“A steady invisible hand”

Asked by the Globe what the “ballot question” should be for the upcoming election, Tasha Kheiriddin, Quebec Director of the Fraser Institute says:

“It should be all about green – money, that is. With the price of oil dropping, inflation creeping up and the auto sector in tough times, which party can provide the steadiest invisible hand for our economy?”

To conflate the steady hand on the rudder or wheel metaphor with Adam Smith’s metaphor of the invisible hand is just too hilarious (as is saying the price of oil is dropping and inflation is rising). Having received the memo from Steve, Conservative strategists are all on message with their question, some variation on who can best navigate us through tough economic times. Tasha, immersed in the free market fundamentalism of the Fraser Institute, clearly could not resist mixing her metaphors.

But it makes for an interesting point around the Conservative messaging because in tough economic times, their answer is “you are on your own.” While Adam Smith was much more nuanced, in conservative parlance the “invisible hand” is about letting capitalism do its thing with minimal interference by government (unless rich and powerful corporations think government action can increase their profits, that is; witness the Copyright Act Bill C-61). The Harperites do not believe in activist government that helps people, so I hope you saved your tax cut, cuz you might need it.

At the level of the federal budget, Harper’s response to a downturn will be to cut spending because tax revenues will fall from projected levels, and ideologically they would never run a deficit. The 2008/09 budget is already at the tipping point towards a deficit, and with the economic numbers getting worse, the Tories will soon be looking to shave a few billion from federal spending, this year and next, to maintain anything close to budget balance.

And cutting spending will only make the underlying economic problem worse by pulling money out of the broader economy at a time when it is needed. A steady hand would actually imply running a deficit, if we were to translate it into good economic policy. Harper’s policy would be the exact opposite: the turn the wheel more sharply into the direction of the rocks.

A full campaign is about to unfold. But while Canadians may vote for the steady hand, with Harper they are only going to get the finger.

6 comments

  • I have come to the reality is that – and like many progressives – conservatives actually purposefully like to spend all the money from the rainy day fund, so with the bank empty, they can make all those cuts – permanent. Back in the 90s we saw structural adjustment programs by various “governments” in sync with neoliberal capitalistic notions.
    As we see in the US, conservatives don’t mind going into debt/deficit because at the end of the day, who pays that debt off is the middle/working/poor class either in taxes, bottom-barrel wages, no social and economic supports. The winners as usual are those who got all the taxcuts and give aways.

  • Just saw Tasha Kheiriddin interviewed on the tube (was either CTV or CBC) and IDed as “a sociologist” or “political scientist” or something, not a director of the FI. Shoddy stuff.

  • Seems like the economy has climbed to become the top issue in this election. At least according to a poll out today quoted in the Toronto Star.

    Amazing that we have all these elected officials over the past months stating quite loudly how well the economy is doing (Flaherty comes to mind). If indeed the economy was doing so great, then why are Canadians voters feeling it is the number one issue.

    The ear to the ground economy is much worse than the official recorded one. There is fear in the air and the threat of a Harper Majority will have our economy in complete collapse. I hate to say this but progressives better get the crash helmets on, as I have a bad bad feeling Harper is going to get his majority.

  • In case you were wondering, given the historic bail out announced today by the US government of Fannie and Freddie, the neo-con economic project is now officially dead.

    We all knew the bail out was coming, the question was when and now the question is how much. The errs of the traders and the financiers will be off the hook again. Creating and sustaining bubble economies, where exactly is that in the textbooks.

    Where is it written that every few years the public has to come in and save the capitalists from themselves. Where is it documented that regulation is good for business and promoting a culture of sustainable growth.

    No where is it mentioned that the current economic space being sought out by the libertarian reformers of the Harper’s crew push our Canadian economy into similar space as our American Cousins.

    paul’s rant of the day

  • “In case you were wondering, given the historic bail out announced today by the US government of Fannie and Freddie, the neo-con economic project is now officially dead.”

    I disagree with this statement. It is actually a fit. Neocons only preach neocon economics to the people – survival of the fittest, pulling up oneself by the bootstraps and so on, and shrink and rid themselves of the social safety net.

    Meanwhile, they have just saddled that same public with the debt of the private company. This follows the same pattern of subsidies and enticements for corps to setup shop in their areas, while ridding self of regulations, protections for health and safety of environment and so on.

    Simply it is welfare programs for the rich so they can play the “market again.” That my friend, is really the magic hand of the market, don’t you know.

  • yes it is a rich culture the control and is glazed over our gaze as we all graze away in the malaise of the irrationality of it all. Seemingly we all just will enjoy our 99 cent treats and keep us off the streets, and with the benefit of tainted meat, poison water and a labour process not fit for an animal at most.

    Yes Jan I was only in my own small way trying to be optimistic. It will all be swept under the carpet of hidden by complication and a convoluted discourse of the rich and irresponsible, to play their games of chance and bubbles. Easily defeating all that walks a different way.

    But alas we do have the reality of being on our side, if only we could unwrap some good bits of the corners of or maybe pull the ribbon off.

    It was mainly my point with the Statcan yelling. Even that voice came into line with the program.

    If only this feeling in the pit of my stomach would go away, I would feel much better. But it a sick feeling knowing that Harper and the nasty lot of environmental and economic imbalancers will walk away with a majority.

    So much potential we carry in the sweaty palms of our voting hands and minds and hearts. We need a huge change in the winds or it is all done. I hate to be pessimistic, but a movement to lead the way forward is not where it ought to be. I hope I am wrong.

    paul

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