled the virtues of majority government to a business audience on Wednesday in a visit to the U.S. capital.

Jim Flaherty, in the first jaunt by a Conservative cabinet minister to D.C. since last week’s election, warned American legislators that they must bring their country’s $14 trillion national debt under control to ward off any future global economic crises.

“I specifically wanted to focus on this visit on budget issues because it’s so important for us,” Flaherty said before heading to Capitol Hill to meet with lawmakers, including Republican Paul Ryan, the budget committee chairman in the House of Representatives whose deep cost-cutting proposals have been met with alarm by Americans.

“We have a plan to get back to balanced budget in Canada. We intend to implement that plan now that the extraordinary time of the recession has passed,” Flaherty said.

“We want to have economic growth. We want our biggest partner to have a similar plan — to control deficits and debt going forward.”

To that end, Flaherty said, he’d arranged meetings with legislators to discuss how Canada has moved “from a time of dramatic deficits . . . to a time of stability and solidity with a good plan going forward.”

“I get a fair number of questions about Canada and how we’ve performed fiscally, and it’s an opportunity for me to talk about our view.”

The White House and Congress are currently trying to reach an agreement on chopping the nation’s annual $1.5-trillion budget shortfall. Time is of the essence: lawmakers have to pass legislation to raise the U.S. debt ceiling this summer or the federal government will default on its loans.

Earlier Wednesday, Flaherty participated in a question-and-answer session at the Council of the Americas. He told the crowd that an updated Canadian federal budget will pass next month thanks to the government’s new Conservative majority.

“We’re going to bring the budget back in June and this time I can say with some certainty it will be passed, and it is a budget that leads us back to a balanced budget in the medium term, in three to four years,” Flaherty said.

The budget was rejected by all three opposition parties when it was introduced in March.

In his remarks to the council, Flaherty delved into everything from Alberta’s oilsands to border security, immigration and even the future of Canada’s Liberal Party following its decimation at the polls last week.

Border security, in particular, is coming under increased scrutiny in the United States. A congressional hearing is being held next week to prod Obama administration officials for details on what’s being done to beef up security along the 6,400-kilometre boundary.

“Our view is that co-operation (with the United States) is essential,” Flaherty said.

But he added “it’s virtually impossible to have perfection in terms of security on such a long border.”

On concerns that the future is bleak for the oilsands due to the possibility of increasingly stringent global emissions standards, Flaherty said Canada was making every effort to ensure it’s a cleaner energy source.

He told the crowd how Toronto is probably the most multicultural city in the world, and that there’s been no social unrest to accompany waves of immigrants arriving on Canadian shores from Asia.

As for the Liberals?

“The Liberal Party has a long history in Canada and I don’t expect it to evaporate,” Flaherty said.

As he left the stage to make way for an appearance by McCain, the two men shook hands, with the Arizona senator congratulating him “from one conservative to another.”

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