19 December 2008

How Do We Go From....

How do we go from the Prime Minister of Canada vowing to never run a deficit--during the election campaign that saw him returned to office largely as a result of his prowess on economic matters--to the Prime Minister of Canada announcing that the budget deficit next year will be approximately 30 billion dollars!!?!? This is quite likely the worst "promise made, promise broken" news emanating from Ottawa in a very long time. My disgust with the Prime Minister for saying one thing and promptly doing another is incredibly high.

I realize that during tough times (cue the Liberal choir: Tory times are tough times) it is sometimes important and even necessary to introduce a stimulus package that requires increased government spending to kick-start the economy. I have no problem with the government taking measures to protect and create jobs to keep Canada's economy strong. What bothers me is that it should not have come to the point that introducing a strong stimulus package leads to running a deficit in the double-digit billions of dollars. The tax cuts introduced by the Conservatives do not rankle me; lowering taxes was a part of the agenda and it was well-received by Canadians across the board. Cutting taxes in times of great prosperity is a hallmark of fiscal conservative ideology. What is not fiscally prudent is increasing government spending to record all-time highs at the same time that taxes are being cut. The government wanted to do more with less, and as a result, the country is going back into the red.

That is incredible. For over a decade this country had been leading the way in the G8 as the best example of an economic powerhouse maintaining its position without excessive spending and racking up additional debt. We were going through great prosperity and paying down debt. The work of Jean Chretien and Paul Martin, though painful at times in terms of government cuts, in the long term benefitted Canada to a tremendous extent. The plans and procedures they implemented, however, have been cut away. The $3B contingency fund was removed. That buffer could have made a difference. The cupboard is bare, and it is a supreme irony that it was a Conservative government that promised restraint and sound fiscal and economic policies that cleaned it out.

I'm getting really close to the tipping point, folks.

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