Thursday, March 04, 2010

Budget - An Example in Poor Public Discourse by Media And Liberals

The release of this budget has prompted many to analyze the impacts on our country's financial position and the implications on the Conservative minority government, but few, if any, are attempting to provide the necessary discussion to remedy the country's ills. It's as if every political party, every commentator, every news outlet, has given up producing anything of value in exchange for reproducing what everyone already knows. It's as if the leaders in our world of current affairs have abandoned the necessary discussion of how Canada can reduce its debt for the always easy and always true, hey, look the sky is blue.

With the presentation of this budget, quel surpris, the media's predictions that it would be merely status quo, stay-the-course, and other clich├ęs that allow them not to express any real opinion, were proven true. Now as the budget is exactly like the reporters and commentators predicted, articles can be regurgitated from yesterday-old ideas. And though there seems to be a consensus among all these bright and ambitious news people that this budget doesn't address the deficit, nor the accumulating national debt, none take the opportunity to suggest any better ideas. The media is supposed to be objective, so this blog writer is speaking nonsense you might say, well though that's another post entirely, I will say the media shouldn't be, especially when the state of public discourse in Canada is at its current deplorable level.

The reporting of the nothing-special budget wasn't limited to the media; Michael Ignatieff the Leader of the Liberal Party denounced it along the same lines. He did it however so saturated in irony, when he was rubbed against a sheet of paper you could see right through it. Though opposing the budget, Ignatieff repeated there would not be an election because he recognized Canadians did not want one, that instead they wanted an alternative. The irony of course being Michael Ignatieff did not offer one.

Not to be overly critical of the Liberals, as in relation to this poor financial forecast all roads lead back to even poorer Conservative fiscal mismanagement, but as an opposing party, the Official Opposition whose sole purpose is to provide an alternative to this government's objective failures, one has to ask where are the alternative policies to balance the budget? Where at least is even the discussion of improving the economy?

A few months ago Gerard Kennedy, a Liberal MP brought public attention to the idea of raising the GST and using the generated revenue to improve vital services, and though it met with criticism it was at least the start of something, at least it was an initiation of a discourse of ideas.

What's needed today, especially today with this lousy budget, is some leader in Canadian current affairs standing up and beginning to do the job others aren't, discussing ideas. From discussing ideas on improving the economy to immigration to education. With the Conservatives clearly not offering any ideas in this budget on how to improve our economy and the media stuck in some antiquated notion of pseudo-objectivism, we can't look to them. But as Liberals we can look to our leader, and if not him, surely we can look to ourselves.

Like Gerard Kennedy I favour increasing the GST, but not so the additional revenue can go toward some other spending, no, that would be financially imprudent; instead that revenue should be used to enable the lowering of more harmful taxes, like those on income. Income tax is a highly distortionary method for the government to collect revenue because it reduces salaries, people are given the incentive to work less and overall as a consequence Canada becomes less productive. The GST as a consumption tax is one of the least distortionary taxes, and as such most economists agree that increasing taxes on goods and services to allow for a decrease in other taxes is a good idea.

Though what economists agree on does not necessitate good public policy, the discussion of ideas does, and that's all I'm asking for.


Annie... said...

Yes, but no one wants to raise the GST when so many are out of work. Michael said he would not think of raising taxes as long as the country is in this shape.
He did say he would like to raise the GST for the deficit, but that was sometime last year, and he was lambasted for saying it. said...

Thank you Annie for your comment it does point out several problems with raising the GST, the most imposing being the public disapproval of it.

In response to the idea that an increase in the GST could be possibly harmful to the unemployed rebates could address that concern. I could also suggest that lowering income taxes and possibly some corporate taxes would increase the likelihood of businesses hiring more workers.

I may be wrong Annie and raising the GST could be bad at this time or at any other, but in the same vein Michael Ignatieff AND other leaders (Harper included) in our current affairs should stand up and suggest at least something to balance the budget.

How else will we come to the best idea if there is no rational discourse?

Eugene Forsey Liberal said...

I agree with your basic point about need for adult policy discussion, though I disagree on the details - people of good faith can disagree.

I said this before, elsewhere, and it applies to your post too:
"Excellent post. One may disagree on the details, but the basic point is excellent: must examine taxation with maturity, in terms of fiscal situation and vision for Canada. Public always wants impossible, excellent services and low taxes, but if forced to choose between higher taxes-better services and lower taxes-worse services, time and again, they go for former, by hefty majorities, into 70s+. But they must be forced to choose, in clear, open debate. Otherwise, confusion & sophism allows bad fiscal & social policy through the back door, pleasing some important opinion-making elite interests, but contradicting and hurting vast majority of Canadians."

Public opinion is not in and of itself an argument for any option. Everyone has to analyse and make their minds up on their own. But if you check out page 10 of last Ekos poll, you'll be struck that the split between services & taxes is 3-1 not just nationally, but in every province/region, age & education(income) group. And that among Opp voters, more like 4-1.

Something to think about. Keep up good work. said...

Eugene thanks for the links, and disagreements are certainly allowed but hopefully, and perhaps I'm too optimistic, at some time in the future they can be resolved.

Though those polls you cited may be accurate or even that they may be even too low, I would think there's a point when there's too much service regardless if the people want more.

I venture to guess where our disagreement in the details lays, and can only suggest that individuals are the best engines of change within politics and within the economy.