mitchellirons

rough notes

Politics, Rhetoric, and the GST

with one comment

How many others out there are fed up with the rhetoric of the Conservatives in Canada? Apparently, we the public need to be ready for a strict, tight budget because times are tough and we ought to tighten our purses in case the US economy actually tanks and brings down the world. If the US Economy does tank, then we’re all definitely be up the creek without the paddle, but I must wonder why Stephen Harper’s Brain Trust did think about this when they lowered the GST by 1% on 1 Jan 2008?

Before going further, allow me to chart a little economic timeline of sorts, just to get some things straight:

23 Jan 2006 – Conservatives win a minority, with a pledge to reduce the GST from 7% to 5%.

1 July 2006 – GST Reduced to 6%

15 October 2007 – US FRB Chairman Bernanke states, again, the gravitas of the sub-primehousing situation on the US Economy.

23 October 2007 – Canadian Department of Finance’s Economic Update, using information current to 19 October 2007, states that (1) “Notwithstanding weakness in the U.S., economic growth in Canada continues to be strong“, but that “the risks to the Canadian economy are tilted to the downside . . . [because a] significantly weaker U.S. housing market and tighter credit conditions have added uncertainty to the U.S. economic outlook“.

30 October 2007 – Canadian Finance Minister announces a reduction in the GST to 5%, reducing the Government’s annual revenue by $5.5 Billion per year.

14 December 2007 – Bill C-28, an Act to implement certain measures of the Spring 2007 Budget, and also to reduce the GST to 5% receives Royal Assent.

1 January 2008 – GST Reduced to 5%

February 2008 – Canadian Finance Minister Jim Flaherty warns citizens that his upcoming budget will be cautious and prudent, because “you don’t throw money around when times are tight“.

It would appear, however, that Minister Flaherty is doing just that – throwing our money around when times our tight. In spite of his own Department of Finance’s opinion that the uncertain US economy could seveerly hamper our own, Flaherty, Harper and Co. are throwing caution to the wind to fulfill a ridiculous election pledge that can do nothing but negatively affect the government’s revenues in a time of fisca crisis. Despite the fact that world markets, governments and news agencies were well aware of the American sub-prime fiasco and its pending ripple effect, the Conservatives still reduced one of their revenue streams by 5.5 Billion Dollars/year.

One cannot speak about a lack of funds, or of fiscal prudence, when one also makes an assinine policy decision such as reducing the GST on the eve of a possible recession. The Canadian government will have less funds to use on useful and necessary social and government spending, but primarily by their own doing.

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Written by mitchellirons

February 25, 2008 at 5:04 pm

One Response

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  1. Your style of writing is awkward and uninspired. It’s like you’re trying really hard to appear intelligent but you just can’t seem to pull it off.

    Mark

    July 29, 2008 at 12:53 am


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