Economic mismanagement and a needless deficit

Prime Minister Stephen Harper promised Canadians during the recent election campaign that his government would not run a deficit. Last month, Mr Harper said that he would never run a deficit; that talk of a deficit was "ridiculous".



Now he is hinting at a deficit and it is his government that looks ridiculous.



This deficit is the responsibility of this Conservative government, of this Finance Minister, of this Prime Minister.



Canada's Parliamentary Budget Officer, Kevin Page, confirmed this in his November 20th report on the economy: "The weak fiscal performance to date is largely attributable to previous policy decisions as opposed to weakened economic conditions," he wrote.



Mr. Page is predicting a deficit next year of as much as $13.8 billion, with further deficits being racked up for years to come. But it is not the result of global economic conditions – rather, it is due to Conservative decisions to impose tax reductions that did not stimulate the economy, while becoming the highest spending government in Canadian history.



The fact is Conservatives are bad fiscal managers who simply cannot be trusted with your money. Every decision they have made has brought us closer to deficit.



Let's look at the financial position his Conservative government inherited from the previous Liberal governments: the strongest economy in all the G-8 group of world-leading nations, a $13-billion surplus, a $3-billion "contingency reserve" set up for emergencies, the best job creation in 30 years and no deficit.



Before Mr. Harper came to power, living standards were rising. Consumer and business confidence was high. The Government of Canada was working on its 10th consecutive balanced budget. And taxes – especially income taxes – were declining more than ever before.



Fast-forward to today and quite a different picture emerges.



It has taken Mr. Harper three short years to wipe out this progress and obliterate Canada's fiscal security. For the first time in more than a decade, we are on the brink of deficit – and that was even before there was talk of a recession.



It is true that virtually all countries across the globe are facing some very tough economic choices. But make no mistake: the looming deficit has not been the result of external factors beyond domestic control. The decisions taken by Prime Minister Harper and his Finance Minister, Jim Flaherty, have made the situation much more difficult for us than it needs to be.



It didn't have to be this way. It was all so avoidable – and Liberals warned as much. But Mr. Harper's preference for short-term electioneering over what's best for Canada has seen his government's budgets swell by more than $40 billion in just two years. But what have Canadians gained from that spending? Can you name anything?



His decision to cut the GST instead of focusing on improving tax fairness, disposable incomes, household savings, productivity or competitiveness was one of his most ill-advised decisions. It costs the Treasury about $13 billion per year, while saving the average Canadian less than a dollar a day.



Analysts are saying a recession is imminent.



During the election, Mr. Harper mislead Canadians that his government would never go into deficit. Now, with this throne speech the government is misleading Canadians about its cause.



Try as he might to convince us he can be trusted to safely navigate these turbulent economic times, Canadians will think twice about taking the Prime Minister at his word.