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This budget is not stimulating

Stephen Harper and Jim Flaherty's Federal dud-get is like Waiting For Godot: no one shows up, except for literary critic Michael Ignatieff.


Last week's federal budget reminded me of the forlorn tramps in Sam Beckett's Waiting for Godot, especially when Estragon says to Vladimir, "Don't let's do anything. It's safer." I'm sure those forlorn federal comedians Steve H. and Jim F. spoke words like those in private, but publicly they're trying to stay in power by pretending to ease the pain of a worldwide recession. So they brought in a budget with a few billion dollars in tax cuts and a few billion in construction spending. Of course, tax cuts are useless for creating jobs and most of the construction won't happen unless the cash-strapped provinces and municipalities come up with billions of their own to match Laurel and Hardy's largesse. And they'll have to do it before the end of next year when the federal money disappears. Meantime, there's little in the budget for the people who need help most and only tepid support for projects to build a greener, 21st-century economy.

"Yesterday's budget is a flawed document," Liberal leader Michael Ignatieff declared after a night of mulling things over. "It doesn't go far enough to protect Canadians who have lost---or will lose---their jobs." Iggy was bang on. But instead of forcing Abbott and Costello to "go far enough," he announced the Liberals would vote for the budget as long as the Tories agree to provide regular updates on how their "flawed" plans are unfolding. Iggy's decision to climb into Steve and Jim's king-size bed means he'll wear his fair share of the blame as the recession deepens, unemployment soars and voters see the folly of the Tory tax cuts.

Economists agree there's no way tax cuts will suddenly persuade people to buy more Canadian goods and services. Those cuts will give middle-class families about $300 next year or $25 extra per month. Not much of an economic stimulus there. Steve and Jim could have given more to the poor who are pretty well forced to spend every extra nickel they get, but instead, the budget's income tax cuts give low-income people a maximum of $33 a year. To be fair, there is a more substantial tax benefit for the poorest of the working poor---those earning less than $15,000---but overall, only five percent of the budget's tax cuts will help the most economically vulnerable. Meantime, the Tories are pressing ahead over the next few years with $60 billion in corporate tax cuts that will help profitable giants such as banks and oil companies while doing nothing for money-losing manufacturers like the auto makers.

The worst thing about the federal budget is that there are no substantial improvements to Canada's unemployment insurance system. Sure, the budget gives five extra weeks of coverage so that in Halifax, an unemployed worker can now get a maximum of 41 weeks of payments. But only 42 percent of workers actually qualify for benefits even though nearly all pay into the plan. The budget does nothing to boost eligibility, nor does it increase benefits. Putting more money into the pockets of the unemployed would provide a huge economic stimulus, but the Tories won't do it and Iggy was too chicken to force them.

The budget is also starkly unimaginative. For example, the Tories could have created thousands of jobs by investing $2 billion over five years to extend high-speed internet service to outlying areas. Instead they allocated a measly $225 million over three years, a tiny fraction of what's needed. Commentator Chantal Hebert nailed it perfectly when she called the budget a backward-looking relic of the 1970s.

In Waiting for Godot, Estragon tells Vladimir "People are bloody ignorant apes." Obviously Steve and Jim think so too, or they wouldn't have tried to pass off this budget as an effective way of staving off rising unemployment. Iggy may be willing to support these jokers, but I predict the rest of us bloody ignorant apes won't. [email Bruce Wark]


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