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Editorial cartoon by Brian Gable (Brian Gable/The Globe and Mail)
Editorial cartoon by Brian Gable (Brian Gable/The Globe and Mail)

Morning Buzz

Gratuitous corporate tax cuts or essential help for 'job creators'? Add to ...

1. Battle stations. Michael Ignatieff is sarcastically characterized as the "professor from Harvard" who should know better and is deliberately trying to trick Canadians in an aggressively-worded Conservative missive aimed at pushing back against Liberal demands to halt corporate tax cuts.

"Why would he mislead Canadians?" the Tories ask in a memo to supporters. "The answer is obvious: he understands that Canadians know that raising taxes now is a risky move that could stop Canada's job creation in its tracks."

The memo goes on to accuse the Liberal Leader of not wanting "to come right out and tell people" he "would have to raise taxes to pay for their expensive new government spending programs." It's the latest salvo from the Conservatives in what is increasingly becoming a stand-off between the government and opposition parties - namely the Liberals - over the Tory favours for big business.

It comes as Mr. Ignatieff is preparing to address his caucus Tuesday. Liberals are meeting in Ottawa for a winter retreat and reversing the tax cuts is to be part of the leader's message, just as it was during his recent tour of un-held ridings and in the attack ads released last week.

The Grits see these Tory messages and statements condemning the Liberal position as evidence the government is running scared. "The Conservatives are clearly worried about their ability to sell their corporate tax cuts," a senior Ignatieff official told The Globe.

Indeed, the Government House Leader called reporters up to Parliament Hill on Monday to condemn the Ignatieff position. John Bairdaccused the Liberal Leader him of wanting to raise taxes and arguing the Tory tax cuts will stimulate job growth.

On Wednesday, nearly a dozen cabinet ministers are fanning out across the country to try to sell the cuts. But in the midst of this battle, the Conservatives are softening their description of the tax measures, referring to them as help for "job-creating businesses" rather than "corporate tax cuts."

Mr. Baird invoked the new talking point repeatedly. And similar language is used in the Conservative memo, which is headlined: "Michael Ignatieff will raise taxes on job-creators."

Mr. Ignatieff's position is that Canadians cannot afford the tax cuts right now with a deficit of $56-billion. He wants to use the $6-billion saved by reversing the cuts for programs aimed at protecting pensions, helping families with care of relatives and education issues.

The Liberals have made it clear they cannot support the government if it does not change its position. "The fact is, with a $56-billion deficit and all the challenges facing families in these tough times, most Canadians would realize it's common sense not to spend more borrowed money on additional tax breaks for the largest corporations," the Ignatieff official said.

Mr. Baird, however, says it's too risky not to continue with the cuts as it would upset the economic recovery. Finance Minister Jim Flaherty and the Prime Minister have repeatedly said they will not change their minds on these cuts.

And as this battle escalates, political observers are asking whether this could become the issue over which the government falls.

2. From one PM to another. Former Liberal prime minister Jean Chrétien is now wading into the diplomatic controversy between the Harper government and the United Arab Emirates, which stems from Ottawa's refusal to grant extra landing slots to two Dubai-based airlines.

"I think this problem has not been well managed," Mr. Chrétien told a business magaine in Riyadh, where he is attending a conference. "I hope they will resolve the difficulty because we need good relations with this part of the world."

He is echoing the message from Michael Ignatieff's Liberals. Foreign affairs critic Bob Rae was recently in the UAE, checking out he situation himself and arguing it could and should be resolved since the Gulf state is important for Canadian business and a key ally in a tense region.

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