The Liberals released a “costed” platform today.
There’s a lot to like here in terms of the Liberal Party’s programmatic commitments to child care , support for manufacturing investment, green job creation, public health care, student aid, basic infrastructure, dealing with poverty, and so on – but I stand by my earlier argument that they can’t balance the Budget, deeply cut corporate taxes, oppose new taxes (outside the internally consistent green shift package) AND make major new spending promises outside the green shift – all in the context of a slumping economy.
The costing here is dubious at best.
We get four year spending and tax reduction totals with little or no detail on timing. No adjustment is really made for slowing growth and rising unemployment.
Clearly a lot of the good new stuff outside the green shift is shunted off to the future. As a key case in point, last week the Liberals promised to bring in a $1.25 Billion per year national child care program. Today, that program is costed at $1.5 Billion over 4 years. That’s a slow phase in, to say the least. Another case in point is municipal infrastructure spending, which barely increases over the status quo for the next four years.
We get a modest dose of Reaganomics and supply-side tax cut magic. Cutting the tax rate on income trusts will supposedly raise $1 Billion in new revenues.
The Liberals actually raise the ante on balanced budgets, promising Martin era determination to run surpluses to pay down debt. They promise to restore the $3 Billion Contingency Reserve – to my mind implying spending cuts “come hell or high water” even if we go into recession.
That’s bad enough, What is worse is that their fiscal plan depends on unspecificed cuts of $12 Billion over 4 years – a not inconsiderable sum after continuing rounds of “program review.”
Last but not least, they say they will borrow $25 Billion to fund post secondary education, but this will somehow be done outside the Government of Canada spending envelope and promised debt reduction.
- NDP’s “Balanced Budget” Platform (April 10th, 2011)
- How to defuse the crisis (December 3rd, 2008)
- Fiscal Statement: Credibility Lost and Opportunity Squandered (November 29th, 2008)
- Stock tips from the PM (November 20th, 2008)
- Lettre ouverte de la part d’économistes canadiens (October 8th, 2008)