Tag Archives: Election 2015

Roundup: Targeting the NDP’s platform costs

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With the fight over the economic planks of the campaign now well underway, we saw a weekend full of jousting over it. Up first was an op-ed in the Sun papers penned by Thomas Mulcair (possibly ghost-written by staffers, as these things go), where he gave a bunch of non sequiturs like provincial NDP records, and bizarre slogans like “politicians that give up on balancing the budget are giving up on Canadians.” Do you know what that means, because pretty much nobody else does? Later in the morning, Jason Kenney took to the National Press Theatre to hand out a 21-page booklet to prove that the NDP’s promises amount to an eight billion dollar hole in their budget, and a couple of hours later, John McCallum and a couple of other Liberals held their own press conference, where the number was $28 billion over four years. The NDP pointed out that a few of their promises didn’t have timelines attached, but I’m not sure how effective of a defence that is considering the magnitude of some of the promises. Meanwhile, economists like Nick Rowe are (quite rightly) complaining that partisan cheap shots about Harper being the “king of deficits” is distracting from the scope of the problems of the 2008 recession, and the actions Harper took during them. In other words, trying to balance the budget then would have been a terrible decision. (There are other criticisms one could make, like the fact that Harper created a structural deficit by cutting the GST by two points, but so far neither of the two opposition parties are making it, which renders it somewhat moot in this discussion). Rowe’s fear is that these cheap shots make fiscal policy more difficult going forward, and it’s a valid point that parties should be keeping in mind, but aren’t.

https://twitter.com/acoyne/status/638149264946827264

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Roundup: First quarter results

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The Fiscal Monitor was released yesterday, and Stephen Harper was quick to don his Prime Minister hat to tout that it showed that the government posted a $5 billion surplus for the first quarter of the fiscal year. Better than expected, he proclaimed. On track to a balanced budget! Err, except maybe not. Much of that revenue had to do with the sale of those GM shares that they used to show that the budget was in balance, and it doesn’t fully take into account the plummeting oil prices or the GDP contraction that our economy has been facing. (We’ll find out on Tuesday if we saw a second quarter of negative growth, officially putting us into a technical recession). Not unsurprisingly, the Liberals called the surplus “phony,” and pointed out things like the GM shares as proof. Here’s Stephen Gordon to put the numbers into context:

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Roundup: The big infrastructure spend

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It all being official that the Liberals are willing to run a small deficit in order to finance infrastructure spending in the hopes of boosting a stalled economy have turned the election into one with some real differences between parties, which incidentally seems to have also energised Harper’s performance at his own stops. The issue for the Liberals would seem to be now not only having to sell the idea of deficits – which they are attempting to do with the line of being the only party that’s being honest about the current state of the nation’s finances – but ensuring that the infrastructure spending they’re doing is going to be actually useful in the longer term. Sure, there is a big infrastructure deficit in this country for which this new funding is but a drop in the bucket, but if he wants to ensure that this is the kind of kick that will grow the economy, it should be in things that will have bigger impact – port infrastructure to get goods to market, ensuring that there is the kind of broadband access in places that need it to grow their business and attract investment, and so on. It shouldn’t be about short-term stimulus, lest the Liberals repeat the mistakes of the Conservatives in 2009-10. Not unsurprisingly, Toronto mayor John Tory and the president of the Canadian Federation of Municipalities both liked the announcement as it means more money for cities. Former PCO Clerk Kevin Lynch talks about the need for fiscal policy rather than just relying on monetary policy to try to grow the economy – and includes infrastructure spending as an example. Kevin Milligan examines the case for infrastructure spending at this time, and finds there is a plausible case for it.

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Roundup: Honesty in deficits?

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Balanced budgets and deficits continued to be a topic of discussion on the campaign yesterday, and it will continue to be so today as Justin Trudeau is set to unveil his infrastructure plan to boost the economy, which seems set to include some deficit financing for another year or two as the economy appears stagnant. Stephen Harper warns the other parties are looking at “permanent deficits,” but it bears reminding that according to the previous Parliamentary Budget Officer, the only way that Harper killed off is own structural deficit was in changing the health transfer escalator, leaving him with only a cyclical deficit (which persists, no matter how much they shuffle money around on paper to cover over it). The NDP continue to insist they won’t run a deficit, but they also seem to dispute that they would need to continue austerity and they would even do things like restore the health transfer escalator, which starts to boggle the mind. The Liberals seem to be looking to score points for honesty in that a) they don’t know the true state of the books, and b) the global economic situation, but one might also add that our debt-to-GDP ratio is in a good place now (as opposed to the eighties and nineties), so small deficits won’t affect our economic health that much. To that end, Mike Moffatt says it’s important to ask parties how they would manage deficits, because they are inevitable in the current economic climate, while Andrew Coyne says that we should be paying attention to the signals being sent by the leaders when it comes to deficits.

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Roundup: Balanced budgets are magic

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Balanced budgets became word of the day on the campaign – Harper warning of permanent deficits if either opposition party gets in, Mulcair promising a balanced budget in 2016-17, and Trudeau hedging by not promising it immediately, given he doesn’t know the real state of the country’s books and we have some global economic turbulence going on. And then things started getting bizarre, with fiscal hawks praising NDP restraint (with no idea how they plan to achieve balance), and the Liberals attacking the NDP as promising more austerity to achieve said balance at a time of recession. And yes, the NDP’s new “star candidate” of the former finance minister of Saskatchewan said they would cut things, but some of the clues the party has dropped – things like “corporate tax giveaways” – are small change, and they even included the Senate on their list of things to cut, which makes me laugh uproariously because a) abolition will never happen, b) you’re not going to cut the Senate’s budget without either starting a war between the two chambers or starving them of the resources necessary to study and pass the legislation the Commons wants passed, and c) any savings they think they’re going to book from Senate abolition would be eaten up and then some with court challenges of flawed bills and Royal Commissions for policy work the Senate did at a cost-effective manner. But keep dreaming. I tackled the subject of party spending promises in my column here, but in the meantime, here are some economists smarter than I, who are similarly doubtful about these balanced budget pledges, for very good reason.

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Roundup: An questionable call to the Governor

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While I often cringe about the media’s reluctance to refer to Stephen Harper as prime minister during the writ period (as he remains prime minister and will until he offers the Governor General his resignation) out of an exaggerated sense of fairness, there was an incident yesterday where Harper himself blurred that line between being prime minister, and being the Conservative leader campaigning for his own ends. For the first time that I can recall, we got a press release that mentioned that the Prime Minister called up the Governor of the Bank of Canada. While the text was pretty banal, talking about “ongoing developments” in the global economy and the recent declines in the markets, it was still unusual because we never get these kinds of releases. Ever. There is a very clear separation between government fiscal policy and the monetary policy set by the Bank of Canada, and the two should never meet – in fact, there is an issue in Canadian history where the Prime Minister tried to interfere with the Bank of Canada, and the Governor of the day ended up resigning in protest as a result. While the purpose of Harper’s call to Governor Poloz is not mentioned, the fact that it came on the day where Harper’s campaign message was all about how only his party could be trusted to weather this global economic turbulence, well, it’s pretty icky. Harper subtly politicizes Poloz by using him as a campaign prop – look at my economic credentials! I’m talking to the Bank of Canada Governor, like an economic boss! For all we know, Harper and Poloz have a weekly call where they talk trends and forecasts, and so on, but if that’s the case, we never hear about it. This time, Harper made sure that we knew about it. I’m having a hard time trying to see how this is acceptable in any way.

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Roundup: Scaling back on tax promises

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With a boatload of spending promises but almost no details in how he plans to pay for the, Thomas Mulcair appears to be scaling back on how much of that shortfall he plans to make up by raising corporate income taxes because as he’s quickly learning, that’s not going to raise all that much money. He also likes to use the phrase “making different choices like cancelling income splitting,” but that’s also maybe a couple of billion, which isn’t going to pay for a whole lot. It also seems to me that by pushing back a number of promises, like the childcare spaces, to full implementation some eight years down the road, it seems to indicate a theory that economic growth is on the way, and soon there will be plenty to fill the coffers. That ignores the fact that a) the projected surpluses depend on continued austerity, which the NDP keep promising to reverse, and b) economists are starting to warn that this slow growth may be the new normal and not just a hangover from the last financial crisis. With no plans to create economic growth coming from any of the parties, it’s going to be uncomfortable trying to come up with promises for major spending plans while maintaining balanced budgets, like they also plan. (And yes, the Liberals still have their own costing figures to produce as well). What the corporate tax piece doesn’t mention are the NDP plans to tax stock options, which economist Kevin Milligan has questions about:

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On the campaign:

  • Stephen Harper announced yet another boutique tax credit, this time for membership dues of service organizations. Also, he’s not changing his limited questions policy.
  • Justin Trudeau sent a letter to Quebec premier Philippe Couillard outlining his desire to be a “true partner” of the provinces.
  • The Liberals are expected to announce a major policy around veterans’ benefits today.
  • Here’s a recap of last week on the campaign.

Good reads:

  • The Ontario government disputes Mulcair’s claim that they support his childcare policy because they don’t have enough information about how it will be funded.
  • Apparently we rank fairly low among OECD countries for public pensions.
  • Here’s a video comparison of the three parties’ childcare benefit promises.
  • Here’s a fact-check of Trudeau’s flexible work hours announcement (spoiler: It won’t amount to much).
  • Christopher Curtis offers a portrait of Trudeau on the campaign trail.
  • Aaron Wherry muses about the issues of control and how that erupted into the ClusterDuff mess.

Odds and ends:

As part of their announcement to protect BC salmon, the Conservatives used a picture of an Atlantic salmon. *slow clap*

Here’s a bit of Ottawa history related to our first general election.

Scott Feschuk gives us his take on the election to date.

Roundup: Constitutionally untenable declarations

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One of those tangential sub-plots in the whole ClusterDuff affair reared its head in the testimony of Ben Perrin yesterday, which is the issue of the test of residency for a senator. Given that the issue had blown up during Perrin’s time in PMO, thanks to Stephen Harper’s panic appointments in 2008 where he named senators to provinces where those individuals did not currently reside but rather had originated from, they found themselves in trouble when a certain Senator Duffy was found to have been treating his long-time Ottawa home as a secondary residence that he could claim per diems with while his summer cottage in PEI was being treated as a primary residence, never mind that he rarely spent any time there, none of it in the winter. Perrin’s advice was to come up with several indicators, but that ultimately it would be up to the Senate to come up with those indicators for themselves. Stephen Harper disagreed, and said that as far as he was concerned, they were resident if they owned $4000 in real property in said province – a position Perrin found to be constitutionally and legally untenable. But the constitutionally untenable has become Harper’s stock in trade, particularly where the Senate is concerned, first with his unconstitutional reform bills, to his present policy of not making any appointments in defiance of his constitutional obligation to do so. (And no, Thomas Mulcair is no better with is own promise not to appoint any senators either). And we also know from the Duffy documents that Harper blocked an attempt by the Senate to strike a committee that would deal with the residency issue once and for all – because Harper wanted to protect those improper appointments he made. The rather sad thing is that if hadn’t made those appointments in haste, he could have ensured that they had their ducks in a row before they got appointed, to show that they had enough proof of residency to pass a smell test. He didn’t, constitution be damned – or at least be subverted on bogus “plain reading” arguments that don’t hold water the moment you think critically about them. And yet We The Media aren’t driving this point home to the voters, that the constitution does and should matter. (Aaron Wherry delves more into the residency issue here).

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Roundup: In danger of losing the plot

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As Nigel Wright’s testimony wrapped up in the Duffy trial yesterday, I am going to confess that I have pretty much lost the plot at this point. I’m having a hard time seeing what the point of Donald Bayne’s cross-examination was, and how anything Wright did somehow excused Duffy either claiming those expenses, or accepting the cheque in the end. Trying to establish a broad conspiracy that may or may not include the prime minister’s current chief of staff is salacious political gossip, which may or may not go to the prime minister’s judgement in the people he surrounds himself with, but for the life of me, I can’t see how this is relevant to the trial. Yes, people lied and covered up what happened – politically relevant, perhaps, but legally? I’m still having a hard time following where Bayne is going in this. Meanwhile, Aaron Wherry offers some ideas about what may constitute political scandal in the whole ClusterDuff affair – seeing as some are starting to express doubts that there is one – while Andrew Coyne expresses faux sympathy for Harper, who has been deceived by those closest to him for so long.

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Roundup: The other ruthless dictator

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NDP-turned-Green MP Bruce Hyer is warning that Thomas Mulcair will be as dictatorial of a Prime Minister as Stephen Harper if elected. To which I would reply “quite possibly.” While some of Hyer’s criticisms are that Mulcair will say anything to get elected, that’s fairly standard practice across a host of different parties and even leaders – and don’t think the Greens are much better, if you looked at how Kevin Milligan eviscerated their election platform’s costing over the weekend. But Hyer does have a point in that Mulcair’s NDP has been a very tightly controlled ship. Iron-fisted in many respects, but it does go back to the 2011 election, when Jack Layton was still in charge. The moment the election was over and they had accidentally won that wave of Quebec seats, with all of those paper candidates, the party went into communications lockdown and messaging became even more tightly controlled than that of the Conservatives. The NDP went so far as to centralise their communications media relations – something even the Conservatives hadn’t done, with their famous control from the centre. This carried on through the leadership and was adopted by Mulcair when he became leader, so it’s not just him that’s doing it – it’s the party’s entire apparatus. And it’s not like the NDP was this bastion of free voting even when Layton was in charge – MPs were routinely punished for stepping out of line with their votes, be it with QP slots taken away, or what have you. Solidarity was enforced, much as it continues to be under Mulcair. While I find José Nunez-Melo’s sour grapes at his nomination not being protected to be a bit rich, it does bear reminding that there is a darker side to the NDP that they don’t like to show or talk about, but it is there if you pay attention, even if Hyer is trying to pin it on Mulcair personally.

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