Dear Editor;
Stephen Harper’s claim that he can be “trusted” to be a “safe” economic manager through uncertain times is a very big stretch.
He inherited the strongest economy in recent memory, and the most robust fiscal position in all the G-8 group of world-leading nations.
Before Mr. Harper came to office, this country had recorded 12 straight years of economic growth. Job creation was the best in 30 years. Disposable incomes and living standards were rising. Consumer and business confidence were high.
The federal deficit had been eliminated. Debt was on a steady downward track. Inflation and interest rates were low and stable. Taxes (especially income taxes) were declining more than ever before.
The provinces were benefiting from the highest-ever federal transfers to support social pillars like health care. The government of Canada was working on its 10th consecutive balanced budget. And Canadians could count on $100 billion over the next five years to further reduce debt and taxes, to guard against unforeseeable shocks, and to invest in the social and economic priorities that enrich our lives.
But in barely two years, Mr. Harper has obliterated that margin of fiscal security.
He has taken this nation to the brink of a deficit – the first in more than a decade. And it’s deliberate. It’s his ideological obsession to stop the federal government from being an instrument for good in the lives of ordinary Canadians.
Among major bank economists, academic think tanks, bond rating agencies, the Bank of Canada and the International Monetary Fund, the prognostications are all consistent. The Canadian economy is now skirting a recession. The slowdown will last longer than first expected. And the Harper government may soon be in the red.
Canadians would find a return to deficits inexplicable. They sacrificed too much to achieve discipline in the nation’s finances to see that success now squandered. At the same time, they won’t like Mr. Harper’s way of avoiding his self-inflicted deficit. He will slash those federal programs and services that are on his right-wing hit list. And he’ll say the “deficit-devil” made him do it.
Even when the Harper government had a $13 billion Liberal surplus on their hands, they cut the court challenges program that helped the less wealthy access their constitutional Charter rights, adult literacy services, the advocacy of women’s equality, historic measures to bridge the gaps between Aboriginal and non-Aboriginal Canadians, funding for child care spaces, a credible plan to fight Climate Change, student aid, and more.
Imagine the destruction Canadians can expect with the threat of a Conservative deficit hanging in the air.
As all this unfolds, remember how that threat came to be. The debilitation of Canada’s fiscal position was not the result of external factors beyond domestic control. It was deliberately engineered here in Canada by Stephen Harper – in three ways.
First, always preoccupied with short-term election positioning above all else, the Conservatives have become very big spenders. Their budgets have ballooned by more than $40 billion in just over two years. Stephen Harper is today the biggest spending Prime Minister in history, but few Canadians can name a single thing they’ve gained from it all.
Secondly, the transparent safeguards that were previously built into federal financial projections have been abandoned – even the most basic “Contingency Reserve” has been eroded. These provisions used to serve as shock absorbers to prevent unpredictable events from pushing the country back into the red – events like the Asian currency crisis, the SARS outbreak, the havoc caused by mad-cow disease, and the terrorism of 9-11. In the face of future threats like these, Canadians will have no cushion.
Thirdly, with respect to tax cuts, Mr. Harper chose to concentrate on the GST – where his cutting does the least amount of good and costs the most. The saving for the average Canadian is less than a dollar-a-day, but the impact on the Treasury is about $13 billion every year. It does nothing to improve tax fairness, disposable incomes, household savings, productivity or competitiveness. And it’s so costly it crowds out other more helpful tax reductions.
These are the components of Mr. Harper’s deliberate deficit. It’s a policy that is brutally ideological, foolishly short-sighted and basically immoral – because it will either savage people in need today, or shift to our grandchildren the burden of paying for Mr. Harper’s obsessions.
He cannot be trusted as an economic manager; he is reckless, not safe.
Sincerely,
Ralph Goodale
House Leader for the Liberal Opposition
Ottawa, Ont.