A whimper of a federal budget

I did not make it to the federal budget lock-up, and having pored over the document I am pleased to say I missed it. There is very little in this budget that one would expect of a budget in the midst of a recession (the GDP numbers have turned up, I know, but unemployment is still high and could continue to rise for a while if past recessions are any indication). OK, I have not looked into every nook and cranny, and did not have Finance officials around this time to decipher pieces of the budget – the feds love long budgets that give precious little detail, especially if something is new money or spent over many years – so there might be some additional stimulus action hidden in there. But it seems to me that most of the content is recycled from last year’s budget, a reannouncement of what the government is already doing (“Great job, Harpie!”).

For example, look at Table 4.2.2 on page 173, which tells us the fiscal magnitude of actions taken in this year’s budget. It shows 2010/11 with a status quo deficit of $48.9 billion. New measures proposed in the budget total $1.1 billion, offset by $800 million in cuts elsewhere, for a net increase in the deficit of $300 million. Underwhelming, to say the least.

Which makes it somewhat better (but not much) than the TV commercials about Canada’s Economic Action Plan, which seem to be more about reinforcing the Conservative pre-election talking points about how strong they are on the economy than telling people information they need to know (and extremely deceptive at that, with many of the recent batch of commercicals on Employment Insurance, an area where the Conservatives have done next to nothing).

Like the commercials, the budget is used as a policy platform for the next election (this itself a recycling of the 2006 Advantage Canada document that also came out at budget time). Rather than actual budget actions, the “budget” goes on and on about plans to boost Canada’s “competitiveness” (would someone in Ottawa please define that term and tell me how it should be measured?). In doing so, they pull out all of the chesnuts of neoliberal policies past. Canada will have the lowest rate of corporate tax in the G7 by 2012, a measure that Bay St will love but that will do little for real economic development in a nation that badly needs a vision (zero poverty and zero carbon would be a good start). No, instead it is more of the same: Foreign investors, please come and create jobs for us! Look how competitive we are! Please!

Also on the “competitiveness” front is a renewed attack on regulation. For those who have been paying attention, the feds have played this game over and over again going back to the early 1980s. It is hard to believe there is any red tape left for a newly minted Red Tape Commission to cut, because once you look closely at regulations, they seem to be there for good reason, darn it. Previously, the government announced in the 2007 budget the Cabinet Directive on Streamlining Regulation, which places “competitiveness” hurdles in front of any new regulations, and subjects the whole of existing federal regulations to those standards.

Why then do we need a Red Tape commission? Like tax cuts, I suppose one can play this one over and over again and still have it sound good. But truth be told, this is not just silly politics from Ottawa. Things can indeed get worse. For example, there is this doozy on page 104:

The Government is taking steps in Budget 2010 to further improve the regulatory review process for large energy projects. Responsibility for conducting environmental assessments for energy projects will be delegated from the Canadian Environmental Assessment Agency to the National Energy Board and the Canadian Nuclear Safety Commission for projects falling under their respective areas of expertise.

So we’ll just not actually do any environmental assessment in the tar sands, on major new pipelines of natural gas, or on nuclear power. Great.

2 comments

  • Kelsey Kirkland

    “Canada will have the lowest rate of corporate tax in the G7 by 2012, a measure that Bay St will love but that will do little for real economic development in a nation that badly needs a vision (zero poverty and zero carbon would be a good start). No, instead it is more of the same: Foreign investors, please come and create jobs for us! Look how competitive we are! Please!”

    Does that mean Halliburton is Incorporating its Headquarters in Calgary? Why stop at G7, to be fair the government should compete with Energy resources rich gulf states in taxation?
    I guess Russia and Japan are not desirable foreign investors. Incidentally both of these countries had the worst ever Olympics performance in history. what a coincidence! Their governments are reeling from the poor performance of their athletes. Despite the stellar performance of Canada, our Hon. Sports Minister Gary Lunn taking a pay freeze. Well, Gary was not singled for this austerity measure,the ruling party has made this mandatory for all federal politicians.
    Underworked government Overwhelmed by the Corporations !
    i’m useless but not for long the
    future is comin’ on, it’s comin’ on

  • Kelsey Kirkland

    “The Government is taking steps in Budget 2010 to further improve the regulatory review process for large energy projects. Responsibility for conducting environmental assessments for energy projects will be delegated from the Canadian Environmental Assessment Agency to the National Energy Board and the Canadian Nuclear Safety Commission for projects falling under their respective areas of expertise.”

    Two Oil-Field Companies Acknowledge Fracking With Diesel

    http://www.nytimes.com/gwire/2010/02/19/19greenwire-two-oil-field-companies-acknowledge-fracking-w-90863.html

    Two of the world’s largest oil-field services companies have acknowledged to Congress that they used diesel in hydraulic fracturing after telling federal regulators they would stop injecting the fuel near underground water supplies

    Halliburton and BJ Services acknowledged to the House Oversight and Government Reform Committee in January 2008 that they had used diesel in the controversial process that has expanded access to vast natural gas plays.

    BJ Services acknowledged it had violated a December 2003 “memorandum of agreement” that it and other companies signed with U.S. EPA agreeing to limit the amount of diesel they use in fracturing.

    The chairman of the oversight panel at the time, Democrat Henry Waxman (Calif.) is now chairman of the Energy and Commerce Committee, which launched an investigation yesterday into fracturing practices.

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