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Harper: Economic Mismanagement 101

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As an economist I am always astounded by Mr Harper.

Any time you are not in a deep recession it is easy to have a surplus – it may not be smart, but it is easy. All you do is shift some payments around.

If you are running a household budget you know how to do this. Don’t pay some bills, postpone getting the roof repaired, try getting through the winter with all season tires, cut out a trip for the kids, don’t buy Christmas presents. You might sell off some tools or a cottage. You are not richer or poorer as a result – you have simply rearranged your spending.

Mr Harper could always do the same kind of thing, and he did. So why does he think people should vote for him for juggling the books? What astounds me is that even after years of getting ready and months of careful book-cooking he still didn’t know if he had succeeded.

If he had actually spent all the money he budgeted, he would be in deficit now. He has been helped by the low dollar and low investment demand that have kept interest rates low. Of course these are signs that his energy superpower strategy has failed. The nation’s infrastructure deficit grew. The nation’s climate deficit grew. The `broad deficit’ is still there.

The real question about Harper’s little fiscal surplus is whether you want a contractionary federal government at a time when the economy is weak.13-PM-Stephen-Harper1-OFFICIAL-11x14in-e1354648279867

The answer is yes, if you are desperate to be re-elected, and no, if you are concerned about Canada’s economy.

I have been astonished by how cynical the man is. He bought votes by cutting the GST even though he had to borrow to do it. Basically he bought just enough economically illiterate voters by passing a huge tax liability on to our kids. Now he is dragging the anchor on the economy in the hope that the magic word “surplus” will buy a few more votes form economic illiterates.

He is not running a government so much as using Canada Revenue a giant vote-buying machine.



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