Costing the Liberal Platform

The Liberals released a “costed” platform today.

http://www.liberal.ca/platform_e.aspx

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.

2 comments

  • I sort of understand your criticism but it would have been just as bad if they had come out with a plan based on their own projections. If they didn’t project a dedication to fiscal responsibility Harper would have attacked them on being spendthrift.

    Also at the presentation this morning John McCallum argued that he had cut $11B out of the last Liberal budget and given that it is about 1.5% of the total budget number should be very achievable. I’ve worked for big and small companies and they regularly wring efficiencies out of the organization without gutting programs.

    What is the alternative — I don’t see a plan from the Conservatives at all and they are the kings of cutting programs that go against their ideology. You don’t see that here.

    Harper’s “platform” is simply an excercise in marketing. He has done a great job at segmenting the voting population and throwing money at segments where they think they can pick up votes. That might be good sales strategy but it’s not good for the country. You might spend some time evaluating the negative impact their “policies” are going to have on the economy.

  • Progressive economists are just that – progressive and tell us how it is. They are not the cheerleaders for the liberals. Also of note, they have put out an alternative budget each year, since the mid 90s, so I trust that through those many years of experience, they know what they are doing and can be “trusted” to speak the truth.

    National daycare promised since 1993, again gets punted to the curb – no surprise there.

    And since I was in my late 20s when the libs did cut and dice to social programs starting in the mid 90s, ones only Mulroney could have dreamed of doing at the time, I have no doubt they would do it again.

    These progressive economists have been around the block quite a few times with liberal platform progressive platforms to know where all the shoals are between-the-lines.

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