Harper once promised to “change the face of Canada” so drastically we wouldn’t recognize it. His goal is to make our country a model of small, weak government; powerful, deregulated corporations; increased unity with the US, and faith-based social conservatism. He seems to think the end justifies the means. We have to make sure the Harper Conservatives don’t gain power again.
Weakening Our Economy
The Conservatives campaigned on their ability to manage the economy in a frugal, business-like manner, protecting the interests of Canadians, but the opposite has happened.
100-Plus Reasons to Stop Harper Conservatives - Part III
1a) “The Harper government's 2011 fiscal plan reaches out to the NDP in a bid to avoid an election, but it could equally serve as a campaign platform should the opposition unite this week to defeat the Conservatives. It is a budget crafted for the politics of the moment, meeting some of NDP Leader Jack Layton's pre-budget demands and sprinkled with targeted tax credits for families. However, action to confront Ottawa’s long-term challenges, such as planning for higher costs and slower revenue growth due to an aging population, appear to be taking a backseat for now, as does a thorough accounting of where future cuts will come.” Globe and Mail on 2011 federal budget.
1b) In 1993, Mulroney’s Conservatives chalked up a $38 Billion deficit. By 2006, Chretien’s Liberals turned this into a $16 Billion surplus. Four years later, Harper created a record $56 Billion deficit.
1c) Somehow, it has been overlooked that Harper’s Finance Minister Jim Flaherty was also Finance Minister for the Ontario Conservative government. The provincial Conservatives had campaigned on their ability to manage the economy, but, after their defeat in 2002, the provincial auditor discovered that Ontario’s “balanced budget” was a $5 Billion deficit.
2a) When Harper was president of the National Citizens Coalition, founded in 1967 to oppose Medicare, he supported US-style bank de-regulation. In his first budget, Finance Minister Flaherty invited “new players” into the Canadian mortgage market, offering greater choice and “innovation,” thus lowering mortgage insurance standards – the US recipe for disaster. Nevertheless, since the 2008 Financial Crisis, Harper has been taking credit for the relative strength of our financial sector, based on a system he inherited, but didn’t support.
2b) At the World Trade Organization, Canada has been pressing developing countries to open up their economies to foreign financial institutions – arguing that their risk management capabilities help stabilize economies! The Harper government has even been pushing derivatives, which played a major role in the financial meltdown.
3a) Harper is now taking credit for stimulus spending and pulling Canada out of the greed-induced Financial Crisis. However, Harper did not support stimulus spending until a coalition of opposition parties threatened to oust his government. As a post in the Western Standard, based in Harper’s Calgary riding, noted: “So Stephen Harper did something that is bad for Canada for the sake of political gain. He reversed a life time commitment to free markets and opposition to Keynesian economics for the sake of political power. Isn’t this exactly what conservatives have complained about the Liberals for generations; a willingness to bend principle for power? Is this really what the Conservative Party expected of its leadership?”
3b) Canada’s Economic Action Plan infrastructure stimulus program had a single focus: jobs. A majority of those surveyed by the Parliamentary Budget Office run by Kevin Page reported the program had either a neutral or negative impact on jobs. Even Harper’s business allies and the conservative Fraser Institute have criticized it. Overall, the stimulus program has been plagued by “flawed accountability,” according to another assessment. For a long time, the government refused to release detailed financial records of the Economic Action Plan, preferring to swamp Kevin Page with paper, rather than handing over a database
3c) Action Plan cheques went out – some with the Conservative logo – to a disproportionate number of Conservative ridings, and don’t forget all those signs and TV ads! Harper wasn’t sure he would extend the program past March, 2011 – then realized that half-built schools and sewers wouldn’t be popular.
3d) Last November, months after the Action Plan was introduced, the good news from Statistics Canada was that Canada's unemployment rate fell three-tenths of a point to 7.6 per cent per cent, and the economy had created 15, 200 new jobs. The bad news was that the work was part-time with no security or benefits. Also the official unemployment rate dropped because 43,600 Canadians, mostly young people, had left the labour market.
3e) To distract voters from the Oda scandal, the Conservatives conducted an Economic Action Plan, public-relations blitz in February, sending more than 80 ministers, MPs, and senators across the country promoting their economic recovery plans – that cost taxpayers almost $300 million as they “announced or re-announced” projects. According to The Globe: “Ipsos Reid CEO Darrell Bricker, meanwhile, suggested the strategy is also aimed at reminding voters – in target ridings and big media markets – that a vote for the Conservatives ‘brings certain benefits.’ ”
4a) Days before the 2008 federal election, Harper carefully downplayed his bailout of the chartered banks, and so did the media. Although the government had consistently committed itself to a "balanced budget," it then began claiming that deficit spending was required to boost the economy at the height of the recession. However, Canada’s deficit, according to economist Michel Chossudovsky, is “directly related to a 75 billion dollar bank bailout program for Canada's chartered banks … Harper stated emphatically that: ‘this is not a bailout ... it will cost the government nothing’ … According to Finance Minister Jim Flaherty: ‘This program is an efficient, cost-effective and safe way to support lending in Canada that comes at no fiscal cost to taxpayers.’ Yet Finance Minister Flaherty contradicts his own statement when he acknowledges that the project will drive up the public debt.”
4b) According to Chossudovsky, while the Canadian bailout procedures differed from those of the US Treasury under the Troubled Assets Relief Program (TARP), they “essentially serve the same purpose … The $700 billion US bank bailout … was the object of debate and legislation in the US Congress. In contrast, in Canada, the granting of $75 billion dollars to Canada's chartered banks was implemented at the height of an election campaign, without duly informing the Canadian public.” There was no Parliamentary debate.
4c) Chossudovsky: “While the bank bailout is a component of government expenditure, it does not constitute a positive spending injection into the real economy. Quite the opposite. The bailout is a handout to the banks. It contributes to financing the restructuring of the banking system leading to a massive concentration of wealth and centralization of banking power. The bailout money will be used by Canada's chartered banks to consolidate their position as well as finance the acquisition of several ‘troubled’ financial institutions in the US.”
4d) Chossudovsky: “This is the most serious public debt crisis in Canadian history.
The bank bailout potentially destabilizes the federal fiscal structure. It leads to a spiraling budget deficit, which must be financed at taxpayers’ expense. The entire structure of public spending is affected including federal-provincial transfers. The (federal) public debt is slated to increase by 14 % over a two year period. The provincial debts are also likely to increase dramatically.”
4e) Chossudovsky: “The Minister of Finance has intimated that further measures are envisaged ‘to bolster the availability of credit’ with the government "injecting capital into banks if necessary … It is worth noting that in addition to the $75 billion, the government has pledged ‘to backstop more than $200 billion in interbank lending so banks can boost their lending capacity.’ (Toronto Star, December 13, 2009).”
4f) "Nobody goes to jail,” writes Matt Taibbi Rolling Stone magazine. “This is the mantra of the financial-crisis era, one that saw virtually every major bank and financial company on Wall Street embroiled in obscene criminal scandals that impoverished millions and collectively destroyed hundreds of billions, in fact, trillions of dollars of the world’s wealth." Taibbi explains how the American people were defrauded by Wall Street investors. There has been little investigation of Canada’s financial institutions.
4g) Statistics Canada reported that Canada’s banks collected over $20 billion in profits last year.
5) The current federal debt is estimated at $560 billion. This means taxpayers will have to pay over $30 billion next year on the interest alone without paying down a penny in what is owed. Debt charges are the single biggest expenditure in the federal budget. The Canadian Taxpayers Federation, a spending watchdog group that has taken on governments of all stripes over wasteful spending, was told it couldn’t bring its debt clock onto Parliament Hill in early March. The CTF conducted a cross-Canada debt clock tour, highlighting government overspending.
6a) Harper is introducing more corporate tax cuts – even though they have proven to be the least effective job creation tactic, have little to do with levels of business investment and competitiveness, and are opposed by a margin of 3:1 Canadians. These cuts will diminish Canada’s revenue base by $14 Billion in 2013/14.
6b) Our corporate tax rates are already among the lowest in the developed world – 16.5 percent here; 35 percent in the US – despite growing corporate (mainly transnational) profits. Unlike past governments, the Conservatives won’t make projected profits public.
6c) To make up for the shortfall, the Conservatives’ HST is moving the tax burden to consumers, increasing the price of essentials like food and heat. In Ontario, that means at least $500 a year.
7) Over the past year, gasoline prices are up by 30%, electricity by at least 15% with the extra surcharges, public transit by about 7%, food at least 10%, housing prices keep soaring. Yet the Bank of Canada says there’s no inflation.
8) Canadian families are now indebted at a rate approaching 146.8% of annual income. “It's not because everyone has all of a sudden decided to buy new BMWs and are using their VISA cards to re-do their wardrobe in Armani,” said one observer.
9) In early March, the government revealed its spending estimates. As The Globe reported: “ ‘industrial, regional, and scientific-technological support programs’ will see the largest decrease with a 33.3 per cent reduction, reflecting the end of infrastructure stimulus spending. That is followed by a 14.1 per cent cut in spending on ‘environmental government services.’ ‘Cultural programs’ are in line for a 4.5 per cent reduction ... Areas in line for increases include a 10.1 per cent increase on ‘security and public safety programs;’… The estimates show Environment Canada faces a 20 per cent cut, bringing its budget to $872-million. That includes a 59 per cent reduction in spending for ‘Climate Change and Clean Air’ and a 51 per cent cut to substances and waste management.”
10) According to a CCPA study, if the federal government wants to control spending, it needs to examine its increasing outsourcing costs. The study found that over the past five years, such costs have gone up 79 percent. While most federal departments have had their budgets capped, spending on outside consultants hasn’t been touched and remains at $1 Billion annually. This has created a kind of “shadow public service” – with different hiring practices and transparency requirements.
11) Kevin Page of the Parliamentary Budget Office has caught the Harper government underestimating the cost of its legislation on prisoner and prison expansion and the new F-35 fighter jets (see below). Ironically, the Parliamentary Budget Officer was established by the Conservatives to ensure “truth in budgeting.”