Monday, March 19, 2007

Budget 2007 Analysis

View the Federal Budget here.

Now, analysis...

Before I begin, I should just go on the record as saying I really, REALLY don't want an election anytime soon... now that my beloved Oilers have taken steps to ensure I have a productive April, May and June (UNlike last year - so thanks for looking out for me, Oilers...), I'd really like to NOT be chained to a desk, typing away at this blog 6 times per day analysing every riding in the country.

Clearly, the government wants to avoid an election, at least immediately, as well. This budget has a little something for everyone - more for some than others - but doesn't break the bank, either, which was the big concern.

Of course, those with vested interest are going to do what they always do... The Bloc will say "It's good for Quebec, so we like it." while the NDP will say "It's bad for working families and working families are the backbone of Canada's economy and it favours the rich and the planet is dying and working families oh we love working families and where has our labour support gone oh maybe we lost it when we and Buzz Hargrove had that falling out but we love working families Tommy Douglas was in our party once you know immigrants are cool Stephen Harper is a madman we need more working families please vote for us... Working Families." (Apparently, none of the nearly 10 Million people who voted Tory or Liberal last January were from working families.) The Liberals will hem and haw and say the Tories made a few good moves, all stolen from the Liberal platform, but that it wasn't good enough and oh, remember when Stephen Harper hiked taxes on the lowest income earners? That has nothing to do with this budget, but we thought we'd mention it anyway. The Canadian Taxpayers Federation will cry about Quebec getting money from Ontario, BC and Alberta, and bemoan the fact that there is any income tax at all. Students groups will stage protests because they have to pay for their own educations. Environmental groups will stage protests because... well, because that's what they do. And at the end of the day... the budget will pass, with a few modifications that the NDPs and the Liberals will both try to take credit for, but they'll both complain about the overall budget, and likely pass it anyhow.

A few highlights:

  • Restoring fiscal balance
  • by providing $39 billion in additional funding over seven years, which will allow provinces and territories to better provide services and infrastructure that matter to Canadians—everything from roads, bridges and public transit, to better-equipped universities and colleges, improving health care, clean rivers, oceans and air, and job training that helps Canadians compete with the best in the world.

    Good. Some will complain it's not good enough... but they'll be drowned out by provinces and municipalities dancing in the streets, waiting for their cheque. Hard for the Liberals to comment on this one, since they refuse to acknowledge the existence of what they STILL call the "so-called" fiscal imbalance. So, for the hardcore Liberals in ES Nation, just consider this "39 Billion so-called dollars".

  • Further tax relief for working families
  • with the Working Families Tax Plan, which includes a new $2,000-per-child tax credit. Budget 2007 also helps parents save for their children’s education by strengthening the registered education savings plan program, and supports seniors by raising the age limit for registered pension plans and registered retirement savings plans to 71 from 69 years.

    Good. More money for working families (you just KNOW they put that particular term in there to see Jack Layton's hair catch on fire) is a good thing, although Canadians in major centres are getting more and more frustrated with the lack of child-care spaces - living in the GCA, I've got to get on a waiting list NOW, and we're not even going to conceive for 4 or 5 years!

  • Further debt reductions
  • resulting in savings for Canadians. After paying down $13.2 billion on Canada’s national debt in September 2006, Budget 2007 further reduces the debt by $9.2 billion. Thanks to the government’s Tax Back Guarantee, the interest savings on this year’s debt repayment will be returned to Canadians in the form of further tax cuts.

    Good. The Liberals may, and the NDP DEFINITELY will, paint this as "retiring debt on the backs of overtaxed Canadians"... but it's not as though we can take the surplus and blow it all because we need, or think we need, to buy certain things... we OWE this money to REAL PEOPLE... the "working families" that the NDP love to talk about. It is a moral and fiscal obligation to pay back the money that we owe - and, it just makes good sense. OVERDOING it, as we saw in Alberta, just to get the debt off the book, is a bad idea - hings get left undone, repairs and needed infrastructure don't happen. But if your pal owed you $100, got a $50,000 inheritance, and spent it all on home renovations, you'd be pretty bent out of shape at him. We owe, and we need to pay.

  • Investing in Canadians
  • by providing $550 million per year for the Working Income Tax Benefit and $140 million over two years to establish a Registered Disability Savings Plan.

    THERE'S the working poor and the vulnerable that Layton ties his wagon to... they'll say it's not good enough, but it's a heck of a lot more than "zero".

  • Preserving the environment
  • with a balanced action plan including rebates on fuel-efficient vehicles and efficient alternative fuel vehicles, an incentive to get older polluting cars off the road and a Green Levy on fuel-inefficient vehicles; by developing a new National Water Strategy; and by providing $1.5 billion to establish a Canada ecoTrust for Clean Air and Climate Change.

    The Liberals and NDP are going to skewer this as sub-standard... can we do better? Sure. Is it a start? Absolutely. A growing consumer base, with cash to spare and large distances to travel (pretty big country - not exactly Luxembourg), is going to buy vehicles. Likely these "horseless carriages" I keep hearing about. Giving rebates on fuel-efficient cars and hybrids and adding a Levy onto that HummVee will help encourage people to make the right choices... not everyone still WILL make the responsible choice for the environment, but what does Dion expect, a law against selling Hummers in Canada?

  • Improving health care
  • by investing $400 million for Canada Health Infoway to support the development of electronic health records and up to $612 million to support jurisdictions that have made commitments to implement patient wait time guarantees, and by providing the provinces with $300 million for a vaccine to prevent cancer of the cervix.

    Efficiency, wait-time guarantees, and a vaccine for cervical cancer. Is anyone politically suicidal enough to vote against those measures?

  • Supporting our troops
  • by providing $60 million to increase the field operations allowance, establishing five new trauma centres to help veterans and their families deal with stress injuries related to their military service, and creating the position of Veterans’ Ombudsman.

    Again, all good... you're not saying "we're increasing the budget to buy more bullets to kill people with", you're establishing trauma centres for injured soldiers... who's going to vote against THAT?

  • Supporting our farmers
  • by providing $1 billion in commitments for improvements to national farm income programs, including $600 million to kick-start contributory style producer savings accounts and a direct payment of $400 million to producers to help address high production costs.

    Some might ask why the Tories need to help farmers, as they've already got most of the Western ridings locked up. Hate to burst anyone's myopic view of things, but there are farmers EAST of Manitoba, too. And most of the country's farmers are in trouble, financially. Since I'm not crazy about the idea of importing beef or grain because Canada's farms started closing down, this is a needed and useful investment.

    As I said, this budget has a little something to like in it for everyone. Enough that if you were a die-hard Grit of Dipper you'd vote Tory? Not likely... but enough that if you were undecided, you'd consider keeping the Liberals on the opposition benches, and see what this Harper fella could do for you? Perhaps.

    To whit: Not a home run for the Tories, but at least a single, possibly a double. No election triggered over THIS budget.

    - ES


    Bobg said...

    I think you are too young to remember a similar good for everything budget that Brian Mulroney one of our parade of Quebec PM's gave Canada. Within a short time, we had a free trade agreement with America giving them control over most of our natural resources that the Liberals didn't allow Europeans and Asians to steal in the name of globalization. Then to pay for all those goodies we got the GST. Want to bet this time it’s a 6% to 8% retail gasoline tax in the next budget? That way like with the GST, everybody gets to pay for the luxuries we are getting with our own money. I'm one of the uncommitted voters and like your girlfriend and I don't like political insincerity.

    Enlightened Savage said...

    bobg: I remember that budget, albeit vaguely, as it was somewhat before my "age of reasoning" (as you kindly pointed out).

    I'd suggest that history has shown that NAFTA, despite glaring flaws when it comes to enforcement of some of its provisions (but, let's be honest: If the UN can't force the US to do something, how can NAFTA hope to?), has been a benefit to the Canadian economy. We are better off than we were 20 years ago - most Canadians would agree on that point. Our financial ship has been righted, by (relatively) sounds fiscal policy by both conservative AND Liberal governments. Mulroney made some absolutely, horrifyingly bad decisions and left the country in a financial mess... but also left after having set the table, through NAFTA, to help clean things up again. The Liberals, luckily, didn't squander the chance. This global free trade system has caught on in places like Europe - so either ALL of these countries are wrong, or we were one of the first to get it right.

    As for our control over our own resources... that issue is one of the areas which lend themselves well to conspiracy theory. Either things are as they SEEM, which is that we are in control of our own resources, or the Americans are quietly, secretly buying our resources from us, and we're days from having black helicopters come swooping in and draining all of our lakes to feed the American need for fresh water.

    All told, Canada is in a pretty enviable position, globally. And as for the threat of a consumption tax being levied by "Scary Stephen", I'd put that right up there with "troops... carrying guns... in our cities..."

    The GST is one of the straws that broke the camel's back and caused many of the current Conservative Party members to flee to the newly-minted Reform Party in the first place. The likelihood of this party introducing a new version of it is infintessimal, at best.

    - ES