Roundup: Fiscal update spin incoming

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This week is the federal government’s autumn fiscal update, and we’ve already seen a pre-emptive push by the Conservatives to try and set a narrative about the government’s deficit. Andrew Scheer took time out yesterday to hold a press conference to say that he plans to force a vote that would demand that the government set a date for a balanced budget. And yes, the shitposts over social media have already begun.

So, a few things to keep in mind this week about the narratives that will be spun:

  • The Conservatives will insist that they left the Liberals with a surplus and a “strong economy.” That’s not entirely true – the “surplus” was on paper and it included a lot of “savings” that the Conservatives falsely booked that never came to pass (e.g. Shared Services Canada, Phoenix). The Liberals will also point to stagnant growth rates.
  • There was a $70 billion hole between the fiscal situation that the Liberals found themselves in compared to the 2015 budget the Conservatives ran the election on. This would have been there regardless of who won the election. The Liberals had a choice to make – honour their spending promises, or honour their promise to balance the budget. They chose the former, and their spending has been largely in line with what was promised.
  • There is no debt crisis looming. The debt-to-GDP ratio is declining, and is the best in the Western world. Government debt is not like credit card debt, so equating the two in shitposts like Scheer does only serves to sow confusion and is a dishonest attempt to look like the government is “bankrupt.” Also remember that much of the deficit spending under this government has been at a time when interest rates were at historic lows, which is not credit card interest rates.

https://twitter.com/kevinmilligan/status/1064271285511811072

You can also expect a bunch of calls this week to cut corporate taxes like they did in the US, citing competitiveness, but again, there are things to remember about those US tax cuts – namely that their deficit is currently around $1 trillion, that those cuts are the economic equivalent of a sugar rush for which there are few long-term gains being made, and most of those cuts resulted in larger corporate dividends and share buy-backs rather than re-investment in companies or workforces. There’s a reason why Bill Morneau hasn’t jumped on this, and we’ll see what his response will be.

Good reads:

  • Justin Trudeau left the APEC summit without any unified final communiqué after nobody could come to an agreement on one.
  • Trudeau also says that he won’t publicly negotiate any American demands to remove LGBT protections in the New NAFTA.
  • Trudeau expressed his “deep disappointment” with Ontario cutting its French language watchdog, and Mélanie Joly sent a letter to Caroline Mulroney on the issue.
  • At the Halifax International Security Forum, there was a focus on the crisis of leadership facing the Western world, along with threats to elections.
  • At the Forum, General Vance said that the changing nature of war means that the Canadian Forces’ “template” for perfect recruits needs to change with the times.
  • At the subsequent NATO Parliamentary Association meeting, Canada’s defence spending again became a subject of discussion.
  • The government is set to announce a call for proposals for $400 million in transport projects to service the North.
  • After rejecting Canada Post’s latest offer, the postal workers’ union wants a mediator appointed.
  • At a speech to Ontario Progressive Conservatives, Andrew Scheer said that Trudeau treats ordinary Canadians like “the enemy.”
  • Scheer also said that he was “concerned” that Doug Ford cancelled plans for a French-language university, but didn’t ask him to reverse the decision.
  • Former federal finance officials Scott Clark and Peter DeVries bring the fire in talking about the Ford government’s inability to comprehend public finances.

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