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lawrence martin

The extent to which the Conservatives' propaganda machine will go was illustrated last week by the news, courtesy of The Canadian Press, of the staging of a Potemkin-village-style citizenship reaffirmation ceremony.

Only three bona fide new Canadians could be found for last October's event, so at least six federal bureaucrats suited up as imposters for the PR show broadcast by Sun TV. In a control-freak kingdom, this one – "a full North Korean," as one wag put it – is hard to top.

News of the charade came on the heels of Stephen Harper's proclamations in Davos on the wonders of the Canadian economy as piloted by a Finance Minister who, he said, is the greatest on Earth. The Prime Minister's musings on the need for pension reform were reasonable enough. But his ever-soaring estimations of his economic record are starting to be challenged by many observers, as well they might be.

From 2007 to 2011, Canada's economic performance put us in the middle of the pack in GDP growth among 34 industrialized countries. Our unemployment rate is currently rising and nearing the U.S. level. It's true that, comparatively speaking, we're doing well on a number of other economic indices. But given the advantages the Conservatives enjoyed when they took office – the big surplus, the well-regulated financial sector, the natural-resource-laden riches – how much of an accomplishment is it? When you start a race a lap ahead of the field, how hard is it to be among the leaders?

To talk of the Tory economic record, we might first address the reddened state of our treasury that's occasioning the cuts in the coming budget. A pertinent question is whether our deficit is the result of natural economic factors or whether it owes itself to vote-getting political expediency.

In this context, let's recall a few things. Let's recall the two-point GST cut that tore a giant hole in the revenue base, accounting for a good deal of the deficit. Let's recall the prerecession spending – having inherited a $13-billion surplus, the Harper/Flaherty team spent so excessively that we were close to a deficit by the time the recession began. Let's recall the slashing of corporate tax rates and the government's easing of mortgage rules and backing of risky loans that further bled the treasury.

Put it all together and what it shows is that, with more prudent fiscal management from the same guy who lectured other countries on debt in Davos, we could have coped with the recession without driving our treasury into a large deficit hole.

Some other things should be recalled. In the fall of 2008, when the economic crisis hit, was the dynamic Harper/Flaherty duo on top of things? Or were they still saying that the budget would remain in balance and that there was no need for stimulus spending, and bringing in a foolhardy budget update that almost brought their government down?

With the opposition parties putting a gun to their head, they introduced a stimulus package that virtually every other country was doing. With the exception of Tory logos on cheques and Tony Clement's G8 spending boondoggle, it was not badly administered.

Jim Flaherty has performed more ably in the past couple of years. But what's in his record that makes him the greatest finance minister in the world?

Given the coming squeeze the Tories talk about on health care and Old Age Security, is it smart economic management to commit a staggering $30-billion to increasingly discredited F-35 warplanes? It's nice that, on trade diversification, the government is waking up to China. But how many years did Ottawa ignore it?

I was talking to a plugged-in guy at the Finance Department the other day and asked him what the Tories have done that's so wonderful. "The PR," he responded.

Hard not to agree. It's been a great shell game. Their propaganda has masked a middling economic performance.