OTTAWA - A left-leaning think tank is warning the governing Conservatives that they could actually worsen Canada's struggling economy if they deliver a "do-nothing" budget next week.
The Canadian Centre for Policy Alternatives will unveil its own alternative budget today, saying the Tories should abandon austerity measures that have led to a much weaker and more prolonged economic recovery.
Chief economist David Macdonald says the Tories should also raise corporate tax rates and income taxes for wealthy Canadians, as well as delay their deficit-killing deadline by a year.
He said if they follow his advice, they can revive the sluggish economy, lower unemployment and reduce poverty.
Macdonald said the economy has been pushed along by growth in household spending -- leading to an alarming rise in debt -- while governments and businesses haven't contributed much since the fall of 2012.
He adds the Tories have a more pressing responsibility to address problems in other sectors of the economy, rather than maintaining their "narrow-minded focus" on their own stable finances.
Macdonald said interest rates are low, so it's a good time to keep borrowing in order to spur economic growth.
