Guest Blog from Chris Watson: “If You Can’t Buy, I Can’t Sell”
The following guest post was written by Chris Watson, legislative liaison for CUPE Ontario based in Toronto:
In stark contrast to the austerity budget strategy of Don Drummond, Dalton McGuinty and Dwight Duncan, a plan premised on Drummond’s core belief that strong economic growth in Ontario is not possible and should not be the goal of Ontario budget policy, the new Premier has publicly committed to “make Ontario # 1 for economic growth” in Canada.
That is a great start and exactly what so many Ontarians, including both labour and many business leaders, have waited to hear.
The challenge, however, is will the government understand that achieving that bold growth goal requires a strategic shift away from the now discredited “austerity” agenda of the previous administration?
Further evidence that we might dare hope for a new direction came in remarks by the (now) Finance Minister of Ontario, Charles Sousa, in his January 26th speech to the Liberal Leadership Convention.
“What did I learn from twenty five years in business?” Sousa asked the crowd. “If you can’t buy – I can’t sell.”
Point? Our economic health is largely dependent upon consumer demand, but if we continue to use government policy to drive down Ontarian’s real earnings, they will have no choice but to either reduce spending (which will only damage the economy and government revenues even further) , or they will try and maintain spending levels by driving up their personal and household debt even higher than it is now. If policy makers allow that to continue, we will hit a catastrophe point. Is it worth the risk? RBC’s Gordon Nixon told the Ontario Economic Summitt last November: Stop being afraid of high wages.
Is anyone listening?
Letter in Toronto Star
Austerity obsession killing Canada
Re: Slow economic growth may mean more spending cuts: Flaherty, March 2
After World War II, our government wanted to make certain that returning soldiers had work, so even though the debt-to-GDP ratio was three times what it is today, the government built infrastructure, introduced new social services, and made sure the economy was functioning at close to full employment.
Contrast that with the situation today. The Harper government is obsessed with cutting the deficit, and when revenues decline, Finance Minister Jim Flaherty threatens to slash ever more government spending, risking a downward economic spiral.
It is apparent that Eurozone austerity programs over the last several years have been disastrous, resulting in unemployment rates reaching 25 per cent for the general population and 50 per cent for youth. In the United States, President Barack Obama labelled the billion dollar sequestration spending cuts inexcusable and dumb because they threaten 750,000 jobs and could send the U.S. into recession.
When will media commentators expose as an egregious failure the Conservative governmentâ€™s fixation with balanced budgets that keeps 1.3 million Canadians involuntarily unemployed, costs our economy billions in lost production, and causes untold personal suffering to individuals and their families?
Larry Kazdan, Vancouver
The problem is that we are preaching to the converted and the rest aren’t listening. We need to change the dialogue. Neo-Conservative policies are laughable, so let’s laugh at them!
Look here for a new kind of conversation about Economics: