In a speech before his caucus meeting today, Ignatieff has rightly tried to place the blame for the deficit on Harper.
This deficit is squarely Mr. Harper's responsibility. He spent us down to the red line in the good times and so we face the hard times as citizens of a great country with the cupboard bare.
To anyone that can read a profit and loss statement it is obvious that the conservatives under Deficit Jim have spent their way into a deficit even before the bail out of the banks and the auto industry. And before the forthcoming stimulus expenditures of a revised budget.
The last accurate numbers received from this government were for March 31, 2008, the end of the fiscal year 2007/2008. They were released this fall on September 30th.
Revenue only increased 2.7 year over year, with the glaring decrease being the decline in GST revenues. As you may recall at the time, opposition parties led by Dion objected to the 1% cut to the GST that the conservatives threw in at the last minute. They preferred decreasing income tax. Well it came back to bite the Conservatives big time as pointed out by their own Parliamentary budget officer Kevin Page in November here.
Meanwhile the expenses for the same period went up 4.8% with the two big items being the escalating costs of the Afghan war and a $2 billion, 8.2% increase in the government’s operating expenses (that's interesting). In any case, the revenue barely exceeded the expenses and we started April 2008 in a new fiscal year with the surplus gone and heading into a downturn.
So with car sales and other large ticket purchases already in decline and the then sudden freeze on consumer spending in September (the dreaded lack of consumer confidence going into the golden quarter) you know the numbers for December 31st (3/4 year mark) are well into the red.
Of course Harper apologists claim that it is the world wide recession that has caused these woes. But the truth is that the governments own forecasting arms, like the EDC were predicting the downturn as early as a year ago this month here .
The Harper government knowing of the expected downturn, with 2009 being a recessive year and knowing that they were already going to be running a deficit called their October election in one last effort to get a majority.
Ignatieff is right this is Harper’s deficit.
Unfortunately that will all be hidden from the Canadian public, if Harper and Flaherty get their supposed stimulus budget passed. When you are talking about spending $40 billion dollars, it is very easy to hide the fact that you are already $10 billion in the hole.
You do not have to be an economist and it should be no surprise that if you spend more than you bring in you are in a deficit.
The only surprise here is that a large number of Canadians still believe that the conservatives are the best ones to handle the economy.
I don't know. I might have to paste up the Coalition banner again. I liked the conditions that Ignatieff laid out today for his acceptance of the conservatives budget on the 27th.
The budget must protect the most vulnerable, save jobs, as well as create the jobs of tomorrow.Somehow I do not think these are the priorities that Harper has. He is just trying to hide his incompetence and remain in power.
Reference: CTV article and Government links. JAWL