Election diaries: why the Conservatives don’t know squat about managing an economy

When the Conservative first came to power in 2006  they inherited a very hard won budget surplus. The Liberal budget for 2005-06 was not only balanced, but indeed boasted a surplus of $13.2 billion. This was delivered along with some modest tax reductions for individuals along with significant new money for defense and the environment.

As we all know, the Liberal minority was forced to go to the polls ushering in Stephen Harper as Prime Minister in 2006. His first budget in 2006 lowered the GST by 1% to 6% and then in 2008 to 5%. This despite the protest by virtually every business economist in the country. By the projected 2008 budget the Conservatives had driven the surplus into a $1 billion dollar deficit.

Now, mind you, this was before the recession’s impact. Indeed, Finance Minister Jim Flaherty in fall of 2009 was still saying that there would be no recession. He made no plans for it either to stimulate the economy nor to reign in spending. Indeed the Conservative government of Stephen Harper has raised spending to unprecedented levels while cutting corporate and income taxes.

Interestingly, this policy managed to erase all the surplus built into Paul Martin budgetary planning.

Jim Flaherty of the Conservative Party is Canada’s biggest spending Finance Minister of all time | Photo by Joshua Sherurcij

With Jim Flaherty and the Conservatives jauntily denying the extent of the economic downturn, they were forced by the NDP, Liberal and Bloc to bring in a budget for 2009 that incorporated stimulus spending. This was the Economic Action Plan (as conceived of by the opposition parties and initially vigorously opposed by the Conservatives) that we have seen advertised so much as proof that the Conservatives should remain at the helm to ride the economic storm.

But just like Reagan and then G.W. Bush in the United States, the right has been a disaster for slowing economies with their reliance on supply side economics. Even before the recession, the Harper Conservatives managed to piss away the massive surplus left to it by the Liberals and failed as well to plan for the future. And don’t let us forget that the very same Jim Flaherty was finance minister in Mike Harris’s ultra-right Ontario government whose Common Sense revolution left Ontario badly in debt after they got through with it.

Hell, even the Conservatives in oil rich Alberta can’t even manage a budget with all the oil royalties they are blessed with.

So why does the Canadian voting public still say in opinion polls that they trust the Conservatives more than other parties to manage the fiscal situation in difficult times? It certainly isn’t based on reality.

We need more of this economic history to get out there. Why aren’t the opposition parties pushing this history more volubly?

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: