Wednesday, May 27, 2009

This Flaherty guy, can't even count


What kind of country has a Finance Minister who can’t even count?

That might have something to do with Jim Flaherty’s background and profession as an ambulance chasing insurance litigation lawyer, where numbers could be inflated with impunity, if it helped win the case and reach a settlement. But why should Canada settle for a Finance Minister who first denied that Canada was even going to be caught up in the world’s economic downdraft or even run a deficit (September 2008) and then faced with the loss of confidence of the newly elected Parliament delivered the largest deficit budget in history at $34 billion in February 2009, only ti proclaim yesterday that...ooops...it’s actually going to be a mere $50 billion deficit, with none of the $15 billion increment being what would qualify as “stimulus”, but rather just keeping the lights on in Canada.

Speaking of keeping the lights on, there is that other exercise over which Jim Flaherty has become infamous, and that involved his income trusts tax. That was another exercise where the election promise proved fleeting. Just like the deficit we were told by Jim Flaherty he would never run, the income trust matter was another promise broken. A promise that just made the difference for hundreds of thousands of Canadians, mostly retirees and seniors, between keeping the lights on and not keeping the lights on. This was another instance of Flaherty being unable to even count. Somehow, Jim Flaherty is of the belief that the taxes that are mandatorily paid on RRSP and RRIF withdrawals are worthless to the government. Flaherty can’t count, as he assigns zero value to these deferred taxes? And yet when Teachers’ seeks to buy BCE in a junk bond laden LBO, Flaherty is the first one to rush to his own defense by pointing out that “Yes... And there is taxation, of course, when pensions are paid out.”

Had Flaherty been able to count, he would have realized that Ottawa would have collected $793 million MORE PER YEAR, had BCE been allowed to become a trust rather than an LBO, and $550 million MORE PER YEAR than remaining as a corporation. Ditto for income trusts at large. But who's counting?

The real question however is whether Flaherty can count, and whether his analysis of tax leakage can stand up to the scrutiny that it deserves, but has yet to formally receive. The answer to that becomes glaringly obvious when we witness a $35 billion deficit figure proffered up by Flaherty in February morph into a $50 billion deficit number in the space of three short numbers. Clearly Flaherty can’t count, and he has no business or qualifications to be Canada’s Minister of Finance. He cause harm where none otherwise existed.

At least as a lawyer, Jim Flaherty should understand that one of the basic tenets of a civilized society is the concept of “duty of care” to one’s fellow citizens.

The best way for Jim Flaherty to exercise his duty of care to Canadians, at this long overdue juncture, is for him to resign, before Canadians rename the Peter Principle as the Jim Principle, as Flaherty clearly has risen to a level far beyond his shallow competence.

7 comments:

Dr Mike said...

Got to Laugh as :

" - Finance Minister Jim Flaherty offered an "impromptu" fiscal update Tuesday, announcing that this year's budget deficit will balloon to more than $50 billion - a new record for red ink in Canada as the costs of the economic downturn mount."

An "impromptu" update from an "impromptu"Finance Minister.

This guy is so funny he should be auditioning for the Conan O`Brien show -- hopefully he will get the job & leave us alone.

Dr Mike Popovich

Anonymous said...

Brent,

Do you remember that a few months ago Mr. Page, the Budget Officer of the Parliamentary Library, forecasted a deficit much larger than Harper and Flaherty. Page was villified and ostracized by the Cons for his herisy. His administrative budget was cut and his boss nearly denounced him for insubordination. Although Page has a tiny staff compared to Flaherty his forecast was much more accurate and the final result is likely to be close to what he said. My suspicion is that the guys in Finance were working on the basis of three economic scenarios (as is often done in cases when economic growth projections are diffficult to make) and that Flaherty only chose the most optimistic one (as politicians are prone to do) for his public pronouncements.

YF

Anonymous said...

Greetings Brent.
Boy this is to the point!
Would make a great letter to the editor - No?

It reminds of Churchill's dire remark upon being informed of the first successful test of the atomic bomb...
"Now, the idiot child has the matches!"

In Flaherty's case, it would have been, "Now the idiot dwarf has the key to the bank vault, and the matches!"
Except for a select few of the dwarf's friends, what a tragedy for Canada and all Canadians,

With kindest regards,
Paul M

CAITI said...

Thanks Paul!

You’d almost get the impression that we live in a monarchy....and that Flaherty got his job by way of lineage and sinecure, being that he is the twisted son of evil parents or some such thing?

Brent

Dr Mike said...

How about Kevin Page for Finance Minister??

My bad---he is probably over qualified.

Dr Mike

Anonymous said...

Strongly agree.

Anonymous said...

Stevo, your boy Jimmy's looking dumber than ever now! Well since we all know at the end of the day Jimmy only does what you tell him to do, the guy wearing the dunce cap is actually Stephen Harper.

But we also all know that you'll sacrifice Jimmy to the dogs if you think that will do anything positive for your re-election chances, which fortunately for the rest of us are trending rapidly to zero. That trend will accelerate in a couple of months time when Jimm's back on camera saying the deficit will be $75bn rather than $50bn! Betcha wich you hadn't shaved that 2% off gthe GST that did nothing for consumers or the economy. Maybe you're even starting to wish you hadn't introduced the tax on income trusts? That measure decimated the retirement income for a huge sector of the population, decimated their net worth and cost hundreds of millions in tax revenues at a time when it's needed most. Now that is truly dumb! Hubris will only take you so far and I think you're just about there.

Sincerely,
Neville ]