As any student of politics knows, the best thing anyone can do with a five-year budget plan is to basically forget about it.
Events will conspire to destroy assumptions. Hard realities will intrude to wreck plans. No one can predict the state of the Canadian and international economies a couple of years from now. Maybe the world will reach the uplands of sustained, strong growth; or maybe higher oil prices, the U.S. budgetary deficit, currency swings and whatever else will plunge the world back into very slow growth or a double-dip recession.
Party platforms, therefore, are wish lists at best. The numbers inserted into platforms to justify spending and taxation are almost completely unreliable, especially when, as just happened, these numbers are being made up on the fly.
All of which means that, when the leaders tossed out numbers and promises Tuesday night in their debate, let's hope everyone watching treated what they said not with a grain of salt but with a huge salt lick.
When we say the leaders were making things up on the fly, consider the Liberal and Conservative commitments on health-care transfers.
The federal-provincial transfer agreements, which were going to be up in 2014, were negotiated in 2004 when the federal government was flush with cash. As a result, Paul Martin's Liberals promised to index the yearly payments at 6 per cent, a hugely generous index far beyond any other government program. Partly in exchange, the provinces agreed to certain stipulations, ostensibly designed to produce certain outcomes for the federal money.
For the next while, Ottawa will be in a deficit - a very different set of circumstances from the ones that prevailed in 2004. So any sensible government today should say nothing about what might be negotiated leading up to 2014.
The Harper government had taken that sensible position. No, it said, transfers won't be cut in absolute dollar terms, but no guarantees were offered on the indexation. That position had been repeated many times by Prime Minister Stephen Harper and Finance Minister Jim Flaherty.
But then Michael Ignatieff's Liberals, trailing in the polls and knowing how health care animates Canadians, suddenly announced that, if elected, they would index health care to 6 per cent for the duration of the new accord. This promise wasn't in the party platform unveiled the previous week, and it wasn't in speeches on health care given before the campaign by a trio of Liberal MPs - very weak speeches full of vapid rhetoric and slogans rather than serious analysis.
The promise wasn't thought through. It means a Liberal government would give away billions of dollars, indexed at a rate Ottawa couldn't easily afford, without asking a thing from provinces in return. It certainly couldn't be squared with the fiscal projections contained in the Liberal platform - another reason for not treating the platform all that seriously. It was a blank cheque, an unwise fiscal promise and a very dumb bit of policy - all made up and announced for political reasons.
Campaigns, however, make parties bribe voters with their own money. So rather than stick with the correct policy of giving nothing away in advance, the Harper Conservatives panicked and said they, too, would extend the index of 6 per cent for two years after 2014. This sum hadn't been included in their platform, either. Like the Liberals, they were just making things up on the fly to produce political hay.
The one thing their record teaches Canadians is that the Conservatives are big spenders - either directly in programs or through tax expenditures - but incapable of making hard decisions to pull back spending, curtail programs or kill them altogether.
Thus, consistent with how they've governed, the Harperites present a platform stuffed with precise multibillion-dollar spending commitments, largely targeted at groups and regions they wish to woo politically, with vague and unbelievable promises to cut in other areas. And now they've followed the Liberals by making a foolish commitment on health care, as both of them desperately hunt for votes.Report Typo/Error
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