Tuesday, September 27, 2011

Attention and Deficit

The election is ten days away. Very soon Ontarians will be travelling to the polls on October 6 to cast their ballots and select the MPPs that will make up out fortieth Ontario legislature. However, it appears to me at least that many Ontarians have been sleepwalking through this election. The media has been quite quiet on the election. This is largely because most Ontarians receive their media from national or international (see American) sources – which don’t really speak to the Ontario election.

The local coverage in my newspapers has even been a little disappointing. Virtually every riding in Niagara is considered competitive with all three major parties involved. I’ve heard ads on the radio, and seen the lawn signs, but still. I noticed a lot more lawn signs around during the May election earlier this year.

On a positive note the leaders’ debate is tonight! With the debate interrupting normal television on many channels it might awaken the Ontario electorate to the upcoming decision they are being asked to make. The debate is going to be a big event in this election. The most recent polls over the last few days have shown the Progressive Conservatives and Liberals very close, virtually tied. In addition the NDP have been building up steam and growing. If any of the three leaders – Dalton McGuinty, Tim Hudak, or Andrea Horwath – have a strong night, it could change everything.

Keeping my promise from the beginning of the election I’ll turn my attention back to an issue. This week I would like to talk about government spending and the deficit. In August Ontario’s deficit was estimated at $14 billion. The total amount of the Ontario budget is about $125 billion. Therefore approximately one in ten dollars spent by the Ontario government is borrowed at this point in time.

Deficits make poor election issues. Why? Because while it is exceedingly easy to make a budget deficit it is monstrously painful to get rid of one. To correct this problem serious tax increases or spending cuts are required, and probably some combination of both.

Fear not for our valiant leaders have stepped forward! All three parties are promising to balance the budget by fiscal year 2017. It should be noted that the Green Party is promising to balance the books by 2015. How? That’s a good question, one which the parties are having a lot of trouble answering. In my honest opinion the Progressive Conservatives and Tim Hudak have the least credibility on this issue. Running a platform of tax cuts and maintaining spending and yet balancing the budget is pure fantasy. Both the NDP and Liberals are promising new spending, but the Liberal’s programs are quite modest overall. The NDP hope to balance their new spending with an increase in the corporate tax rate. An increase in the tax rate would put Ontario at par with our nearest competitors.

Ever since the conservative revolutions of the 1980s deficits have become a major issue. Candidates from all over the spectrum are now adamant for the need of a balanced budget. Believe it or not only a few decades ago the idea of deficits was not taken into account. As Adam Radwanski pointed out in the Globe not so very long ago none of the parties are takingthis issue particularly seriously. Governments want balanced budgets, but at the moment it doesn’t seem entirely necessary. In this time of economic hardship government spending helps keep the economy moving, even if it produces deficits.

Despite Ontarians’ desire for balanced books, and the parties’ claims that they will achieve them, the pressure isn’t there. Without the public pushing for it, it will not happen. Planning our future budget plans though seems a bit risky right now, especially with the dark news coming out of Europe. Perhaps that’s the bigger question, who should lead us into suchuncertain times? Next time I’ll try to end on a happier note.

A reminder that I am writing for Speak Your Mind and the Toronto Star.

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