How about some steak with all that sizzle?
November 16th, 2012 - 8:06pm
The Finance Minister gave a fiscal update this week, outside of parliament, avoiding appropriate oversight from the people elected to review his work. Among the items of interest to all Canadians is a change in language that sees Canada no longer boasting about having the best economy in the G7.
The update also stated the deficit will not be under control as planned for by 2015-2016. That expected surplus has now been changed to a forecast of deficit. For the following year, we are being told a surplus of $7.8 billion, has shrunk to $1.7 billion.
The report also shows how Canada relies more on income tax dollars as corporate tax dollars dwindle. Oddly, the Finance Minister was claiming corporate tax dollars increased as he made the rounds on political talk shows. He says New Democrats need to check their math, but he should check the tables from the Public Accounts of Canada instead. If he does that, he will see his signature on documents that show his claims don’t match the spread sheets.
If you take a look at those tables from 2005-2006, when the Conservatives first came to power, corporate tax in Canada amounted to $31,724 billion in revenue. In the last four years we have not exceeded that number and for 2012, we are $22 million behind.
The real damning number is for personal income taxes. On that front, Canada collects $15 billion more than when the Conservatives first took power. Yet, Canada has shed hundreds of thousands of well-paid manufacturing jobs and has become increasingly dependent on resource extraction jobs – with no strategy to encourage value-added work with those resources.
Even with the income tax windfall the Conservatives overestimated federal government revenues by tens of billions in budget 2012. This is part of a pattern that sees them view the economy with rose coloured glasses instead of as impartial analysts. Despite missing their own deficit targets, mounting reports of slowing growth, dire warnings from the IMF, and double digit unemployment in many regions, Conservatives fail to heed the warnings, including that of the disastrous effects of austerity measures.
When the economy was headed into recession in 2008, the Conservatives had to be forced to address the problem with stimulus spending. This week the Federation of Canadian Municipalities (FCM) gift wrapped a solution as it warned the bill for critical infrastructure was mounting and would only get worse if left unaddressed. The FCM is proposing a national, 20 year plan with predictable funding to maintain and develop infrastructure. That means jobs, which will help grow the pot of income taxes at the same time as we ensure our cities can support our population without undue risk.
It is no secret that the international economic climate is uncertain. Europe is in crisis, the United States is headed towards a showdown over spending, but the Conservatives have no plan to protect Canadian jobs. All this is happening at the same time as the IMF is predicting slower growth in Canada than in the USA. By using the Fall Economic Update as a PR exercise for a budget that isn’t getting the job done, the Conservatives show they are trying to sell the sizzle and not the steak.