Newspaper article The Canadian Press

Editorial Exchange: Penny-Ante Promises Betray Discipline

Newspaper article The Canadian Press

Editorial Exchange: Penny-Ante Promises Betray Discipline

Article excerpt

Editorial Exchange: Penny-ante promises betray discipline

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An editorial from the Winnipeg Free Press, published Aug. 29:

So the waiting's done. Justin Trudeau says if his Liberals form government, they expect to post deficits, at least for three years before getting back to surplus in 2019. Maybe.

This is the "wedge" issue NDP Leader Tom Mulcair was hoping for, a way for him to highlight a distinct choice voters face between his party and the Liberals.

The Conservatives, meanwhile, are crowing "I told you so," having warned Canadians voting anything-but-Tory Oct. 19 risks running the country to financial ruin.

Conservative Leader Stephen Harper knows a thing or two about deficits. His government managed, by the skin of its teeth, to bring the country out of seven years of deficits posted under their hand, after what was (and to a degree continues to be) one of the greatest global financial challenges in a very long time.

In fact, Canadians are still waiting to know, officially, whether the federal budget for 2015/16 will be a little red, or into the black as promised by Finance Minister Joe Oliver. Many say Mr. Harper's record of fiscal management puts it on a dubious pulpit from which to preach.

The Harper government is proud of its two percentage point cut to the GST, for example, but that sucked billions from revenues just before the U.S. economic crisis rolled over Canada, too. The additional cash could come in handy now as the downturn in oil prices buffets the economy.

So the Tories didn't see that coming. But rather than seeing it as a cautionary lesson, they forged ahead this year with a $2-billion income-splitting promise despite the barest of financial wiggle room. (The 2015/16 budget forecasted a $1.4-billion surplus, which appears to be evaporating.)

This is relevant to the election campaign. The promises reveal the parties' particular views of national priorities; fiscal policy tends to be moulded around that.

The Conservatives are staunch defenders of keeping taxes low; Liberals believe spending big now on infrastructure will fire economic growth; the NDP promises to keep Canada in the black, financing its expensive national daycare program by cancelling income-splitting and raising corporate taxes. …

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