Budget: My reaction

Now that the budget has come down I will give my opinion. Unlike some other bloggers, I will try not to be overly partisan, but rather give a fair assessment. As Garth Turner gave on his blog, a B-, that is what I would give this budget, so while an improvement over the last budget, it still could be much better. It certainly hit all the right notes for winning the next election for the Tories, but it seemed to have too much of a short-term focus and lacked a long-term one. However, to be fair to the Tories, no forward looking budget has every come in a minority government or an election year. Instead election budgets are always about trying to win the next election. Some Liberals and Dippers are condemning it for not spending enough, but while I agree we should spend more on Post-Secondary Education, Health Care, and Social Housing, overall spending increases are too large in my view. We need to re-allocate from low priorities to higher priorities, but despite being awash in cash, that would disappear if we fell into a recession and if we continue to let spending grow unhindered, we could risk a deficit again. In addition bigger government may be popular with some, but it generally doesn't work. Also elections are not won by appealing to the wealthy or rural voters, nor are they won by appealing to the poor and people living in the urban cores. Rather the middle class suburban vote is where elections are won and lost and this budget did a good job of appealing to this group. On the whole most of the things in the budget were positive and almost all the negatives were not what was in the budget, but rather what was not in the budget. Some fiscal conservatives are complaining this budget abandons conservatism, but I would argue that since the government was acting like a truly conservative government up until January, the change to a more liberal budget has more to do with the fact Canadians are still not fully comfortable with conservatism as opposed to Harper being a liberal convert. In addition even the most conservative leaders such as Ralph Klein and Mike Harris presented liberal budgets during election years, so groups like the Canadian Taxpayer's Federation should realize a conservative budget will not come in a year where there is a potential for an election.

The child tax benefit, environmental funding, increased equalization, and minor tax cuts are all positives and going in the right direction. Sure many will say it wasn't enough, but all governments have limitations. Its biggest weakness was to spend more on R&D (which Canada has on the lowest amongst the G-8 Countries) and lack of income tax cuts as well as spending on Post-Secondary Education. These are key investments if we want to succeed in the future. I also think the government should do a full review of all programs and cut inefficient ones as we simply cannot do everything. Budgets should be designed to be deficit proof regardless of how the economy is doing. We are only awash in cash because of the strong economy, but this could change in the next few years.

The NDP obviously will vote against it and as I said earlier I don't think you could create a budget that would be acceptable to supporters of both. Already many Tories are complaining it abandons fiscal conservatism too much, so I think the idea of getting a budget both the NDP and Tories could support should be dropped.

The Liberals will also vote against it and I felt their reasoning was generally reasonably good. I do disagree with the party on childcare as I am not sure that creating a large program and all the cost it entails is the right way to go, but on competitive taxes, Post-Secondary Education, and the environment I fully agree with the Liberals. In addition, as I alluded to in my earlier blog, the Liberals really had no choice but to vote against it. Even if it was a budget they privately liked, voting for it would only benefit the Tories as it would say the two parties are essentially the same, so people would go for who is known than who isn't. Voting against it, whatever its pitfalls, was the right choice.

The Bloc Quebecois has decided to support it, which is a bit of a surprise for me, but I guess they realized an election would hurt them more than anyone else. After just coming out of a provincial election, I don't think they are keen on another election. In addition they are fighting a two-front battle with the Conservatives being their main opponents in Quebec City and Rural Quebec, while the Liberals in the Greater Montreal Area.

The fact we are having no election is good news for us Liberals as this gives Dion time to make himself more known to Canadians, brush up on his debating skills, as well as the longer the government is in power, the more baggage they will accumulate. It also gives me a little break from politics this spring, since as I new resident of Toronto, there are other things I would rather be doing than campaigning. On a final note, as bad as our poll numbers may be, I think the fair of us returning to power has caused the Tories to take a far more centrist approach than they were prior to Christmas and this a good thing. At the end of the day, I care less about who is making the decisions than what they are, so if the threat of the Liberals returning to power pushes Harper towards the middle, that is fine by me. Lets just make sure he doesn't get too far ahead in the polls or else he will revert to his right wing tactics, which I don't want to see.

As a side note, Elizabeth May will be taking on Peter MacKay. This will no doubt be a tough riding to win as Peter MacKay is reasonably popular here and in addition while they are pockets that are left wing such as Antigonish, the riding on the whole is still fairly conservative like most rural ridings. Even though her chances of winning the seat are close to nil, taking on MacKay will at least bring a higher profile to her and could help them elsewhere. In addition, although a Liberal, I generally think MacKay is a decent person and would make a good PM. It is more his current leader Stephen Harper and the ex-Reformers who I have a major beef with.