Wednesday, January 28, 2009

$80 M in corporate welfare down the drain

CBC reports:

Business New Brunswick Minister Greg Byrne says two northern textile mills were thoroughly vetted before the provincial government began investing almost $80 million over the last decade.

The provincial government is now on the hook for close to $80 million after Atlantic Yarns in Atholville and Atlantic Fine Yarns in Pokemouche closed and filed for bankruptcy last week...

Kevin Gaudet, the acting federal director for the Canadian Taxpayers Federation, said the mills were a bad investment of public funds.

"This is a classic example of corporate welfare. Governments use taxpayer dollars to support private sector companies who end up competing with other private sector companies and then they aren't able to compete effectively in many cases," Gaudet said.

"Then they take taxpayers dollars down with them when they go bankrupt."

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