Harper growth record worst since R.B. Bennett

September 9, 2013

Stephen Harper went to Russia this week to lecture G-20 countries about fiscal responsibility. It all rang a bit hollow because of his fiscal record here at home.

In 2006, he was handed a steadily growing economy which had generated 3.5 million net new jobs, declining debt and taxes, a decade of balanced budgets, annual surpluses at about $13-billion, and fiscal flexibility projected ahead five years totaling $100-billion. That’s what Mr. Harper had to work with – the most robust fiscal situation in the western world. And he blew it in less than three years.

He over-spent by three-times the rate of inflation. He eliminated all the financial shock absorbers that had been built into Canada’s budgetary framework to protect against adverse events. And he put this country back into deficit again – a structural deficit – BEFORE (not because of) the recession which arrived in late 2008.

Mr. Harper failed to anticipate that recession. As it began, he dismissed it as just “a good buying opportunity”. When he couldn’t deny reality any longer, his belated stimulus plan was slow, convoluted, intensely partisan and tainted with boondoggles like that “fake lake” in Toronto and multi-million dollar misappropriations for ornamental gazebos and sidewalks-to-nowhere in Muskoka.

It’s now four full years since the recession ended, and still our national economy remains sluggish and uncertain with vast disparities among different regions, sectors and demographic groups.

This government has only one prescription for everything – austerity, austerity and more austerity. To fix (or at least camouflage) his structural deficit, Mr. Harper took a slice out of future federal funding for healthcare and old-age pensions. This week at the G-20, he re-attached himself to debt ratio targets that are at least a decade old.

By doing so, he’s admitting failure. He has failed to meet all debt reduction goals set out for Canada over the past decade, and he’s now lowering the bar by which he wants to be measured.

Part of the problem is simple incompetence – witness the bungled and deceitful F-35 fighter-jet fiasco, among others. And part of it is having no credible plan for economic growth. You cannot hack-and-slash your way to a better debt-to-GDP ratio. You have to make the Canadian economy grow at a stronger, sustained rate.

That’s the message coming from the Bank of Canada this week. But it seems lost on this government. Mr. Harper has the worst economic growth record since the dismal days of R.B. Bennett.

But never mind, he says, Canada is doing better than Spain. But we’re not doing better than Australia or New Zealand or Norway or even the United States.

Canadians are weary of the grinding mediocrity that characterizes the Harper regime. We’re constantly told to lower our expectations, settle for less. And a big part of that burden falls on Canada’s middle-class:

  • Middle-class incomes have been flat for years, while living costs and household debt have ballooned;
  • 70% of those employed in the private sector cannot count on a company pension;
  • 60% of middle-class parents worry about affording any kind of higher education for their kids;
  • For the first time ever, over 50% of middle-class Canadians fear their children will not do as well as they did;
  • More than 40% of empty-nester parents have had their adult children move back home because they can’t afford to live on their own;
  • Youth unemployment remains near recession-like levels and a whole generation of young Canadians are putting their lives on hold.

The Harper Conservatives are oblivious to these realities. But middle-class Canada lives them everyday day.

They yearn for a government that will be on their side, encouraging them to be hopeful and ambitious once again – about their own prospects and about the future of their country.

Ralph Goodale

Deputy Leader