Newspaper article The Canadian Press

Editorial Exchange: Oil Slump Makes Tax Cuts Riskier

Newspaper article The Canadian Press

Editorial Exchange: Oil Slump Makes Tax Cuts Riskier

Article excerpt

Editorial Exchange: Oil slump makes tax cuts riskier


An editorial from the Winnpeg Free Press, published Dec. 15:

Prime Minister Stephen Harper took note last week of the sharp decline in world oil prices and its implications for Canadian economic policy. He told the House of Commons in question period on Tuesday fossil fuel emissions in Canada should not be regulated by the government because the oil industry is afflicted with low prices. "Under the current circumstances of the oil and gas sector, it would be crazy, it would be crazy economic policy to do unilateral penalties on that sector. We're clearly not going to do it," Mr. Harper said.

Since the prime minister never regulated oil industry emissions when oil was at $110 a barrel, his reasoning about current circumstances of the industry seemed more like a pretext.

Oil has dropped below $60 a barrel because worldwide supply exceeds demand, and producing countries that count on oil revenues are unwilling to reduce production. Economic forecasters were wondering whether the price might rise to $70 next year. Mr. Harper has yet to stipulate the oil price at which emission regulations would seem reasonable to him.

But since Mr. Harper has raised the subject of crazy economic policy, it may be time for him to look more widely at the implications of the oil-price collapse for the policy of his government.

In particular, he should ask Finance Minister Joe Oliver to tell him once again why boutique tax cuts for a narrowly defined class of Canadian families make sense for the country at a time when our most lucrative export commodity has fallen on evil days and when three of our 10 provinces are facing economic hardship as a result. On the face of it, that looks like crazy economic policy.

Mr. Harper announced at the end of October a measure he labelled the Family Tax Cut, which will benefit parents with children under age 18. …

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