Monday, February 18, 2008

$62.5 billion? Mere bagatelle.

Let's assume Harper's claim about $62.5 billion in Liberal spending initiatives were true. It's mere bagatelle relative to Harper's income trust losses.

Stephen Harper is trying to defend his record by attacking the Liberals with a sad exercise in fear mongering, claiming the Liberals will cause a $62.5 billion deficit over 4 years. That works out to a $15.6 billion a year spread over 33 million Canadian for a cost of $472.27 each. Compare that to the 2.5 million income trust investors who are down some $40 billion at this point in time. That works out to $16,000.00 each.

$472.00? $16,000.00?

Harper: Leader? Hypocrite?

Furthermore, the $472 will actually buy something, whereas all the $16,000 bought was $65 billion in trust tax related takeovers
and the annual loss of a further $1.4 billion in taxes. Nothing for everybody.

Stephen Harper: Give your head a shake. You are the problem. Look in the mirror. It’s not a pretty sight. We bought your fear mongering, garbage, election arguments once already. To wit:

“You know where the Liberals stand on raiding seniors nest eggs. A conservative government will never tax income trusts”

Here’s the Liberals response. Somehow, and for some reason, they have become the more credible party, than the Harper, been there, done that, CONs.



Dr Mike said...


I thought I was really burned-off on the evening of Oct 31st 2006.

I thought that I could not get any more Burned-off than I was that night.

Well , guess what , I am.

The Conservative party has no interest in doing what is right for Canadians --well , unless you are Michael Sabia or Gwyn Morgan or Dominic D., then the skies the limit.

It appears that attack adds are all that these guys know , except of course our Finance Minister Jim Flaherty who does have a good eye for a fine speech writer.

All I can say is that I now know why I am a former conservative--I will never travel down that road again as long as they are represented by people who care not a whit for anyone but themselves or a few of their select cronies.


Robert Gibbs said...

For the sake of the cause - and indeed the country - vote strategically in the next (upcoming) election.

I.E. Vote Liberal.



Robert Gibbs said...

What constrains Flaherty's budget
Globe and Mail Update

February 18, 2008 at 9:13 AM EST

The fiscal chickens have come home, and are roosting uneasily on Jim Flaherty's shoulders.

Last fall, the federal Finance Minister cut taxes by roughly $9.4-billion in the upcoming year, and almost $60-billion over six years. Those splashy cuts included a reduction of one percentage point in the GST - on top of a previous reduction, and against the advice of virtually every economic expert. That move alone accounted for $34-billion in lost revenue. Now the cupboard is bare as the economy slows, and the Conservatives have only themselves to blame.

Even last fall, the surplus cash for future years was in worryingly short supply. True, Mr. Flaherty was rolling in money for 2007-08, partly because of a resource-revenue boom. But for 2008-09, he foresaw a measly surplus of $1.4-billion (after setting aside $3-billion for debt reduction), followed by a $1.3-billion surplus in 2009-10. That was so then. Now the United States is on a recession watch. Meanwhile, Statistics Canada reported last week that our export and manufacturing sectors dropped dramatically in December. The situation is so dicey that Toronto-Dominion Bank economists predict the trade surplus could disappear this year for the first time in more than three decades.

Such tidings have badly eroded Ottawa's revenues, and Mr. Flaherty's bottom line. Dale Orr, chief economist for Global Insight (Canada), figures the slowdown has evaporated the planned 2008-09 surplus and eaten away about half of the $3-billion earmarked for debt. He estimates that the general tax base, which is effectively the same as nominal GDP, will be $20-billion less than Mr. Flaherty forecast for 2008-2009 and $28-billion less in the following year. So tax revenues will likely be $3-billion lower than expected this year, and at least $4-billion less in 2009-10. Even the upside to this news is bad. Mr. Orr says that although the tax base has eroded, it "has not yet eroded to the point where a deficit is forecast - but it is getting very close." There's a word - deficit - that many Canadians hoped they would never hear again.

Uneasily aware of this arithmetic, Mr. Flaherty vowed last week that his Feb. 26 budget would be prudent and that he was "not going to be the finance minister that puts our country back into deficit." As his officials warned that there would be no significant new spending or tax measures, the minister added that he would not "throw money around." That is precisely the problem. Having thrown money around last fall, he has precious little cash now to help manufacturers write off new equipment faster or to boost research and development - and that's what is really needed to pull Canada out of its slump.

Perhaps finance ministers have grown accustomed to dispensing large surpluses in the 11 years since the Liberals balanced the budget for the first time in almost three decades. Free spending is a habit that they will have to break. The minister may be able to earmark a portion of the 2007-08 surplus for use in 2008-09, but that could be technically and politically difficult. His options are far narrower now. His leeway is lost. The GST was the wrong tax to cut, at the wrong time. Now Mr. Flaherty has to pinch pennies.